I asked about the present position at Shannon. Perhaps the Minister would let me know.
Air Transport Bill, 1984: Committee Stage (Resumed).
Debate resumed on amendment No. 2:
In page 2, line 31, to delete "mail or other cargo".
—(Deputy O'Malley.)
The position is that Federal Express will have a hub in Brussels with certain connection flights in and out of Shannon. I can communicate the exact details to the Deputy as far as I have them.
When was the decision taken? Was the Minister given any reason why the venue was changed from Shannon to Brussels?
There is no change from Shannon. I understand the company concerned were looking at different possibilities but their main business was to mainland Europe. I understand they wanted a hub on mainland Europe but there will be some business coming into Shannon.
I spoke on the amendment before lunch and the Minister replied during a five minute period before the lunch break in terms which had very little to do with the amendment but which had much to do with me. I appreciate that you, Sir, were not in the Chair at the time but I hope I will be given the same latitude to reply to the rather strong, personal criticism that was voiced of me.
If the Deputy is in order he will be entitled to speak.
On a point of order, I replied to the points made by the Deputy and highlighted the fact that he made erroneous assertions throughout the debate including ones which I ask him now to withdraw. There was no personal attack involved.
That is not a point of order.
I do not want to quibble about this but just to demonstrate my difficulty in the matter, I spoke for 20 minutes on this amendment regarding mail and other cargo. The Minister stood up and said there was no validity in any of the points I made and referred to various things I said the last day and to statements which were issued in response to that. Since I issued a statement in response to them which, so far as I am aware, was not published and since it is directly relevant to what the Minister said before lunch, I want to take the opportunity now to read the statement I issued on 2 May.
I do not want to anticipate the Deputy's contribution but we are on amendment No. 2 and I appeal to Deputies to stay on that amendment.
I did this morning but the Minister did not deal with it at all. He dealt with other matters that were referred to the last day and to statements which were issued after the debate the last day. While I appreciate it may not be directly relevant to amendment No. 2 it is the only opportunity I have to reply to that.
It may be more relevant on the section or on Final Stage. It is not relevant now.
I will leave it until we are dealing with the section, in deference to your ruling, but the Minister was allowed to deal with it in some detail. Presumably now the Press have a version of it which they will print in good faith without the person who was attacked having an opportunity to reply.
I do not want to mislead the Deputy. I do not know what he intends to say. I said it may be in order on the section. I do not know if it will until I hear it.
We will be hopeful that it will.
Hope keeps us all going.
This morning in his reply, almost none of which was devoted to what I said today but rather to what was said by Aer Lingus and others arising from the debate the last day, the Minister referred to the fact that I referred to the CAB in 1983 as regulating the fares with zones of flexibility. The Minister said to the House that here was Deputy O'Malley who would allow the CAB to make these regulations and expect us to have no controls here. It is a matter for outsiders to judge who is right and who is wrong in this matter but the fact is that the Minister's familiarity with the situation in spite of all the advice available to him in the House is, not for the first time, somewhat suspect. The CAB was abolished on 31 December 1984.
It was the Deputy who raised it.
It cannot regulate charges or anything else. Therefore in asking that cargo charges be not regulated here in the sense of minimum charges being fixed for mail or other cargo, I am only asking that the same be done here as is done in the United States which is where a lot of our cargo traffic is to and from. It does not put us at a disadvantage.
It is no harm to remind the Minister that the thinking in the US is so strong against regulation that it was abolished last December by the President with the full agreement of Congress and with what was described as the enthusiastic support of the administration in the US. That is the reality and not what is represented in this Bill which is the opposite of the trend in the US and Europe.
On the Second Stage debate here last June, there was a long argument between myself and the Minister of State on the question of fares between London and Amsterdam, when I said that it was £49 for the return fare. I was interrupted on two or three occasions to be assured that that was not the case. A month or two later I got a letter from the Minister stating he regretted that he was wrong and that he was sorry. There are many instances of that kind of thing and it is not enough for the Minister to assert blandly——
These comments are not relevant to the amendment.
I gave a detailed argument this morning as to why it was inappropriate that controls should be put on cargo and mail charges. I stated that it was illegal in regard to mail to force people to tender——
This section merely defines certain expressions or words. The relevant matter now is whether airline tariffs should apply to mail or other cargoes.
I have been arguing that it should not apply to mail and cargo. I have sought to delete those words and I have given a lot of reasons why it is inappropriate that mail and cargo, which on the Minister's admission are not controlled at present, should be controlled in future. The Minister has not replied beyond saying that there was no validity in what I said. He then launched into matters which were discussed the last day, which are not connected with this, and I hope to reply to that if I am allowed to do so.
I made compelling arguments this morning why it would be damaging to this country to control cargo and mail charges. Control in this context means keeping them up and over a certain level, not under it. This is damaging to industry and, although the IDA cannot say anything publicly about it, I am sure they are horrified at the prospect. The CII do not want to say anything about it publicly either for reasons which some of them explained to me. A particular airline is one of their members and the member does not want to say anything publicly but, privately, they are very annoyed. CTT are also annoyed, but again because they are a public body they cannot say what they feel about it.
Under EC regulations the carriage of mail has to go for public tender and, unless the airline which provides the lowest tender is very unsuitable from a safety point of view, the contract would have to be awarded to them. However, there cannot be a lowest tender if this Bill is passed containing this provision. Everyone will have to tender the same amount; they will all be lowest tenders. That is wrong and in breach of EC regulations. It is a bit of a joke because other countries are dying to get people to tender lower and lower for various services and here we are pushing them up.
I am sorry that Deputy O'Malley is so sensitive. He accused me of making a personal attack on him but I did no such thing. I highlighted the fact that in the last debate Deputy O'Malley made three major errors of fact in his contribution and I invite him to deny that he made those mistakes——
I have done my best to keep Deputy O'Malley to the amendment and I have succeeded fairly well. I have to do the same in the case of the Minister.
I appreciate that but I am making the point that Deputy O'Malley in his contribution this morning again raised several points which had no validity or basis in fact.
Deputy O'Malley wanted to reply to the Minister but I would not allow him to do so.
In his contribution this morning, Deputy O'Malley said things which were erronous or misleading.
I am sure other sections of the Bill will be a great platform for that.
May I deal with the question which Deputy O'Malley raised?
I am encouraging the Minister to deal with the amendment.
I am trying to deal with the amendment and perhaps you would bear with me for a moment. Deputy O'Malley revealed to the House that the CAB were abolished on 31 December 1984. I am aware of that. The powers of the CAB have been transferred, lock, stock and barrel to the Department of Transportation. Therefore, there is no change in the powers and the Department of Transportation in the United States have precisely the same powers which I am seeking here. I should like to ask Deputy O'Malley if the civil aviation authorities in Britain or France have these powers. I can tell him that they do have these powers and we are seeking the same powers. I tried to cite three major errors of fact in Deputy O'Malley's contribution the last day which got very wide publicity, because he is a highly respected and newsworthy Member and what he said is more likely to be reported than contributions from other Members. It is a pity that these errors are stated as fact in the daily media. Aer Lingus and Dan-Air made corrective statements which did get publicity but not nearly as much as the original statement. Deputy O'Malley is again making errors of fact and, although I have the highest personal regard for him, he is wrong in relation to this amendment.
I am glad to welcome you back to the Chair, a Leas-Cheann Comhairle, because you were here this morning when certain matters were dealt with which I hoped I would have the opportunity of replying to. I did not get such an opportunity but perhaps I will now. The Minister accused me of errors of fact but I do not know what they are. It is all very petty. He said that the CAB had powers and that I was trying to deprive him of the same powers. However, he agrees that that body are abolished——
I agree with their abolition. The Deputy is promoting the idea of having a separate aviation authority here and they are doing the opposite in the United States.
What is the error of fact? I said that the CAB were abolished. In view of what the Minister said before lunch and again now, could I read a statement which I issued on 2 May dealing with the various matters to which the Minister referred?
Is it relevant to the amendment?
It is certainly as relevant as it was at 1.25 p.m. today.
If it refers to cargo, it is relevant.
I feel entitled to reply to things that were said before lunch today and I should like the permission of the Chair to read this statement, which is not very long.
Is it relevant to the amendment?
It is no more relevant than what was said before lunch——
A passing reference is in order.
This statement was not published so I am anxious to refer to it. I said that I noted with interest the partial denial by Aer Lingus of my statement to the Dáil regarding proposed additional services to Ireland by Dan-Air. I said that in the early part of the year discussions took place at a high level in relation to this proposal in which two Irish State agencies were involved and that I was satisfied as to the accuracy of my sources.
I also said it was noteworthy that the Aer Lingus denial as reported does not make reference to what I said regarding the withdrawal of Dan-Air from the booking computer. It is worth making passing reference to the Dan-Air statement which was very short. It said that discussions with British Airways and Aer Lingus did take place in January to consider a proposal by Dan-Air to introduce lower promotional fares to and from Ireland, but after careful consideration of all the implications, including the response of other carriers and the present Ireland-UK bilateral position governing fares, it was reluctantly decided not to proceed with a formal filing to British and Irish authorities. It went on to say that, if, however, a more liberal tariff régime were to exist, Dan-Air would welcome the opportunity of being able to introduce a more innovatory package of air fares for travel between the two countries. That is the entire Dan-Air statement.
Now let us get back to cargo.
It is worth drawing attention to the fact that that statement does not deny one syllable of what I said, nor could it. I had what I said the last day confirmed once again by reputable sources in this country. In so far as that statement says positive things, it agrees with everything I said the last day. I did not make the suggestion, as the Minister implied this morning, that he had turned down these fares. He did not. He never got them. I made that point the last day.
The points I made about cargo and mail have not been replied to and if the Minister feels he cannot reply to them, or that there is not much to say in reply to them, then he should accept the amendment. He told us these are not subject to control at the moment and that he does not propose to use the controls relating to cargo and mail, but if that is so, there is no need for them and they should not form part of our legislation. In my view, he should leave out the few words I suggested in my amendment.
Deputy O'Malley said I did not reply to those points but what we are seeking here is exactly the same enabling powers as most other civil aviation authorities have, including the United States which have deregulated internal affairs only. Up to now we have not used those powers and I hope we will not have cause to use them, but they can be used not just to prevent predatory low price fares, but also to prevent high prices——
We are on cargo.
——high prices cargo. It would be very unwise to delete these words.
Amendment put and declared lost.
Amendment No. 3. is consequential on amendment No. 13. By agreement amendments Nos. 3 and 13 and amendment No. 1 to amendment No. 13 will be discussed together.
I move amendment No. 3:
In page 2, between lines 35 and 36, to insert the following definition:
"‘the register' has the meaning assigned to it by section 5;".
The purpose of this amendment is to include the definition of the term "the register" among the definitions in the Bill. This amendment must be read in conjunction with amendment No. 13 to section 5 which makes provision for the keeping of a register of airline tariffs submitted for the Minister's approval and of airline tariffs upon which a decision has been given. The proposed register is very much a consumer-oriented provision. Its purpose is to give the public and interested parties an opportunity if they wish to study and comment on tariffs proposed by carriers.
I have no objection to this amendment. I was going to agree to amendment No. 3. I put down an amendment to amendment No. 13 to add further criteria. I thought I could argue that when we reached section 5. I have no objection to the definition or establishment of the register.
We agreed to take these three amendments together but they will be decided separately.
I did not know that until now, and I am not sure I have all the documentation appropriate to amendment No. 1 to amendment No. 13 which is a long way down. I thought we were going to deal with the earlier amendments.
We are discussing the three amendments together. We can deal with amendment No. 3 in the name of the Minister and adopt it and then move on to accept or defeat the amendment to amendment No. 13——
I would not object to postponing discussion on amendment No. 13 and amendment No. 1 to amendment No. 13, if that will facilitate Deputy O'Malley.
That is all right, on the basis that we can discuss amendment No. 13 and the amendment to it in full.
I welcome this amendment which should help to clarify the situation.
Amendment agreed to.
Section 1, as amended, agreed to.
NEW SECTION.
Amendments Nos. 4, 12, 14, 17 and 18 are related and if it is agreed we can debate them together and decide on them separately.
I do not like not to agree, but this is very confusing because some of these amendments are quite different. Some are in my name and some in the Minister's.
They are related.
Yes, in a vague way.
There would be repetition of debate if they were taken separately because they are related. Is it agreed to take amendments Nos. 4, 12, 14, 17 and 18 together?
Agreed. I move amendment No. 4:
In page 3, before section 2, to insert a new section as follows;
"2.—This Act shall not apply to travel agents.".
The purpose of this amendment is to exclude travel agents from being covered by the Act. Under the 1965 Act it was held apparently by the Supreme Court that they were not covered by its provisions and that they were entitled to give discounts to their customers as they saw fit. It was, of course, the practice of travel agents here, as it is in every country, to give discounts where they thought it appropriate to customers of theirs, in particular to the good customers. In this connection the Minister decided that this was a loophole in the existing legislation, as he put it. It is clear when you read the 1965 Act that it was never intended to cover travel agents. It was a very erroneous belief on the part of the Minister and the Department that it should be. It is not a loophole, and bringing travel agents into this whole system of control, which will be unique in the world, is a new scene. It is not closing a loophole or clarifying a situation that existed before.
In connection with the question of competition between travel agents, complaints were made some years ago — in fact, when I was in the Department of Industry and Commerce — by various firms and members of the public to the Department and to the Examiner of Restrictive Practices about insufficient competition, as was alleged, between travel agents here. I had no great interest in the matter at the time, but apparently it was referred to the Examiner of Restrictive Practices who investigated it and decided that there was a prima facie case, at least, in relation to it. He thought he should make an order having it examined in turn and an inquiry held by the Restrictive Practices Commission into whether there was sufficient competition between travel agents.
A public inquiry was held by the Restrictive Practices Commission into the whole question. That commission produced a report and presented it in June 1984 to the Minister for Industry, Trade, Commerce and Tourism. On 1 November last in this House I asked that Minister a Parliamentary Question about when he intended to publish the report and, in particular, if he would publish it before Committee Stage of this Bill was to be taken. At that stage I understood that Committee Stage would be taken a week of two after 1 November, as we were led to believe at the time. The Minister replied saying that he would publish the report as soon as possible, would comment fully on it then, that there would be a debate on it and so on. I asked him in a supplementary question would he not agree that it was essential that it be published before Committee Stage debate on this Bill, as it was entirely pertinent to it. He hummed and hawed a little about that and said that he would operate independently and did not know much about this Bill which, while he agreed was connected, was a matter not for his Department but for the Department of Communications.
We are now in the second half of May, six and a half months later than the date of my Parliamentary Question, and we still have not seen the report of the Restrictive Practices Commission on the lack of competition between travel agents. While it has not been formally published, many people know what it recommends. It recommends that in recent years there was not enough competition between travel agents, there should be far more and that the cartel situation in which airlines and——
We are not discussing that Bill. We are discussing the Bill before us.
I know, but the Bill before us deals with whether to confine travel agents or not, whether there should be competition between them or not. I am speaking about a report of the commission, not a Bill. The report recommended that there should be far more competition between travel agents, not less. If this Bill is passed, and particularly if it is passed without this amendment taking its application away from travel agents, it will be impossible for a travel agent, even if he wanted to, to compete with any other. They will all have to do exactly the same, charge exactly the same for everything, and if they give any kind of discount they are liable to a fine, which originally was £1,000 and two years in jail but now to a fine of £50,000.
We are the only country, as far as I can ascertain — with the exception of France where an action was taken in respect of these matters against travel agents last year — where you can be prosecuted for charging too little. The French court was of opinion that the French law sustaining this matter was in contravention of Articles 85 and 86 of the Treaty of Rome and they referred it to the European Court for confirmation of that view. The European Court will hear the case next month and give its decision in October. Otherwise, I cannot find any instance of travel agents being prosecuted for charging too little. At the moment they cannot be and they are recommended strongly by the Restrictive Practices Commission to see that they compete more and issue more discounts more readily than they do.
It seems quite unreal that we should have an official report of that kind available to the Government for the last 11 months and that it should not be before this House when this House is being asked to legislate on something which is entirely relevant to the very point of that report and when the legislation that we are now being asked to pass is in direct confrontation with and contradiction to the report that was produced and given to the Government last June. The thing is a bit of a joke. What is the point of a Restrictive Practices Commission going to all the trouble and expense of holding a public inquiry? I suppose it lasted a couple of weeks and they spent a lot of time afterwards drawing up the report and coming to conclusions. The whole thing is cast aside and hidden because it would be a joke if one could stand up here and formally read out from the published report all the things which it said should not be done, including the provisions of this Bill.
The report is suppressed in the meantime, but everyone who is interested knows what is in it. It is the direct opposite of what is in this Bill — more competition, less regulation, more freedom. The thing is a farce. The Minister for Industry, Trade, Commerce and Tourism is reputedly annoyed about this Bill, and I can well imagine that. One can imagine the view taken by the Restrictive Practices Commission. What is the point of their holding an inquiry? I do not know where else such a situation could arise.
Discounting of airline tickets, which we are told in this country is a very serious crime, is a normal commercial transaction in Northern Ireland, as it is in most countries. In 1984, five million discounted tickets were sold in Britain — not just a few hundred or a few thousand by some kind of backstreet operators. It is not uncommon in this country, either. It has been regarded as a fairly normal practice by not all travel agents but many — so much so that some were prosecuted for doing it. So little was thought of it that others considered it worth while to complain about them to the Restrictive Practices Commission for not giving enough discount.
The travel agents who were prosecuted by the present Minister, a firm called Club Travel, who were selling airline tickets too cheaply had the case dismissed. That is why this Bill has been brought along. That agent was merely extending to the general public discounts which were already widely available and, according to such inquiries as I have made, will continue to be available privately to certain privileged classes even if this Bill is passed, but are not available to the general public. Among the privileged classes, of course, are airline staffs, civil servants and Members of this House. Why should Members of this House be entitled to discounts? Why, for example, should former Ministers for Transport be entitled to considerable——
That is the first I heard of that. I must say I am agreeably surprised. I did not realise that I was going to have free travel in future.
I did not realise the Minister was entitled to free travel at the moment.
I did not know of any discount for former Ministers, although it is not a bad idea.
These selective discounts will be available to certain groups but any travel agent who gives a discount to a member of the public will commit an offence. That is ridiculous. There was an interesting item in The Irish Times last September which referred to certain well-known people who enjoyed the benefit of very heavily discounted tickets to Nice last July. The full fare was more then £600 but the fare paid in that instance was in the region of £180. The question was asked in that slightly amusing snippet: who would have gone to jail in those circumstances, the distinguished Member of this House or the travel agent who sold him the ticket? This Bill was meant to be passed before the end of June. If it had been, a leading Member of this House would have committed a criminal offence, as would the travel agent who sold him the ticket. That is all documented in The Irish Times. However, because the Bill was not passed, neither of them committed a criminal offence. If the Bill is passed by the summer and if the same distinguished Member of this House wants to do the same thing this summer in respect of his holiday he could be in trouble then. I think that might bring home to the public the silliness of all this business.
As the Bill is drafted the sale of any discounted ticket to anywhere in the world by an Irish travel agent will be illegal. That applies to routes on which Aer Lingus do not operate. It applies to places such as the Far East, Australia, South America and such places where it could not conceivably be suggested that Aer Lingus would be affected. Tickets for these routes are not available through airline offices in Ireland except at full IATA rates. If the Bill is passed and applied to all travel agents here it will have the effect of raising the Dublin-Tokyo fare. I am talking now of figures operating last October but I do not think the situation has changed materially in the meantime. It will have the effect of increasing the fare from £814 to £1,994 which is the IATA undiscounted fare.
Can the Deputy substantiate that statement? Can he give me a breakdown of that £1,994 fare? Will he tell me the cost of each leg of the journey to Tokyo?
I do not know.
The Deputy does not know. The point is we do not control fares to Tokyo. We would control only the first leg which would be Dublin-London or perhaps Dublin-Frankfurt. If there is a huge increase it is nothing to do with this Bill or with this administration.
That is the point I am endeavouring to make, namely, how futile and silly is this Bill. If the ticket is sold in Ireland by a travel agent based in Ireland he cannot discount any of it even though five-sixths of the route will have nothing to do with Ireland.
That is not so. The only fares we purport to control or seek to control are fares directly in and out of this country to the first point thereafter. The Deputy should know that. We have no control with regard to onward fares.
That would be grand if we could write that into the Bill. Unfortunately it is not in the Bill.
It is in the Bill.
During the Second Stage debate——
Which should not be repeated.
—— there was an amusing incident which has a bearing on what I am talking about. I said it was a pity the Minister for Communications was not in the House and I was told by the Minister of State he was in Japan. He said the air fare from Japan was terribly high and that it would be too expensive to bring him home.
It was a good joke.
Exactly. The difference between the full undiscounted fare to Japan and the discounted fare is that one is £1,994 and the other is £814. If I were going to Japan I would wish to pay the £814 fare and I would prefer to buy my ticket in Ireland. I do not know what benefit it is to our country to operate in this way. It is simply increasing Irish payments to foreign carriers. There can be no argument in this case of acting in support of Aer Lingus.
One of the replies the Minister will probably make to this amendment is that the travel agents' association have not asked that this Bill should not apply to them. As I understand it, that is correct. However, they are extremely divided about the matter. They had a prolonged private debate and it appears a majority took the view that, even though it will stop them going through even a semblance of competition from now on, that will suit a majority of them. They will not have to compete or give even the relatively limited discount they have given up to now. From now on they will be able to tell their customers they have to charge the full fare, that otherwise they will commit a criminal offence if they reduce the fare even by £5 or £10. On that basis a majority probably took the view that they would be better off financially to some extent and for that reason they were not prepared to ask that the Bill should not apply to them. Of course many travel agents see the dangers in the Bill. They see the damage it will do and they look at things a little more widely than just their own interests. They would prefer that this Bill should not have been introduced or that it should certainly not apply to them.
I see a note I have here in relation to the Dublin-Tokyo run. If the Bill were applied only in respect of the Dublin-London leg of the journey we would have a fare of £204 as part of the total £814 fare to Tokyo. The mileage from Dublin to London is 279 miles and the mileage from Dublin to Tokyo is 6,274 miles. Therefore, for 4 per cent of the journey we would have 26 per cent of the fare, that is, assuming that the Bill will apply only to the Dublin-London leg, as the Minister has suggested. I have suggested it applies to the whole journey. However, assuming that it will apply only as the Minister has said, for 4 per cent of the journey we would have 26 per cent of the fare. That is lopsided and ridiculous. It demonstrates how out of touch we are and at what extraordinarily high levels fares are charged here. It was interesting to see in The Irish Times only on Saturday last a report of the fact that Virgin Atlantic were applying for a licence on the London-Dublin route. Mr. Branson, their chairman, was asked why and he said because London-Dublin is one of the highest priced routes in the world.
The Deputy is moving into other air space now.
I will come back to the travel agents now. I thought I had those figures but I could not lay my hands on them. I was glad I was able to do so now. I have given the Minister the figures——
They are as erroneous as all the rest of the Deputy's points.
The Minister asked me to give the breakdown of the legs. I have given them to him — 279 miles Dublin-London, 6,274 miles Dublin-Tokyo; Dublin-London is 4 per cent of the latter journey but the fare represents 26 per cent of the latter.
It is extremely difficult to deal with Second Stage speeches on each and every amendment. I think Deputy O'Malley has spoken for almost half an hour now on this one and I do not propose to spend half an hour replying.
He confined himself——
It would be a misuse of the time of this House were I to spend minute for minute replying to Deputy O'Malley, especially when so many of his points are errors of fact. It is very hard to believe that a person of Deputy O'Malley's stature can come into this House with so many errors of fact. I have drawn attention to the errors contained in his contribution the previous day. He has not been gracious enough to admit that he was wrong. He misled the House on three major points and has not withdrawn them. Today we have again an assertion that we control fares all the way to Tokyo when everybody knows that there is no direct service from this country to Tokyo, that there are connecting flights. We would control only those air fares to, say, London, Frankfurt or some other European city. Does anybody think there is any substance in Deputy O'Malley's assertion that we control the onward journey from, say, London to Tokyo? Does anybody think that the British Government or the British Aviation Authority would tolerate that for one moment? I am sorry that Deputy O'Malley persists with such misleading points.
The effect of this amendment, which seeks to delete the coverage of travel agents from the provisions of this Bill, would be to subvert a central part of this Bill and, therefore, is not acceptable. I think I am not misquoting the Deputy when I say that he has said also that the only place of which he is aware where this control exists is France where it has been challenged. Deputy O'Malley is a solicitor. I am not sure if he is familiar with British legislation. I would ask him if he ever heard of the Civil Aviation Act of 1971 and, if so, if he is aware of its provisions? Is he aware that its provisions have the very same control over travel agents as we seek here? Deputy O'Malley is repeating assertions which are incorrect.
How many travel agents in Britain have been prosecuted for charging too little?
I want to assert here, as I have done repeatedly, that all we are seeking in this Bill is the same power as all the other civil aviation authorities in western Europe, North America, indeed in the rest of the world. That is all we are seeking and Deputy O'Malley wants to deny us that. I oppose this amendment.
I should like to repeat the question I asked the Minister which he declined to answer, that is how many travel agents in Britain have been prosecuted by any of the authorities in Britain for selling tickets too cheaply? Remember that 5 million tickets were sold last year. How many were prosecuted?
I am not the British Secretary of State for Transport, I do not know how many and, given the other incorrect assertions by Deputy O'Malley, I would have to treat with a great degree of caution any figures he suggests in the House. I do not know. Certainly figures have been bandied about as to the number of illegal tickets, but they are illegal tickets, sold by British travel agents. I have no doubt that there are illegal sales and that there are illegal sales here, as the Deputy has said. But that is not a reason that there should not be the power to protect the air services in and out of this country. We have a duty to ensure a continuity of air services in and out of this country.
I might refer to one or two other points Deputy O'Malley made previously. He referred to concessions available to Members of this House and former Ministers of Transport. I have to say in this respect that certainly I am learning all the time; I was not aware of this——
Hear, hear.
There may be some concessions as far as Members of the European Parliament are concerned; I am not sure but there may be some concessions. The Deputy also talked about a distinguished Member of this House — whoever that is — who went to Nice for £180, not for the normal fare of £600. What is the normal fare to Nice? Where did Deputy O'Malley get that figure? We do not have any direct air services to Nice. Therefore, we do not have any control over air fares to Nice. If it was a chartered flight to Nice, then we do not control charter fares. It really is extremely difficult to carry on a rational, logical, intelligent debate if these assertions are going to continue, incorrect, non-factual assertions. I am very disappointed that Deputy O'Malley has continually put forward points which, in many cases, are totally incorrect, and in other cases, must be suspect and are unsubstantiated.
It is somewhat sterile, instead of answering points I made, that the Minister's only modus operandi is to get up and say: Deputy O'Malley is nonfactual; he is making mistakes or errors of fact. We are never told what they are; I do not know. I asked him how many British travel agents were prosecuted last year for selling tickets under cost?
I do not know.
He says he does not know. I can quite accept that the Minister does not know because I would suggest to him that the answer is zero. If any of them was prosecuted we would know about it because there would be an outcry. Can one imagine the British at present prosecuting somebody for charging too little for a particular service? There would be an outcry in every paper in Britain. Therefore we can safely take it that the answer is none. The only place, apart from France, of which I am aware where prosecutions were taken for charging too little was here by the Minister himself. When he found that he could not succeed in that he did an extraordinary thing: he brought in this Bill to ensure there was no way he would fail in the future, that he would be able to convict, have fined or sent to jail anyone who charged too little for a ticket. That is just silly. It is not sufficient for the Minister to get up and say: "Deputy O'Malley is factually wrong every time he opens his mouth". I am not. I have spent a lot of time on this. I know a fair amount about it, and I do not just hit it in spots, as does the Minister when it suits him, and make broad assertions of this kind.
I should like to ask the Minister if his attention was drawn to a news item in yesterday's Financial Times, a very interesting one, another interesting development in Britain in relation to these matters we are discussing.
In relation to the travel agents?
In relation to the selling of tickets under the full IATA cartel figure, that is, that complaints against travel agents and airlines for not competing, for charging fares that are regarded as too high, for maintaining a cartel, or for conspiring together to keep up prices or not to compete genuinely, are to be referred now, not to the Department of Transport but rather direct to the Office of Fair Trading, which is the equivalent in Britain of the Restrictive Practices Commission here. That very interesting news item appeared in yesterday's Financial Times. It needs to be pointed out that it is a matter of some significance because, if the same were to happen here, if we did not have just the fairly hopeless option open to us of complaining only to the Department of Communications — whose concern is to keep prices up and to prevent competition — if we could go to the Restrictive Practices Commission and say “I do not like this, these two airlines are in a cartel, they are joining together to keep up prices”, we all know the kind of reply we would get because we already know what they have said in relation to travel agents not competing sufficiently with one another. That is a very significant development in aid of the consumer, in aid of lower costs all round for everybody, in aid of competition and in aid of the general development taking place in aviation.
The Deputy is moving away from the amendment. The Deputy is spreading his wings all over the area.
I spoke about travel agents because the tickets will be sold through them and I am suggesting that instead of the complaints being made to the Department of Communications, if the Minister sees fit to follow that particular move, they should be made to the Restrictive Practices Commission who will have a lot to say about it. When we are complaining about costs and about everything being so dear we are introducing legislation on our own in order to ensure that people will be prosecuted if they charge too little. This seems to be a fairly ridiculous situation. By bringing travel agents within the ambit of this Bill we are putting an end to any possibility of competition. Competition is of growing importance in the EC and is one to which Commissioner Sutherland is making a considerable contribution. He has made a very marked contribution in the four and a half months he has been in that position. With regard to this question of competition could I read one short paragraph from an article which Commissioner Sutherland wrote in Community Report, May 1985?
I have been very lenient with the Deputy. He is making a Second Stage speech again. We are dealing with amendment No. 4 which is that this action not apply to travel agents. Would the Deputy confine himself to that amendment?
The reason I brought up this point about travel agents is that I feel there should be competition and I am not alone in thinking that. It is the very predominant view within the EC that there should be more competition. The name of the article is "How I will Deal with the Black Hole". What Commissioner Sutherland refers to as the black hole are the areas where there is no competition. He identifies air transport as one of the worst black holes in Europe. I hope he can do something about this but he will have to start here. He will have to start with this Minister and with this House. It must be very discouraging for a man, who was closely allied with the Government until quite recently, to find that some of the implacable opponents he has to his philosophy in his job are some members of the Government. There is no way the Minister for Industry, Trade, Commerce and Tourism would support the principle of this Bill applying to travel agents.
I ask the Minister to answer more of the points I made earlier. We would get through it much quicker if he did. I do not want to prolong the matter. I already agreed that we pass one of the earlier amendments without discussion. Would the Minister deal with the point I made about the report of the Restrictive Practices Commission given to the Minister for Industry, Trade, Commerce and Tourism last June which recommends the direct opposite of what is suggested here? How does the Minister reconcile the recommendations of that report with his refusal to accept my amendment now?
If Deputy O'Malley's proposal were accepted it would dilute the whole thrust of this Bill, which is to continue what has been the case in the past and what needs to be confirmed resulting from the court decision, that is that our air transport is controlled for the benefit of the country. It is right and proper in the national interest that our air transport be controlled in a proper manner, realising the consumer interest but also balancing that against the national interest. They do not conflict. In my view on most issues they are compatible. It is for the Minister to argue against the amendment but that is my view on it. I feel strongly we should have the controls the Bill envisages. I am not in favour of this amendment because I believe it would water down the types of controls that are required for air transport in the country. Various statements have been made by Deputy O'Malley during his contribution on this amendment. One was with regard to discounts which are apparently available to Members of this House and also available to former Ministers for Transport.
Does the Deputy know of any?
He said they got discounted travel. I have done a fair bit of travelling, both official and personal, in my time. As I am in the constituency where Dublin Airport is I have been as closely associated with the national airline as most Members of this House. I want to put it on the record that there was never a question of discounted fares on any social travel I have undertaken. It is important that the Minister clear the situation with regard to all Members of the House in relation to the statement made by Deputy O'Malley. If the Deputy has some information it is important that he put it on the record because he made a sweeping statement which is supposed to include the Members of this House. I have no knowledge of the type of travel he is suggesting. The public perception of it will be that the Members of this House are flying around free, gratis and for nothing. That is not the fact. It is incumbent on the Minister for the protection of Members of this House to put the record straight.
I am rather surprised at this. If there is such a facility available we should be told about it. I have never heard of it, not that I travel very much by air. I have never been offered any discount by Aer Lingus when travelling.
Are there such approved discounts available?
I have had time to check since Deputy O'Malley made that assertion. There is no such facility available to Members of this House. There is no discount travel or free travel available to Members of this House. This is the fourth major error during Committee Stage by Deputy O'Malley. It is quite disgraceful from a person of his particular standing to repeatedly make assertions which do not stand up to examination. He said I did not deal with any of his complaints. He also said there was no legislation like this in other countries. I have already replied that there is in Britain the Civil Aviation Act, 1971, which gives precisely the same powers I am seeking here. The vast majority of the civil aviation authorities in Europe have these powers.
A lot of Deputy O'Malley's argument has been that we are seeking extraordinary powers that no other country has. That is not the case. We are seeking the same powers that other countries have in order to clarify that we have them because of some doubt in the absence of a court decision. Deputy O'Malley as a solicitor can be presumed to know the law. He has made much of the report of the Restrictive Practices Commission, the responsibility of the Minister for Industry, Trade, Commerce and Tourism, but the Deputy should know that restrictive practices legislation, for which he was responsible for many years, excludes air services. As Minister he did not make any attempt to amend that legislation to include air services. It is a bit much to take these repeated fallacies which do not have any basis in fact.
If we were to accept Deputy O'Malley's amendment we would be up-turning the Bill. The fact is that a ruse was used by one airline with one travel agent to the exclusion of all others. There was no competition, with an offer to increase the commission to 20 per cent or whatever, and the agent was told to keep half of it and pass on the other half. It was a way of circumventing the legislation which exists to protect the continuity of air services to and from the country. As a former Minister for Industry, Deputy O'Malley should know the crucial importance for industrial development of having a continuous air service east and west of the country. The Deputy has fallen for propaganda. When he looks at what the British, the Dutch, the Americans or the Germans do he should realise that none of them is running to abandon their national interests. He is proposing that we abandon ours but I am not going to do that.
As it has been mentioned I should like to say something about the contribution of Mr. Sutherland to Community Report. He started off with the laudable sentiment that competition was not to be pursued for its own sake but rather because it is an instrument for promoting a harmonious development of economic activities, a continuous and balanced expansion, and an accelerated raising of the standard of living. He went on to say that he would concentrate on three areas — legislative framework, enforcement of the law and distortions. With regard to “black holes” he said:
One example is the missing regulation of the Council of Ministers regarding the introduction of a control on concentrations and mergers;
He went on to mention the one which I presume Deputy O'Malley was referring to:
another is the missing regulations for the application of the competition rules in the fields of air and sea transport.
What we want to advert to is the fact that that is spoken in a European context and that he is not speaking to Dublin merely but to ten capitals as Commissioner. It is our view, and I am sure it is the view of the Minister, that a limited form of regulation is necessary. When Mr. Sutherland is speaking to the Ten I am sure he is aware that all ten Governments in one way or another practice some form of protection policy.
The Fifth Freedom of the Air is the privilege of one State to take on passengers, mail and cargo in another State destined for the territory of a third State and the privilege to put down passengers, mail and cargo coming from any such territory. It is well known that other members of the Ten have refused that type of right to our carrier, Aer Lingus. As I understand it, Aer Lingus are anxious——
I regret to interrupt the Deputy but, while I appreciate the argument he is making, he is moving away from the amendment which states that the Bill shall not apply to travel agents.
It is precisely about travel agents, and their freedom to act, that I am talking. I am talking about travel agents. If a travel agent wants to pick up somebody in Manchester and to take that person to Frankfurt he is in trouble because of restrictive practices, not by an Irish Government but by the UK Government. If a travel agent wants to pick up somebody in Manchester and drop that person in Brussels he is not permitted to do so by the UK Government. The same is true of restrictions that travel agents have to operate under as far as flights to France are concerned. Air France made a pitch into the business of Aer Lingus, to Lourdes specifically. If a travel agent wants the freedom to book Aer Lingus to Lourdes he is not free to do so except to a limited extent because Air France, backed by the French Government, has pitched in and said "No, Air France must get part of that business". The same is true of the Spanish Government.
The point I am making is that when Mr. Sutherland is speaking, as in the article quoted; he is speaking in the full context of the Ten. There is a certain tone in the final paragraph of his article — I will not expand on it — which I find slightly disturbing. As a Commissioner he is challenging the power and right of Ministers. The Minister for Communications is the person who makes the decisions, not the Commissioner. There are threats in that paragraph.
As far as travel agents are concerned, there may be restrictions here and I will be pushing that the type of restriction will be one that will not interfere with competitive fares and tariffs. We must remember that there are also restrictions on travel agents as far as the Governments of the Ten are concerned.
In regard to the point raised by Deputy O'Malley, I should like to make it clear that I am all for a very liberal air transport regime provided it is done together. Therefore the proposals of the Commission are welcome. The only way is to get progress throughout Europe together. We cannot unilaterally abandon our controls, as Deputy O'Malley suggested. If everybody else will accept Fifth Freedom rights, Sixth Freedom rights or Fourth or Third Freedom rights, we will welcome it and Aer Lingus will welcome it. The freer the position is in Europe the better, but it cannot be done unilaterally.
My reply to that is that we should all do what the Commission want us to do. Commissioner Sutherland made it quite clear that it was depressing for him to find that Memorandum II put forward last year by the Commission was rejected by a majority of the Council of Ministers of which the Minister is a member. That is a great pity. Will the Minister not go so far as to go along with Memorandum II? That memorandum is under criticism by some European Governments because it does not go far enough. They say it is useless, but we are not even prepared to go that far. The Minister could go that far. He is not being asked to do anything unilateral. He would then be acting in conjunction with the Commission and the other member states. Why not do that? There is no question with memorandum II of giving up controls or regulations. One only takes a very limited number of steps along the road, so limited that some Governments think it is a bit of a waste and that Europe should go far beyond that. I am only asking as a first step, and a very important first step for this country, that we go as far as the Commission ask us. Commissioner Sutherland will go to some lengths to ensure that that will happen. He says in the article:
Take one example, the air transport sector. The objective being pursued now is to open up the extensively regulated market to fresh competition within the structure of the Treaty. This is by no means an obstacle to deregulation.
I shall therefore urge the Commission to press the Council to adopt the three regulations now before it, dealing with the merger control and the application of Articles 85 and 86 to air and sea transport. Their adoption before the end of the year will be one of the Commission's priorities and far from leading the overregulations the adoption of these instruments will open up business opportunities and will constitute a positive dynamic.
He goes on to say:
The situation as regards air transport should also be adverted to. Should the proposals made by the Commission in Memorandum II not succeed, the Commission will have to consider taking further legal action. It will be recalled that its existing powers include the use of Articles 169, 89, and and/or 90.
He goes on in that vein at length in the article saying why all these regulations to air transport will have to be broken down in Europe, how it will be for Europe's benefit if that happens and how that is being recognised fairly generally in Europe; but not, unfortunately, very widely as yet in some countries. The Commissioner finishes by saying:
Freedom of competition within the market place is as crucial an element in the development of the European economy as is the elimination of non-tariff barriers.
I appeal to the Deputy again. The Deputy is going on and on.
Deputy Wilson could quote at length ——
Deputy O'Malley has been allowed a lot of latitude for the last hour and I would ask him to restrict his comments to the amendment put down by himself in relation to travel agents. We have been here an hour on that alone and at this rate of progress this Bill will still be before the House next September.
During our Presidency of the EC we spared no effort in pushing Memorandum II from the Commission, but other countries will not move on it. We will support Memorandum II, but it must be a multilateral move; it cannot be unilateral.
Is the Deputy pressing the amendment?
The only point which seems to be disputed vigorously is my reference, or part of it, to discounts being available to various groups — airline staffs, civil servants and Members of this House. Exception was taken to the reference to the Members of this House. The situation as I understand it is that Deputies going on official business can book through this House and get a 10 per cent discount. I did not suggest that they get a discount for their personal trips. It was the case that there was a discount for Deputies booking through this House on official business.
That is not the suggestion that was made.
No.
The Deputy has clarified the situation now.
I mentioned it in relation to airline staffs and civil servants and that does not appear to be disputed.
Deputy O'Malley has done a disservice to this House by suggesting something that is not true. It is true that there is a 10 per cent discount for Deputies and civil servants travelling on official Government business. There is not a discount for personal travel. Deputy O'Malley referred to former Ministers for Transport and other Members of this House and it is quite clear that he was talking about personal travel and not about official business.
It was not clear. I did not use the words "personal travel" and if I did I am glad to take the opportunity to clarify it. There is such a discount for official business. Why should it be available while it is being made illegal for other people? That is the point I was making and it is a perfectly valid point.
It is not illegal. There is a 10 per cent approved discount for official business and any other discounts that are approved are legal.
There was no such thing as an approved discount for Deputies travelling on social occasions, which was the implication made by Deputy O'Malley.
Is amendment No. 4 being withdrawn?
I would like the Chair to put it formally.
Amendment put and declared lost.
SECTION 2.
I move amendment No. 5:
In page 3, lines 1 and 2, to delete "terms or condition".
This amendment is to delete the words "term or condition" in section 2 where it says that the Act applies to any fare, rate or other charge, term or condition contained in an airline fare. While one would prefer that this Bill, if it is passed, did not apply in the way that it is intended to apply to all fares for the purpose of keeping them up and preventing people charging less than the approved fare, certainly if one is forced to go along with that one is not forced to go along with the enforcement of all these terms and conditions, which under this definition will form part of the overall fare and without which certain lower and more attractive fares and not available. These include things like various advance booking requirements, the necessity to stay over a Saturday night, for example, in certain destinations and various other terms and conditions of that kind which are attached to a great deal of travellers or at best are very awkward and unsuitable, so that people cannot avail of them.
It should not be for the Minister to involve himself in applying legal penalties to those who find it impossible to comply with those conditions. Provided one can comply with very strict conditions, there are quite substantial reduced fares available, on paper at least, but in practice we find that they are hardly ever availed of because of the onerous conditions. For example, we saw advertised in recent months a return fare of £69 between London and Dublin. It exists all right on paper. I understand that each weekend a handful of people avail of it because they have some reason for going to London. Scarcely more than a handful avail of it. It comes to less than 1 per cent of the people using the service. These conditions and terms which are applied as part of the tariff, and therefore of the application of this Bill, are so onerous as to be quite misleading. They do not deserve the sanction of the law.
On the £69 fare, the difficulty is that you must travel outward on a Saturday and back the same day or the following day, Sunday. If you go outside that, the fare does not apply to you and the normal fare of £204 applies, which is very different. Last November in a series of written questions to the Minister I inquired what proportion of people using particular routes used these different categories of fares and I was told the information was not available to the Minister and he did not know at that time what the different proportions or numbers were. I accept it when he tells me that. I find it difficult to understand why he wishes to try to underwrite all those various conditions.
The strange thing about it is that, although some of these conditions are very particular, very onerous and obviously tremendously restrictive in the number of people they could apply to, or who would be able to comply with them, airlines operating in the same cartel all have exactly the same restrictions, even though they are very unusual. One of them is this outward on a Saturday and back on Sunday. That is very unusual. When you read that there is a £69 fare available, you think it is great until you find it is impossible. I wonder whether all these conditions, including the pre-booking conditions and others that apply to other fares, should have the force of law. If a breach of them by a travel agent, or an inadvertent breach by somebody or other, or even a breach which was not inadvertent, should result in a criminal prosecution, that is going a bit far. When we move in the direction of having a smaller variety of fares, but a much more reasonable level of fares, we will have arrived at a more sensible position.
Terms and conditions are a fundamental part of airline pricing. To accept the amendment would make a nonsense of the approval process, since it would be open to an airline or agent to disregard conditions on matters such as advance purchase period, minimum stay, penalty for cancellation, and so on. This is important.
Deputy O'Malley made a great meal out of the £49 return fare between London and Amsterdam. If what he is now proposing were accepted, that would not be possible. That sort of fare is possible only under certain conditions and in certain circumstances. There is a conflict. Deputy O'Malley is making what sounds like a very liberal proposal but it is completely inconsistent with his stance on other matters. It may be that Deputy O'Malley does not know the sort of conditions that can apply to the celebrated cheap fare of £49 between London and Amsterdam which happens to be much dearer than the £69 restricted fare between London and Dublin on a per mile basis. We have to have this provision.
If the Minister would reply in straightforward terms to the points I make, rather than thinking he has to launch an attack on me each time, suggesting that I do not understand this and I do not know the other——
There is no attack.
To say that because there is a fare available between London and Amsterdam which is almost without restriction——
It is not almost without restriction.
The only restriction is that you have to book the day before you go. Otherwise there is no restriction. You can go any day of the week you like.
You are not sure of a seat back. There are loads of restrictions.
It is almost without restriction or with very minimum restrictions. To say that I would abolish that because I object to fares with very onerous restrictions is not logical. It is absolutely illogical. To argue against something which is enormously onerous and to be told by the man fate has ordained that you should argue with, unhappily for me, that you are also arguing against something less onerous is not logical. I am trying to make these fares less onerous. Consistently, but without any success, I have been trying to bring about the situation which exists under the Anglo-Dutch agreement which the Minister said he was all in favour of last November. I have cuttings here of what he said on the Anglo-Irish free trade agreement on air transport. Apparently he has forgotten about that now.
It is precisely because I am trying to bring those things about that I make these arguments for the benefit of the people in this country. If the British are prepared to enter into these arrangements with the Dutch, is there any reason to believe they are not prepared to enter into them with the Irish? Of course they are. The Minister should give up this childish thing he goes on with of telling me that because I argue against one thing, inevitably I am arguing against something else altogether. It really is childish and I do not know who it impresses.
The enforcement of onerous terms and conditions of this kind should not be through the criminal law. It would be to the benefit of all concerned if it were not through the criminal law. I do not know why the Minister wants to enforce all these restrictions through the criminal law. The restrictions have nothing to do with the cost of the transaction or the cost of the flight. They are simply devices by airlines to split markets. They should not be supported by the force of law and, in particular, they should not be supported by the force of the criminal law.
Question: "That the words proposed to be deleted stand" put and declared carried.
Amendment declared lost.
I move amendment No. 6:
In page 3 between lines 4 and 5, to insert the following subsection:
"(2) This Act does not apply to any airline tariff in respect of any flight to or from the following airports, namely, Shannon, Cork, Waterford, Galway, Sligo, Farranfore and Connaught Regional Airports.".
The purpose of this amendment is to try to ensure that the Bill does not apply to airports other than Dublin. I do not think it should apply to Dublin because the Bill is wrong in principle. I have to wear the fact that it is likely at some time or another to pass through the Houses if the Government so decide. I want to try to see that it does the least damage possible.
It is quite clear that, apart from Dublin, all our other airports are seriously under-utilised and could do with substantially more traffic than is available to them. For that reason the provisions of this Bill should not apply with all the controls, regulations, and so on, to our airports other than Dublin. I set them down: Shannon, Cork, Waterford, Galway, Sligo, Farranfore and Connaught Regional on the basis that presumably the latter will open at some time in the future. When it does open, it will be fairly substantial in size by comparison with all the others except Shannon and Cork.
It is very disappointing to look at the smaller airports like Waterford, Galway, Sligo and Farranfore and see how little business they do. What possible use or advantage is it to have all these regulations, all these criminal offences, criminal sanctions, fines and jail sentences applied to people who use those airports? Why should fares be kept up to a certain level at a place like Farranfore? What we want is to see the airports used. Similarly with Shannon and Cork; we want to see more use made of them.
For example look at the attitude Aer Rianta take in their annual report published fairly recently. Judgments on matters of this kind tend to be made, as so frequently in this country, in the Dublin context only. If it is appropriate in Dublin, it is appropriate everywhere else. If it is inappropriate in Dublin, it is inappropriate everywhere else.
I should like to look at some of these other airports and, in particular, Shannon which is mentioned in the amendment as one I should like to see not covered by the Bill if it is passed. Aer Rianta reported in 1984 a 17 per cent increase in passengers on the Atlantic route into and out of Shannon. For the same year they reported no change in Shannon's European traffic, no growth at all, and a 1 per cent increase in transatlantic traffic at Dublin. It is worth comparing the situation in Shannon between 1983 and 1984. On the transatlantic route there was an increase of 17 per cent. On the domestic, European and British side, no change, and on freight an increase of 4 per cent.
Aer Rianta attribute this to what they describe as the more competitive fare structure operating on the Atlantic into and out of Shannon. The Minister takes a lot of credit for that and by all means. I am delighted. There was some competition in 1984. There were new people. They were beginning to compete with one another. What is the result — plus 17 per cent, a very worth-while increase at Shannon on the Atlantic because there was some competition, because fares were lower, because new people were allowed in to operate there. There was no competition on all the other routes, the domestic, British and European routes from Shannon. The whole lot of them were in a cartel situation with no new people allowed in. What was the result? Stagnation, no change, in a year when air traffic generally and movement of passengers increased.
Surely the Minister and the House can see a moral in that. In the part of the business where competition was allowed, even if only to a limited extent, and where new entrants were allowed, there was a spectacular increase. In the part of the business where the cartel situation was maintained and no competition was allowed, there was no increase. Surely we are not so blind that we do not see the significance of that, and should we not act accordingly? Therefore should we not exempt Shannon, Cork and the other airports I have mentioned from this situation and allow them enter a more competitive scene because there will be competition anyway?
Aer Rianta say that this happened at Shannon in response to a more competitive fare structure and that it was a welcome development. I agree thoroughly. Aer Rianta will be looking for a more competitive fare structure. They greatly regret that the situation there is not more competitive. They believe that because we are not more competitive our airports are losing out. This is an example of one airport that is more competitive in a given year and all credit is due to the Minister for helping to make it more competitive by not blocking the new entrants which is what happened in earlier years. He allowed some competition at least in terms of fares. There is a spectacular increase and that situation could apply in all our airports all the time.
Would there not be an increase of at least 17 per cent in British and continental traffic into Shannon and all other airports if there was competition? Of course there would and that would be to the benefit of the country. There was not a major upheaval when this was allowed in respect of transatlantic traffic but why can we not do the same in respect of all traffic and all our airports? The Minister may not wish to make the change in relation to Dublin but that is unfair to Dublin because that airport would take more traffic if it got it. It is unfair to impose the restriction on Shannon, Cork and the other airports who could do with many times the business they are doing now and who are only utilised to a small proportion of their capacity.
The lesson we should learn from this is that the liberal regime in respect of charters to Shannon promoted by tourist interests and the pro-competition policies of the US Government and airlines, with credit supported by the Minister in the past year, is the way forward for Shannon but Shannon's European traffic will not grow while present policies which are so different from Atlantic policies apply there. Ministerial interventions against US carriers serving European points onward from Shannon mean that these services cannot develop. Aer Lingus, though protected by the Minister, have been withdrawing from direct services to the Continent from Shannon and from Cork. The desirable development for Shannon is that it would become a hub in the US system of hubs and spokes. We need as many services as possible to Britain and Europe direct from Shannon for passengers and also in the area of freight feeding for transatlantic services but this will not happen if the pressure on carriers to charge high fares on the airport's European services is maintained.
A recent paper to the Regional Studies Association by Donal Dineen of the NIHE, Limerick included the comment that it is well known that eastbound traffic from Shannon makes London, not to mention central Europe, quite inaccessible to time-conscious business users because of poor scheduling of flights. Removal of Shannon from the scope of the Bill would help that airport's case in the freight area also. I had intended saying that projects such as Federal Express could then go ahead but I was very distressed to hear the Minister say this afternoon that that company have apparently decided to locate the hub of their European operation in Brussels. As the Minister spoke in a low tone, I am not sure that that is what he said, but if it is the case I am very disappointed because the loss involved for this country is huge.
Shannon was absolutely ideal for that operation and it is surprising to find Federal Express go so far into Europe. Brussels in terms of time is about one hour and 15 minutes east of Shannon and this means much additional distance and fuel usage. Shannon's geographical location is ideal, so it is a profound loss that this operation is siting its operation elsewhere. I understand there is one other smaller body of that kind who have indicated at least some interest in Shannon and I trust that since we appear to have lost Federal Express every possible effort will be made to obtain the United Parcels operation.
Shannon seems to me to be ideal as a hub for freight coming from North America, but anyone operating such a service and their customers would not welcome the prospect of being bound by the legislation which is now before the House. The contrast between a 17 per cent increase in transatlantic traffic and no increase in European and British traffic at Shannon is remarkable. It occurred because the western route across the Atlantic is price competitive and the eastern routes are not. The experts in this field, Aer Rianta, leave no one in any doubt as to which policy they prefer. They have set it out clearly in their annual report for 1984, which was recently published.
In 1978 Cork Airport handled 260,000 passengers on its international services. By 1983 this had dipped to 227,000 and last year it increased slightly to 243,000. Thus there has been seven continuous years of zero growth at that airport. That is a serious matter. The international passenger figures at Cork are lower in 1984 than they were in 1978. There are few if any airports in Europe in that position. The growth in most European airports has been phenomenal. I am afraid it is the kind of policy enshrined in this Bill which is the obstacle to expansion. Aer Rianta feel the same way. In their annual report they stated that Cork Airport has the plant and manpower today to handle increased traffic without any significant increase in costs. It should be said that every credit is due to the managers of Cork Airport for cutting expenditure by 16 per cent in 1984 to bring the airport close to a break even position. To ensure this break even position in 1985 the House should support this amendment and allow freedom of competition and new entrants on to the routes into Cork.
The various other airports are ones to which the level of fares deemed desirable by the Minister will be subject to what is set out in the Bill, but they will be unable to sustain scheduled services. They gain nothing from present policy and will be no worse off if the amendment is passed. Waterford is ideally situated for a low cost link to South Wales and the Minister should not stand in the way of such development simply because he is told by the major airline in Ireland that they do not want any international service from any other Irish airline.
The Deputy said "any other Irish airline". I presume he meant any other airline.
Their ability to stop outside airlines is rather more limited than their ability to stop Irish ones. One would like to see an airport like Sligo utilised to a far greater extent than it is at present. There are prospects of Galway being expanded. Further money has been made available to it and that will make it a more attractive place; but when that happens why should it be subject to all these rules and regulations? It will still be a small airport. It is the same with Farranfore, although that has no scheduled services. What is lost by excluding it, even from the Minister's point of view? I am one of many people who thought Connacht Regional Airport should not have been started, but since it is for the most part already built I presume it will be used and we should try to make the best use of it we can. If the ordinary cartel rules which will be underwritten by this Bill are to apply to it we should look at some of the figures. The ordinary return fare from Dublin to London is £204, but from London to Connacht Regional Airport in County Mayo is a journey of about 50 per cent further in terms of miles. One would assume that if the rules in this Bill apply the same kind of fare structure will apply. Add 50 per cent to £204 and the figure is £304 approximately, which would be the ordinary return fare between Connacht Regional Airport and London. That is not attractive and will not generate much business there.
I suggested before to the Minister that exemption of the Mirabel Airport outside Montreal from the ordinary rules worked wonders for it and transformed an under-utilised airport into one which is now extensively used. The controls in regard to fares were removed and people were allowed to come in subject only to safety and other regulations of that kind. It made a vast difference to the airport and it could do the same for Shannon, Cork and any of the other smaller airports. I do not know why we do not see our future in terms of growth or why we have a defensive attitude all the time, saying it is necessary to have regulation, protection and monopoly, instead of going out and competing, bring in business, surviving and prospering on additional business rather than surviving but not prospering on regulation and the protection of monopoly. That is wrong. There is a glorious opportunity in this amendment to have a different kind of approach for all our airports other than Dublin. It would be to the benefit of all of them and to the benefit of the country as a whole.
I have power under section 3 of the Bill to exclude an airport if I feel it is appropriate. I could not exercise that power in respect of external flights except by agreement with other countries with whom we have bilateral air agreements. We would be in breach of our international commitments under the bilateral agreements if we deregulate certain airports just like that. However, I have power to do what the Deputy suggests provided, in respect of external flights, we get agreement from our bilateral partners.
In relation to some of the regional airports — Sligo and Waterford are cases in point — there are very few applications for services but when there are they are usually accompanied by the maximum fares they think they can charge together with a request for a subsidy. It sounds very grand and exciting to deregulate these airports, but the fact is that even if we did it in respect of internal flights it would not attract the kind of business Deputy O'Malley seems to think it would. There is effectively no restriction on internal services out of those airports. There are many local bodies in those areas seeking airlines to provide services but they have proved time and again not to be viable.
In relation to Shannon we have given to any American or other carrier who wants it Fifth Freedom rights out of Shannon onwards to Europe but none of them has taken that up. It is very rare to offer such rights, but we have done so and they were not taken up. We have given approval to Dan-Air to operate the London route but they have not taken it up. If we accepted Deputy O'Malley's suggestion Shannon would suffer dramatically and that is a risk which I am not prepared to take even if I was not bound by bilateral constraints. I have used my powers with regard to Shannon, as I have done in regard to London-Dublin, to keep fares down. Various authorities had approved increases out of Shannon of between 15 and 20 per cent but I forced them down to sub-inflation increases, as I have done in almost every fare increase application which I received since I became Minister. I oppose Deputy O'Malley's amendment.
The Minister said that we give Fifth Freedom rights to other carriers. By "other carriers" I presume he means other than Aer Lingus. So what? It is in our interests to do this and it is regrettable that we give them to such a limited extent. It is particularly regrettable that when we do give them, as was the case to Amsterdam and Prestwick, that they will have to stop exercising the Fifth Freedom right unless they increase their fares by 12 per cent. This was stated in a letter from the Minister's Department, signed by a senior official, because the Minister did not approve of the company exercising those rights at the level which they were charging. If they are not allowed to exercise these rights at the kind of fare level which they want but are forced to charge more, what use is that? There is no big deal in giving Fifth Freedom rights out of Shannon.
It is a big deal.
Perhaps in the Minister's mind it is a big deal, but we are gaining by this. We get more passengers flying through Ireland, we increase our turnover and the use of the airport. It is made out to be a big deal but I do not think it is.
It is a big deal in the context of the criticism made by the Deputy. No other country gives Fifth Freedom rights. In relation to the point made regarding the 12 per cent increase to Amsterdam, that was a requirement of the Dutch Government.
With all due respect to the Minister, the Dutch Government could not care less about what fares were charged into and out of Amsterdam and the proof of that is that they have entered into a most liberal bilateral agreement——
The Deputy has fallen for their propaganda.
If the Dutch Government had been trying to keep up their fares between Amsterdam and Shannon, they would have been writing the letters.
Does the Deputy not believe it?
We should try to get more airlines to fly between Shannon and Amsterdam and let them charge as little as £100 if they like. What loss is it to us? Why not let them do it? A few years ago an airline was prepared to provide a service between Shannon and Amsterdam but they were told in a formal, official letter from the Minister, signed by a principal officer in charge of that area, that they would have to stop the service unless they increased charges by 12 per cent. No matter what they were charging out of Shannon it was good to have that service and they should not have been stopped. I have the letter here if the Minister would like to see it. At present I understand that an airline is providing a service to Prestwick at a fairly competitive fare and I hope that we will not see the end of that as in the case of the service to Amsterdam.
I suppose the Minister makes great play of the fact that Dan-Air have a licence to operate between Gatwick and Shannon. They have but, as I pointed out here the last day, they do not now use it because they would have to go into the cartel. They feel that there is not enough business to sustain cartel rates and that they will have to charge too much. They said in their press statement of 3 May 1985 that, if a more liberal tariff regime existed, Dan-Air would welcome the opportunity of being able to introduce a more innovatory package of air fares for travel between the two countries. They are more than anxious to get in here, but they are only prepared to do so at figures below those of the cartel and if they can compete. They feel there would not be enough business if they had to charge the full cartel fare.
How, therefore, does our national interest prescribe that we must retain the full cartel fare? Our interest should be to get more people in here. That is why Dan-Air are not using their rights into Shannon. They would love to be able to do so, but they would have to charge too much. If they could charge half the fare, there would be a daily Dan-Air service from Gatwick to Shannon which would be great for this country. It is terrible that vested, local and institutional interests are strong enough to ensure that they come before the national interest. It is a tragedy because the national interest loses out.
Amendment put and declared lost.
Section 2 agreed to.
SECTION 3.
I move amendment No. 7:
In page 3, before section 3, to insert a new section as follows:
"3.—This Act applies to any rate or other charge, term or condition charged by an airline or other provider of ground services at any airport in the State in respect of passenger, baggage or cargo handling and the Minister is hereby empowered to fix maximum charges for such services and to disallow any conditions attached to the provision of such services as he considers not to be in the public interest.".
The reason I put down this amendment is to make it clear that any suitable body can provide these handling and ground services. The Minister may say that at the moment, technically at least, anybody can; but there a monopoly of ground handling in this country. The only people who act as ground handlers are Aer Lingus. Some small airlines may do their own handling, but nobody does any handling for anybody else other than Aer Lingus. This is not a very competitive situation. It is well known that Aer Rianta, for example, are very keen to introduce either other ground handlers, in order to provide some competition, or to do the ground handling themselves. It might be better in the circumstances if they did not become involved themselves, but, in practice there is a great deal to be said for other people being encouraged.
We do not hear very much about this subject here but it is of some importance in other countries. The possibilities of abuse in an monopoly situation are widely recognised. In the past there was a report in a European magazine, The Kangaroo News of May 1985, of a case between the European Commission and Olympic Airways which reads as follows:
The applicability of the Community Competition Rules to airlines could be tested if Olympic Airways, the state-owned Greek Airline, decides to appeal to the Court of Justice against a fine imposed on it by the Commission.
The Commission has demanded that Olympic provide it with details of its handling charges as part of a case that the airline has abused a dominant position in the market by raising its handling charges by 50 per cent. Olympic has an monopoly of handling services at Greek Airports.
But Olympic's defence is likely to be that there can be no infringement of competition rules if the relevant Treaty articles are not applicable to air transport.
The Commission, whilst conceding that the rules have not been applied, believes them nevertheless to be applicable and would like a straightforward judgment from the court to this effect.
That is a very interesting case. If it is brought to the court and if the imposition by the Commission of a fine is disputed, the decision will be of great interest. If it is not appealed, the decision will apply and this would presumably apply here also.
Charges of this kind for ground handling account for 12.2 per cent of the cost of an airline ticket on average in Europe, according to EC Memorandum No. 2, page 25. Therefore the amount of money at stake is not trivial. It would comprise £25 on a Dublin-London ticket. Probably as important is the fact that passenger or baggage handling monopolies are restrained from competition and provide incumbents with a lever. We know this can be used to deter new entrants and to prevent the introduction of new services. I referred to that instance the last day and since then, in addition to the Dan-Air case, another instance of this vis-à-vis an Irish company has come to my notice. Some very interesting documentation in relation to the matter has also come to my notice which I can go into if and when the occasion demands. It is likely that the operation of these services at Irish airports does not meet the commercial criteria set by the Restrictive Practices Commission and often would not be tolerated in other lines of business.
The purpose of this amendment is to allow the Minister to show his interest in competition and in the interests of consumers generally by regulating these charges in the public interest and to ensure that there is competition between the suppliers of the services. We know what happened in the recent Dan-Air case on the Dublin-London route. We now hear from Dan-Air that they did not proceed with a formal filing of their fare after, as they put it, "consultation with other carriers on the route". We know exactly what that means and it has been confirmed to me from several sources since.
The difficulty Dan-Air had in regard to the computer booking facilities if they were to take certain steps appears to be an echo of the difficulty that a small Irish airline had in relation to their computer facilities. Because the computer facilities were held by Aer Lingus the small Irish airline had to go to the High Court to seek a declaration that they should be entitled to continue to avail of those services. Under the agreement the High Court referred it to an arbitrator who held that the service could not be withdrawn from them if they were already using it.
That opens up a whole field in regard to computer booking facilities and ground handling service facilities which arise under this amendment. This is very interesting and disturbing. In getting confirmation on these matters the last day it was brought to my attention what had happened in the Irish case. Since that had gone to court, it is a very much more public matter than the Dan-Air case which had not gone to any court. For that reason it was surprising to see the vehemence of one of the denials particularly when, as it was put to me by people who knew the full facts, some of those who made the denials know that their denials are wrong. I will not go into any of the documentation in that case unless I have to, and if I have to I will have great pleasure in revealing what goes on behind the scenes in Ireland in relation to these matters which are the subject of this amendment.
It would be preferable if there was some form of competition. That would not entail any unemployment because some of those working as existing handlers could be employed by different handlers. That would be in the public interest. That view is shared very strongly by organisations like Aer Rianta, Bord Fáilte and others. The Minister may say Aer Rianta already have the power at the moment and that, technically at least, other people can act as handlers. I agree that they can, but the fact is that none of them does. It is not healthy, but we have a further instance of a monopolistic situation in regard to that aspect of our air services also. Could I make reference in this context, because it is relevant to the statement made on 1 May last by Mr. Tony Ryan, founder of Guinness Peat Aviation, reported as follows:
The aviation industry is showing steady growth and evolving from its traditional monopolistic and regulated nature into a commercial business.
That sentence sums up the philosophy which should infuse Irish aviation policy generally. Indeed, Mr. Ryan's own success and the success of his company in becoming in a short time the leading company in its field in the world demonstrates the sound economic basis for such an approach. It is distressing therefore to find that our chief airline, Aer Lingus, and the Minister and his Department are so anxious to achieve the direct opposite of this approach by increasing rather than decreasing the traditional monopolistic protected and regulated nature of the aviation business in Ireland today. It is time the Minister, and the Department and our State airline realised that they cannot continue in many of these areas to swim against the tide and that our national interest in the broadest sense requires the adoption of policies which will lead to a maximisation of access to Ireland rather than to further control and regulation which will inevitably prove damaging, both to the economy at large and the interest of the individual airline users. It may be that the Minister will tell me that these powers exist already. If it is the case that there could be other handlers, that Air Rianta could act as handlers if necessary, that is grand. But could we have some active encouragement to people to act in that capacity so that we would not have a repetition of the situation which we had in at least one aspect of the recent Dan-Air problem and at least one aspect of the recent Avair difficulty?
Here Deputy O'Malley is proposing, against the normal run of his argument, to give me extra powers and is asking for extra regulations. I do not want that. It is not necessary at all. Any airline coming into Ireland can do their own handling, for a start. That is not so, for instance, in Italy or in Greece. It is also open to Aer Rianta to appoint other handlers than Aer Lingus. I cannot see any merit whatever in the proposal being made by the Deputy. It runs counter to the philosophy that he has been expressing on this Bill since last year. That philosophy I do not dispute, but the practical details I hotly dispute. I am very much in favour of liberalisation in this area, but it has to be multilateral.
I am not suggesting more regulation; I am suggesting more competition. I am giving the Minister power, or proposing it if he does not already have it. I do not know whether he does or not. He did not deal with that point.
I do not have the power.
I am giving him power to enable handlers to operate. It may be that the power is there already. I am not talking about people handling for themselves, but about those handling for outsiders. It is perfectly clear to anyone who reads this debate that I am endeavouring to generate competition in an area where there is not at the moment competition. I do not see anything inconsistent in that with what I have said already. I have spent all this debate trying to encourage competition, deploring the lack and absence of it in many respects in our transport and re-echoing what Commissioner Sutherland has said. I would like to see done here what he is trying to do in terms of competition. I regret very much that the Irish Government are holding out against it. I wish they would not continue with these provisions. It is not just in terms of sales of airline seats alone that one can see a lack of competition. It is in these other areas which enable a particular airline to preserve a monopoly in a way that they would not have if they did not also have a monopoly, in practice, of things like ground handling, computer booking facilities and so on.
I accept very much that Deputy O'Malley is in favour of more competition — so am I. We just differ on the way that should be achieved. He has been extremely consistent in that. I have no doubt that the motivation behind this amendment is also to increase competition. But I cannot see how, in practice, that would work out.
The Deputy suggests that I take extra regulatory powers. I think he will agree that many of his earlier contributions have tended to suggest that where I am taking regulatory powers I am going to misuse them and have higher charges, tariffs and fares. In this situation I do not need those extra powers. First, all airlines are free to do their own handling. Secondly, Aer Rianta are empowered to select different handlers from their present ones. There is plenty of competition. It should be said that a similar situation appertains in the United Kingdom. Aer Lingus are the major handlers for the British Airport Authority in Heathrow. They also have major handling contracts in New York against competition. The fact that they have maintained the contracts in Ireland against competition does not mean that there is no competition, or cannot be. There can. The power suggested here is not necessary.
I made the point that I thought it might be. What I was trying to do was encourage competition in practice.
I do not see how that can be achieved.
As in other matters, I do not appear to have succeeded. There is no encouragement for that. In other major airports there are often six, eight, ten or 12 different handling firms. There is plenty of competition. If you are dissatisfied with one, you can go to another. That does not operate here. There is only one firm handling for outsiders, leaving aside airlines handling for themselves. There is no competition. I am also making the point that because that is the case it gives them an inordinate power in terms of access to this country. It is clearly recognised by Aer Rianta that that is so. They have made no secret of it.
Everybody desires to have competition on the ground in this field of activity. This is the field of activity, incidentally, in respect of which Aer Lingus made a denial of what I said the last day. As I pointed out, they did not make any denial in respect of my reference to the computer situation. I have rechecked these matters and have no reason whatever to doubt the accuracy of what I have said.
No dissatisfaction that I know of has been expressed with handling at Irish airports. If it were, it is up to Aer Rianta to seek other handlers. Indeed, they could do the handling themselves. They could do that in Shannon, in Cork, in Dublin, or in all three airports. I do not see the problem. I do not see that this power is necessary and I am not accepting the amendment.
Deputy O'Malley, are you pressing your amendment?
No, Sir.
Amendment, by leave, withdrawn.
I move amendment No. 8:
In page 3, subsection (1) (a), line 5, to delete "may" and substitute "shall".
It seems that the word "may" at the beginning of this section should be replaced by the word "shall". While "may" is there it is optional for the Minister for Communications to require an airline to give the notices that are referred to in this section in relation to their tarriffs. I would dislike a situation in which one airline or more than one may be required to give these notices while another airline may not be so required. It should be made clear that either all or none will be affected. We have to keep reminding ourselves that this Bill was described here last June as an emergency Bill, one that had to be passed in a matter of days or enormous problems would arise and huge damage would be done. Yet, here we are 11 months later and we find one of the main provisions is within the discretion of the Minister rather than obligatory. It is very difficult to see how this could have been considered an emergency at any stage.
Much depends on the fact that we have not an independent civil aviation authority. We have a form of conflict of interest which is very unsatisfactory and which is beginning to engage the minds of people to a fair extent. When the regulatory authority is also the State commercial authority, it is very important that the exercise of powers of market regulation by a Minister and a Department who are also in charge of an airline in the last resort should be seen to be exercised in a way in which there could be no conflict of interest. Therefore, perhaps the element of discretion should be avoided.
The word "may" in this section emphasises the discretionary nature of the powers I am proposing to take in the Bill. As I indicated previously, it is not my intention, for example, to regulate charter fares. Similarly, use of the word "may" will leave me or succeeding Ministers with the latitude necessary to accommodate such liberalisation measures as may come about in the context of the EC or otherwise. Substitution of the word "shall" would introduce an element of compulsion that would be entirely inappropriate and in conflict with the thrust of Deputy O'Malley's arguments in relation to the Bill and would eliminate the flexibility which I am trying to provide.
Unfortunately we have not got flexibility. The Minister tells us he is trying to provide for it but I can reasonably ask where is this flexibility? We have a situation where you can operate in and out of this country provided you are in a cartel. We do not have flexibility. The Minister read out something which I did not hear entirely but which seemed to me not to be relevant to the point I am trying to make. If these powers are applied only to some airlines or air carriers, I ask why should that be? Why not apply it to all of them? The Minister read out something but it did not deal with the point as far as I could see. In view of the fact that in a sense he is responsible for the commercial welfare of an airline and is also the regulatory authority for aviation, would he not agree that he should act the same way for all airlines rather than acting one way for one airline and another way for another airline?
The Deputy has raised a good point in this respect. Certainly it would be policy not to discriminate between carriers. It is not provided in the Bill that there should not be discrimination between the carriers. I would be prepared to consider the point for a Report Stage amendment to put a duty on me not to discriminate between carriers.
Is the Deputy withdrawing his amendment?
Do I take it it is accepted in principle, at least?
Yes. What is accepted is that there should be no discrimination between carriers. I think it would be a mistake to accept the word "shall" instead of "may" because that would be an even tighter wording and would be giving tighter control than the Deputy wants. If we qualify the word "may" by saying we cannot discriminate between carriers I think that would have the desired effect. We will bring in an amendment on Report Stage.
On that basis I withdraw my amendment.
Amendment, by leave, withdrawn.
I move amendment No. 9:
In page 3, subsection (2), line 21, to delete "contained" and substitute:
"contained: provided that the Minister shall not make a decision under this section in relation to the airline tariff before the day which is twenty-one days after the day on which particulars of the airline tariff are entered in the register pursuant to section 5 of this Act, or the day immediately following the expiration of the period specified in the relevant notification under subsection (4) of this section, whichever is the later".
The amendment requires the Minister to refrain from taking a decision on any tariff proposal until a specific period not less than 21 days has elapsed since its inclusion in the register. The purpose of this provision is to give the public and interested parties an opportunity to make representations to the Minister on aspects of particular airline tariff proposals submitted. However, this provision does not impose any restrictions on airlines selling particular tariff proposals within this period. Selling of tariffs subject to Government approval is not an offence under section 5 unless the Minister has specifically prohibited their sale by way of temporary direction under section 4.
It should be clear the amendment does not preclude the Minister from reacting quickly in appropriate circumstances to disapprove or modify a particular airline tariff. For instance, the Minister is permitted within the 21 day period to notify an airline of his intention to refuse or modify any airline tariff submitted so as to allow him to make his decision on the 21st day if he so wishes. He may also have recourse to section 4 which allows him, by the issue of a temporary direction, to prohibit the sale of tariffs in order to prevent any abuse of the concession to airlines and intermediaries, allowing sale subject to Government approval.
I should like more clarification from the Minister about what can happen within that 21 days. This may be relevant to the amendment we have been dealing with a few moments ago. Will it be the case that there will be a totality of information available for all airlines regarding proposals and fares during that interregnum so that judgment can be made as between how one company are proposing to charge and the others?
This is a pro-consumer move in order to allow the public or interested parties to make submissions to the Minister within 21 days of a filing, to make points for or against that particular filing. In normal circumstances, if the airline so wishes, it is envisaged that they will be able to go ahead with that fare pending ministerial approval. That is common practice, that they can sell fares subject to Government approval. It would not be our intention normally to intervene unless there was gross abuse, and if there was we could use the power in section 4. I do not envisage us distinguishing between airlines in this respect; they would all be treated exactly the same. I think that was the point Deputy Wilson made.
I find it difficult to follow the reasoning behind the Minister's amendment, purporting to put a straitjacket on himself in imposing this 21 day period. One can visualise a situation in which a given tariff might be entirely excessive and require immediate action. If that is so, why leave the thing running for 21 days? Why impose that burden? It could be that in the normal course the Minister might well wish to do that but his reasoning for straitjacketing himself rather escapes me.
As I have said, I have power under section 4 to make a temporary order if anybody is grossly abusing the 21 day period. It is desirable that we have a period of time within which interested parties can make representations in relation to a particular filing. I do have the power under section 4 to intervene immediately should there be any gross abuse of the 21 days.
Why should there be an obligation imposed by the Minister on himself to do that? If a Minister feels that it is appropriate that a certain length of time should elapse there is nothing to stop him doing it; he does not have to take a decision within a particular time. Why is he saying that he must make it within a particular period? It could be that seven days would be adequate, that 14 days would be adequate. The Minister may well feel it is appropriate to leave it for a month, two months or whatever. It does not require an amendment of the Bill to say that he may defer it, pending making soundings, inquiries or whatever. Here is a case where he provides that he must not within 21 days make a decision. He is not obligated to make it within 21 days anyway.
That is true, I am not, but during such longer time as I take, the airline can continue to operate the filing, whatever it is. This is a desirable move. Deputy Taylor describes it as putting myself in a straitjacket. It is true, it is a certain control on myself in response to some of the legitimate concerns expressed by people who have commented on the Bill. It is intended to give the consumer a certain chance to make representations in relation to filings. At the same time it is universal practice to allow airlines to file fares and to sell those fares there and then subject to Government approval. Were we to say: no, there cannot be any change in filings until I approve them we would be in breach of international practice. Here we are allowing a minimum 21 day period — it is not a maximum, it is a minimum period of 21 days to allow consumer and other interests, if they so wish, to make representations or comments on the filing and then we take a decision. I think it constitutes a sensible and good move.
Would the Minister clarify what happens during that 21 day period? I am sorry, I missed part of the earlier debate on the point. Can the airline who filed it charge that lower or new fare during that period?
Yes, that is the point. I think Deputy Taylor was making the point that perhaps they should not make any alteration until a decision was taken by the Minister. I am saying no, that they should be able to make the change subject to Government approval because that is universal practice. Certainly it happens all over the world. However, if it was a grossly outrageous proposal — suppose somebody pushed up their fares by 20 per cent at a time when inflation was running, as it is now, at approximately 5 per cent — I would have powers to intervene immediately to stop that if I so wished. The normal position would be that a filing would be made; they could charge that fare immediately, subject to Government approval and without prejudice to whatever was the ultimate decision, having given the consumer at least 21 days to make representations.
I am principally interested in what most people are principally interested in, that is not the kind of situation the Minister has described there of somebody increasing their fare by 20 per cent or whatever other figure he considered to be much too high but rather in the instances which are likely to be far more common, that is where people want to reduce the fares, for example, our friend, Mr. Branson of Virgin Atlantic who wants to come into the Dublin — London route because, as he says, it is one of the highest priced in the world. He is proposing a very much lower fare. I have the cutting here. I think he is proposing——
£29 sterling.
Which would be approximately IR£35, that is single fare. I see Bord Fáilte have issued a statement welcoming his intentions. I second that proposal but I would say that Mr. Branson has as much chance of flying Dublin-London at £36 as I have of winning this year's Derby. For that reason I want to ask the Minister, if Mr. Branson, or somebody like him, appears on the scene and files a fare which the Minister, Aer Lingus or some of his other advisers regard as too low, will he allow that fare the powers he says he has under section 4, or does this use of the temporary powers apply only to fares that he thinks are too high?
No, it applies both ways, as do all the provisions of this Bill. It is in order to prevent the charging of fares that are too high or fares that are too low, where they would be disruptive. The intention would be to use the temporary powers under section 4 in the case of a very disruptive fare only. I am sure this amendment is greatly welcomed by all consumer interests.
Amendment agreed to.
I move amendment No. 10:
In page 3, subsection (2), line 21, after "contained", to add ", provided always that any airline tariff shall be regarded as complying with the Minister's approval if it is within a zone of reasonableness, that is, if it is within 25 per cent. above or below the figure approved by the Minister for a similar service on a particular route".
This amendment proposes to add words to the end of subsection (2) to which the words have just now been added by the Minister's amendment, which in broad terms would allow what is called a zone of reasonableness in terms of charging fares above or below a particular fare that has already been approved for a similar service. That would allow an element of price competition which one does not get now on the vast majority of routes in and out of Ireland to the detriment of Irish tourism and other economic interests.
This concept is not one that I dreamed up myself. I took it from the EC Commission's Memorandum II where it is advocated by the Commission, on page 31 of that document. A zone of reasonableness is a pricing range within which airlines can establish their tariffs freely without seeking Government approval.
Memorandum II goes on, in page 31, to state:
It seems to the Commission that this concept has considerable merit in the Community context.
The EC describe how their proposal would operate. I quote from the memorandum, on page 32, which states:
If the fare proposal was an individual fare and a dispute arose between governments, the governments would be expected to consult each other and seek agreement. If this proved impossible, in the end the country of origin would be permitted to go ahead unless the country of destination accepted two zones of flexibility for the route in question.
The drafting of my amendment may not be exactly perfect but I am trying to adapt EC concepts or law to the Irish context rather than using the Irish or English way of drafting these matters. This concept of zones of reasonableness unfortunately has not appeared in Irish aviation regulations before. It should. As the Commission says, "this concept has considerable merit in the Community context".
The Minister said today he was all for Memorandum II but nobody else would support it. The British and Dutch, for example, regard it as hopeless because it does not go nearly far enough and the Irish are identified as one of those who will not adopt it because it goes too far. The Minister would be a fair bit along the road if he accepted this amendment, not necessarily in the precise words in which I have it. It may be possible to dress it up in slightly more formal, more European terms if necessary. He would certainly be a fair bit along the road towards the current movements in Europe if he accepted the whole idea of zones of reasonableness.
It happened in America a long time ago. It was one of the steps towards deregulation. There is very strong feeling in Europe towards it. Mr. Sorenson is very keen on it and, as far as I can see, it would be something which would accord pretty precisely with the thinking of Commissioner Sutherland on this matter. He has said that if the Council of Ministers are not prepared to adopt this by the end of the year he will have to consider withdrawing the memorandum and implementing it directly by the Commission by its powers under Articles 169, 85 and 86.
The way this would work in practice— this is why I consider it is very attractive for here — is that if a particular fare is set on a particular route at, for example, £200, somebody is entitled to come along and charge another fare on the same route which cannot be more than 25 per cent higher and cannot be more than 25 per cent lower. Therefore you cannot get outrageously high figures and you cannot get outrageously low figures, but you can get a choice for the consumer. If we assume the fare I am talking about is £100, the alternative fare could be somewhere between £75 and £125. That could be done without having to go to the trouble of getting approval for it from the Department of Communications. It would be done without consultation with anyone else on the route. It would give a reasonable choice to the consumer and it would introduce a reasonable element of competition. It would also get rid of this cartel situation in which everyone charges exactly the same for precisely the same service subject to the same terms and conditions. This has resulted in one of our main routes out of the country being chosen by Mr. Branson because it was so high priced. I have the newpaper cutting. It is from The Irish Times of 18 May, which stated that Virgin Atlantic wanted to introduce a £36 one way Dublin-London shuttle. It also stated:
The chairman of Virgin Atlantic, Mr. Richard Branson said yesterday that the company had chosen the Dublin-London route because it was "one of the most highly priced routes in the world". He said that the company had already been in touch with Bord Fáilte and had received a "very favourable response".
He might not be providing a service on the less popular and less remunerative routes.
He might not, but he would not be remunerating himself too highly at £36 a go. I do not believe the level of profitability there would be very high. I certainly would not object if he was using another route.
If they undercut Aer Lingus they might not be able to provide a service on other routes that suffer a loss.
This is the old chesnut, but I am afraid it is not something that will stand up for the future because, if that is the case, there must be this enormous subsidisation; and any airline which has not an enormously profitable route like Dublin-London should logically close down, but that is not the case. I would remind Deputy Taylor that there are other routes which are loss-making at the moment because they are not subject to competition and the cartels tie the fares. If open competition was allowed on them they might not be loss-making at all. For example, for years and years British Airways justified the very high fares they were charging on the London-Glasgow route by saying they had to fly to the Shetlands, Aberdeen and other places like that which are loss-making and they needed the very big profits they were making on London-Glasgow. Finally, the British Government said to them "We are throwing London-Glasgow open to competition. You can stay on the route but you will have to compete". They did and they also continued on many of the other routes which they suddenly found they could manage if they used different equipment and so on, and other people came in on some of the other routes.
One of the features of air transport at the moment is that you will get a lot of new operators. Some of those will go out of business. There is no great tragedy in that. At least competition will be afforded where there is not any at the moment. The limits were much higher within the United States than those I am talking about. I am only talking about 25 per cent above or below. Much higher limits than that were introduced in the United States but this will give some reasonable element of competition. It is precisely in accordance with what the EC Commission want.
Deputy O'Malley, making a point about competition in the UK, said that some of those airlines would go out of business and it would be no great tragedy if they did. That may be so in the UK where there is a market of 60 million people which can sustain, even temporarily, a number of airlines. If one of them go there will still be a number left; but because of our size, we have only one national airline. We could not sustain more than that. That is a central point to the whole debate because transport economics, as Deputies will appreciate, are very much affected by volume and numbers. What is good in a place like the United States with more than 200 million people might not be practical in a small place like Ireland, Finland or Belgium. What is good in the UK would not necessarily work here. I understand that all the internal routes in the UK are now very seriously loss-making and that is as a result of the free competition.
In relation to the amendment I should like to state that the concept of approved tariff zones is currently under consideration at EC Council and within the European Civil Aviation Conference. Because of the complexity of the topic, discussions on the wisdom and practicability of introducing such a concept are ongoing. During the course of the Irish Presidency of the Community in the latter half of 1984, I am glad to say that, as a means of introducing greater flexibility ——
Will the Minister read his reply a little more slowly. He is reading it down into the paper and it is not easy to hear him here.
I will start again for the benefit of the Deputy. The concept of approved tariff zones is currently under consideration at EC Council and within the European Civil Aviation Conference. Because of the complexity of the topic, discussions on the wisdom and practicability of introducing such a concept are ongoing. During the course of the Irish Presidency of the Community in the latter half of 1984, I am glad to say that, as a means of introducing greater flexibility in this area, member states agreed that a fare zone system could in principle be contemplated, though the main parameters of any zone system remain to be described. Work on this aspect is currently proceeding under the auspices of the Italian Presidency. Having regard to these ongoing developments it would be rather premature for Ireland to implement a specific tariff zonal arrangement in the absence of wider international agreement on its terms.
In any event, I would have reservations about inserting a specific percentage figure in legislation, even if there were currently agreement on a particular zonal concept. Any such international agreement could be changed which would involve extensive time and effort in enacting new legislation. As I am satisfied that the definition of "airline tariff" in the Bill is broad enough to accommodate any zonal arrangements to emerge from current international discussions, I believe that there is no need to incorporate a specific zonal concept in the present Bill.
In his statement the Minister used the word "zonal" and I should like to know if he was using it in the context of zones of flexibility.
Yes.
Through no fault of my own I did not hear the latter part of what the Minister said. The ushers keep coming to me looking for my quotations. I did not hear the last part of the Minister's reply.
I will repeat what I said. In any event, I would have reservations about inserting a specific percentage figure in legislation, even if there were currently agreement on a particular zonal concept. Any such international agreement could be changed which would involve extensive time and effort in enacting new legislation. As I am satisfied that the definition of "airline tariff" in the Bill is broad enough to accommodate any zonal arrangements to emerge from current international discussions, I believe that there is no need to incorporate a specific zonal concept in the present Bill.
It is interesting to hear what the Minister had to say in relation to the amendment, but unfortunately it is not very reassuring for him simply to say that progress is being made in this direction but that he does not at the moment propose to implement it. This is not some sort of unique thing that I just dreamed up out of the blue. This is, as closely as one can do so, worded from Memorandum II. Assuming that zones of reasonableness come in in Europe — that is not a very major assumption to make; it is very likely to happen, either because the Council will adopt it or, if they fail to adopt it by the end of the year, that the Commission will impose it — is it not likely that whatever does apply in Europe will be on the lines of what the Commission recommend?
I believe the Minister is telling me that he has no objection to this except that it is always possible that the specific percentages might be changed or might be different at some time in the future, that we will have to have amending legislation and that anyway he thinks the definition of "tariff" is wide enough to cover it. If it is, that is all right; but will he indicate his agreement in principle now to the introduction of zones of reasonableness of plus or minus 25 per cent out of Ireland and into this country? If he accepts that in principle there will be plenty of airlines, including new entrants into the market, who would be prepared to operate on that basis. They will operate on the basis that they can charge not more than 25 per cent less than the existing fares. It would make quite a difference. For example, it would reduce the ordinary basic London route fare from £204, which it is under the cartel arrangement, to £153. That would be quite a boom to hard-pressed consumers in what Mr. Branson rightly describes as one of the highest priced routes in the world and which Bord Failte are very keen to see reduced.
I am putting in figures the meaning of this idea of zones of reasonableness which the Minister, to his credit, seems to accept as a concept but which he does not seem to want to implement in the legislation. Will the Minister, even if he does not want to write in 25 per cent as such in the legislation, give an indication that he will be prepared to allow airlines to operate within a zone of reasonableness of 25 per cent of the existing basic norm for certain routes?
The point I wish to make arises from what we have been talking about in the context of the Commissioner's article. I am not at all satisfied that the Commission are finding acceptance with the Council as of now. The Commissioner's article is clear that he felt the Council were not going along with what the Commission want. Until the political heads, Ministers in Council, accept it, then it has no chance of becoming effective. From what Deputy O'Malley has said it seems to me that he is pinning all his hopes on what the Commission want done, but it is equally important that the House recognises that the political situation is dealt with by the Ministers and until they deal with it and accept it nothing can be done.
In annex 2 (2) the zone of flexibility is mentioned. It states that zone of flexibility means a pricing zone grouping together of air fares with similar characteristics within which double approval is not required. It states that the range of the zone is calculated as a percentage of its upper limit. Deputy O'Malley said that there was nothing sacrosanct about the 25 per cent figure. From where did it come? Was it just shoved in or was it debated in the context of the settling of air tariffs and fares? If there is a question of 25 per cent below would the idea bear also the definition of 25 per cent above or what exactly is the significance of the 25 per cent? As the Commission suggest, it should be defined. On the right hand column of this we have the amended proposal for a Council directive for scheduled air transport between member states. As such it is simply a suggestion. For that reason I would like a little more accuracy and definition as to where the flexibility applies. Does it apply below or above, either of which is very important for competition?
The zones of reasonableness concept would allow airlines to charge above or below a stated percentage. We pioneered this idea at a European Civil Aviation Conference in discussions between ECAC and the US and an agreement was reached with the US by the European Civil Aviation Conference allowing for zones of reasonableness which go from 125 per cent down to 55 per cent in certain circumstances. Deputy O'Malley asked me if, in principle, I agreed with the idea of zones of reasonableness. I am in favour of it, but the details of these things have to be worked out at EC level and perhaps even at ECAC level. Our existing legislation allows us to adopt, as part of airline tariffs, zones of reasonableness, as we have done in the case of the United States.
Is Deputy O'Malley pressing his amendment?
It would be very easy for the Minister to go on to the next logical step from what he has said in relation to these zones. The Minister accepts the principle. It may be necessary to change percentages from time to time, depending on developments in Europe or in other bodies. The existing definition is wide enough to allow it and the only other thing that remains is for the Minister to agree to implement it. I would withdraw my amendment like a shot if the Minister would agree, because it would not be necessary. We would have this idea novel to Ireland introduced here, we would have competition and the cartel would be at least partially curbed. It is a very limited zone that I am proposing. On the basis of plus or minus 25 per cent the highest permitted fare would be only 1.7 times the lowest at a ratio of 125: 75, whereas the US zone, when they had it before they deregulated, from 30 per cent to 110 per cent of the reference rate, where the highest fare would therefore be 3.7 times the lowest. The ratio here is quite small. Would the Minister not indicate that he has no objection to this since he approves of it and agrees with the idea and that the existing legal definitions are wide enough to enable it to be implemented? It would be in our interest as a nation if it were done. Would the Minister not say that we will have it beginning from 1 June on some routes at least to see what difference it makes?
It should not be thought that it would necessarily be in the best interests of Ireland if this was allowed. A lot has been written about this subject and from what I have read — and I do not pretend to have read all the material that has been published on it — one has to look at the overall situation and not just look at one fare in isolation. No doubt some zones of reasonableness will give a quick short sharp benefit on one route perhaps for one flight at peak times, but that might well not be repeated for flights that are required at less popular times. Nor is there any guarantee that fares overall are going to be reduced or that the consumer will be any better off. The figures from the US on what happened there on deregulation seem to suggest the contrary. The figures supplied to the Council of Europe, report document 5383, on the subject indicate that what happened in the five years following on deregulation was that the average fare increase was of the order of 46.4 per cent whereas in the five years preceding deregulation the average price increase was only 33.3 per cent. That was at a time when the consumer price index in the five year period following on deregulation rose by 59.2 per cent, whereas in the five years preceding deregulation it rose by 44.9 per cent. The indication there is that average fare increases operated to the detriment of the consumer following deregulation and not to his benefit.
Deputy O'Malley suggests that I take the next step and commit us to zones of reasonableness being implemented from 1 June. No country has done that, none of the great liberal aviation authorities which the Deputy so admires has done that. I support the idea in principle. We are working towards it at EC level and ECAC level and we will continue to do so. I already have the power to make provision in airline tariffs for this, should agreement be reached, so the amendment proposed by Deputy O'Malley is superfluous.
The amendment has been sufficiently debated. I am putting the question: "That amendment No. 10 be made."
Amendment put and declared lost.
By agreement the amendment to amendment No. 11 will be discussed to together with amendments Nos. a1. 2 and 3. That includes Deputy Wilson's amendment.
I move amendment No. 11:
In page 3, between lines 21 and 22, to insert the following:
"(3) In considering an airline tariff submitted under this section, in addition to having regard to the interests of the air carrier by or on whose behalf the submission is made, the Minister shall have regard to—
(a) the reasonable interests of—
(i) the other air carriers to which this Act applies, and
(ii) the persons whom he considers will use the passenger service, or the mail or other cargo service, as may be appropriate, to which the proposed airline tariff will relate,
(b) the contribution capable of being made to the economy by the tourist industry by reason of the provision (subject to the need to maintain an air transport industry) of competitive airline tariffs,
(c) the necessity, having regard in particular to the public interest, of maintaining the continuity, range, frequency and standard of all or any of the following, namely, particular air services to, from or within the State, such air services generally or airport facilities associated with such air services,
(d) any representations or objections regarding the airline tariff which are made to him within the period mentioned in subsection (2) of this section (which representations and objections are hereby authorised to be made), and
(e) any air transport agreement for the time being in force, to which the State is a party and which the Minister considers relevant.
(4) Where under this section the Minister proposes either to approve of with modifications or to refuse to approve of an airline tariff, he shall notify in writing the air carrier or other person from whom the relevant submission was received under this section of his intention and of the reasons therefor and the notification shall state that within such period, beginning on the date of the notification as is specified in the notification (being a period of not less than seven days), representations and objections as regards the proposed refusal of modification may be made to the Minister by such air carrier (which representations and objections are hereby authorised to be made).".
On Second Stage various allegations were made that the Bill would restrict competition, lead to high air fares, damage tourism, endanger Shannon, be anti-consumer, etc. The purpose of the new section 3 (3) is to require the Minister to have regard for certain specified criteria in assessing airline tariff proposals submitted to him for decision. In practice the criteria specified have always been taken into account by the Minister in assessing fares, but it is considered useful to make explicit provision in law for these criteria in the interest of consumers, tourism, carriers, etc.
The preamble and paragraph (a) of the new provision require the Minister to have regard to the reasonable interests of air transport users and of airlines. It is reasonable for consumers to expect airline tariff structures to cater for all substantial categories of public demand for air services by providing a range of tariffs on terms which are clear, understandable and, above all, competitively priced. In the case of airlines it is reasonable for them to expect approval of tariffs that will guarantee an economic return on their investment.
Paragraph (b) specifically provides that the Minister shall take account of the needs of the Irish tourism industry for competitive airline tariffs subject, of course, to the overall requirement of maintaining on an economic basis an Irish civil air transport industry.
Paragraph (c) is intended to ensure that the broader public interest is not lost sight of in terms of the need for a broad range of air services to meet the needs of industry, economic development, exports, communications, etc., all of which are essential to a modern state. The reference to "airport facilities" is intended to provide a safeguard for airports like Shannon or Cork.
Paragraph (d) requires the Minister to take account of any representations or objections which may be made to him by interested parties within the time period specified in the amendment to sub-section (2) arising out of the availability for public inspection of airline tariff proposals. Paragraph (e) makes clear that the actions of the Minister in determining tariffs must conform with the provisions of any relevant bilateral and multilateral air transport agreements to which the State is a party. None of the provisions in the Bill conflicts with any of our existing international treaty obligations.
The new sub-section (4) enshrines in the Bill explicit provisions requiring the Minister to notify his dissatisfaction to the relevant airline in circumstances where he intends either to modify or refuse to approve of an airline tariff. The purpose of the provision is to give an opportunity, in accordance with the rules of natural justice, to airlines to make representations to the Minister in advance of his taking a decision.
The Minister is the final arbiter. However, the relevant international aviation agreements in most cases provide for inter-Governmental consultation where disapproval of fares results in dispute between two States, and, in the event of their failure to agree, the reference of the dispute to arbitration. Of course, there is nothing to prevent an airline exploiting the common law by, for example, seeking to get an injunction or challenging the Minister's decision in a court on a specific point of law.
I should like to point out that there is a typographical error in the second last line. The first word on that line is "of" and it should be "or".
Amendment No. a1 in the name of Deputy O'Malley.
I should be called first.
His amendment is first.
My amendment comes first.
We may have a difference of opinion but my word is official.
A Cheann Comhairle, you are pulling rank on me.
I move amendment No. a1:
In the sixth line, after "carriers" to insert ", operating on the same route or routes,".
I have three amendments down to the Minister's amendment. The amendment in the Minister's name is of some significance. Last June we were told there was no need for any amendment of this kind, that this was an emergency measure and would have to go through the House in a matter of hours. Now we have a whole rethink and suddenly the consumer matters as a result of this debate in this House on 27 June last. Suddenly a whole lot of things about which I was derided last June matter and we are trying to appear-reasonable. The Minister's amendment goes part of the way to putting an appearance of reasonableness on the situation. It does not go very far, but in order to try to improve it, I tabled three additional amendments to it. Deputy Wilson also has tabled an additional amendment and that is one I would agree with too. The first two in my name would not be major amendments and what I have to say relates manily to the third one and to the amendment as a whole.
In the first of these additional amendments I propose, in relation to taking into account the reasonable interest of other air carriers, to insert the words "operating on the same route or routes". This is because we have had instances of carriers who were not operating on the route concerned objecting violently to some noncartel airline coming in to operate on a different route. In considering the reasonable interest of other carriers we should be referring only to other carriers operating on the route or routes concerned. A carrier not flying the route concerned should not be entitled to have his interests taken into account. If the Minister would like details of instances of that kind I can quote some. There was, for example, the Avair case before they were forced out of business. If the changes I am proposing are made the general amendment of the Minister will be improved. We would be thereby ensuring that some carrier is not given a kind of carte blanche right to have their interest taken into account irrespective of what route was involved and even if they were not operating on that route.
I move amendment No. 1 to amendment No. 11:
In the tenth line after "relate", to add "and which tariff will not be rejected by the Minister solely on the grounds that it is too low".
This is a very important amendment. It arises as a result of the very strong consumer interest that was aroused at the time of the Bill's first appearance. It is well to refer to the fact that a judge of the High Court stated clearly that an air company who were associated with a travel agency were in clear breach of what was intended in the Act and then the Supreme Court deemed that the company and the travel agency concerned had an arguable case. That is what sparked off the legislation. I said at the beginning of Committee Stage that if the due process of law had been followed, even allowing for delays in the law area being notorious, the whole matter would have been settled by now. However, we must deal with what is here. I said at the time also that this side of the House would be in support of the national airline.
Progress reported; Committee to sit again.