Willie Walsh under fire for 12,000 British Airways job cuts that spare Spain arm as IAG sits on £8.7bn
- BA owner IAG faces a grilling by MPs for cutting up to 12,000 BA jobs
- MPs are set to interrogate Walsh on his justification for deep job cuts
- The group is sitting on €10billion (£8.7billion) cash reserves
Airlines boss Willie Walsh is heading for an explosive showdown with MPs tomorrow over controversial plans for mass redundancies at British Airways while the group’s Spanish division appears to have so far escaped the cull.
The chief executive of BA’s parent International Airlines Group faces a grilling before the Transport Select Committee for cutting up to 12,000 BA jobs – more than a quarter of its workforce.
MPs are set to interrogate Walsh on his justification for deep job cuts when IAG revealed just days ago that the group is sitting on €10billion (£8.7billion) cash reserves.
Showdown: Willie Walsh, chief executive of BA’s parent International Airlines Group
There is huge concern that BA has so far borne the brunt of IAG’s redundancies despite contributing about 60 per cent of group profits last year.
BA furloughed more than 30,000 staff before announcing the redundancies last month. But there has been no public statement from the company on job cuts at IAG’s Spanish airlines – Iberia and Vueling.
Walsh said in March that airlines should look at ‘self help’ before seeking state aid. He has since secured a combined £1.17billion in commercial loans backed by the Spanish government and the Bank of England.
The hearing tomorrow forms part of an investigation by the committee into the impact of the coronavirus crisis on the aviation industry.
Huw Merriman, chairman of the Transport Select Committee and Tory MP for Bexhill and Battle, told The Mail on Sunday: ‘We are trying to work out what IAG’s strategy is.
‘Are the job cuts all about surviving the coronavirus crisis, or is it a plan Willie Walsh has had all along to cut costs – and he’s using the pandemic as an opportunity?’
The 11 cross-party MPs on the Transport Select Committee have been deluged with emails from BA staff and customers since the restructuring was announced two weeks ago.
Ruth Cadbury, Select Committee member and Labour MP for Brentford and Isleworth near Heathrow, said many customers were waiting for refunds for cancelled flights which BA appears to be ‘very reluctant’ to pay back.
British Airways cut up to 12,000 BA jobs – more than a quarter of its workforce
MPs plan to ask Walsh to lay out his plans to repay BA’s share of the total £7billion of customer money held by the aviation industry.
Cadbury said: ‘IAG is taking the taxpayer’s money through the furlough scheme, while sitting on passengers’ money by making it very difficult for them to claim that money back.’
BA and Virgin Atlantic have said they may stop flying from Gatwick permanently as they shrink their fleets due to the slump in demand for air travel which is unlikely to recover to pre-virus levels until 2023.
IAG declined to comment.