Deputy John Wilson and Deputy Bertie Ahern have been given permission to put a question on Private Notice to the Minister for Communications.
Private Notice Questions. - Cessation of Independent Airline's Services.
andMr. B. Ahern asked the Minister for Communications if, in view of the serious implications to the economic and social development of a number of regions and the loss of jobs due to the cessation of Avair air services, he will indicate the circumstances under which the cessation occurred, the policy of his Department regarding the development of this type of private enterprise air service and whether he is prepared as a matter of urgency to take any steps open to him to enable Avair to resume operations.
I was informed by Avair on the afternoon of Thursday, 23 February 1984 that the financial circumstances of the company were such that, without a commitment from the Government to provide Exchequer assistance of about £400,000 over a very short timescale, the airline would have to cease trading almost immediately. I was further advised that Avair's bankers had been informed of the financial crisis and that it was Aviar's intention to notify their staff of the position and to hold a press conference announcing a cessation of services within a matter of two hours. Avair also made it clear that, in addition to financial aid, they would require me as Minister to grant them additional traffic rights to make their operation viable. After careful consideration of the position within the limited time that was available to me, I advised Avair that I was unable to provide them with the financial assistance required.
On the matter of my policy in regard to the development of air services by Irish independent carriers, I have made my position clear both inside the House and elsewhere on a number of occasions. In March of last year, and within a short period of taking up office as Minister, I broke with long-established precedent and authorised private Irish carriers, including Avair, to provide services to mainland Britain. I might add that this policy initiative was taken despite strong opposition from Aer Lingus and the Irish Congress of Trade Unions. Despite the difficulties which Avair have encountered, my policy initiative was taken in the best interests of developing civil aviation within Ireland.
I am aware that the cessation of services by Avair has implications in terms of both internal operations and services to mainland Britain. The position at the moment is that a receiver has been appointed to Avair and, while I am keeping in close contact with the situation, I do not wish to do or say anything that might pre-empt his scope for action.
In conclusion, I would wish to state that I fully appreciate the difficulties involved in successfully mounting international scheduled air services and it is a matter of great regret to me that the efforts which Avair have made to build up a highly professional airline are now in jeopardy. At the same time, I must state that many of the statements made by the managing director of Avair do not accord with the facts and do no justice to the exceptionally favourable treatment which I, as Minister, have given to that airline and other private airlines since I came into office.
Will the Minister agree that his refusal to grant licences to Avair to fly into certain areas and to provide certain services both internally and externally contributed to a great degree to the demise of this company? Will he also put on the record of the House that he brought this matter before the Government before he took the stand he took?
I refute absolutely the implication of Deputy Flynn's question. The application was before the Government from July 1982, and I am not surprised that Deputy Wilson is not in this House to ask the question which he tabled. On the applications which were presented to Deputy Wilson six months before he left office I decided in a matter of ten to 12 weeks. There was no discussion on this matter at Government level before the matter was brought to my attention.
Would the Minister agree that had he granted the licences sought by Avair he could have averted the collapse of this company? What measures does he propose taking now in regard to major centres such as Cork to cater for the tourist traffic and industrial development traffic that was being generated by Avair?
The only international route for which Avair applied and did not get was Dublin-Leeds-Bradford. In March of last year I granted them the Dublin-East Midlands route, the Dublin-Blackpool route and the Cork-Jersey route. In September of last year they applied for the Cork-Isle of Man route and a decision in their favour was made by me at the beginning of this year. In November of last year they applied for two other routes, Cork-Manchester and Cork-Birmingham, on which a decision was imminent. This is in contrast to the delays which Avair endured during the time Deputy Flynn's party were in Government. I should also say that last March, within three months of coming to office, I granted also extensive rights to Aer Arann Teo. within Ireland and between Ireland and the UK. Earlier this year I granted a freight service route to Shannon Executive Aviation Ltd. The House should welcome this new initiative in aviation policy to open up aviation to independent carriers because I believe that it is in the interests not only of the country but also of the consumer and even of Aer Lingus.
(Interruptions.)
Order.
The Minister should be reminded that it was a Fianna Fáil Government who introduced the subsidy for Avair——
The Deputy will ask a question, please.
——to fly into Derry. He will be reminded also that it was Fianna Fáil who started the whole question of internal flights in this country.
The Deputy cannot go on making statements.
(Interruptions.)
I would like the Minister to reply. Before pulling the rug from under this essential internal and external service, did he consider providing them with a small subsidy to keep them in flight and would he consider, in view of the 80 jobs of which he has now brought about the termination and which normally would cost in the region of £800,000 to create, that it is worth while reviewing the situation and allowing Avair to continue the services they have built up?
Deputy Flynn is correct that during the term of office of the Fianna Fáil Government developments in internal air services took place and credit should be given for that. It should also be said that Avair only approached this subject with the Department throughout its developnment as an internal service and never was the question of external services raised at any stage until July 1982 when Deputy Wilson was Minister. A decision was not taken on that until I became Minister at the end of that year.
In relation to services vacated by Avair I have been making contingency plans but it would be improper of me or my Department to develop on those plans or announce them until such time as the receiver's intentions are clear. It would be very wrong of me to pre-empt his actions.
Is the Minister aware that 80 employees of Avair have decided to remain together as a group in the hope that some possibility may emerge which would enable the operation to continue in some shape or form? Will the Minister keep in mind that those employees are there ready to provide their expertise, knowledge and experience to any potential investor or any other group that might feel that there would be an opening in the type of situation that Avair have, unfortunately, ceased to operate in? Will the Minister agree with me that in so far as he was granting concessions — I accept that he did grant them and we all acknowledge that fact — internally to private enterprise operators like Avair and others he was fully in a position to do so because Aer Lingus were not interested in that type of situation and, rightly or wrongly, completely neglected any possibility of——
This is argument and the Chair is ruling it out.
It is not argument. Will the Minister agree that these people stepped into this situation because of the continuing failure of Aer Lingus to do anything about it?
I believe the Deputy misunderstands the position. I did not grant any internal routes to Avair because, as I said, it was his Government who had already granted those routes to Avair. I did say that I granted internal routes to Aer Arran. However, I will bear in mind what the Deputy has said. I am keeping in close touch with the position.