Bedford Mayor’s Airlander Tax Break Slammed

A decision by Bedford’s Mayor to award tax relief to a business which paid its directors and management over £1.2m in 2017 has been called ‘bizarre’.

In December, Mayor Hodgson agreed to reduce the 2015/16 – 2016/17 business rates bill of Hybrid Air Vehicles Ltd. (HAV), the company behind the Airlander 10 project, by £72k on the grounds of ‘hardship’.  This followed a rise in HAV’s tax bill following a revaluation of rates payable for Cardington Hanger 1, where the project was based until last year.

HAV’s statement of accounts for 2017, released in November 2018, shows the company paid its directors and senior staff £1.2m.  The company also received over £5m in public grants and a £20m insurance pay out after the crash of the Airlander 10 prototype.

At a meeting last week (Thursday 10th January), Conservative councillors called the decision an inappropriate use of taxpayers’ money and argued for a loan to be considered instead.  Conservative Cllr Gianni Carofano said:

‘Airlander 10 is a unique project with a lot of potential.  Despite this, Hybrid Air Vehicles Ltd. cannot be said to be facing ‘hardship’ when it paid £1.2m to directors and management as well as making a profit of £2.3m in 2017.

‘The company is underpinned by significant loans from directors and shareholders to protect it from losses during the development phase of the project.  It has also been successful in attracting external investment, including over £5m in grants in 2017, and plans to raise a further £7.8m, half of which would be from revenue generation.  The Council’s £72k contribution is less than 1% of this figure so it a nonsense to state that the company would be in jeopardy without it, particularly following the announcement that it intends to have a commercial model operating by the early 2020s.

‘It is bizarre for the Mayor to use taxpayers’ money for the benefit of a private company which has paid its directors handsomely when he tells us at every opportunity of the Council’s precarious financial position.  If we have the resources to provide tax relief then we should be supporting our town centre which is under huge pressure, as shown with the closure of Marks & Spencer.’