The new brand would restart BA’s short-haul services within the UK and to Europe from Gatwick. BA moved all European flights to Heathrow at the outset of the pandemic to cut costs.

News reports claim that BA has told unions an operation dubbed ‘BA Lite’ or ‘British Airways Express’ would be based at Gatwick, Sussex.

In discussions with unions, BA said that change is essential if the airline is to return to Gatwick at scale. The move could meet with resistance with unions if staff are put on less generous contracts.

BA and other airlines have consistently criticised the UK government’s travel restrictions and subsequent undermining of passenger confidence.

According to the Independent, BA’s chief executive Sean Doyle wants to press ahead with plans to cut costs and make BA more competitive with budget airlines such as easyJet as the furlough scheme comes to an end.

The new BA budget subsidiary reportedly plans to use the same staff, aircraft and slots as existed in March 2020 for a new, separate airline.

PA news agency reports that an internal letter to staff said: “This was previously a highly competitive market, but for us to run a sustainable airline in the current environment, we need a competitive operating model.

“Because of that, we are proposing a new operating subsidiary to run alongside our existing long-haul Gatwick operation, to serve short-haul routes to/from Gatwick from summer 2022.

“This will help us to be both agile and competitive, allowing us to build a sustainable short-haul presence at Gatwick over time.”

Martin Chalk, acting general secretary of pilots’ union Balpa, said: “BALPA cautiously welcomes this decision to restart BA short haul operations at LGW and create a number of much needed new pilot jobs. BALPA and BA are in the final stages of negotiations over the revised pay and conditions for Gatwick based BA pilots and we hope to bring these talks to a conclusion shortly.”