Thursday, 12 January 2012
Dáil Éireann Debate
16. Deputy Joe Carey asked the Minister for Transport, Tourism and Sport when he will make a decision in relation to the future ownership and operation of Shannon Airport in the context of the report (details supplied); if he will publish the report; and if he will make a statement on the matter. [1357/12]
35. Deputy Kieran O’Donnell asked the Minister for Transport, Tourism and Sport his plans for the future strategic development of Shannon Airport; and if he will make a statement on the matter. [1359/12]
42. Deputy Michael McNamara asked the Minister for Transport, Tourism and Sport the detailed terms of reference of consultants (details supplied); the company’s relevant experience with airports here and the United Kingdom; and if he will make a statement on the matter. [1349/12]
I have already outlined in the House today the current position on the future of Cork and Shannon airports and the background to the commissioning of consultants to carry out a study of the options for the future ownership and operation of both airports. The tender process used to select the consultants took into account, among other factors, the degree of each tenderer’s expertise and experience of the aviation sector, nationally and internationally. The terms of reference for the study were essentially to identify and analyse all likely options with regard to the ownership and operation of the two airports and having regard to all relevant factors to make clear recommendations to me and the Government as to the optimal ownership and operational structure for the airports.
Deputy Jerry Buttimer: I thank the Minister for his reply and congratulate him on demonstrating political leadership which was lacking in the previous regime with regard to Cork Airport. As part of the consultative process there was real engagement and I compliment the company involved. I hope the Minister takes on board the strategic importance of Cork Airport, particularly given the location and catchment area of approximately €1 million. If it is allowed, it can become a key player in our transport infrastructure. It will require a very strong commitment from the Government to be held in State ownership and a business plan. It must be allowed the ability to grow and be autonomous within the Dublin Airport Authority. It is a difficult time in the aviation industry and the Cork facility is suffering. It deserves to be kept in State ownership and should have autonomy within the DAA. There must be space to be able to grow and develop as it is a critical facility.
Deputy Joe Carey: I commend the Minister for dealing with the issue after years of inaction on the part of the previous Fianna Fáil-led Governments. The matter is finally being dealt with. Shannon Airport has paid a very heavy price, losing 52% of passengers over the past three to four years. I welcome the recent public announcements by the Minister, Deputy Varadkar, on a visit to County Clare, that it is his desire that Shannon Airport would again become the second busiest airport in the country after Dublin. I would like to establish when he intends to bring the memo to Government and when a decision will be made. We need clarity and certainty. Shannon and the mid-west region can begin an economic fightback. The decision will be a catalyst for that to happen. I would also like to hear the Minister’s views on the conditions of workers in the airport. Could he offer any thoughts in that regard? It is critical that they are not made the scapegoats in the decision that is to be taken.
Deputy Kieran O’Donnell: I thank the Minister for taking action on this issue. Shannon Airport is probably the most vital piece of infrastructure for Limerick, the mid-west, Shannon and County Clare. Everyone, across all party lines, is agreed that the situation cannot remain as it is. We must examine the issue. That is why I welcome the fact that the Booz & Company report has been commissioned by the Minister. What is important now is that we get a timescale on when the Minister proposes to bring the matter to Cabinet and for the implementation of the plan. We must reach a point where Shannon Airport is able to operate independently of Dublin. It is difficult for any airport to compete with its employer, namely, the Dublin Airport Authority, DAA. The operation of the airport is underpinned and conditional upon Shannon Airport not being laden down with debt, which is the scourge of any business in terms of being able to function. I commend the Minister on bringing the report forward but we need to know the timescale he envisages for the implementation of the plan and the details thereon.
Deputy Michael McNamara: My specific question relates to the past experience of Booz & Company. While I am aware from media reports that it has past experience of the sale of airport, the key recommendation is that Shannon Airport would remain in State ownership. I am relieved to hear that as I would be most disturbed if there was any proposal to remove anything of the strategic importance of Shannon Airport from State ownership.
I join with Deputy Carey in expressing concern for the future of the workers. I wonder whether Booz & Company. has sufficient expertise in the area. There is a proposal to devolve the airport to a State-owned undertaking but it is essential that such an undertaking would have sufficient resources to make Shannon work and to ensure the future of Shannon Airport as a cargo airport, an avionics airport and an industry airport but primarily as a passenger airport which is essential for the tourism sector of the entire mid-west. The Minister does not need reminding of that as he is the Minister primarily responsible for tourism. I would welcome his comments on the expertise of Booz & Company on how it is proposed to ensure the future undertaking which might run Shannon Airport — if it is devolved from the DAA — will have the resources and cash-flow necessary to invest in the airport, as the Dublin Airport Authority has been doing in the past to ensure that it remains a 24 hour international airport of the calibre required to drive the economy of the entire mid-west region of Limerick, Clare and north Tipperary.
Deputy Timmy Dooley: I did not manage to respond to the Minister on the matter that arose on another question but he indicated that certainty would be brought to it over the course of the coming year. I hope that was a broad, general statement and that he intends to deal with it a lot more quickly than by the end of the year. I would welcome certainty on the timescale.
Comments by Government Members seem to indicate that independence is the solution for Shannon. From my point of view, that is absolutely not the case. Shannon Airport needs more autonomy within an overall structure. I saw media reports in which a few kites were flown either by the Minister or by——
Deputy Timmy Dooley: Prior to Christmas we saw various proposals being put forward as the preferred option. One such proposal related to the development of a management structure similar to that of CIE with the three airports having an independent structure within an overall umbrella aviation company. I favour that approach as the way forward and would strongly support it. I welcome the Minister’s comments in that regard.
Deputy Leo Varadkar: Many questions were asked and I hope I do justice to Deputies in terms of replying to their questions. Booz & Company has had extensive experience both in terms of infrastructure and airports. I can provide the Deputy with a more detailed document if he requires on the background to some work it did internationally. Many people would accept the company did a very good job, although I accept there was scepticism about it initially. One of the things I asked it to do was to spend time in the relevant regions and with the various sectoral interests, which it did. It did it well and I was pleased with the work carried out.
It is important to put on record the motivation of the Government on the issue, which is to make sure we have strong airports in both Cork and Shannon, Cork being a passenger airport and a business airport for the future. Cork is working very well as an airport but the difficulty there is the enormous debt that has arisen from the new terminal which it will not be able to pay off on its own. Inevitably, over time the debt will have to be paid off by passengers using Dublin Airport. Shannon Airport has a great future as a passenger airport but also as one which is concerned with avionics and aero-industry but the status quo there is not working and the airport is in decline, which is why we need to have a change of policy in that regard.
When it comes to public ownership I agree with the Deputies’ comments. It is intended that the airports will stay in public ownership but that is not to say that there cannot be private sector investment and involvement in the airports in a way that is not the case currently.
When it comes to timescale, I need to spend a little more time in consultations and discussions. I have not yet had a proper chance to talk to the unions, for example, some of the stakeholders in the various regions and some of the businesses that are interested in investing. A memo for information will go to Government this month or next month and then a memo for decision will be prepared later on in the year. Given that any decision to proceed with separation could require legislation, getting it all done this year is ambitious but possible.
Regarding the workers, I fully understand that they want assurances about their pension, terms and conditions and security of tenure. I should point out that nobody in the DAA at the moment in any of the existing airports has security about their pension because of the huge pension deficit, so there is an opportunity there for the workers. Nobody has security about their jobs because further redundancies are planned, albeit voluntarily, and nobody in the entire country has security about their terms and conditions unless they are covered by the Croke Park agreement, which the staff in the DAA are not. Let us be realistic about the current position.
We have a lot of semi-State companies and State agencies and it is important that the workers in semi-State companies and in State agencies are respected. At the same time, we must remember that semi-State companies and State agencies should not be run in the interest of the workers. The HSE should be run in the interests of patients not the staff, schools should be run in the interests of children not the teachers and airports should be run in the interests of passengers and the broader economic interests of the region not just those who work there. I am sure everyone would agree with that.
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