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$4m payment to Skyport for lost revenue last quarter

LF Wade International Airport (Photograph by Akil Simmons)

Government had to pay Skyport almost $4 million last month after another quarter of low revenues at the airport, MPs heard today.

Lawrence Scott, the Minister of Transport, told the House of Assembly that revenues at LF Wade International Airport for the last quarter were $3,92 million below the minimum revenue guarantee threshold.

Mr Scott said: “As such, the Airport Authority was obligated to transfer that amount to the escrow account in April 2021.

“This $3.9 million was paid for out of the $4.2 million that Skyport was obligated to return to the Airport Authority back in December.”

He added: “This is a complex matter and the Bermuda Airport Authority is doing an excellent job in managing it along with all of its other contractual obligations and oversight responsibilities.

“I would like to reiterate that the Bermuda Airport Authority has met all of its contractual obligations relating to the MRG payments and this Government has, and continues to, provide the necessary funds to enable the Airport Authority to meet its contractual obligations.

“There have been no overpayments by the Bermuda Airport Authority.”

The Government paid more than $20 million into an escrow account to cover Skyport’s lost fees last year.

But Mr Scott said that an audit carried out last December found that the bill had been overpaid by $4.2 million.

The cash was later transferred back to the Airport Authority.

The agreement for a new airport terminal was struck by previous One Bermuda Alliance Government with the Canadian Commercial Corporation and Aecon, CCC's contractor.

Skyport covered the design, finance and construction of the new terminal, as well as its operation and maintenance over 30 years, under the public private partnership deal.

But a minimum revenue clause in the contract was triggered when air arrivals plummeted because of the Covid-19 pandemic.

Mr Scott criticised the deal during the Motion to Adjourn and insisted his ministry could have spent the MRG payments on upgrades to the cruise ship wharf at Dockyard or more vehicles for the island’s bus fleet.

He said the agreement had left the Bermuda Government with the task of increasing airlift while Skyport did “absolutely nothing”.

Mr Scott attacked Scott Pearman, the shadow transport minister, who said in The Royal Gazette last April that the payment arrangement, based on estimates, needed a rethink.

He told the House in a phrase based on the military phonetic alphabet: “Whiskey Tango Foxtrot, Mr Speaker.”

Mr Scott added: “I have clearly articulated that there was no mistake or no misspeak when it comes to what we said about the MRG and how we are going about the MRGs.

“I hope the Opposition takes a long hard look at themselves and changes their conduct so they don’t speak just for speaking’s sake but that they know what they are talking about and have something worthwhile to say.

“Money is power and we are flying behind the power curve because Skyport and Aecon are getting all the money.”

He added: “I don’t want to hear the Opposition leader who was in Cabinet at the time, I don’t want to hear former Premier Dunkley or former Premier Cannonier say a single iota or letter disparaging anything this Government does when it comes to this airport.

“If they do, they should be ashamed of themselves, because they didn’t know what they were doing.”

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Published May 08, 2021 at 7:53 am (Updated May 08, 2021 at 7:53 am)

$4m payment to Skyport for lost revenue last quarter

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