Dáil Éireann - Volume 588 - 24 June, 2004

State Airports Bill 2004: Second Stage (Resumed).

Question again proposed: “That the Bill be now read a Second Time.”

  Dr. Devins: I propose to share my remaining time with Deputy John Carty.

Before the debate was adjourned I spoke about the business plan that each of the new airport authorities must prepare regarding how they see the future development of their own airports. Once the shareholders in Aer Rianta, that is, the Minister for Finance and the Minister for Transport who hold these shares on behalf of the Irish people, are satisfied as to the long-term viability of each business plan, Shannon and Cork will be allowed to become fully independent. A date of 30 April 2005 has been set as the earliest date on which that can happen. I am sure each board will be eager to get up and running as a separate entity as soon as possible after this date. There are very large and substantial assets in Aer Rianta and they must not be allowed to be dissipated or squandered in the reorganisation of the three airports. Hence the Minister is to be congratulated on the very imaginative approach he has adopted in this Bill.

[106] Some concerns have been raised by trade unions on behalf of the people currently working in Aer Rianta. I welcome section 12 of the Bill which specifically states that there will be no diminution in the terms and conditions of workers who are currently employed by Aer Rianta when they are employed by the new independent airport authorities. It is natural that employees would have concerns. It is important that these concerns are recognised and dealt with. Change of any sort will raise issues and can cause anxiety. I urge the Minister to ensure that his departmental officials are aware of these concerns and that any issues are dealt with in a conciliatory fashion.

The airports have developed to where they are today because of the excellent work done by the employees. Their future development depends on management and employees pulling together. Friction and tension will only delay the success of the much-needed reform process of our three main airports and any obstacles to that process must be resolved by dialogue and communication. Knowing the undoubted skills the Minister possesses in the fields of communication and conciliation, I am sure the success for which this Bill aims will be assured.

This Bill opens up an exciting future for the three main airports. As with any new development there are potential down sides as well as new possibilities. I believe the latter is the likely outcome and I, therefore, commend the Bill to the House.

  Mr. Carty: The purpose of the State Airports Bill 2004 is to provide the necessary legislative basis for the restructuring of Aer Rianta and the establishment of Dublin, Cork and Shannon airports as independent airport authorities under State ownership. I welcome this Bill because it is long overdue as developments at Dublin, Cork and Shannon airports should have grown over the years. The three airports have to significantly increase airline business to grow passenger levels and jobs.

Under focused regional leadership, Cork and Shannon airports will have a fresh start and can develop separate business strategies. It is possible for Shannon Airport to double the number of passengers from 2 million to 4 million. Up to 90% of those who fly to the UK or to the Continent fly out of Dublin. There is no reason that many of these passengers cannot use Shannon or Cork if the airports were marketed properly and services provided. It would save those from the west and south much time in travelling to Dublin for flights if the service was available locally.

The Bill provides for the break-up of Aer Rianta and the monopoly that exists would give the airports a chance to develop independently. The full potential of Shannon and Cork airports can be realised with strong regional leadership free from central control in Dublin. Tourism in the regions would benefit greatly if the airports were developed to their full potential. The tourist boards, regional authorities, local authorities and [107] chambers of commerce recognise this and have given strong support to the aims of the Bill. Under the terms of the restructure, both Cork and Shannon airports will begin debt-free from the first day. This means debts of €70 million and €120 million are to be lifted from Shannon and Cork, respectively.

Both Cork and Shannon can survive as independent airports. An airport in my constituency is Knock International Airport, which is independent and is growing every week. It has brought business to the area and there are now flights to many cities in the UK, with a number of chartered flights each week to the Continent. Knock International Airport has grown its business significantly in recent years with passenger numbers anticipated to reach 400,000 in 2004, which is three times the level of a decade ago. This expansion in traffic follows the expansion in services with six destinations served by seven scheduled flights. Part of the growth in passenger numbers reflects the development in outbound charters in recent years, with 46,000 passengers expected to take charter flights in 2004.

There has been a substantial expansion in employment at the airport to cater for this demand. An average of 100 people will be employed in 2004 at the airport. It also supports additional employment through the purchase of goods and services. This additional employment is estimated at 60 people in 2004 so the airport supports 160 jobs in our local economy. Expenditure by the airport earns the Exchequer €1.2 million in PRSI payments and income tax, directly and indirectly.

The increase in passenger traffic means that the airport is now making a significant contribution to tourism in the western region. Over 50% of passengers are inbound tourists, staying for six days on average. The total spend of inbound tourists using the airport is estimated at €41.6 million. This is a huge boost and proves that the business is there if the work is put in to promote the airport. I compliment the chairman of Knock Airport, his board and staff for the hard work they have put into the successful development of the airport. It is an example to the other airports of what vision and focused development can do for the success of the airports. When this Bill is passed, the airports in Shannon and Cork will be debt free. I therefore take this opportunity to ask the Minister to make more funding available to Knock Airport for its continued success and development. It is currently difficult to get in and out of Dublin Airport and a new terminal is badly needed. It should happen in the near future to allow Dublin to develop and to allow passengers more comfort.

I welcome section 20 as it provides that it shall be a function of the aviation regulation to use all reasonable endeavours to assist the Competition Authority on the enforcement of competition law pursuant to the co-operation agreement made between the Commission for Aviation Regulation [108] and the Competition Authority. I welcome this because competition is vital to the success of the airports and the people who use those services. Without competition prices will increase and it will hamper people travelling by air. I compliment the Minister on the Bill, I hope it will have a swift passage through the House and that when it has passed, parts of it will be implemented as soon as possible.

  Mr. P. Breen: I have no doubt that the Bill will get a speedy passage through the House because it will be guillotined next Tuesday after one hour. It is rushed legislation as we only got the Bill last Tuesday and we are debating it on Thursday. This is the eighth rushed Bill to go through the House this year.

This Bill is a botched attempt by the Government to deal with the aviation sector. Following the demise of the Government in the local and European elections, I would award Oscars to the Fianna Fáil backbenchers for their public soul-searching last week, particularly when they declared that the Progressive Democrats had a huge influence on Government policies. Very few of them have spoken out today on this legislation. On the Order of Business this morning, when the Opposition leaders objected to this rushed legislation, the same backbenchers voted with the Government, including my colleagues in Clare. Everyone knows that the Tánaiste intervened last week in the pay talk to ensure that this legislation on the break-up of Aer Rianta would take place before the summer recess. Who is wagging the dog’s tail now? This is a Government decision that has been introduced to the House by the Minister for Transport, Deputy Brennan, with the blessing of the Tánaiste. The Minister for Finance has such faith in the Minister for Transport that he is willing to overrule a decision at the end of the day.

Earlier this afternoon, Deputy Ring complimented Aer Rianta and said that it did a good job in its day. I agree with his comments. Aer Rianta is responsible for the operation and management of our three national airports. In 2003, the company employed 2,353 full-time staff at its airports, 684 staff in its hotels and 351 staff in its international activities. The semantics of the Government, the uncertainty and the indecision are destroying confidence in the airports and have destroyed this profitable company.

The Aer Rianta annual report for 2003 shows that all is not well, with group profits for the financial year down €20.3 million after tax, from €36.2 million. That represents a 44% drop. This has been caused by the complete uncertainty in the aviation sector. We saw that €7 million was wasted on pier D, which was never built. Why was that money spent? Aer Rianta International had a turnover of just over €47 million in 2002. It manages the airports and duty business overseas, as well as investing in other airports. The profit from the Great Southern Hotel group was also down considerably. However, Aer Rianta paid a [109] dividend to the Government in 2003 of €6.1 million, which is a large sum of money.

5 o’clock

The Bill provides little solace on what lies ahead for the airport in my area, Shannon Airport. Since its establishment, Shannon Airport has been one of the great models and success stories of how national policy can support and promote balanced regional development. The development of Shannon as a tourism gateway has brought maximum benefits to the west coast of Ireland. The distribution flow of Ireland’s tourism within the country is influenced by its access. Hence we have the spread of American visitors to Killarney, Connemara, Westport and all over the west coast. Forty-four per cent of the traffic from Shannon Airport is made up of American business, and that is a significant amount.

The Minister said that we should be taking the low-cost route, and I have no problem with that, since it is important that we have it. I would welcome Ryanair or any other low-cost airline increasing its business out of Shannon Airport. However, it is important that we do not put all our eggs in one basket and that we have a mixture of American and low-cost European flights. We all know that most Americans who come here wish to come to Ireland but not through Dublin, so the American market has great potential still to be tapped by Shannon.

We see overseas industrial investment, particularly from American firms, attracted to the region. Fifty per cent of the companies in the Shannon free zone are American and depend on direct transatlantic services coming to Shannon from the United States. As a result, the airport has a direct impact on 46,000 jobs on the west coast of Ireland. In the mid-1990s, Shannon Airport expanded with the development of a new, state-of-the-art terminal building. As most other speakers said, the airport can handle up to 5.5 million passengers yet currently handles only about 2.4 million. It therefore has the capability of taking more.

Aer Rianta Shannon has been a good employer in the region and a major contributor to its economic success. From the date that this Bill is enacted, Aer Rianta Shannon will cease to exist, and the new Dublin Airport Authority will assume control. The Bill provides for the establishment of the Shannon Airport Authority plc. The Minister has noted that the establishment of that authority will pave the way for competition between airports. I would like to know how that competition will be improved and how Shannon Airport will have more control over its own destiny if it is to be controlled by its competitor, the Dublin Airport Authority.

Aer Rianta Shannon is represented in the group structure but, as a result of the Bill, the company’s employees become employees of the new Dublin Airport Authority. As I read the Bill, members of the Shannon board will not be represented on the new authority, something Deputy Naughten has pointed out. I do not know what [110] is to happen but, if there is nobody representing Shannon Airport on the new Dublin Airport Authority board, which has already been appointed, what will happen?

Immediately after its establishment, the Shannon Airport Authority plc will be charged with drawing up a business plan which will require the approval of the Minister for Transport and the Minister for Finance. We all know that the Minister for Finance has serious concerns about the break-up which he has expressed quite publicly. The reason is obviously that he has read the PricewaterhouseCoopers report. I assume that the Minister for Transport has read the report, but he seems to be ignoring it and taking a gung-ho approach to policy change. I would like to know whether the business plan will address the real issues or whether the board will again be requested to produce more fudge. The PWC report commissioned by the Government indicates that Shannon Airport would have to produce earnings of €7 million by 2008. It states that some €36 million of capital expenditure will be incurred between 2005 and 2008 at Shannon.

The report also highlights the intention of the Government to break up Shannon Development by indicating that Shannon Airport will be able to draw on resources of €6 million annually from its rental income. Now we want the new airport authority to be a property manager as well. The Government is not content merely to break up one semi-State company in the process, it proposes to destroy the flagship of regional development in the mid-west, Shannon Development, which has created more than 1,000 jobs in the past five years and brought 35 new companies to the region.

I am seriously concerned at the lack of a clear business plan for Shannon Airport before the break-up of Aer Rianta. It is scandalous that no appraisal has been undertaken of the future of a stand-alone Shannon Airport before introducing this legislation. There has been a lack of clear information on how future capital projects will be financed in Shannon. Aer Rianta estimates that in the ten-year plan €75 million capital investment will be required for Shannon Airport. As we all know, the runway needs a new underlay, and many other improvements are needed. I would like to know who will finance the €75 million capital investment.

No information is available on the financial projections, cash and debt management or the nature of ongoing relationships with existing Aer Rianta operations. What is proposed for Aer Rianta International? Will it remain at Shannon? What about the Great Southern Hotel group, of which the Great Southern Hotel in Shannon is a part? Those questions must be answered. Is the Great Southern Hotel group to be sold off to finance further investment in our airports?

The Bill also indicates that the vesting day for transfer of assets to the Shannon Airport Authority plc will proceed following the approval of its business plan after 30 April 2005. However, I [111] have serious reservations about how those assets could be transferred. Have the legal difficulties been overcome? The law forbids the distribution of a company’s assets where their value exceeds the amount of its reserves. Aer Rianta airports are valued at €400 million, while the reserves are valued at only half that. According to the report by Farrell Grant Sparks and Mazars, the value of Shannon Airport will be reduced by €65 million if this plan goes ahead. That is because, they claim, the assets will be valued at their fair value rather than their carrying value. Naturally, we all know that a whole loaf of bread is more valuable than half a loaf, not to mention if one divides it into three.

The PWC report points out that an immediate distribution of the assets of Shannon and Cork is not possible. It suggests that Cork Airport be leased from Dublin rather than completely spun off. Is that policy geared to put Shannon Airport out on its own or down the road to be sold off to the highest bidder? The Farrell Grant Sparks and Mazars report warns that the reduction in the value of Shannon Airport places it in a more precarious state. They further warn that a deeper analysis of Shannon should be undertaken before any break-up. Once again, I ask the Minister why the PWC report was not published. The report also strongly suggests that those matters be considered by the Minister for Finance before any decision to proceed. It urges that the full legal and accounting clearances be obtained with regard to the proposed transactions and a basis for market value be determined, as they are central to the proposed restructuring.

Section 12 of the Bill deals with the appointment of staff, their remuneration and transfer to the new Shannon Airport Authority. This is where the Minister really surpasses himself. He has been party to the discussions on the future of the bilateral agreement and the consequences that such a change will have not only on the airport but on the entire west coast of Ireland. No analysis has been carried out of how the change or the introduction of open skies will affect Shannon.

How can the Minister expect the people of the west, especially the workers, to have confidence in the security of their employment when this change is hanging over their heads? The recent report commissioned by the unions questioned that. It has been said that Shannon can switch over to a new low-cost model and manage to increase passenger numbers by 50% by 2008. The report says that detailed projections have not been produced to support that view. I have highlighted on several occasions in the House the importance of the dual gateway to Shannon and the entire western region. If there is a change in the current bilateral, it is estimated that Shannon will only break even. If there is a change to a “two for one”, €4 million will be wiped off Shannon Airport’s bottom line. I repeat that no analysis has been undertaken, bearing in mind [112] the potential losses to Shannon Airport if there is even a minimal change to the current status.

Yesterday we read in the newspapers about the ten-year plan which Aer Rianta has proposed. That suggests that there should be 281 redundancies in catering and general clerical areas at Shannon Airport. While the report accepts that any redundancies would have to be voluntary, it also suggests that there would be a cost factor in the pay-off of between €20 million and €25 million. Who is going to finance that cost? It also points out that the ending of the dual gateway will make this position even worse.

In recent years Aer Rianta has consolidated its financial services in Shannon Airport. I would like to bring to the Minister’s attention section 12(5) of the Bill which refers to the transfer of staff working in shared services to new entities. I want the position of staff in this area clarified. Will the staff in shared services at Shannon Airport continue to be employed by the new Dublin Airport Authority? This section appears to intimate that staff may be transferred to the company which continues to provide such shared services or it may be designated by Ministers to supply such services. Does this mean the area will be commissioned to a third party?

Then there is the question of pension funds relating to Aer Rianta employees. The PricewaterhouseCoopers report does not take into account any potential shortfall in Aer Rianta pension funds. There is an urgent need for the Minister to review all these implications arising from his proposed restructuring. Overall, in spite of the fact that this Government and Minister have been in the process of introducing legislation to break up Aer Rianta for over a year — prior to the Dáil recess in 2003 — we are no closer to knowing the exact implications for Shannon Airport of this legislation. Deputy Naughten referred to that this morning. We have witnessed a series of varying indicators from different Ministers. Deputy Brennan, the Minister for Transport, indicated on 31 May that he was battling with Deputy McCreevy, the Minister for Finance, over financial aspects of the break-up. The Taoiseach has intervened at various stages but at this point nobody is sure what guarantees he has given to the unions and their members.

We have to look at everything that is happening. Yesterday we heard the Leader of the Seanad, Senator O’Rourke, calling for the immediate disclosure of donations to political parties from business interests. Last night we witnessed on television the chairman of Aer Rianta, Mr. Noel O’Hanlon, raising similar concerns. This weekend Shannon Airport will be the focus of attention from all over the world as the visit by President Bush for the EU-US summit takes place on Friday and Saturday. I hope the Government will pay the same level of attention to Shannon Airport and its future that it is attributing to security this weekend.

We saw in the local elections that the Minister’s own party had lost control of Clare County [113] Council. The Progressive Democrats lost its only seat in Clare. We also saw that a number of candidates lost their seats in the Shannon area. This is an very important issue in Clare and is of great concern to the whole west of Ireland. The Minister should bear in mind in making his decision the jobs that are at stake. He should also consider the families concerned. What is to happen, given the uncertainty these people must face over the next nine months not alone in Aer Rianta, but also in Aer Lingus with its proposal to cut staff numbers at Shannon by 50%?

This business plan should have been put in place before any proposed break-up. In the short period between now and next April, the new board will find it hard to put a viable business plan into place. We all know that the aviation sector is currently in difficulty. We know how hard it is to attract new airlines to a region whether by Aer Rianta or an independent board. Airlines have gone into liquidation before they have started business. That was the situation in Cork and Shannon where Jetmagic collapsed. There was also the liquidation of the company in England which Aer Rianta had commissioned to run cross-channel services. A new service, EU Jet, will hopefully take off in September, but it was announced before the local and European elections. There is an urgent need for the Minister to act now in the future interests of the people of Shannon.

  Mr. Killeen: The Minister has set out clearly his rationale for the State airports in this legislation. In view of what it is trying to achieve, the Bill is both technical and complex, as many speakers have indicated. The Minister is aware that I argued strongly for an interim arrangement whereby sub-boards would operate at Dublin, Shannon and Cork under the Aer Rianta board. I am aware of the complexities of the company law provisions that made that difficult to achieve. However, it seems to me that the interim arrangement that is in place prior to the preparation of these business plans is close to what I had argued for. The timescale envisaged by the Minister in the Bill is somewhat shorter than I would have liked, but the interim arrangement appears to allow the possibility and the time to achieve a number of things that urgently need to be dealt with if the individual airports are to operate as I believe they can. There was an undertaking in the Fianna Fáil manifesto and in An Agreed Programme for Government to move in this direction.

The business plans which are prepared by the boards at the airports will decide how we proceed after the middle of or early next year. I would not blame the Minister for being somewhat confused. Not only have different people been claiming that the Bill had come too late and too early, but even in the same speeches individuals had said the Bill had come too quickly and too slowly. It is important to examine the background to the Bill. As many people have said Aer Rianta has been, and is, a profitable organisation. However, it is [114] profitable in the context of the need for a considerable level of infrastructure at all three airports. When that is taken into account the level of profit is somewhat misleading. In addition, there were ongoing complaints from Dublin that it was forced at various times to subvent both Cork and Shannon. Simultaneously of course, there was disaffection at both Cork and Shannon over the fact that even minor decisions at the airports had to be approved in Dublin and that sometimes reasonable and important proposals were either refused or discouraged from getting to a stage where they might be turned down.

Prior to this there were alternative proposals to raise finance to proceed with necessary work at the various airports. The previous Government had a proposal to the effect that 40% of the company be sold off as an IPO. An impression may have been given in the House yesterday and again this morning that the worker directors at Aer Rianta favour that option. Certainly any discussions I had with them would suggest the opposite and that they were very much opposed to the IPO option. That is the Aer Rianta or national airports background against which this legislation has come forward.

There are additional pieces of background at Shannon which impinge on how we move forward and how we should try to ensure that each of the airports not only becomes profitable but also attracts the numbers of passengers it has the potential to service. An airport might be quite profitable but not serve the region in the manner that is necessary. The key issue as regards background in Shannon is the ongoing negotiations between the United States and the EU on arrangements over transatlantic routes.

Even today I have heard people use the term “stopover”, which is long outdated and creates the entirely incorrect impression that there is a requirement for planes to land at Shannon. Currently, and for the last 11 years, a dual gateway policy has been in place. It was won at considerable political cost. It attracted predictions of gloom and doom and party political posturing. Fortunately, the doom and gloom have never been realised. To be fair, Shannon has done quite well under the new arrangements and I have every confidence that it will do well under what is proposed today, provided the outcome of the EU-US negotiations ensures that it continues to have a fair share of transatlantic business and is not disadvantaged to the extent that it loses out on that important market.

Another important piece of the background is the behaviour of Aer Lingus. I have spoken about that at considerable length in the House previously and I will not repeat what I said. However, I will make two points to the Minister. Now that he has an opportunity he should appoint a chairman to Aer Lingus who will understand that there are regions outside Dublin which the national airline ought to serve. It should be a chairman who will deal with the interests of the company in any privatisation pay-[115] off, which to many observers seems to be the only driving force behind some of the current Aer Lingus management.

Another element of the intricate background to this Bill is the effect it will have on Shannon Development. The former Minister, Mr. O’Malley, decided some years ago to take responsibility for industry, apart from those industries in the free zone, from Shannon Development. Another former Minister, Deputy Lowry, decided to take responsibility for Shannon Airport from the development company. The Tánaiste’s decision to decentralise Enterprise Ireland has clear implications for the role of the company. Shannon Development’s town management functions are to be transferred to the county and town councils. The company will face changes in any event.

It is a pity that there is such a lack of clarity about where Shannon Development’s future will lie. I refer not only to the company’s remit, but also to the geographical area it should serve. I believe that its catchment area should be Shannon Airport’s catchment area for transatlantic services. Such an area would be considerably bigger than Shannon Development’s current area.

It is ironic that the board of Shannon Development was to the fore in calls for the break-up of Aer Rianta. It engaged in strong anti-Aer Rianta propaganda. The board behaved in a reprehensible manner when it undermined Aer Rianta and Clare County Council, in respect of the Cliffs of Moher project. I am aware, however, that the vision of staff at many levels within Shannon Development was entirely different to that of the board of the company. I would like the staff’s vision of the future to replace that of the board.

I am pleased that the Bill provides that all three airports will continue to be State airports. It is hugely important that the airports are kept in State ownership because they are important pieces of infrastructure. I am happy that section 12 of the Bill preserves the current staff conditions. The Minister for Transport has given a clear undertaking in the Bill that there will be no downgrading of terms and conditions of employment.

A number of speakers, including the Fine Gael and Labour Party spokespersons, referred to the need to address Shannon Airport’s cost base. A Deputy compared Shannon Airport to Bristol Airport, on the basis of a report compiled by PricewaterhouseCoopers. The report claims that although the airports have broadly similar passenger numbers, Bristol Airport made a profit of €16.9 million in 2001, whereas Shannon Airport lost €1.1 million. It was not mentioned that Bristol Airport’s airport charges are two and a half or three times greater than those imposed at Shannon. The catchment population at Bristol is sufficiently large to attract airlines to a sizeable market that has to be served. The catchment area of Shannon Airport is limited by the small local [116] population and poor infrastructure on its main access routes.

There have been considerable infrastructural improvements since the Newmarket-on-Fergus and Hurlers Cross bypasses were completed and further benefits are expected from the Ennis bypass, which is under way. There is an urgent need for similar improvements at Gort, Crusheen, Claregalway and Galway. The Minister has approved a feasibility study for the rail link, to which the Government should adopt a positive attitude. Many of my constituents argue that the Government did not have any difficulty in spending billions on the Luas system and similar projects. They say it would be nice if we were occasionally to adopt a similarly positive attitude to projects in the west of Ireland.

The truth about Shannon Airport is that its real catchment area is overseas, in key tourism markets such as North America, the UK and Europe. Airports are not destinations but access points. We need to improve dramatically the tourism product in the west of Ireland and the Shannon area. Development is about to start at the Cliffs of Moher, but there is great potential in other areas such as Lough Derg in east Clare, the Burren in west Clare, towns such as Ennis and Nenagh and the city of Limerick.

  Mr. Naughten: What about Roscommon?

  Mr. Killeen: Indeed, there is great potential throughout the west of Ireland, in places like Connemara and Killarney. It often strikes me that few people are familiar with the wonderful beaches of the coast of north Mayo and elsewhere in the west.

  Mr. Broughan: It will be more expensive to fly to Knock Airport.

  Mr. Killeen: This country’s weather conditions mean that we need to make provision for all-weather facilities.

A number of speakers spoke of the need to address the cost base at various airports. The lack of measures in that regard has been one of Aer Rianta’s great failures. It is important that we make clear that the provisions of section 12 of the Bill have to be real and tangible. They should contain no less of a guarantee of employment than was the case heretofore. The safety net should also extend to pensions, not that former employees are particularly pleased with operation of the airline employees pension fund.

Provision should be made to give the right to a dividend to the staff of the three airports if any one of them is privatised in the near future, perhaps in the next ten years. If some assets are sold, such as those of Aer Rianta International or the Great Southern Hotel group, a fair division of the proceeds should be made among the airports. Aer Rianta International was established, built up and worked at in Shannon Airport. If any of it has to be disposed of to get the asset base right [117] to move forward from the situation we are in at the moment, Shannon should be the major beneficiary. The infrastructural deficit at Shannon has to be acknowledged, independently of how that is done. That has to be provided for before the independent board takes over, if that comes to pass.

It reflects no credit on Aer Rianta that some of the work that needs to be done at Shannon, particularly the airport sewerage system, has been neglected for so long. There is also a debt following the construction of the terminal building some years ago. It would not be feasible for an independent board to have to deal with the debt, which needs to be written off before the board takes over fully. There is a potential cost to the airports of staff restructuring packages that may arise in the short term. If there is a provision for a worker buy-out or a partnership in any particular area, it needs to be dealt with before the airports become independent.

One of the reasons many of us have championed the need for separate boards at Shannon and Cork is that we have a clear belief that the management at Dublin Airport rationed services and infrastructure in the other two airports. I acknowledge that losses which might have been incurred may sometimes have been dealt with by using profits from Dublin. Management at Cork and Shannon sometimes felt that good ideas for the development of routes and the promotion of the airports were stymied by their lack of independence. It is difficult for those in management positions in a company to make a case as strongly as it needs to be made if they have to consider their own positions. Independent boards would not face the same extent of difficulties being faced by the boards at Shannon and Cork, which are, in effect, sub-boards.

It is vital that the chairmen of the boards at Shannon and Cork should continue to be members of the Dublin board, just as they have been members of the board of Aer Rianta until now. Provision should be made for staff representation on the Dublin board during the interim period. I do not doubt that important decisions have to be made before April of next year or the year after, or whenever the package setting out the future of Cork and Shannon is reached. During the interim arrangement, it will be impossible for the boards of Shannon and Cork to proceed if they do not have a say in Dublin, or if they do not have meaningful dealings with the Dublin board. At a minimum, the chairmen should be represented in Dublin.

Eventually when there is complete independence and the airports run separately, Shannon will be entitled to a share of whatever is provided in both public service obligation and marketing funding. Heretofore that has been denied to the airport and there may be a difficulty given that it remains fully State-owned. However, this will need to be addressed in the short to medium term for Shannon and Cork.

[118] Many people are pessimistic about the future for Shannon and Cork airports. While Shannon has faced many challenges, it has always risen to them. I have had considerable contact with members of the interim board who have all operated in business over many years and have a substantial degree of experience and expertise between them. They are confident they can meet the challenge. It is not helpful for them to have obstacles, real or imaginary placed in their way. They believe they can increase passenger numbers at both Shannon and Cork. Ultimately the only guarantee of jobs, increased numbers of tourists and increased access for those involved in industry and business is through an increased level of service carrying more passengers.

I have every confidence that the airport which invented duty-free and Irish coffee and where for decades innovation was a byword and a call to action will rise to the challenge before it now. To a certain extent I disagree with the Minister’s wish that Cork and Shannon should have greater competition with Dublin. I am not sure that is a necessary or even desirable outcome. While an element of competition is required, I do not believe going down that route would benefit Ireland’s economy or any of the three airports. On this issue, I would encourage the airports to avoid overshooting the runway, as it were.

The autonomous boards need to have a financial base that enables them to deliver on the vision they clearly have. The critical decision has been taken for the airports to remain State-owned as they are very central parts of our infrastructure. In coming years it will be very important that the Government be prepared to stand by that decision.

It is true that Shannon has a huge dependence on the North American market and it would be grossly unfair to the new board to undermine access to that market in any way during the next ten years or so. Any arrangement for two, three or four years will certainly militate against the capacity of the Shannon board to operate the airport to its optimum capacity. While it might be possible for airports to make a profit, we need to be careful not to try to have airports making profits on the basis that Bristol or Cardiff airports do, where the profit is made through airport charges that are approximately three times those at Irish airports. It would simply prove to be a major disincentive to tourism and is an option the boards must be prepared to avoid. They must be prepared to ensure that passenger numbers and levels of service are considerations far ahead of profit and the Government will have a key role in leaving some leeway for the boards to do that.

  Mr. Broughan: I wish to share my time with Deputy Seán Ryan. The Labour Party vehemently objects to the manner in which this Bill is being taken. This week we received a schedule that basically involves ramming a series of critical Bills through this Chamber. On the last week of the session we must deal with important [119] Bills such as the Electricity (Supply) (Amendment) Bill and the Maritime Security Bill along with a range of other Bills.

This is one of the most important Bills to come before Dáil Éireann in my time in the House and possibly in the time of the Ceann Comhairle in that it seeks to make a fundamental change to one of our most successful semi-State bodies. We in the Labour Party believe it does so in the most reckless and cavalier fashion, which may well do untold damage to the three critical regions of Dublin, Cork of Shannon and to the aviation industry here. This critical decision will be made today following a desultory debate of less than four and a half hours, which will be followed by a single hour next week. This is no way to conduct serious Government business.

The Minister, the Government Whip and the Taoiseach, who is primarily responsible for all legislation as the Leader of this House, must be castigated for presenting us with this. We might have expected from the Minister for Transport, who on many occasions has plenty of time to present himself to the media and make statements willy-nilly across the gamut of transport issues, to come to the House with a Green Paper or White Paper on the future of aviation policy for the State. He did not have time to produce even three of the basic outline business plans that any new business might present to its shareholders whom we represent in this case. We have been treated in a disgraceful and cavalier fashion by the Government.

Following the suspension from this House of my colleague Deputy Stagg yesterday, I meant to make a brief comment this morning on another matter and I hope the Ceann Comhairle will not mind me doing so. Around this time of year, as a successful medical practitioner, he always strictly enjoins us to take not two but three weeks of a major holiday away from this House. After the rí rá between the Ceann Comhairle and various Members of this House, it might be time that the medical practitioner took some of his own advice.

  Mr. Naughten: Just what the doctor ordered.

  Mr. Brennan: Is there a doctor in the House?

  Mr. Broughan: Over the next two weeks as we attempt to invigilate these Bills, I hope the Ceann Comhairle will not be too hard on us.

I have read the Minister’s speech very carefully. It offers very little insight into the future of Aer Rianta and the three proposed State companies and was extremely vague. It is striking that our Fianna Fáil colleague who spoke just before me picked up on a number of those vague areas. The Minister failed to address fundamental issues about the future of the Shannon region. While he made a few comments about Shannon Free Airport Development Company, he did not address the fundamental points of regional development at Shannon. He certainly did not [120] address any of the issues of regional development in the north Dublin region, which I am very proud to represent.

The Minister said he wants to develop cost competitive services and appropriate infrastructure with three commercially successful airports. Why could the Minister not have done that with three autonomous units, so to speak, within the successful company that is Aer Rianta? If the Minister had done that it would have given the Cork and Shannon Aer Rianta personnel the freedom to operate within this very successful, multinational, Irish-owned semi-State body.

The Minister spoke about promoting and expanding a range of services leading to greater competition. Michael O’Leary was referred to in the House this morning because of his massive funding of the Progressive Democrats Party, and rightly so. I have simple beliefs. I believe that he who pays the piper always calls the tune. If a party is receiving €60,000 or €70,000 from a powerful businessman in an important industry, it cannot fail to be influenced by his fundamental wishes, as we have seen in the massive advertisements he placed in the newspapers on a daily basis during the recent election campaign in which the Taoiseach was described as a ditherer and almost referred to as a clown and a fool.

Comparisons with our EU partners in respect of regional airports do not always have the same resonance for Ireland because of our location and size. It is different when operating in a major medium-sized European country, and the reference to Bristol Airport is a good example because it brings to mind the kind of economies of scale that regions in other parts of Europe can achieve.

Having said that, the aviation industry is our birthright because we are an island people. Just as the Greeks had a major interest in shipping and navigation, it is our destiny to have a great aviation industry, and Aer Rianta deserves immense credits for all its achievements in past years. The Minister will agree, despite the difficulties at Dusseldorf last year, that Aer Rianta’s 2003 results are impressive. The developments at all levels are impressive, including the new routes that Aer Rianta has introduced.

In bringing forward this Bill and ramming it through Dáil Éireann, the Minister is effectively devaluing our constituents’ portfolio. Their fundamental asset value is being directly attacked by the Minister. The Bill places in jeopardy the future levels of capital investment which Aer Rianta needs and deserves. When people look back on the Minister’s period in office they will judge him severely on the efforts he made to stop the building of Pier D and the expansion of the airport, and his failure to address the problem of overcrowding and hassle which has become endemic in Dublin Airport in recent years due to the lack of investment the Minister has deliberately prevented from going ahead. The Minister has a major responsibility in that regard.

This morning my colleague, Deputy Shortall, rightly said that the fundamental aspect of the [121] Labour Party’s unhappiness with this Bill is that the Minister did not come into the House with a clear-cut business plan for the three new companies, the residual Aer Rianta company at Dublin Airport, how its future will be shaped with the additional debt and problems it will experience due to the ending of the current system of regulation, the cost issues, which are difficult for Shannon Airport and the Shannon region, and the recent capital expenditure in Cork. None of those issues has been addressed and that is the reason we oppose the Bill.

This is the first time I have had an opportunity to speak on an aviation Bill in this Ministry. I have always felt that the Minister’s real agenda has been a second privatised terminal at Dublin Airport. The Minister started from that premise. That was his ambition. He worked his way backwards and because of that we have had the amazing reports throughout the past eight months of his failure and that of his Department to be aware of the basic precepts of company law and the rules of accountancy in respect of any de-merger. When we first heard the Minister talk about this we knew that a de-merger would be a very difficult operation, particularly in regard to transfer of assets, but he wilfully went ahead with it because he wanted to bring about a second terminal. It was only because of trenchant opposition from trade union colleagues and staff at Dublin Airport that the Minister backed down to this extent over recent months and came forward with the current Bill.

Aer Rianta’s achievement has been extremely impressive. There is no commercial reason for proceeding with this Bill today. The Minister has not made a case in terms of a business plan of any description that even a young businessman or woman would bring forward. The de-merger, as we have learned from PricewaterhouseCoopers, is a shambles and it is a disgrace that our Civil Service has been put through that. This Bill will have a negative impact, particularly in my region of north Dublin, and I am fearful for the staff involved in terms of pension rights and transfer of engagements. I am resolutely opposed to the Bill and I regret the Minister has proceeded to this stage with it and is prepared to ram it through this House.

  Mr. S. Ryan: This is scandalous legislation. No legislature in any democratic society would bring forward legislation such as this, which has the potential to have a detrimental effect on our economy and aviation policy, without knowing with any degree of certainty that it will be successful in its objectives. This legislation, which is based on ideological grounds and will be guillotined in the Houses, has no viable plan to back it up. Any voluntary sporting organisation applying for funding to the Department of Arts, Sports and Tourism for a community based project would not have its application processed unless it was accompanied by a viable business plan. Similarly, someone with a small business looking for [122] a loan to extend that business would not get inside the door of a bank without having a viable plan for consideration. That is normal practice nowadays, and rightly so, but the Minister has different standards and a different agenda. The Government brings forward legislation without a plan or objective.

The State Airports Bill 2004 is a sell-off by Fianna Fáil of its core principles and a victory for the Minister, Deputy Brennan, the Progressive Democrats and Michael O Leary. Aer Rianta workers in Dublin, Cork and Shannon are being used as ideological pawns by the Government, particularly the Minister, Deputy Brennan, in an experiment to prepare Cork and Shannon airports for privatisation. That is the inevitable effect of this legislation. They will not be able to stand alone in Shannon and Cork on the basis of these proposals.

It is difficult in any objective way to see how the strategic interests of tourism or transport can be served by this Bill. There seems to be no logic behind the proposals as it envisages the establishment of authorities for Cork and Shannon airports while Cabinet members, particularly the Minister for Finance, are not sure of their viability.

The Minister for Transport has some audacity in rushing this Bill without a business plan. If he was chief executive of a major private company he would have been sacked for implementing this policy.

  Ms Shortall: Hear, hear.

  Mr. S. Ryan: However, it is scandalous that the Minister’s experiment in the public sector is acceptable. Many Fianna Fáil backbenchers have stated their concerns about this Bill publicly However, as most are hoping for promotion to ministerial rank by the Taoiseach in September, they are not prepared to stand up and be counted on this important issue, especially those from the Dublin region.

  Mr. Broughan: Hear, hear.

  Mr. S. Ryan: Fianna Fáil has not learned the lessons of the recent elections as the proposals do nothing to serve the interests of air travellers and workers or promote proper regional development, whether in Cork, Dublin or Shannon.

The Bill saddles the proposed Dublin Airport Authority with unnecessary debt, jeopardising its ability to borrow for further important infrastructural developments. No specific reference is made as to where Aer Rianta International will end up. However, such decisions will be taken under section 8. In one of his off-the-cuff briefings to the media, the Minister indicated it would be assigned to Shannon. Such a decision, if taken, would have a major impact on Dublin Airport and the Dublin Airport Authority as Aer Rianta International was responsible for 60% of Aer Rianta profits in 2002 and 64% in 2003. Accounts [123] for 2003 show that of Aer Rianta’s annual profit of €29.5 million, €19 million came from Aer Rianta International. The Minister proposes to take this from the Dublin Airport Authority and, in addition, lump it with the liabilities of Cork and Shannon airports. It does not stand up to critical analysis as has been shown by previous reports.

The Minister, in his subtle way, has decided to retain the three new companies in public ownership. This is the thin end of the wedge, ultimately leading to the privatisation of Cork and Shannon airports, the sale of the Great Southern Hotel Group, the undermining of the economy of Dublin Airport and the provision of a privately-built second terminal, which all of the objective consultants’ reports have come out against.

Dublin Airport workers’ representatives have published the pamphlet entitled, A Ruthless Act of Institutionalised Vandalism — Seamus Brennan’s Proposals to Dismantle Aer Rianta. Included with it was the following statement:

We believe that the Government’s decision is fundamentally wrong. The result of that decision will be to replace one profitable and effective airport company with two loss-making ones, Cork and Shannon, and a Dublin authority crippled by the debts of Cork and Shannon. The recent Pricewaterhouse Coopers revelations seem to support this view. We also note the stated reservations of the Department of Finance and also the fact that not a single Government-Aer Rianta commissioned report supports or proposes the break-up of the existing company.

All of this is being proposed by Government without a shred of a business plan to support it and apparently, without any real appreciation of the ... complexities involved in the proposed demerger — commercial, legal, employees concerns etc. ...

The impact of all of this will be negative for the consumer, the State and employee. There is no doubt that the effect on employees will be to impact on job security, terms and conditions of employment and pensions. It is [unacceptable] that such a major State asset should be wrecked and the livelihoods of its employees and their dependants, not to mention the public interest, should be put in jeopardy in such a fashion.

I support these views. It is a sad day when the Minister sets out to privatise the industry and look after his friends.

  Mr. T. Dempsey: I wish to share my time with Deputy O’Connor.

  An Ceann Comhairle: Is that agreed? Agreed.

  Mr. T. Dempsey: Deputy Seán Ryan’s concern for Cork is touching and his concern for his Dublin fellow Deputies is even more so.

[124]   Mr. S. Ryan: I have always been known as a concerned Deputy.

  Mr. T. Dempsey: I am not sure which is the least informed. I remind Deputy Seán Ryan that the success of Knock Airport, independent of any centralised control from Dublin, is one of the outstanding economic successes of the last decade. Dublin Opinion, which has long gone out of publication, used to say that all roads from Cork lead to Dublin. I am glad that the Minister for Transport has the initiative and ambition to point a few roads back down the country. Cork Airport has no need for centralised control or over-reliance on the megapolis which Dublin Airport is turning into, in order to survive. There is a little theory——

  Ms Shortall: So it is just taking the subsidy for the sake of it.

  Mr. T. Dempsey: I am glad that Deputy Shortall allows it to have a subsidy. Perhaps under a Labour Party Government it would be withdrawn.

  Mr. Broughan: When will Wexford get an airport?

  An Ceann Comhairle: Deputy Dempsey without interruption.

  Mr. T. Dempsey: I would be delighted to discuss an airport for Wexford with Deputy Broughan.

  Mr. Broughan: Wexford is going for the double this year but it has no airport.

  Mr. T. Dempsey: Only today I discussed with the Minister for Transport the proposal for an autonomous authority for Rosslare Europort which I hope will be established in the same way as it will for Shannon and Cork airports.

In the school of thought I was brought up in, there is a saying “Small is beautiful”. This is what the State Airports Bill is about. Dublin Airport is a victim of its own success. In 2004, approximately 15 million people will pass through it. Any Member who has passed through it recently will be familiar with the long queues. This is a result of the impossibility of a management system, established many years ago, that is charged with responsibility for security, car parking, shopping, duty free and passenger mobility. Such a management system is long outdated.

6 o’clock

I am delighted that the Minister for Transport seeks to give autonomy to the three airports under this Bill. It is a form of decentralisation, with which I live happily, and is a recognition of new realities. It also suggests that smaller entities can be more focused than larger ones. A Goodbody consultants’ report on Knock Airport which has its own autonomous authority, found that it had significantly grown its business in recent years with [125] passenger numbers anticipated to reach 400,000 in 2004. I wonder would the people who objected even to the idea of an airport in Knock perhaps think about the success of that airport. Those who have genuine fears about the autonomy of smaller units should consider the economic report on Knock Airport.

Part of the growth in passenger numbers reflects the development of outbound charters in recent years. Some 46,000 passengers will take charter flights in 2004. The airport supports additional employment through its purchase of goods and services. The additional employment is estimated at 56 people in 2004. That all comes about because of the focus of small communities and entities. If one were to go by Deputy Seán Ryan’s economic theories, we could never offer hope to the Leitrims of this world. They would not even compete in Gaelic football, although we learned last Sunday that they do so quite successfully.

  Mr. Naughten: They will find out about that next Saturday.

  Mr. T. Dempsey: If we have a Minister some time in the future as innovative as brave as the Minister for Transport, we might have an airport in Wexford. In the meantime we have a Europort and I appeal to the Minister to show the same initiative and give us our autonomy.

I have been a member of a trade union all my life and continue to be one. I would not support any proposition which would disadvantage ICTU members and I am glad to see that the Minister has guaranteed them that there will be no deterioration in working conditions or employment.

I congratulate the Minister on his initiative. This Bill will help to facilitate the efficient economic development and the better operation of a new Dublin airport and a new authority. I hope that ultimately it will lead to a second Dublin terminal. It will protect the reasonable interests of users in Dublin Airport. Like many others, I have been the victim of the tremendous numbers passing through the airport. I am certain that the Dublin Airport Authority will operate the airport in a way that is sustainable and economic. In future, if Deputy Seán Ryan and I are returned to this House — I know he will be equally concerned for my welfare as he is for his Dublin colleagues — we will be here to congratulate the Minister in about five years’ time on the wonderful success facilitated by the new Bill.

  Mr. Broughan: I hope there will not be a tribunal investigation.

  Mr. Durkan: Noel Hanlon has not got the same confidence as Deputy Tony Dempsey.

  Mr. S. Ryan: Can we get an airport for Tallaght?

  Mr. O’Connor: The Deputy should not anticipate anything I might say. Deputy Seán Ryan’s [126] speech was going well until he suddenly had to depend on the Labour Party scriptwriters. They are in a spot of bother because all they do is pick on poor Fianna Fáil backbenchers. I am proud to be a Fianna Fáil backbencher.

  Mr. Durkan: God love them, they are a pitiful sight. The plinth has been raided on numerous occasions.

  Mr. O’Connor: We are easy targets but we come here and do our job.

  Mr. Durkan: That is bravery.

  Mr. O’Connor: We are not afraid to tell the Minister how we feel about issues and we do that on a regular basis.

  Mr. Broughan: Has the Deputy ever been in the Minister’s office? The Deputy has never been across the bridge.

  Mr. O’Connor: Unlike other parties, we are not afraid to do that. There is much democracy in Fianna Fáil and I am proud to be a member of a Government party. I speak as a backbencher who has no expectation of promotion so I am not one bit afraid of what is happening. I will always be honest in my approach to these things.

  Mr. Naughten: That is what the Taoiseach said about the EU Presidency.

  Mr. O’Connor: I am on the record as saying that if the Taoiseach went to Europe, I would be devastated. I am not afraid to say that.

  Mr. Durkan: The Deputy should be careful. The Taoiseach is returning from Japan. Does he know what the Taoiseach did the last time he came back from Japan?

  Mr. O’Connor: If I need help from the Leas-Cheann Chomhairle, I will be happy to seek it. I take the point that colleagues speak to their constituents and to the parties about matters as they see them. This Minister has a great deal of support in this House, not only on the Fianna Fáil and Progressive Democrats benches but on many other benches

  Mr. Durkan: That is why he wears a hard hat.

  Mr. O’Connor: We should wish the Minister well because he has a difficult job. There are a few myths going about. I have already approached the Minister about matters. I accept the little taunt that Tallaght does not have an airport. I wish we had, though Baldonnel has some potential in that regard.

  Mr. S. Ryan: We have the noise from it.

  Mr. O’Connor: The Minister knows that, like other Members of the House, I have had rep[127] resentations from constituents asking me to raise issues of detail about these proposals and I have attended to that.

  Mr. S. Ryan: Did the Deputy get any answers?

  Mr. O’Connor: I am happy that the Minister has told me and other colleagues that in acknowledging that the trade unions are fundamentally opposed to the restructuring proposals, the Government has accepted many of the concerns of the unions.

  Ms Shortall: It has not.

  Mr. O’Connor: The Minister has also informed colleagues that to assist in addressing those concerns, agreement has been reached on a number of important areas. A section of the Bill specifies that there will not be any deterioration in the terms and conditions of employment of the workers in the company on transfer to the new independent airport authority.

  Mr. Broughan: What about the new workers?

  Mr. O’Connor: He has also made the point that the transfer of assets to Shannon and Cork will not take place until after 30 April 2005. The Minister has informed us that detailed business plans will be drawn up for Dublin, Shannon and Cork airports by the airport authority and that the transfer of assets to Shannon and Cork will not take place until the shareholders, the Minister for Transport and the Minister for Finance, are satisfied as to their state of financial readiness. The Minister and senior officials of his Department have maintained a process of full engagement with the Aer Rianta unions to deal with all issues of concern, and the Minister informs me that process will continue through the transition period. It is important we note that.

I wish my Wexford colleague, Deputy Tony Dempsey well in his endeavours.

  Mr. S. Ryan: Is that for re-election?

  Mr. Broughan: He is going for the double.

  Mr. O’Connor: Deputy Dempsey made a point about the PricewaterhouseCoopers report. Deputy Sean Ryan talked about ambition. I would be quite happy to be elected at the next general election. If not, I will find something else to do in my community. That is the way democracy should work. I do not know how it works in other parties but that is how it works in Fianna Fáil.

Myths are going about regarding the PricewaterhouseCoopers report. I understand that the company never suggested that restructuring was too risky or should not proceed. I also understand that the company has informed the Department in writing that the establishment of three independent entities will, in a focused way with fresh [128] ideas, allow for a clearly defined capital pool allocated to each airport and an autonomous approach pertinent to the business priorities of each airport.

I am glad my colleagues have calmed down. We should understand that there is support for the proposals.

  Mr. F. McGrath: There is no public support.

  Mr. O’Connor: It is not true to say there is not. There has been strong support at national and regional level.

  Mr. Broughan: Not in Dublin.

  Mr. O’Connor: The support at regional level has been particularly evident before, during and after a number of visits the Minister made to the Shannon mid-west area and to the Cork region. The plan has strong support from public representatives, regardless of whether the Deputies like that, from regional and local authorities, business interests, chambers of commerce and consumer organisations.

  Mr. F. McGrath: Who elected them?

  Mr. O’Connor: One can ask who elected them and who elected us. Many organisations are giving views. Many views come across from the Opposition benches and one wonders where they originate. In a democracy we are all entitled to make our point. I am not afraid to make the point.

  Ms Shortall: What is the point?

  Mr. O’Connor: At some point I might ask the Leas-Cheann Comhairle to protect me.

  An Leas-Cheann Comhairle: The Deputy should address his remarks through the Chair.

  Mr. O’Connor: I apologise. I am always happy to do that.

  Mr. Broughan: A Tallaght man needs no protection.

  Mr. O’Connor: The Minister should be allowed to get on with his job, representing the public and doing what it wants him to do. The reforms provided for in the Bill are focused on developing Dublin, Cork and Shannon airports, increasing airline business and drawing significant passenger traffic levels as well as jobs. The only sensible way to guarantee jobs in future is to grow the business at the three State-owned airports. Under strong, focused regional leadership, Shannon and Cork airports will have a fresh start and can develop separate business strategies, including concentrated marketing initiatives.

Shannon Airport can double the number of passengers from 2 million to 4 million and Cork Airport can also grow. Almost 90% of people [129] who travel to Britain or the Continent fly out of Dublin, and I am happy about that. There is no reason many of these people would not use Shannon or Cork if the airports were extensively marketed.

The passenger numbers in Dublin Airport are set to increase from the present figure of 15 million per year to 30 million by 2018. Looking around, I wonder how many of us will still be in the Dáil then — Deputy Finian McGrath probably will be. Is he not going to top the poll at the next election?

  Mr. F. McGrath: That is correct.

  Mr. O’Connor: So they say. The new Dublin Airport Authority, combining international and national aviation expertise with proven financial and business experience, will focus on meeting the urgent need for increased capacity at that airport.

The Bill provides the necessary basis for the restructuring of Aer Rianta and the establishment of Dublin, Cork and Shannon airports as independent airport authorities under State ownership. It provides for Aer Rianta’s mandate to be changed by ministerial order to include a responsibility to restructure the company on an orderly basis. On the day this order is made a new board will be appointed to replace the board of Aer Rianta and Aer Rianta will be renamed as the Dublin Airport Authority.

The Bill is enabling legislation that will allow implementation in a two-stage process. The airport authorities will take office in Dublin, Shannon and Cork. They will immediately prepare business plans and agree between them on the function each can carry out on a delegated basis. During this period the assets will remain with the Dublin authority. Assuming the shareholders, the Ministers for Transport and Finance, are satisfied with the viability of the business plans, the assets will transfer and Shannon and Cork will become fully independent and autonomous airport authorities on or after 30 April 2005.

I have referred to the support that exists for restructuring, and my colleagues have confirmed that. Shannon and Cork airports can better realise their potential with strong regional leadership free from central control in Dublin. The new airport authorities for Shannon and Cork will combine international and national aviation experience and proven business leadership and will bring a new and concentrated focus to promoting those airports.

The chairman designate of the Shannon Airport Authority has predicted, based on discussions with airlines, that the number of passengers at Shannon can double to 4 million per year. Under the terms of the restructuring, both airports will begin debt free from the first day. For Shannon Airport, this means the lifting of a debt [130] of €70 million and more than €120 million in the case of Cork.

  Mr. S. Ryan: What about Dublin?

  Mr. O’Connor: Transport in general and infrastructure in particular in the Shannon and mid-west and the Cork and southern regions will benefit from increased investment and there will be an emphasis on integrating all transport systems, including aviation.

In the hurly-burly and excitement of political debate, we are all entitled to make points, but we must see the benefits of this legislation.

  Ms Shortall: What about the damage it will do to Dublin Airport?

  Mr. O’Connor: I will finish now as I do not wish to get into conflict with the Leas-Cheann Comhairle. I have been here for two years, I have never upset anyone and I will not start now. I would like to see out my term without upsetting anyone.

  Mr. S. Ryan: What about the Deputy’s constituency colleague?

  Mr. O’Connor: My constituency colleague is a senior Government backbencher and he can speak for himself. He does not need me to protect him, it is more about him looking after me.

  Mr. Broughan: He might be a Minister soon.

  Mr. O’Connor: It would be good for my area if he was a Minister. Debate on this issue is healthy and it is important the Minister knows he enjoys a great deal of support because, while he finds these debates interesting, they must also be trying.

  Mr. Sargent: The Deputy should not be so hard on himself.

  Mr. O’Connor: I wish him well in his job. Where I have concerns or where my constituents bring genuine concerns to my attention, I will go to the Minister and ask him to take account of them.

  Mr. S. Ryan: Would the Deputy support him for Taoiseach?

  Mr. O’Connor: I am a well known supporter of the Minister. I share a constituency boundary with him and admire the work he is doing. He is doing a tremendous job in this area.

  Mr. Sargent: Tááthas orm seans a fháil labhairt ar an Bhille um Aerfoirt Stáit 2004. Tá mé ag roinnt mo chuid ama leis an Teachta Aengus Ó Snodaigh agus an Teachta Finian McGrath.

[131] This Bill makes for interesting reading, although I have spoken to numerous people who are reading it again and again because they cannot see where it is going. It opens up possibilities but its final destination is still clouded in mystery. It indicates, however, that the thinking behind it is characterised by the ideology of Thatcherism gone mad in that it sets out the template for privatisation further down the road. It ignores any critical analysis of airport economics, and we should bear that in mind regardless of which party supports it or the personal points of view expressed.

If we look at small and large airports, such as those in Liverpool and Manchester in Britain, the airport in Liverpool is small while the airport in Manchester is large because Manchester has critical mass. That factor exists in Dublin also so splitting the three airports will mean Dublin will continue to grow in a cancerous fashion while the airports in Cork and Shannon will find it difficult to achieve that critical mass. That will result in this plan being seen as flawed in the long term so it should be reconsidered. The Minister must think long and hard about what he will do and the legacy he will leave.

Why is there such a hurry with this legislation? I asked the Tánaiste on the Order of Business why the road safety Bill was not seen as equally, if not more, urgent; it is a matter of life and death. As Deputy Finian McGrath pointed out, we have been waiting a long time for the disability Bill, as we have for legislation on Grangegorman.

Those Bills have been postponed again and again but here we are presented with legislation that has received no justification in independent studies. Five independent studies have cast considerable doubt over this programme and if the Tánaiste says it will save money, we should definitely revisit the entire idea because there are no signs of savings in the Bill. Instead, it will increase congestion in Dublin, a costly problem. There will be further impacts in health terms as Dublin Airport grows, increasing the prospect of another runway, a matter of concern to the citizens of Swords, Portmarnock and Malahide, given the impact of additional flights on their communities.

In terms of cost, I wonder where the Tánaiste is coming from. In the case of Cork and Shannon, many of the companies based there will find that it is not possible to sustain jobs because they depend on direct international route connections. If Dublin is to become an almighty hub once again, I suspect Cork and Shannon will not be able to provide the direct international routes. This should be a concern because it will not save money but will be a cost in terms of unemployment.

Ultimately, when all matters are taken into account, I foresee in the establishment of Údarás Aerfort Átha Cliath, Údarás Aerfort Chorcaigh [132] and Údarás Aerfort na Sionainne that there will be a cost of millions of euro for new livery, new uniforms, re-naming and re-branding, and all of this despite the proviso that there might be a business plan which would stand up and get the go-ahead. It seems a costly way of proceeding and we should be concerned about it. There is no business plan. First, there is a transfer of assets and only then is the business plan thought of. Is the Minister trying to put in place a face-saving exercise or was a Government policy decision taken and is the Minster simply following through on it in some way? Regardless, it will be costly and this cost will not mean jobs.

The Minister is not thinking strategically in this regard. The country needs a more robust strategic plan in place which will carry Aer Rianta forward. Whatever one might want to call the company, it has served us well internationally and at home. Breaking up the three airports and expecting that they go forward as public companies with shareholders as well as taking shares in other companies is a much less efficient method than having Aer Rianta as a stand-alone company. Given that this is a small island, that is what makes sense.

While we are discussing civil airports, Shannon is looking increasingly like a military airport. I do not think it will be helped as a stand-alone company by having to put up with the visit of George W. Bush. In discussing civil aviation, we should be discussing the protection of the benefits of Aer Rianta rather than undermining them.

  Aengus Ó Snodaigh: Since taking over his ministerial position, the Minister, Deputy Brennan, has run with a right-wing economic agenda with scant regard for the best interests of employees, trade unionists and the people. Aer Rianta has been a profitable State company successfully managing the State’s airports, including Dublin Airport which is one of the most prominent airports in Europe. In the lean years of the 1970s and 1980s, Aer Rianta was one of the largest contributors to the Exchequer. Now, when it faces small financial problems, the first idea is to privatise it. The proposed break-up has met with the disapproval of the vast majority of commentators because the break-up is unviable. It is simply a smokescreen in preparation for privatisation through which the people will be screwed once again, as they were with the sale of Eircom.

My party wants vibrant, progressive and well-run public sector companies in control of public transport across the board in Ireland. Aer Rianta comprised a relatively affordable service compared with other European countries, which is quite an achievement considering the limited amount of support provided by the State over the years. Support has been the other way around in most cases. The chairman of Aer Rianta today described the Bill as draconian. As my colleague, [133] Deputy Crowe, pointed out, the debacle regarding the proposed break-up of Air Rianta is not only a potential disaster for the aviation services in Ireland but amounts to a waste of Government time and taxpayers’ money. We are an island nation. When added to the sale of other Irish transport companies over the years and the proposed sale of Bus Éireann, CIE and Aer Lingus, it will leave the nation at the mercy of greedy international or perhaps national capitalists.

The Bill is unclear and this is due to the haste with which it was introduced by the Minister. Haste makes for bad legislation, as I have stated repeatedly in the Chamber. While the Minister is not as hasty as the Minister for Justice, Equality and Law Reform, he has been hasty in this instance. What would happen if the Minister for Finance, Deputy McCreevy, decides to reject the business plans? Will that mean that the arrangements for delegation will be retracted and the break-up issue will be reversed?

As Deputy Crowe pointed out, nothing good can come of this legislation. The Dublin Airport Authority will stand for nothing but a hopelessly diluted national aviation service with all the fundamental problems which the Minister declared would be addressed in the Bill. The legislation leaves large spaces for ambiguity at every level. For instance, in the matter of remuneration there is little consolation for employees whose remuneration and transfers will be dependent on common agreement. In other words, there will be more months of conflict and negotiation and this will not bed down quickly. How much, for example, has the Minister spent on reports relating to this legislation? How much will the changeover cost in terms of changes to logos, moving staff, uniforms, vehicles, letter-heads and so on?

This is a rather expensive name change. Has anything been gained even in terms of the Minister’s aspiration to more competition and better financial dividends? Nothing stands to be gained from this legislation. The Aer Rianta ten-year plan suggests that a large number of redundancies will be needed at Shannon despite the proposed break-up, and this could cost as much as €30 million. How long will it take before Shannon and Cork airports will be individually viable and how much will be required to keep them afloat? Where will the money come from?

There is no commercial rationale to this Bill. The reality is that the proposed break-up of Aer Rianta, which has now been delayed, and the Government’s approach to Aer Lingus is concerned with the Government implementing the privatisation agenda of the Progressive Democrats, which is now the ideological wing of Fianna Fáil. What other logic can explain the break-up of a successful State company? This break-up, if it is allowed to proceed, will see the constituent parts of Dublin, Cork and Shannon airports incurring huge increased costs in administration, [134] marketing, accounting and all the functions which are now carried out centrally and with economies of scale?

Bad legislation is made in haste. What is the urgency for the Bill other than to satisfy some deadline set by external vested interests? There is no logic to the haste. There has been a lack of debate, planning and forethought. Was this idea a dream of the Minister’s or did he think it up over a ministerial dinner in a villa in the south of France? Moreover, which Minister dreamed it up? Did both of them do so? Nobody will benefit from the Bill. I urge the Minister to withdraw it, even at this late stage, and go back to the drawing board in regard to Aer Rianta.

  Mr. F. McGrath: I oppose the Bill. Not only is it a bad Bill, it is also dangerous for the country, the staff and the regions. That is the reality of this legislation and I call on all Deputies to vote against it. This legislation which proposes to break up the airports is a classic example of economic and social vandalism. People in the business know that Shannon Airport will not be profitable for ten years and Cork would not show a return on investment for six years. Shannon will not develop for ten years without Exchequer funding and Cork will be similar with debts of €200 million being transferred to Dublin. We all know the EU rules that will be wheeled out again to bury State aid. These are the realities of the Bill and I urge everyone involved in the debate to listen to the workers and, above all, to listen to the people who want to save and develop Aer Rianta.

I also urge an objective analysis of the issue. It is a disgrace that people involved in the aviation trade were not consulted on the legislation. The Aer Rianta board should have been more involved in the preparation. There will be an increase in landing charges at all three airports and we will hear more whingeing from Ryanair’s chief executive, Mr. Michael O’Leary.

I find it a bit rich to hear the Tánaiste trying to distance herself and her party from the political donation issue. There is a connection, which past tribunals have proved, so please spare us the high moral ground lectures. There is something undemocratic about a party with 3% of the national vote having so much power and influence in the Cabinet. What about the views of the remaining 97% of people? Is it any wonder people are cynical about politics and wonder what they can do to have their voices heard? Most people believe they live in a liberal democracy. I urge them to think again when 3% of our wealthy elite have major power and we have a right-wing press which is constantly squeezing out the democratic mandate of approximately 30% of people.

I raise these issues in the debate to ensure that another side to the story is told. There is a lack of fairness and balance in our society. The 150 [135] people on hospital trolleys and the 3,000 people with intellectual disabilities waiting for respite care, day care and residential care are a symptom of the lack of justice in our society. The State Airports Bill can be rushed through the House but where is the disability Bill? Why are people left waiting for services? There is a lack of interest and commitment to people with disabilities and this debate indicates the priorities of the Government. There is no benefit in having a vibrant economy and refusing to share the wealth and resources. I challenge the Minister for Justice, Equality and Law Reform, Deputy McDowell, on this issue and his lack of social conscience. What did tax cuts do for people on hospital trolleys or children with disabilities seeking services?

These are the difficult questions for the Minister, Deputy McDowell, and his right-wing clique who are damaging this country. They appear to be obsessed with anything in State ownership. I raise this question as a warning regarding their real agenda in the long term, namely, privatisation. This Bill might seem like a compromise but we must beware of their future plans. The Minister for Transport, Deputy Brennan, appears to have been bitten by the PD bug and it is time he was given a shot in the arm to cure this tax-cutting, deregulation and privatisation disease which is now getting out of control.

We must also challenge the whole issue of business plans or, more important, the lack of them. If I were to open a little corner shop tomorrow or start a small business, nothing would happen. No doors would open until it was costed, planned and a serious business plan put in place, therefore, how can anyone split up and destroy our airports without a decent plan? We need an overall plan with vision and which addresses staff and national interests, which is important in an island nation. This is the way forward. One must examine new ideas and more development, which I would welcome, but above all, one must do the sensible thing in regard to Aer Rianta.

When one examines the details of the legislation, one will see that the purpose of the State Airports Bill 2004 is to provide the necessary legislative basis for the restructuring of Aer Rianta and the establishment of Dublin, Cork and Shannon airports as independent airport authorities under State ownership. The Bill provides for Aer Rianta’s mandate to be changed by ministerial order. On the day this order is made, a new board will be appointed to replace the Aer Rianta board and Aer Rianta will be renamed the Dublin Airport Authority.

The Bill also provides for the establishment of Cork Airport Authority and Shannon Airport Authority, which shall enter into such arrangements as agreed with Dublin Airport Authority for the performance on its behalf of functions covering Cork and Shannon airports, respect[136] ively. On the Cork and Shannon appointed day, the Cork and Shannon authorities will have the relevant airport assets vested in them and will assume full responsibility. The Bill also provides for the amendment of the Air Navigation and Transport Acts 1963 to 1998 and the Customs-free Airport Act 1997. These are the nuts and bolts of the legislation. These are the issues with which we are dealing today. However, they need to be changed radically in order to make the Bill more effective. As it stands, it is not effective and has the potential to cause a major crisis in the Irish aviation industry and damage seriously the social and economic interests of the Irish people. Hence my opposition to the Bill. I urge all Deputies to reject the legislation as it against the interests of the staff and taxpayers.

I encourage the Minister, Deputy Brennan, to listen to the views of the staff and people who have a genuine interest in the aviation industry. It is important for him to listen to people who have a commitment to this country. I am concerned about the way in which the Bill is being rushed through the House. People and taxpayers have views and people who are elected on these issues should be listened to. It is with regret that I will be opposing the Bill.

  Mr. Carey: I welcome the opportunity to say a few words on the State Airports Bill 2004 and I do not do so as a starry-eyed ideologue of either privatisation or State ownership. Perhaps it would be wise for all sides to take time to reflect on how Irish commercial and industrial policy has evolved over the years and to acknowledge the significant role State companies have played in that development. We think about companies such as the ESB, Bord na Móna, the Irish Sugar Company, Irish Shipping and so on. There have been companies that have been very successful and companies that have gone under — forgive the pun when I talk about Irish Shipping. I am referring to companies like Bord na Móna, which was able to respond to the demands of the day by exploiting our peat lands, to develop its technologies to produce moss peat and peat briquettes and still has a research and development ethos. It does not matter whether such companies are in State ownership or private ownership because they are dynamic and evolve organically.

This year we are celebrating a jubilee of the first dam the ESB built at Ardnacrusha. This company is a shining example of what can be done when given the flexibility by its shareholder to respond to the needs of an evolving market. Given that we are talking about Ireland being the most globalised economy in the world, surely it makes sense that we position our industries so they can benefit to the maximum extent possible from globalisation. I know some people in this House condemn globalisation as a philosophy but [137] it is here, we can benefit from it and it provides opportunities.

We can also recall companies like Irish Shipping which, because it was not able to respond to market forces and the Government did not invest in it or have faith in it at the time, went out of business. I believe with hindsight this was a mistake because we would have been able to benefit more from the INTERREG programme if we had a vibrant shipping industry. However, that is in the past. Unfortunately, Opposition Members were associated with that decision. I do not condemn them because they took what they thought at the time was the best decision.

We have seen how Bord Gáis has transformed towns, villages and industries by exploiting our natural resources and providing pipelines throughout the country to homes and industries. We can see the difference it has made to the economy. This has happened because the Government — I cannot remember which Government — had the courage to allow Bord Gáis the flexibility to respond to challenges in the market and the economic environment.

There are more recent examples. Some of us were small shareholders in Eircom, a public company, and we can see what happened to it. It certainly needed investment but it became overnight a private monopoly and much profit was made. That was badly handled and badly timed. It was not the best decision any Government has made but it stands as a good example of what we should not do. Let us consider instead the cases we have handled well, such as the ESB, Bord Gáis and Irish Sugar. We are now discussing the contribution made by Aer Rianta. We have debated the contribution Aer Lingus made and is still making to the Irish and international economy. Aer Rianta has also made a contribution and has the potential to make a major contribution to the Irish and international economy into the future.

This is not a deep insight, but there is a need for sensible, level-headed pragmatism in the way in which we deal with this issue. We should not be driven by a particular ideology or a political philosophy. We need to think things through. I had some reservations about the way in which the Minister proposed to deal with this issue but, on balance, what he is doing will turn out all right. Developing business plans for the three authorities is the right way to go, provided — this is an important proviso — there is consultation with all the stakeholders in the regions and the companies. There is substantial talent among the workers within the companies and in the communities served by those authorities. Provided there is consultation, Aer Rianta will make a major contribution to Irish aviation.

There are pitfalls, however. We need to consider what happened when FLS, as it is now called, grew out of Aer Lingus. There were difficulties, and there is no point in pretending there [138] were not. Some difficulties still exist, such as the issue of pensions which is still of concern. There are retired workers from Aer Rianta and FLS who still talk to us about the injustice, as they see it, that arose out of the different ways in which pension issues were dealt with.

There are other areas, however, on which I take my hat off to the Minister and his predecessors. People have been critical of the break-up of CIE. There was an opportunity there which has been exploited by Dublin Bus, for example. It is a good public company which serves the community very well. I have been critical of its management for many years, but because of the investment that has been made in it by this and the previous Government and the flexibility it has been allowed, it is now quite a good company. Iarnród Éireann, similarly, will be an extremely significant contributor to the growing economy in future. We have models of best practice provided we learn the lessons.

I commend the Minister and all associated with the pay talks and other discussions that took place on ensuring that everybody’s views were respected and taken into consideration. I do not think everyone would agree with this. It would be a sorry thing if everyone agreed that things are hunky-dory. There will always be varying ideological positions. The Irish Congress of Trade Unions has a particular ethos and I respect that. However, it should recognise that the companies will be staying in State ownership and will be given a great deal of flexibility. I compliment ICTU and the trade union movement on the way in which they have encouraged their members to avail of the opportunities of flexibility provided by joint ventures and private investment in State and semi-State companies. I do not think there is anything for them to fear.

The Minister knows that Dublin Airport is close to my constituency. It is a very important player in the community I serve. The House must forgive me if I speak with a special interest in Dublin Airport. I pay tribute to the work done by the staff of Aer Rianta. Nobody can deny the major contribution they have made and they are to be commended on that. I am delighted this legislation means their destiny is in their hands. There are approximately 1,400 Aer Rianta workers at Dublin Airport alone providing operational, cleaning, maintenance, car park, retail, management, safety and security services among many others.

It annoys Aer Rianta workers when they are held responsible for work they do not do. Today I heard some of my colleagues on this side of the House criticising what happens at Dublin Airport. Let us remind ourselves that Aer Rianta does not provide check-in, baggage handling, flight catering, fuel or ground catering services at Dublin Airport. Its workers have often been unjustly blamed for incidents at the airport which [139] are entirely beyond their control. They are not responsible for the delays in obtaining taxis. They are not responsible for the distance that must be travelled from the long-stay car park. These are issues that need to be considered.

Aer Rianta workers are the people who provide the facilities that allow an aircraft turn-around time of about 25 minutes at Dublin Airport. It must also be emphasised that Aer Rianta workers have never been a burden on the taxpayer. Indeed, they have made a notable contribution of almost €300 million to the Exchequer over the past two decades.

While the destiny of the workers may be assured, the number of destinations for the passengers who use Dublin Airport greatly needs to be expanded. The possibility of a second terminal should be critically examined as part of the business plan. In that regard, it should be borne in mind that a great deal of traffic already comes into the airport. Can it accommodate an additional terminal without placing a major burden on the north Dublin community? We do not have a metro system, although we need one. I urge the Minister to ensure that while he has this brief as a member of the Cabinet, he advances the idea of building a metro from Dublin Airport to the centre of the city. It would make a major difference to transport in the city and to Dublin Airport. If that is not done, the people of north Dublin, including the Ward, Finglas, Ballymun, Swords and Malahide will be crucified with the additional road traffic along with increased aircraft traffic.

I have asked before why we do not exploit the potential of Casement Aerodrome in Baldonnel. It has enormous possibilities. We often hear Michael O’Leary talking about getting things done. Ryanair, with which I have flown, flies into many airports in mainland Europe which are jointly operated by military and civilian authorities. Why can that not happen in Dublin? I often wonder whether the reason is that some important political people who represent the area around Baldonnel do not want noise annoying the cattle and so on. I know additional roads would be required, but it has significant potential.

  Mr. F. McGrath: I am not familiar with that part of the country.

  Mr. Carey: The Deputy should brush up on his geography.

Baldonnel Aerodrome should be utilised more. By way of providing a little history, the former First World War Royal Flying Corps base at Collinstown in north Dublin fell into dereliction and disuse during the 1920s. To provide for regular air services the military field at Baldonnel was initially used. Then, with the establishment of Aer Lingus in 1936 providing more regular air [140] links, the decision was made to open Collinstown for civil aviation. Prior to that the grass strip at Kilshane was used. Kilshane is now absorbed into the broader Finglas community.

  Mr. F. McGrath: The Deputy is good on history.

  Mr. Carey: Absolutely. The Department of Transport confirmed last March during an industrial dispute that it was exploring the possibility of using Baldonnel Aerodrome to cater for some flights, probably those connected with EU business, in the event that airport strikes were likely to go ahead. Surely, with the existing facilities at Dublin international airport under severe pressure owing to congestion, a civil terminal should be developed on the Baldonnel airfield. A number of private businesses have been interested in private civil aviation in Baldonnel. However, a wider and more extended use in terms of commercial civil aviation would require a very substantial investment and major planning and consultation. I agree with what the Tánaiste said this morning or yesterday morning regarding a second terminal wherever it may be. It should not be owned by one single airline but should be held by the airport authority, whether it is in Dublin Airport or Baldonnel.

In 2002 Dublin Airport was the second fastest growing European airport, with more than 15 million passengers using it. There are more than 180,000 movements by aircraft on 123 routes by 70 airlines. Dublin Airport serves many different markets. More than 50% of the passengers travel to and from the UK, 30% to and from London, just over one third travel to and from Europe and about 5% travel either domestically or across the Atlantic from Dublin Airport. Dublin Airport, therefore, exerts a significant positive impact on local, regional and national economies. By 2023, given development, the airport will support more than 51,000 jobs and will generate more than €3 billion worth of annual income to Ireland. By contrast, if a new runway is not constructed and the development of the airport is constrained by 2023 the total employment supported nationally by the airport will fall slightly from its current level. What is being proposed at the moment will facilitate a greater expansion of the airport.

One of the core activities for any airport, whether Aer Rianta or a new airport authority, is planning. Much planning, particularly forward planning, has taken place between Aer Rianta and, originally, Dublin County Council and now Fingal County Council regarding how best to use the lands that have been acquired over the years in Airside and elsewhere around the airport.

My concern about this measure is that if there is a halt in planning — I believe there will be anything up to a 25 year lead-in time before one sees a serious turnaround in the value for money [141] in an airport development — we will lose much of the momentum in the Dublin area. Tourism in Dublin city has thrived in the past 15 to 20 years. I remember when the former City Manager, Mr. Frank Feely, used to bemoan the fact that few if any tourists coming to Dublin stayed in Dublin. Now, most who come to the city stay in it. Many complain about the congestion caused by the parking of large coaches at Trinity College and elsewhere but that has been the fruit of some of the planning by Aer Rianta, Dublin City Council, Dublin Tourism, Bord Fáilte and others working together.

  Mr. F. McGrath: The tourists cannot have a smoke. The Deputy should await next year’s figures.

  Mr. Carey: I welcome this measure. It is important when the three boards are working up their business plans that they engage with the existing management, workers, trade union interests, groups such as the chamber of commerce and industrial interests. There was much talk about the Shannon Free Airport Development Company. Let us not forget that around the Blanchardstown and Swords areas there is a greater concentration of warehousing and logistics than in any other part of the country. I venture to say it has grown so fast that it will be more important than any other destination in any other part of Europe. The port tunnel will come on stream soon. I know Deputy Finian McGrath cannot wait to welcome the positive contribution it will make to the city, taking thousands of trucks per day off the streets of Dublin.

The expansion of the M50, the improvement of the road network and the development of the North-South economic corridor will make a huge difference to north Dublin. The measure proposed by the Minister will make a positive and significant contribution to the development of a vibrant aviation sector. I hope the low cost airlines, the existing ones and others, which are always preaching to us about the need for competition, will buy into this measure courageously, with a sense of adventure and a sense of the challenge which is being offered by the measure being promoted by the Government.

  Mr. Coveney: I propose to share my time with Deputy English.

I am glad to have the opportunity to speak on this Bill. I am also glad the Minister has stayed throughout the day for the debate. That is helpful. I will make only a few points as I have only about three minutes in which to do so.

One of the problems of this legislation is that as the debate has continued on the so-called break-up of Aer Rianta the goalposts have been moved a number of times. My understanding at the start of the process was that Aer Rianta would remain as an umbrella organisation, a [142] national airport authority, and that Cork and Shannon would be given far more autonomy regarding their decision-making capacity and so on, but that the parent company, Aer Rianta, would be there backing them up. That was also the understanding of workers, particularly in Cork and Shannon, who were somewhat reassured by that. That has changed. Now it is clear that what we are trying to do is effectively end Aer Rianta as an entity and instead set up three airport authorities in Cork, Shannon and Dublin which will in time be independent.

7 o’clock

There are some concerns regarding the transition which the Minister might address. It is stated in the legislation that Aer Rianta will be changed in name and that a Dublin Airport Authority will be set up almost immediately. Over a period of time if Cork and Shannon can put business plans together and prove themselves viable the Minister will set up airport management companies for Cork and Shannon. What will happen if, as I believe is likely, Shannon cannot prove itself to be viable and Cork does? From what people such as Mr. Noel Hanlon have said, that is a likely scenario, not merely a possibility. What happens then? Will Shannon remain under the control and management of the Dublin Airport Authority? Will Cork go it alone? The situation that Cork people have feared will then arise, which is that Cork Airport will be in competition with Dublin and Shannon as the one entity.

I am in favour of giving Cork and Shannon their own decision-making capacity because both areas are very ambitious for their airports and an element of competition is positive. Cork has shown huge progress in the last decade on a range of areas around the airport. I ask the Minister to consider that eventuality because it will cause huge concern in Cork if the airport there ends up in competition against the other two airports.

Debate adjourned.