Dáil Éireann debate -
Tuesday, 2 Mar 2004

Vol. 581 No. 2

Adjournment Debate.

Job Losses.

Mr. Ferris

I am grateful for the opportunity to raise the serious crisis in employment currently facing County Kerry. At the end of 2003, there were more than 7,000 people on the live register in Kerry, the seventh highest in the State. As a proportion of the labour force, this puts Kerry among the two or three worst affected counties.

Since Christmas, a further 248 jobs have been lost at the Sports Sock Company's plants in Tralee and Cahirciveen, Goblin in Tralee and Imperial Schrade in Listowel. These losses bring the number of unemployed in Kerry to an extremely worrying level. The decline in the number of tourists coming to Kerry, and north Kerry in particular, coupled with the adverse effects on the tourist market over the past number of years, through no fault of the local tourist boards, is alarming. There are currently 3,000 people unemployed in Tralee; 1,300 in Killarney and more than 1,100 in Listowel. One of the most worrying aspects is that in 2003 almost no new jobs were created and those created were outweighed by losses.

I raised the lack of IDA success in bringing jobs to Kerry with the Tanáiste and Minister for Enterprise, Trade and Employment, Deputy Harney, on a number of occasions last year. Not only did she inform me that the IDA had brought no new jobs to the county, but she said there had been only two visits by companies to Kerry during an 18-month period. I am not advocating we become totally dependent on foreign inward investment, although it will have to play a part if current job levels are to be tackled. We also need to encourage and support the establishment of local enterprise and small businesses.

I am also concerned that the Minister has refused to meet with Tralee Town Council to discuss the jobs crisis. The invitation was passed at the council's meeting last November with the support of all parties. The Minister, however, has refused to meet the council. The Progressive Democrats do not have elected councillors in Tralee but I can assure the Minister that members of the other Government party were extremely annoyed at her refusal and have cited it as evidence of a lack of interest in the situation and a lack of will on her part to address the crisis. The Minister has no difficulty flying by helicopter to Leitrim to open a pub and with having a State car to bring her home, yet she will not meet the democratically elected councillors of Tralee Town Council. The Minister's refusal to meet the council is an affront to democracy and an insult to the electorate.

I ask the Minister to reconsider her position and to meet with the council to hear at first hand the views of those attempting to cope with the social and human costs of the high level of unemployment in Kerry and, in particular, Tralee where 3,000 people are unemployed. Unemployment not only brings poverty and deprivation, it has a seriously demoralising impact on the community as a whole. I can attest to the grey mood that has gripped the town in the face of a series of major job losses. The same story can be told of every other large town and rural community in the county. I call on the Minister to address the situation as a matter of urgency and to ensure that her Department devotes more resources to turning it around.

I cannot emphasise enough the demoralising situation which exists in Kerry. People are also conscious that other companies may be experiencing difficulties. Given the loss of 248 jobs since Christmas and the possibility of more job losses by the end of this year, it is imperative the Minister agrees to invest resources and to do everything possible to turn this crisis around.

Minister of State at the Department of Transport (Dr. McDaid)

I wish to extend the Tanáiste's apologies for her inability to be here this evening. I also wish to point out to the Deputy in reply to his remarks about the Tanáiste not meeting with elected representatives, that she would meet them if such a meeting were to provide a positive outcome. My constituency is also experiencing problems of unemployment. Even today 120 jobs have been lost in Letterkenny.

Members can blame the Government for its failure to bring jobs into the county but they cannot blame it for decisions taken in board rooms in other countries. We, as politicians, cannot take the blame in that regard.

I thank the Deputy for raising this matter on the Adjournment. The Tanáiste is conscious of the adverse effects on workers and their families in Kerry of job loss announcements in companies such as the Sports Sock Company's plants in Caherciveen and Tralee, Rosenbluth in Killarney in January last and the recent announcement of job losses at Imperial Schrade at Listowel. However, she would point out that the number of people on the live register in the south-west region actually fell in the year to January 2004, with 1,177 work permits issued to companies in Kerry in 2003. This does not suggest a jobs crisis.

Finding alternative employment for the workers affected by these job losses is a priority for FÁS and the State development agencies. FÁS is making available its full range of support services including skills analysis, training and job placement to the staff of the affected companies. IDA Ireland is the agency with statutory responsibility for the attraction of foreign direct investment to Ireland and its regions. The agency, through its project divisions and network of overseas offices, is actively marketing County Kerry to overseas investors as a potential location for foreign direct investment. However, the current economic slowdown has meant that there are less companies actively seeking to invest overseas and, consequently, fewer companies are visiting Ireland. Ultimately, decisions regarding where to locate a project, including what areas to visit as potential locations, are taken by overseas investors.

In 2003, five overseas investors visited Kerry, including two visits to north Kerry. In addition to targeting potential new projects, IDA Ireland and Enterprise Ireland are working with the existing base of companies in the county with a view to supporting such companies with potential expansions and diversification of activities. There is a diverse range of companies located in Kerry, representing a number of industry sectors including manufacturing, international services, engineering, pharmaceuticals and consumer products. IDA and Enterprise Ireland believe that a number of these have the potential to expand and/or take on additional responsibilities or activities.

To continue to enhance the attractiveness of Kerry as a location for inward investment, IDA commenced site development works in 2002 on its business and technology park at Tiernaboul, Killarney. This site development work, which is now complete, involved significant landscaping, access development and site clearance, all of which has resulted in upgrading the overall appeal of the location. In addition, a local group of business people has completed a new building of 14,716 sq. ft. on a site acquired from IDA Ireland on the Business and Technology Park, and IDA Ireland is actively marketing this facility as an alternative property solution to present to potential investors.

IDA Ireland believes that these investments, together with other available facilities such as Kerry Technology Park in Tralee, where Shannon Development has invested €8 million, will put Kerry in a position to compete more competitively for inward investment in the manufacturing, ICT, software and international services sectors. The designation of both Tralee and Killarney as hub towns under the Government's national spatial strategy will also add to the attractiveness of the county for overseas investment.

IDA Ireland believes that regions need magnets of attraction, some compelling business reason or unique selling proposition that will attract investors. The challenge of achieving high value FDI into regional locations is considerable; nevertheless, progress is being made. Each region needs a hub of attraction around which, for approximately 40 to 50 kilometres in every direction, the region can grow through attracting a wide range of enterprises, both local and international, which emerge because of the integrated competitive strengths of that region.

The major decentralisation package announced in the budget includes 165 jobs to be relocated to Killarney and 50 to Listowel. This move demonstrates the Government's commitment to balanced regional development and will provide a further boost to enterprise development in Kerry.

The Tánaiste is confident that the strategies and policies being pursued by the State development agencies in Kerry, together with the ongoing commitment of Government to regional development, will bear fruit in terms of investment and jobs for the people of Kerry.

Schools Building Projects.

Mr. M. Moynihan

I thank you, a Leas-Cheann Comhairle, for allowing me the opportunity to raise the issue of the further development of facilities at the Christian Brothers secondary school in Charleville, County Cork. This is the alma mater of Éamon de Valera and the Cathaoirleach of Seanad Éireann, Senator Rory Kiely.

I want to bring to the attention of the House, the Minister and the Department that three junior cycle classes are accommodated, and have been so accommodated for the past 15 years, in a prefabricated building, which is a most unsuitable environment. The Charleville CBS will consider a further prefabricated building as an option for further expansion.

In a secondary school which teaches a foreign language through to leaving certificate level there are no language laboratories. There are no art or technical graphics specialist rooms. A converted classroom is used currently for these facilities. Woodwork cannot be offered on the timetable due to lack of facilities, and this also reduces the school's competitiveness in securing new student numbers. There is no major gym or assembly hall. There is a lack of space for physical activities and PE can only be offered to junior certificate classes. The parents' council, the staff and the pupils have great difficulty with this aspect of the school's lack of facilities. We often read about obesity levels and lack of fitness in our young people and it is unacceptable that Charleville CBS does not have proper facilities. I ask the Minister and the Department to give serious consideration to that aspect.

There are no canteen facilities in the school and I am aware from many visits to Charleville CBS that the classrooms are used as eating facilities, which is totally unacceptable. There are no facilities to include pupils with disabilities and this school is one of the schools in my area which has two storey accommodation. It was built in the late 1960s and nothing has been done to the school since that time.

We would like a clear indication from the Minister and the Department on the future of Charleville CBS. What initiative does the Department intend to take in regard to maintaining a top class education facility in Charleville, which is what the Charleville CBS has been for many years?

There is no need for me to outline the school's long list of academic achievements on the part of its pupils, both here and throughout the world, despite the lack of facilities and investment by successive Governments over the years. This school has a fantastic academic record and I urge the Minister and the Department to seriously examine this problem with a view to getting investment back into the school.

Dr. McDaid

I thank Deputy Moynihan for raising this matter as it affords me, on behalf of the Minister for Education and Science and the Department, to outline to the House their strategy for capital investment in education projects and the current position regarding the application received in the Department for refurbishment and remedial works at the Christian Brothers secondary school in Charleville, County Cork.

I am aware this matter has been raised by Deputy Moynihan on a number of occasions. As the Deputy stated, the school in question is an all-boys' secondary school, one of three post-primary schools serving the needs of the Charleville area. The other schools are St. Mary's secondary school, which is a girls' school operated by the Mercy Sisters, and Mannix College, which is a co-educational school operated by County Cork VEC.

Enrolments at the Christian Brothers' school and in the Charleville catchment area generally have been declining in recent years. The current enrolment in the Christian Brothers' secondary school is 220, while the combined enrolment in the three schools is 782 pupils. The combined figure is expected to fall to approximately 750.

The application to upgrade and refurbish facilities at the Christian Brothers' secondary school is currently being examined in the planning and building unit of the Department of Education and Science in conjunction with the feasibility study carried out at this school. This process involves consideration of all relevant factors, including enrolment and demographic trends in the area, and the overall accommodation requirements of this centre. A decision on the application will be made in light of the school's accommodation needs, as pointed out by the Deputy, and the overall needs of the centre, having regard also to the availability of capital resources.

A key strategy will be grounded on the budget day announcement of multi-annual allocations for capital investment in education projects. All projects that do not go to construction as part of the 2004 school building programme will be re-evaluated with a view to including them as part of a multi-annual building programme from 2005 onwards. I have no doubt Deputy Moynihan will make representations in that regard.

In the meantime, the CBS authorities were approved for funding under the 2003 capital programme to address the replacement of the main electrical board, refurbishment of the science laboratories and emergency lighting and fire alarm system for the overall school. Towards the end of that year the school authorities advised the Department that it had not progressed these works and would not be in a position to draw down the funding allocated in 2003. Due to the nature of the works required, the school authorities were given approval by the Department to carry out the works during 2004 and a commitment was given that the funding earmarked for 2003 would be made available in the current year under specified conditions. I take this opportunity to thank Deputy Moynihan for raising this matter in the House.

Job Losses.

Ms O’Sullivan

I welcome the opportunity to raise this issue in the House, along with my colleague, Deputy Pat Breen. It relates to Shannon Airport and the latest blow in the announcement by Aer Lingus that it intends to compulsorily relocate 29 staff to Dublin and to seek 102 redundancies at the airport. That is in the context of the intention of the Minister for Transport, Deputy Brennan, to renegotiate the bilateral aviation agreement with the US Government.

Aer Lingus's slashing of jobs at Shannon Airport reached alarming proportions last week when it told the 29 cabin staff that they would be compulsorily relocated to Dublin followed by the announcement that it is seeking 102 redundancies. This is the latest and most damaging in a series of moves to centralise Aer Lingus's operations in Dublin. Already management, staff, pilots and some cabin crew have been relocated. The number of cabin crew based in Shannon has been cut in half. It is no secret that the national airline has been campaigning to have the 50-50 stop regime renegotiated. The Minister appears to have bought the line that the company is simply seeking to gain extra routes and that it is fully committed to Shannon. I heard the Minister saying that again on Question Time in response to Deputy Pat Breen. I hope the Minister of State will convey the views expressed in the House because it is disappointing that the Minister is not present to hear what we are saying. Apparently, he does not hear what anyone says regarding Shannon.

All the evidence is that Aer Lingus has every intention of centralising its operations at Dublin Airport and drastically reducing its operations at Shannon. Why else would it shed so many jobs when there is extra business to be fought for? The unfairness of this is that more than half the transatlantic passengers last year chose to use the Shannon gateway. Aer Lingus's strategy appears to be to force many of them to come in and out through Dublin simply for the convenience of the company and to prepare it for privatisation. It is not for the benefit of the passenger.

The workers at Shannon took the pain and helped to turn the airline around from being a loss-maker to returning profits of almost €100 million. The Minister needs to wake up to what Aer Lingus is up to before he sells out the mid-west and the west. We depend on the transatlantic routes for more than 40% of Shannon's business. More than 40,000 jobs in the west depend on Shannon's continued activity. This is not scaremongering; this is survival. A man whose job is in an industry reliant on access through Shannon to the US seriously posed the question to me last week whether they want us all to move to Dublin and where they were going to put us.

A spatial strategy is supposed to be in operation. Great play is being made about the decentralisation of civil and public servants, which may or may not prove to be a pipedream. At the same time, one of the few policy instruments that has been successful in maintaining regional balance, the dual gateway transatlantic equality of access, is to be ditched. It is wrong to blame this on the EU open skies policy, as the Minister repeatedly does. Mr. van Hassell of the European Commission's transport department has made it clear that the dual gateway is not an obstacle to open skies competition rules because all airlines must abide by the same regulations.

The Minister must be open and transparent in the steps he proposes to take over the next few months. I urge him to look at the reality of what Aer Lingus is doing to Shannon rather than simply believing its propaganda. He should take renegotiation of the bilateral agreement off the agenda. He is railroading through his agenda in the absence of a properly worked out business plan for Shannon's future, any assessment of the regional implications of proposed changes, or without acceptance by Aer Lingus, the national airline, to comply with the national spatial strategy. Aer Lingus's announcements in the past week must be a wake-up call to the Government to reappraise its strategy on Aer Lingus and Aer Rianta.

Mr. P. Breen

Like my colleague, Deputy O'Sullivan, I am disappointed that the Minister for Transport, Deputy Brennan, has not taken the time to be in the House to deal with this important issue. It is an issue that not only affects the people of the mid-west but of the whole country. Shannon Airport is a perfect example of balanced regional development, decentralisation and spatial strategy. It has underpinned the development of tourism and US foreign direct investment in the western seaboard and has offered transatlantic services over the past 60 years. It has a modern terminal capable of accommodating up to five million passengers, US immigration facilities, unrestricted operational conditions with no curfews or slotting, good road networks around the airport and easy parking. Above all else, it has a 3,200 m. runway that can accommodate any aircraft type. One might call it a jewel in the crown and many countries would envy Shannon Airport.

Unfortunately, the Government has no commitment to it nor does it care about Shannon or its future. Since 11 September 2001, there has been an erosion of services from Shannon by the national carrier, Aer Lingus. All the 27 services announced last year to continental Europe are out of Dublin and Cork. Aer Lingus, which contributed so much and was the foundation stone of Shannon 60 years ago, now seems to be running away from its responsibilities as the national airline and consolidating its business in Dublin to prepare for a long-term privatisation agenda. It is doing so with the Government's approval.

It is a sad state of affairs when US officials are unaware that no special case is being made by the Irish Government for Shannon in the Ireland-US talks. It is a sad state of affairs that at EU level no special case has been made for Shannon in the open skies discussions, despite the fact that Commissioner de Palacio says that Shannon has a special case. It is sad when the media contacted the Minister of State's Department last week regarding the proposed job losses at Shannon — where Aer Lingus proposes to cut 50% of its staff — and were told by an official that this was an operational matter for the national airline.

Dr. McDaid

It is an operational matter.

Mr. P. Breen

That is a sad state of affairs. The Minister of State should have been in Shannon last Friday, as I was with the Aer Lingus workers, to see the grim faces as they left the meeting not knowing their future. Individual workers wondered how they would pay the mortgage if they were to be among the 103 the company proposes to let go, how they would educate the family, etc. This is not an operational matter. It is a matter of national importance and the Minister for Transport has a responsibility to these workers who have given so much to this company over the years. In the debate earlier the Minister informed me that Aer Lingus says it is committed to Shannon Airport. These are feeble words and are not good enough. The Minister has the ultimate responsibility for this semi-State body and he must ensure that Aer Lingus and Willie Walsh commit themselves to Shannon. They should get a business plan in place immediately, obtain guarantees to build on transatlantic services out of Shannon after the open skies negotiations and abandon the proposed job cuts.

Deputies will recall how quickly the Minister acted last year against Dublin City Council when it erected the traffic direction signs around the city without his approval. The Minister must act as quickly with Aer Lingus. Other rumours persist, such as more job cuts in the cargo and maintenance sectors of Aer Lingus and in Aer Rianta, despite that the Minister said during his negotiations with the unions that there would be none. Unless he acts immediately and comes clean on this, he will lose all trust and will become a modern-day Pontius Pilate washing his hands of Shannon and flying in the face of balanced regional development by refusing to stand by his west of Ireland roots. What is good for Aer Lingus may not be good for the rest of the country.

Dr. McDaid

I thank the two Deputies for raising the matter of Shannon on the Adjournment. In light of the apparent lack of information at their disposal, I point out to them that I and the Minister attend all the Council of Ministers meetings in Europe. I have attended every one of them and I categorically deny that no case has been made for Shannon Airport with the EU and the US. I cannot imagine what would have happened to Shannon in recent years without the Government. To say, as Deputy Pat Breen has, that the Government does not care for Shannon is pure political opportunism of the cheapest type——

Mr. P. Breen

It is not political opportunism.

Dr. McDaid

——and I hope he will listen to the reply that I am about to give on what exactly is happening. Neither of the Deputies understands what exactly is happening with regard to EU-US negotiations and what it would mean for this country if we were not present at those talks.

Ms O’Sullivan

Of course we do.

Dr. McDaid

No, the Deputies do not. The European Court of Justice ruled on 5 November 2002 on a case taken by the European Commission against eight member states, not including Ireland, on those states' open skies agreements with the USA. The court ruled that the designation of national airlines in those member states' bilateral air transport agreements is contrary to the right of establishment provided for under the treaties establishing the European Union. This means that member states must allow any European airline established in their country to enjoy the benefits of that member state's bilateral agreements. I am sure the Deputies understand what that means, that British Airways or Air France have the same rights if they are operating from this country.

Ms O’Sullivan

The Minister of State is deliberately misrepresenting us.

Mr. P. Breen

What deal was done? What did the Government get?

Dr. McDaid

This legal principle applies to each member state's bilateral agreements with every third country, not just the USA.

In response to the court's ruling, the European Commission then reactivated a proposal to give it a mandate to negotiate an open aviation area agreement with the USA. This was a long-standing proposal and the Minister considered that it was only a matter of time before such a mandate would be given to the Commission.

Under the mandate, the EU and US territories would be treated as one single aviation area. Such an open aviation area agreement between the EU and US would satisfactorily solve the legal problems highlighted by the court with the USA and is a pragmatic response to the difficulty of up to 15, and shortly 25, member states having to simultaneously change their agreements with the USA in an integrated way.

The mandate given to the Commission envisages a liberalised regime in which airlines may operate services in both Europe and the USA as well as between them. The intention is that European and US airlines are not constrained as to the destinations to which they fly, just as they are not so constrained within Europe today.

When deciding what position he should adopt at the Transport Council in June 2003 on behalf of Ireland, the main issues the Minister took into account were the ruling of the European Court of Justice last November, the impact on Shannon Airport and its hinterland, the impact on tourism of increased access to Ireland, the opportunities for Aer Lingus to increase its business on trans-Atlantic routes and Ireland's wider relationship with Europe. The Minister also had to consider that an EU-US liberalised market is the inevitable outcome of this whole process in Europe.

At the Transport Council, the Minister stated that he would not oppose the wish of all the other member states to grant this mandate to the Commission to negotiate an EU-US agreement. The Minister also reiterated his concerns about the impact an EU-US agreement might have on Shannon Airport and that he will carefully assess the draft agreement which ultimately emerges from those negotiations.

Rounds of negotiations between the EU and US sides have taken place in October and December 2003 and in February this year. The Transport Council on 8 and 9 March will consider the progress so far, and following that, the EU and US sides will meet again at the end of this month to review the outcome of the Council. During these negotiations, a special committee made up of all member states is assisting the European Commission. Ireland is represented on this committee by a senior official from the Department of Transport.

It is unclear how long these negotiations will take. There are signs that an interim agreement could be reached on some issues. However, it will be a matter for the Transport Council next week to determine if the outline of a deal that is on offer could serve as a basis for a substantive deal between the EU and the US. If the Council determines that what is on offer is sufficient as a first step in EU-US aviation relations, it is possible that a deal could be reached by June of this year.

As the Minister has previously indicated to the House, he has authorised his officials to seek negotiations with the US on possible phased amendments to the Ireland-US bilateral agreement. No dates have yet been finalised for such negotiations. The purpose of negotiations with the US authorities, which the Deputies want us to abandon, is to ensure that an Irish dimension is agreed between Ireland and the US for inclusion in the EU-US deal. If the Minister were to abandon the intended negotiations with the US authorities there is a grave threat that the EU-US negotiations would not take account of Irish requirements. That is the bottom line.

The Department of Transport has also been in contact with the European Commission to inform it of the intended negotiations with the US. While the Minister has stressed to the Commission the importance of the Shannon issue for the Irish authorities, he believes that the best prospects for achieving the most advantageous outcome for Irish aviation and tourism, including Shannon Airport, lie in direct talks between Ireland and the US.

There is no question of the Minister or the Government abandoning Shannon Airport. On 5 February the Minister met the Aer Rianta unions for further discussions on the dual gateway status of Shannon. There will be further discussions with the unions and the Shannon board designate before the Minister's negotiating position is finalised. The House will appreciate that it would not be appropriate for the Minister to publicise his negotiating position in advance.

I want to refer to concerns expressed about recent announcements by Aer Lingus regarding job transfers and job losses at Shannon Airport. I do not wish to comment on individual industrial relations matters as these are day to day operational matters for the company.

Mr. P. Breen

The Minister for Transport is responsible for Aer Lingus.

Dr. McDaid

There is a range of industrial relations machinery available to assist in resolving these matters and some of the issues are in the Labour Relations Commission as we speak. However, Deputies must clearly appreciate that Aer Lingus operates in an environment which is becoming more and more competitive with ongoing pressure to reduce fares. This can only be achieved if costs are reduced. Nevertheless, Aer Lingus is committed to maintaining operations at Shannon, especially US services. The more efficient the Aer Lingus operation at Shannon, the better the business case for retaining and indeed expanding services at Shannon.

Mr. P. Breen

Fewer jobs mean fewer services.

The Dáil adjourned at 9.10 p.m. until 10.30 a.m. on Wednesday, 3 March 2004.