Prestwick Airport bailout loans head towards £40m

The bailout of Prestwick Airport could reach £40m by 2018, according to Scottish government figures.

A previous projection by Audit Scotland suggested it would not reach this level until 2021-22.

Ministers bought the airport for just £1 from owners Infratil in late 2013 amid fears it could close.

It is hoped the airport could become the UK's first space port launch site and also benefit from the new Heathrow runway by becoming a "logistics hub".

In February 2015, Audit Scotland had warned loans could reach up to £39.6m by 2021-22.

'Out of control'

However, government figures suggest £39.5m could have been given in loans by the end of the 2017-18 financial year.

According to Scottish government consolidated accounts, loans had reached £20.8m by 31 March 2016, and the budgets for 2016/17 and 2017/18 outlined loans of £9.3m and £9.4m respectively.

Conservative North East MSP Liam Kerr said: "These figures are further evidence that the costs regarding Prestwick Airport are starting to get out of control.

"The amount of public money being sunk into the airport is spiralling and taxpayers are getting increasingly fed up.

"It's time the SNP government got a grip of the situation and started putting plans in place to return the airport to the private sector as soon as possible."

'Market rate'

Repayments on the loans are not scheduled to begin until the airport starts making a profit, which could be 2023 according to last year's Audit Scotland report.

It said the government planned to sell Glasgow Prestwick Airport back to the private sector once the airport was viable.

A Scottish government spokesman said its investment in the airport was on a commercial basis, in the form of loan funding.

"This attracts a market rate of interest in line with state aid rules," he said.

"A report from Audit Scotland confirmed that we are highly likely to generate a return on our investment that is higher than the current rate of interest we are charging the airport."

The Scottish government has not set a limit on overall loan funding for the airport.