Vol. 514 No. 3
36 Mr. Yates asked the Minister for Public Enterprise if she will ensure that the State will retain complete ownership of Dublin, Cork and Shannon airports; the future of the Great Southern Hotel Group; if she will make a statement on Government decisions relating to the consultants' report (details supplied) on the future of Aer Rianta; and if she will make a statement on the matter. [4191/00]
37 Mr. Stagg asked the Minister for Public Enterprise if her attention has been drawn to trade union opposition to the privatisation of any part of Aer Rianta; her views on the future of Aer Rianta; and if she will make a statement on the matter. [4356/00]
I propose to take Questions Nos. 36 and 37 together.
I submitted the Warburg Dillon Read report on the strategic options for the future of Aer Rianta to my Cabinet colleagues at the Govern ment meeting on 1 February and also made it publicly available. I am giving careful consideration to the findings and recommendations contained in that report with a view to formulating specific proposals for consideration by Government as soon as possible.
I am aware of the position of the unions in relation to the future strategic direction of Aer Rianta. During the latter half of last year I received considerable correspondence on the subject and I met and consulted with staff and union representatives of the airports to hear their views and concerns regarding the future of the airports. The matter was further aired at a good meeting of the Oireachtas Joint Committee on Public Enterprise and Transport. No decisions on possible alternative ownership arrangements for the State airports or on the future of the Great Southern Hotels Group will be taken in advance of the Government's consideration of these issues.
When the Warburg Dillon Read report was published it was stated that decisions on it would be brought before Cabinet by the Minister a fortnight later, which would have been today. Why has this matter been consistently deferred? Will the Minister set a timeframe for it to be brought before Cabinet? Does she agree that State airports are no different from State ports or roads and the State can invest in them? Does she further agree that there is no reason Cork, Dublin and Shannon airports cannot continue to be 100% owned by the State and funded through the public capital programme and for Aer Rianta International to be subject to an IPO? Does she accept it is not possible for a company to pursue public policy goals in regard to regional and access transport policy issues, for example, if it is privatised and must operate to the mantra of earnings per share?
I do not intend to wholly privatise the airports. The Deputy asked for a timeframe. I did not have my proposals ready to bring before the Cabinet today as I thought I would. There are other equally pressing matters and I must rearrange my priorities accordingly. I hope within the next two to three weeks I will have the proposals ready to submit to Cabinet for full discussion on the matter.
Does the Minister agree that there is no case to be made for privatisation or part privatisation of Aer Rianta? Is she aware that the unions and the company's employees are opposed to such privatisation and their first option is the one the Minister said she could not avail of because the EU would prevent her from doing so, namely, State investment in the airport infrastructure as required? I refer her to document 94C350/07.
Will she indicate whether she is simply flying another kite or has the agreement of Deputy Healy-Rae on the matter? When will there be a decision on the matter? In the meantime I am sure she will agree there is a pressing need for the investment that is required in Aer Rianta. The Government has oodles of money to make such investment and there is no let or hindrance to it from doing so.
I met the trade unions involved on several occasions and they did not press me on the matter of partial privatisation. The main item on their agenda was the sell off of airports and that is the basis on which our discussion was held. In May or June the advanced stages of capital programmes will be reached. Aer Rianta needs approximately £503 million in capital expenditure for the three State airports.
The Minister has the money.
I have not.
The Minister for Finance certainly has the money.
I repeat a serious net point. The driving force for this issue is Aer Rianta's need for investment. What is the legal impediment to the State investing in these airports in the same manner it does in sea ports or other infrastructure? I believe there is none. Does the Minister agree that Dublin Airport's profits should be used for the benefit of Cork and Shannon Airports and our aviation infrastructure, not for future private shareholders. Given that Dublin Airport has a monopoly, it is much better to have a public monopoly than a private one.
I agree with the Deputy's latter comment. It is correct that it is not worth exchanging a public monopoly for a private one. The Deputy referred to how profits earned by Aer Rianta at Dublin Airport should be invested in the three airports but, sadly, due to the abolition of duty free sales the company's profits will be considerably diminished. We await the publication of its 1999 results which should show the half year effect of that. Approximately £500 million is the amount of capital investment needed in the immediate, medium and long-term for the three State airports. That poses its own difficulties which have to be met.
I will repeat the question I asked and which Deputy Yates asked three times. Will the Minister accept there is no hindrance, legal or otherwise, that she has to overcome to invest money infrastructurally in the three airports, the £500 million she mentioned? She repeatedly said in the House that she was disallowed by the EU from doing so. We have now acknowledged that she was wrong in saying that and that she can now invest State money – all she has to do is convince her Cabinet colleagues to do so – and that it should be included in the national development plan along with roads, sewers and everything else except airports.
Will the Minister confirm or deny the reported U-turn on the sale of Great Southern Hotels? I am looking at a statement by her colleague, the Minister for Justice, Equality and Law Reform, who said the Great Southern Hotels would not be sold. I presume he was intending to gazzump his constituency colleague, Deputy Healy-Rae, on that matter. Will the Minister tell us if a decision has been made to sell the land surrounding the hotels but not the hotels themselves?
If I may take the last question first, the hotel unions came to me on several occasions but on the last occasion they put forward that idea to me. I thought it was constructive. The idea came from them, not from me. I want to be clear on that.
They did not put forward that idea when they talked to me.
It is on the record. I listened to Kerry radio where one of the leaders of those unions repeated what he had said to me on the sale of lands around some of the hotels. That is a fact and if he did not say that to the Deputy, the Deputy would want to take it up with him.
So the Minister is not selling the hotels, just the land?
No, I am not. I answered the Deputy's last question. The Deputy then asked if I would not put it to my Cabinet colleagues that we should invest structurally in the airports. I shall not be putting that to my Cabinet colleagues.
That is not the question. The question is—
Excuse me, sorry, a Cheann Comhairle.
The Minister is in possession.
The Deputy said that all that now remained was for me to persuade my Cabinet colleagues that we should invest structurally—
The Minister should now accept that there is nothing to hinder her in doing that. She repeatedly said in this House that she could not do it. We are saying she can and we want her to accept that.
I would ask the Deputy to address his remarks through the Chair.
She is simply refusing to do it. It is not that she has an inability to do it.
Can I ask—
I would like to answer Deputy Stagg. I do not intend to recommend to Cabinet that the State should invest—
So the Minister accepts that she has the right to do so.
Allow the Minister to speak.
I am awaiting a ruling on that.
It is here in black and white. It is very clear.
If the Deputy will allow me to continue. I am awaiting a ruling on that but it is not my intention to recommend to Cabinet that it should invest £500 million in Aer Rianta.
Why?
Because the commercial semi-State companies should make that investment alone, as in—
So the Minister is giving not money to CIE?
—the way of Bord na Mona. The Deputy's party in Government decided it would replace—
And the Minister's Government gave them money, and they gave to CIE.
The Minister is in possession.
I do not know why I try to give the answers; perhaps the Deputy should give the answers. I do not intend to recommend to Government that it should invest £500 million in Aer Rianta.
The Minister is putting forward the argument that only 30% may be sold, that people should not be worried and so on. If the principle is set out that the State will not invest, it is inevitable that that 30% will be enlarged and the State's share will be diluted every time Aer Rianta needs further capital, if the same principle is to apply. I put it to the Minister that once she starts down the road of an IPO, be it 30%, there will be an absolute sea change whereby public policy considerations will take second place to commercial ones.
A very brief question from Deputy Stagg.
Will the Minister now put an end to her determination to have an investment strike whereby she will not invest money in the companies for which she is responsible so that she has an excuse for selling them off to get capital with which to invest in them?
No. Deputy Yates asked if there was an inevitability when one starts on the road of partial privatisation. I do not accept that.
The reality is that the Minister has made a decision.
There is not an inevitability about that. On public policy considerations, the State remains the major shareholder and therefore the public policy considerations of the three State airports, and particularly the policy on regional needs, would remain. Deputy Stagg asked whether it was the intention not to invest in something. We are about to put £2.2 million into CIE.
Why in CIE? Why not in Aer Rianta?
