Jim O'Keeffe
Question:13 Mr. J. O'Keeffe asked the Minister for Public Enterprise her policy on the future of Aer Rianta. [16519/99]
Other Questions. - Aer Rianta Report.
Liz McManus
Question:20 Ms McManus asked the Minister for Public Enterprise if she has received the analysis report on the future strategic direction of Aer Rianta; and if she will make a statement on the matter. [16484/99]
I propose to take Questions Nos. 13 and 20 together.
The Minister for Finance and I have jointly appointed a team of advisers to assist in the examination of Aer Rianta's report on the future strategic direction of the Aer Rianta group. These advisers are now examining and evaluating the full range of recommendations made to me by the board of Aer Rianta. I do not think it would be appropriate for me at this point to speculate on the possible response until they have finished that job, which they will do in the near future.
Following that, and in the light of my own consideration of the advisers' recommendations, I intend to report to Government with specific proposals on the future strategic direction of Aer Rianta.
I appreciate that the Minister cannot tell us now what her or the Government's final decisions will be. However, does she agree it is not in the interests of Aer Rianta, the country or consumers to have a continuation of Aer Rianta's monopoly, or of any other public or private body? Does the Minister agree the approach which should inform consideration of the proposals should be based on that fundamental principle?
I do not know what they are coming forward with, and the Deputy accepted that in his question. However, to exchange a public monopoly for a private one is not very good business.
Does the Minister agree the sale of Aer Rianta will lead to its private ownership and, thus, of Dublin airport? Does she agree that having a private monopoly that is not subject to the Minister in any sense, except in company law, is the worst possible scenario from the consumer's point of view? That would be a ready made opportunity for the abuse of power by such a private monopoly. In the public interest, will the Minister strive to ensure that will not occur?
The points made by Deputies Jim O'Keeffe and Stagg are in my mind. I do not know what the advisers will come forward with and, therefore, I am constrained in giving a decision on the matter. However, it strikes me that exchanging a public monopoly for a private one cannot be the best way to do business.
There is only one airport in Dublin. Therefore, somebody can have a monopoly on it.
I wish to press the Minister further on the question of a monopoly. As one who is in favour of neither public nor private monopolies, does the Minister agree that, whatever future is being mapped out, this core principle should be borne in mind – neither a public nor a private monopoly? Whether it is achieved by way of a second airport at Baldonnel, a separately operated terminal at Dublin airport or by independent regulation, we should not have a monopoly in future.
I understand what is being considered is the report on the future strategic direction of the company, as produced by the board of Aer Rianta. Why is the Government's consideration confined to the options produced by the board of Aer Rianta? Why is there not a broader consideration of all options, not just those emerging from the Aer Rianta stable?
The terms of reference for the advisers were laid out more or less in line with the board's report to us. We included the issue of Baldonnel, in whatever guise, for it to be considered. There was one other issue. I will send the Deputy the terms of reference.
I thank the Minister.
In coming to her conclusions, why does the Minister feel there is a need for a change in the status of Aer Rianta, given its history and success over a wide range of areas at Dublin Airport? Why is there a need for change?
Last August, I wrote to Aer Rianta asking it to look at its future. The company came back with a report.
Did the Minister give the company guidelines?
No, it was in the light of the company's capital needs. Various matters were laid out, but I did not produce guidelines. I asked Aer Rianta to prepare a report which was published. The letter I sent to Aer Rianta is contained in the report which I gave to Members. I am not saying the Aer Rianta report is good or bad, but it is certainly interesting. I did not say what must happen next, but when I bring the report to Cabinet we will discuss what should happen.
I am sure the Minister is aware the Arthur Andersen report recommended an IPO for Aer Rianta.
That is what they said.
In that context, does the Minister agree that if there were an IPO for Aer Rianta, there is absolutely no guarantee the three airports would be kept together? Given that Dublin is by far the most profitable of the three airports, one could not avoid a situation whereby, later on, some private group might decide to hive off Cork or Shannon. This would pose serious threats to those regions. Will that form part of the Government's regional considerations in any future plan for Aer Rianta?
I have not met the people doing the analysis but, as I understand it, they are taking it on the premise that the airports are State airports.
If a private company purchased Aer Rianta, that could not be guaranteed.
That question will certainly have to be considered.
Has the Minister finished her reply? I am not sure there was any reply.
I did not know where the interruption came from.
It came from Deputy Yates.
Deputy Yates asked a further supplementary question.
It was the same question. The Minister could not guarantee that a private company or companies might not break up the airports.
It is not my intention that they should.
Will the Minister acknowledge the tremendous work of Aer Rianta over the years, particularly on the north side of Dublin where so many of the company's employees live? Will she also acknowledge the tremendous success it has had in extending the duty free business around the world? Will the Minister assure the House that in her consideration of what will happen to Aer Rianta, she will take into account the important employment element of the company, and that there will be no jobs losses for those currently working there?
I gladly and fully acknowledge the pivotal role Aer Rianta and Dublin airport have played in employment and in being the focus for development and onward investment in that region. There is no doubt about that. That has occurred under successive Governments, Aer Rianta chairmen and boards. I have a warm regard for their work under all Ministers.
The Minister's initial response to the original question is the correct stance to take at this time. She correctly made the point that no company can stand still. Listening to the debate, there is total disagreement on both sides of the House as to what should happen to Aer Rianta in future. I commend the Minister's position, as stated in her initial response.
Say nothing, do nothing.
I thank Deputy Wright for his espousal of my cause.
Does the Minister agree that Aer Rianta has been particularly successful at running the airports on behalf of the people? Does she also agree there is a need for further serious investment at Dublin airport and, to a proportionally lesser degree, at Cork and Shannon airports? Will she agree the company has been starved of investment capital by this Government which seems to be on an investment strike in that it will not invest in anything? Certainly it has not invested in any of the State companies since coming to power. Will she agree arising from that, that both the management and the unions in Aer Rianta have opted in desperation for an IPO to get funding for the necessary capital investment at the airport? Will the Minister ensure a majority shareholding is retained by the Minister so that a private monopoly will not run Dublin Airport?
I agree Aer Rianta has been a very successful State company. I will continue to say that. Does the Deputy recall the debate on the Aer Rianta Bill when he talked about the double whammy?
I do.
It did not get a double whammy.
Yes.
Perhaps it was Deputy Yates who mentioned it. It is not getting it. It was excused a whole year of a single or a double whammy—
The Minister did not deliver on the duty free sales issue either.
No, I was not able to.
The Minister kept us hanging for a year and half on that one and there was not even the reward of a white feather at the end of it.
I suppose that is a Duchess of Cumberland job. When will there be an end to the process of consultation or indecision? When will a decision be made by the Government on this issue?
I expect a fully worked out resolution by September.
When will the "For Sale" sign go up?