It is now costing Cornish taxpayers almost £10m a year to run Newquay airport.

The eye-watering amount was revealed at an extraordinary Cornwall Council meeting on Wednesday, August 19 to discuss how the loss-making airport can be operated more efficiently.

“We can be under no illusion that council taxpayers cannot be expected to find anything like £9-£10 million a year because most of them don’t use the airport,” the council’s cabinet member for economic regeneration told the meeting.

Councillors discussed the commercialisation and development of Cornwall Newquay Airport following an independent efficiency review to “strengthen governance, improve commercial performance, increase operational flexibility and enhance financial discipline” at the airport, which is likely to never run in profit.

The Steer report, commissioned by the council – which owns the airport, managed by subsidiary company Cornwall Airport Ltd (CAL) – includes 71 recommendations for change, based on four “core pillars” (listed at the end of the story).

A number of councillors said during the sustainable growth scrutiny committee that the way the airport and its estate is run should be made simpler as it has led to “confusion”.

Currently, Cornwall Council, Cornwall Airport Ltd, Corserv – the council’s company which oversees CAL, and Treveth, another council-owned company which oversees the development of the estate’s land, are all involved in its governance, operations and future plans.

Corserv / CAL will present a transformation plan to the council for consideration in December.

Paul Cooper, Corserv’s director of resources, told the meeting that £3.6 million of efficiencies and “productivity gains” have already been planned, some of which are included in the Steer report recommendations. “The next iteration in December is to grow that £3.6m to a bigger number.”

Independent councillor Andrew Mitchell, who has long questioned the amount of public money spent on keeping the airport going, said: “Looking at the report in the whole, I think it sounds a lot like business as usual. Where is the reorganisation structure that should come from a review like this?

“We’ve had two years where month upon month passenger figures have declined. We have overnight, it appears to me, required to jump from a £5 million a year subsidy to £10 million a year.

“It appears to me that we have no credit control at Newquay airport. To allow Eastern Airways to go bankrupt owing us £1.6 million beggars belief. It was three times what they owed Heathrow and here we are, a small regional airport.”

He added: “I really do have concerns. There are 71 recommendations but to be perfectly honest they just tinker with the edges. Things aren’t going well at Newquay airport – a £10 million a year subsidy does not show efficient running.”

The committee chairman, Cllr Connor Donnithorne, said concerns around the reasons for the “significant increase” to a £10 million public subsidy had been an “emerging trend” among councillors who had been briefed before the meeting.

Mr Cooper explained  why the public subsidy paid by taxpayers had grown over time.

Between 2020 to 2023, it sat between £3 million and £4 million and started to increase slightly between 2023 and 2025 to between £4 million and £5 million. Factors for that included significant Foundation Living Wage increases for over 50 per cent of airport staff, the need to increase the number of air traffic control staff and a pay issue for firefighters based at the airport.

He said the big increase was in the last couple of years due to the employers’ National Insurance uplift, which caused a £3.5 million “hit” to Corserv as a whole, including the airport. Issues with the airport estate and the problems involving Eastern Airways going bust also added to the increase in taxpayer subsidy.

The current year will see a £9.7 million deficit, which has been exacerbated by the council’s decision to stop the subsidised Public Service Obligation (PSO) route from the airport to London Gatwick earlier this year. Mr Cooper said the independent report did not highlight any areas where the airport was spending more money than it should.

He stressed that, like all regional airports, Newquay had to find alternative commercial revenue streams to help with the cost of running the airport. “We are not making best value of the architecture and infrastructure around the airport,” added Mr Cooper.

He said that there will be a £5 million “income stream” coming to CAL from Cornwall Council this year. Cllr Rowland O’Connor declared that the £5 million should not be referred to as an “income stream” but a “taxpayer burden”.

Cllr Karen La Borde said: “We are currently subsidising people who are mainly flying on holiday at £20 per person. How do we justify this to local taxpayers going forward?”

The council’s cabinet member for economic regeneration and investment, Cllr Tim Dwelly, responded: “We are not complacent on cabinet about this cost of subsidy. Our commitment is to continue the airport but not with an unending and ever-rising subsidy.

“You can’t expect a zero cost airport in somewhere like Cornwall, but you can’t allow the costs to get out of control. I have consistently asked for a proper breakdown of why it’s gone up from roughly £4 million to closer to £10 million. I haven’t had anything back yet.”

Neil Edmond, CEO of Corserv, said Cllr Dwelly would be receiving such a report imminently.

“We can be under no illusion that council taxpayers cannot be expected to find anything like £9-£10 million a year because most of them don’t use the airport,” added Cllr Dwelly. “Who should pay for the deficit? Should it be council taxpayers or should users of the airport have a greater burden in some way, even if it’s car parking?

“We want really serious cost reduction and we’re putting pressure on Corserv to achieve that. I don’t want to hear that everything’s fine, because it isn’t. However, we are in an era where the future of the airport may be a little bit different to what it has been in the past.”

Cllr O’Connor highlighted that there had been “consternation” caused by a line in the Steer report which states that £320,000 had been spent on “unidentified consultants” at the airport. Mr Cooper, of Corserv, responded: “Just to be clear, we absolutely know what we’ve paid for. It isn’t that £320,000 has gone missing. We’ll make sure there is a full list of suppliers to whom that money was paid.”

Cllr Julian German said he was “absolutely astounded” that just under £500,000 had been spent on marketing functions as flagged in the efficiency report. “It seems there is some low hanging fruit that can be quickly realised to reduce costs. There is though the ludicrous recommendation that Cornwall Council pick up that cost [to promote the airport] which obviously wouldn’t be the case.”

Following an almost four-hour long meeting, the committee agreed that the council’s corporate finance scrutiny committee undertakes further analysis of the increasing level of taxpayer subsidy and examines the factors contributing to that increase.

The Steer report’s four “core pillars” for change at Newquay airport

First, consistent governance should be established to ensure “clear accountability, streamlined decision-making and robust oversight of performance”. Second, financial discipline should be strengthened to improve the airport’s sustainability, including tighter cost control, improved contract management and more rigorous capital investment appraisal.

Third, organisational changes should be implemented to improve efficiency and enhance accountability across the executive team and wider organisation. Finally, business opportunities should be pursued to strengthen revenue generation and maximise value from existing assets.