Priority Questions.

International Agreements.

Pat Breen


108 Mr. P. Breen asked the Minister for Transport when he expects his officials to have completed the negotiations on the Ireland-US bilateral air agreement; the case he and his officials have made to the US on behalf of Shannon; if he has made a case to the European Commissioner, Loyola De Palacio, for an exemption for Shannon; his bottom line in these negotiations; if he and his officials will cease negotiations if an acceptable package is not forthcoming for Shannon; and if he will make a statement on the matter. [6834/04]

As I have indicated to the House on a number of occasions, I have authorised my officials to seek negotiations with the United States on possible phased amendments to the Ireland-US bilateral agreement. No dates have yet been finalised for such negotiations. My Department has also been in contact with the European Commission to inform it of the intended negotiations with the US. While, on several occasions I have stressed to the Commission the importance of the Shannon issue for the Irish authorities, I believe the best prospects for achieving the most advantageous outcome for Irish aviation and tourism, including Shannon Airport, lie in direct Ireland-US talks.

On 5 February I 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 my negotiating position is finalised. The Deputy will appreciate that it would not be appropriate to publicise my negotiating position in advance.

I thank the Minister for his short reply, which is not really a reply. Given the reports over the weekend from US officials that Department of Transport officials have made a case for new gateways for Aer Lingus, will the Minister confirm that no special case has been made for Shannon? Within the EU open skies negotiations, the Commissioner, Loyola De Palacio, has stated that Shannon represents a special case. Is it true that no special case has been made for Shannon since the former Minister for Public Enterprise, Senator O'Rourke, did so? Is it correct to assume that the proposal by Aer Lingus to ask 50% of its staff to leave is a precursor to Aer Lingus leaving Shannon Airport to consolidate its business in Dublin? Does the Minister support such consolidation?

Both publicly at the Council of Ministers and privately to the Commission I have consistently made the case for Shannon Airport and will continue to do so. The US and the EU are engaged in talks about open skies, the first round of which is complete. A further round will take place in Brussels in the week commencing 29 March. I understand the Commissioner is adopting a two-phased approach with some progress to be made by June and the rest will await the outcome of the United States presidential elections. In the context of the US-EU talks it is important that we protect Shannon Airport.

The reason I have authorised discussions, which have not yet commenced, is to seek to ensure that, in the context of the USA-EU deal, we get a deal for Shannon with which the airport can live and that will allow Aer Lingus to continue to operate out of it and provide more gateways. Aer Lingus requires additional gateways to the United States. We cannot obtain those under the present bilateral agreement. For that reason it is necessary to renegotiate it, but that must be done in the context of the USA-EU talks.

Were I not to approach it in this way, we would be at the mercy of the USA-EU making an arrangement which could be some years away and which may not suit Shannon. It is critically important that we achieve an understanding with the United States so that, when that deal between the USA and the EU is completed, it will incorporate a clear deal for Shannon Airport that allows it to move forward strongly with Aer Lingus.

I do not support the idea of Aer Lingus exiting Shannon, nor do I believe the company has any intention of doing so. The present job situation there partly relates to baggage handling, which is being undertaken by another company for other airlines and not specifically Aer Lingus, although there are other disputes. However, Aer Lingus informs me that it intends to operate as soon as new gateways to the United States from Shannon can be obtained. It does not envisage exiting Shannon Airport. The contrary is the case.

How does the Minister intend to guarantee transatlantic services in Shannon, given the situation that has arisen in the context of Aer Lingus in recent times, especially in the context of its proposed summer schedule in which some of the transatlantic services out of Shannon are being scaled down? If fewer people work for Aer Lingus in Shannon, there will be fewer services.

I am also informed that Aer Lingus was not tendering for extra business in Shannon, especially regarding third party handling of baggage. What deals are in place for Shannon? There is no trust now. Workers in Shannon have no faith in either Aer Lingus or the Minister. Will the Minister give the workers a guarantee, especially where transatlantic flights are concerned, because they are the core — 44% — of business for Shannon Airport?

I cannot give guarantees. A commercial world approach is involved and I cannot give guarantees about that. Aer Lingus has a commercial mandate. It must make aliving. It informs me it is fully committed to Shannon.

We have been hearing that for a long time.

Aer Lingus still flies out of Shannon.

Just about.

Its passenger numbers out of Shannon are growing substantially.

There are fewer services.

I am told that Aer Lingus is fully committed to providing those services and to expanding them, if possible.

Airport Development Projects.

Róisín Shortall


109 Ms Shortall asked the Minister for Transport the status of the Government decision announced by him on 10 July 2003 to proceed with arrangements with a view to establishing Dublin, Shannon and Cork as independent airport authorities under which new arrangements the three airports would compete with each other and vigorously pursue new business, free from central control, including arrangements (details supplied), in the wake of the press reports of 21 February 2004; and if he will make a statement on the matter. [7091/04]

Denis Naughten


344 Mr. Naughten asked the Minister for Transport if his Department has resolved the legal difficulties surrounding the break up of Aer Rianta; if he has satisfied himself that the three airports are commercially viable as stand-alone entities; and if he will make a statement on the matter. [6836/04]

I propose to take QuestionsNos. 109 and 344 together.

I am satisfied that the Government decision of July last to restructure Aer Rianta will be implemented within the timeframe originally envisaged for this project. As I said in response to questions a few weeks ago in this House, there are significant technical and legal issues which my Department and its advisers are working through in conjunction with Aer Rianta management and its advisers. We want to ensure, in accordance with the Government decision, that the new independent Shannon and Cork airport authorities commence business with a fresh start while at the same time ensuring that Dublin Airport, which is the country's main metropolitan gateway, is also positioned to develop and grow to meet the increasing travel demands of our business and tourism sectors.

The articles in the media on 21 February last referred to a confidential document drawn up by my Department for the purpose of advancing the implementation of this important, strategic and of course complex project. The project steering group which comprises officials of my Department and the Department of Finance, Aer Rianta management and advisers, is evaluating the technical, operational and commercial aspects of the approach proposed in that document. This exercise includes the prompt finalisation of revised financial projections for each of the three State airports as stand-alone entities. Obviously, it is essential that each of the new airport authorities would have sound opening balance sheets and that each would be able to trade successfully on a commercial basis in the future. As I have emphasised on numerous previous occasions, however, the preparation of these revised and updated financial projections will not in any way inhibit the commercial freedom and responsibility of the new authorities, when formally established, to develop strategic business plans for each of the three airports.

While no decisions have yet been taken on the precise methodology to give effect to the Government decision, the approach being explored by the steering group would involve the transfer of Shannon and Cork airports out of Aer Rianta by way of a distribution in specie. Under this approach, the transfers would take place on a phased basis as the reserves of the parent company permit. It would be an objective of this approach to keep the timescale associated with the phased transfers to the minimum and, in this regard, other financial options for allocating airport assets among the three airports are also being examined. In this regard also, the issue of Aer Rianta's main subsidiaries such as Aer Rianta International and the Great Southern hotels group is being carefully examined. Deputies will appreciate that while this important work is ongoing, it would not be appropriate for me to speculate on or pre-empt the outcome.

Additional information not given on the floor of the House.

In tandem with this work, my Department is also well advanced with the drafting of the necessary amending legislation to give effect to the restructuring. At this stage, it is not envisaged that the amending legislation will dictate the specific methodology which is ultimately decided upon to effect the restructuring. Instead, it will contain enabling provisions which will preserve a degree of flexibility and ensure that optimum mechanisms, which are in the best interests of each of the new independent airport authorities, are employed. The enactment of the amending legislation, which I believe will be achieved before the summer, will also enable the establishment of the three new boards for the State airports on a formal, statutory basis.

Both I and my Department are also maintaining the ongoing process of full engagement with the Aer Rianta unions to deal with issues of concern to workers arising from the implementation of the Government decision. When the revised financial projections for the three airports which I referred to earlier are completed, I have already confirmed my willingness to share key financial information with the unions in the context of the current engagement process being facilitated by the Labour Relations Commission before legislation is finalised. As Deputies are aware, I have also conveyed assurances and clarifications about the protection of the current terms and conditions of employment of Aer Rianta workers in the context of the three new independent airport authorities when established.

Does the Minister accept that he has made a hames of the restructuring of Aer Rianta? Does he accept that, when he announced last July on the basis of a hunch that he intended to break up the Aer Rianta company, he did not have a clue what he was getting into? Does he accept that, because of that, he has had to employ an army of consultants, such as PricewaterhouseCoopers, Matheson Ormsby Prentice and God knows who else? Will he inform us how much taxpayers' money he is spending on consultants to get him out of the legal and economic mess he has created for himself and Aer Rianta?

The Minister said that he was on target and within his timescale. I remind him that, in his announcement last July, he said he would immediately establish the three boards designate for the three airports. That has not been done. He spoke about having builders on site in Dublin Airport by last Christmas to commence construction of the second terminal. There has been no movement on that, nor has there been any movement on pier D. The Minister spoke about having the legislation in the House by last December. There was a delay and he promised it for January. It is now the end of February and there is no sign of that legislation because it is almost impossible to legislate for the hunch the Minister had in mind last year not knowing and not giving any consideration to what was involved.

The Minister has informed us in recent days that the reason he is not publishing the legislation is that he is meeting the unions as part of his negotiations. What negotiations are taking place? When did the Minister last meet the unions? Has he met the unions since the industrial action was called off some weeks ago?

The Minister is talking about legislating for something for which it is not possible to legislate. Will he put on the record the legal obstacles that have been identified by the consultants? How does he propose to overcome them?

There are about 18 questions there.

The Minister has about one minute to answer the questions.

I do not accept that I made a hames of it. That is the answer to the first question. I do not accept that it is impossible to legislate.

Where is the legislation?

Deputy Shortall should allow the Minister to continue without interruption.

I do not accept that it is impossible to legislate. This House should have no difficulty in taking a State company and establishing three independent airports by legislation.

The Minister cannot just take a PLC——

We will move on to the next question if the Deputy frustrates the Minister in answering the question. It is not appropriate to do that in a parliamentary democracy.

The Chair is giving the Minister excuses for dodging the question.

The Deputy took three and a half minutes to ask her question. The Minister had one minute remaining to answer it.

I depend on the Chair to notify me of time.

It is not impossible to legislate. The legislation is almost completed and will be brought before the House. There are issues that have yet to be resolved. I explained to the Deputy that they were complex, and that is why we need good advice from consultants and specialists to ensure we do this properly. We are doing it for the future. The reason we are doing it is to allow Shannon and Cork airports to have a fresh start with new leadership and regional input and to place the future of these airports in the hands of the regions. The Deputy and I will never agree on that and I do not envisage there ever being a meeting of minds on it. I firmly believe the Shannon and Cork regions have the capacity, talent, ability and determination to grow those two airports in a way that will never happen in the Aer Rianta structure.

It does not matter what the Minister believes, the evidence——

The time for this question has concluded. We must move on to question No. 110.

It is not a matter of what the Minister believes. He is doing a huge damage to Shannon Airport and Cork Airport.

That is the trade union view. We know from where the Deputy is coming on that matter.

No, it is the view of the——

There are other Deputies who have submitted questions and who are entitled to hear the replies to them.

Deputy Shortall should ask the people of Shannon and Cork.

They are extremely concerned about the jobs haemorrhaging out of Shannon Airport.

I believe in Shannon and Cork.

What about——

I will have to ask Deputy Shortall to leave the House if she does not allow the Minister to answer question No. 110 in the name of Deputy Eamon Ryan.

Public Transport.

Eamon Ryan


110 Mr. Eamon Ryan asked the Minister for Transport if his Department will review national transport policy in view of the publication of the 2002 census travel statistics which showed a dramatic increase in car use for adults going to work and children going to school; if such a review is to be carried out, the form it will take and the timetable for the resulting review of investment priorities within his Department. [7073/04]

Transport policy is kept under constant review and data such as that in the census figures contributes to that process. National transport policy has to meet a wide range of needs and demands and the census figures reflect how the demand for mobility has increased dramatically in recent years as the country has developed and economic growth has increased. The challenge is to respond appropriately to this demand while taking into account potential conflicts with other policy objectives, including those relating to sustainable development, balanced regional development, social inclusion and land use development, which is coherent with transport policy.

Against this background, and on the basis of the mandate in An Agreed Programme for Government, my Department's statement of strategy 2003-05 establishes strategies that will underpin Ireland's economic growth and competitiveness and contribute to social development through the efficient and effective delivery of a sustainable, appropriately regulated, safe and integrated transport system.

A key component of that policy is the significant investment taking place in key transport infrastructure and services, in a manner consistent with the national spatial strategy and in a way which promotes modal shift in favour of sustainable transport. Much of the benefit of that investment is now becoming evident in Dublin and in other urban areas, as the DTO's most recent annual report revealed. For example, it emerged that the percentage of commuters using their car instead of the bus or train to travel in the morning peak in Dublin had fallen slightly in the five years to 2002. Some 85,000 or more than 18% now use buses to travel to work in the greater Dublin area, primarily due to the success of the quality bus corridors. These are positive trends.

I do not know if the Minister believes what he has just read into the record. If one considers the census statistics, it is clear we are presiding over a disaster in the area of transport. The Minister stated that we have a policy aimed at achieving modal shift. It is obvious from the census figures that this is not happening. Any analysis shows that people are switching to their cars. Our children are learning habits or starting lifestyles which will encourage them to drive to school rather than walk or cycle there as in the past.

The Minister referred to a slight marginal increase in some parts of inner city Dublin in respect of bus use. However, the reality is that most Dubliners drive to work from counties Laois, Kildare and Meath. These journeys are extremely long and lead to huge economic, social and environmental costs. The Minister is facilitating such transport patterns by spending four times more on motorways than on public transport. While he states that we want to achieve a modal shift towards public transport, the reality is that he is providing for a modal shift in the opposite direction. He is getting what he and other Ministers want to achieve, namely, a massive switch to car use.

What will the Minister do about this? How will he change policy or will it be a case of continuing as we go on the basis of the census figures? Are we to change anything or is the Minister satisfied the current policy is leading to the desired result? Does he believe the constant shift from 1986, when 45% of work journeys were done by car, to 1996, when 55% were done by car, and on to 2002, when 62% were done by car, is a step in the right direction? If not, what will he do about it?

I acknowledge the Deputy's statement that there has been a substantial increase in car use. A total of 50% of primary school students and 28% of secondary school students are driven to school. These are double the corresponding figures for 1981. It is clear there has been a major growth in the use of cars.

It has been the policy of successive Governments to try to effect a real modal shift. There is no great magic about how we intend to achieve this. First, we are building the Luas. In addition, we have put in place substantial quality bus corridors on which more than €90 million was spent during the past eight or nine years. This year our target is to double the number of quality bus corridors. There has been a substantial increase in the patronage of buses on these corridors. In addition, the average bus journey on the Stillorgan corridor is 35 minutes whereas in a car it is almost 65 minutes.

The answer to the Deputy's question is that it is a constant battle. Dublin is not unique in facing such a scenario. The people of Dublin are not selfish and if we provide public transport for them they will leave their cars at home. There has been phenomenal investment in Bus Éireann, Dublin Bus and Iarnród Éireann in recent years.

It has been the policy of successive Governments to develop Luas, bring forward the metro, invest heavily in quality bus corridors and buses and invest heavily in cycling and walking facilities throughout the city and county. That is what is happening at present and it is one of the reasons the city is almost a building site.

During the past seven years there has been an increase of 9,000 in the number of people using buses. At the same time, there has been an increase of 280,000 in the numbers driving cars. The Minister is spending four times more on roads than on public transport.

The Deputy should put a question.

How is it proposed to reverse this position or encourage a modal shift?

The main answer is that we are catching up in terms of roads.

Four times more is being spent on roads.

Approximately €400 million or €500 million will be spent on public transport this year. As the Deputy is aware, the economy has been exploding and we have had to catch up in terms of our motorways. Most countries of Ireland's size would have full motorways running between their main cities. We are still trying to get there. We have invested heavily in rail and will continue to do so.

Denis Naughten


111 Mr. Naughten asked the Minister for Transport the position regarding discussions taking place with the bus unions; and if he will make a statement on the matter. [6835/04]

I stated in my reply to a priority question on 28 of January my belief that the objective of regulated market opening could be achieved in the context of market expansion and negotiations without undermining terms and conditions of employment of existing employees. I also indicated my expectation that Dublin Bus would continue to play a significant role in meeting the future transport needs of Dublin. As stated on a number of occasions in the House, I am firmly of the view, supported by a number of professional studies and experience in other countries, that franchising is the most effective means of achieving genuine market opening to new entrants. However, I remain open to additional suggestions provided they are directed at achieving the same objective. Likewise, I am open to reasonable proposals relating to the pace of the introduction of competition so long as this objective is achieved in an acceptable time frame.

The Secretary General of my Department wrote to the CIE unions on 29 January outlining what I had said in the House and proposing that intensive discussions take place under an independent chair, within a tight time frame on the basis I have already set out. The CIE unions agreed to resume discussions on this basis. Intensive discussions, chaired by Mr. Kevin Foley of the Labour Relations Commission, commenced on 17 February. These discussions are ongoing and I understand have been characterised to date by a forthright and meaningful engagement on the issues.

Does the Minister accept that what we do not need is a change in the colour of the buses in Dublin? With regard to franchising, is it intended to have 25% more buses in Dublin or will 25% of the Dublin Bus fleet be handed over to private operators?

There is not a "yes" or "no" answer to that question. My target for Dublin is to open 25% of the market initially, before further progress is made. If I were to open it today, I would be talking about 25% of the existing market. If it is opened in six months' time when legislation is passed by the House, it will be 25% of the market as it exists at that time. The market is growing rapidly each day. There are increasing demands regarding the number of routes, buses and new services. My target is to achieve a figure of opening 25% of the entire market in 2004. I have not given up on this objective as yet.

The Minister continues to speak in parables. Does he agree that we need 250 additional buses in Dublin now, rather than in six or 12 months? Many communities around Dublin and elsewhere need bus services which are not being provided because the bureaucracy involved in the current system prevents it. Will the Minister ensure that a mechanism is introduced to provide services for the communities in question? Is it his intention to hand over some of the garages in Dublin to private operators to provide services in the city? Is he aware that the privatisation of bus garages in London was detrimental to competition?

In recent years, the public has provided hundreds of new buses for Dublin Bus and the company has done a fine job in using these assets. As regards the need to have more buses immediately, I am anxious to proceed with my proposals as quickly as possible in order that we can provide the additional services the city needs.

I do not want to discuss the matter in too much detail because discussions are ongoing, but I have received a number of studies on bus services, including the NERA and ISOTOPE reports to which I referred, both of which are strongly in favour of the direction I have proposed. I have a list of statistics in regard to the position in Helsinki, Stockholm and London before and after franchising. They are startling figures in that they all show that franchising resulted in significant increases in the number of buses and people travelling, reductions in subsidies per passenger and more modern bus fleets.

If the Minister is so eager to open up the market in Dublin, why did he not start discussions with the trade unions at an earlier date, rather than postponing them until now? If one examines the London market, which I ask the Minister to do, does one not find that while the quality of the service has improved and the number of people travelling on it has increased, the level of subvention to private operators has also increased significantly? That is the factual position.

I also thought that was the case, but when I checked I found that the subvention per passenger has decreased. While the number of passengers has increased dramatically and the subsidy has also increased, the subsidy per passenger has decreased and ultimately this is the key measure.

In that case, does the Minister have available to him the additional resources necessary to provide the additional subventions which will arise?

The Government has not yet worked through all that. I do not have a set number of buses in mind——

Is the Minister relying on another hunch?

I do not have in mind an optimal number of buses for Dublin. Many new applications have been made and new services are being demanded.

They are gathering dust in the Department.

In addition, much greater efficiency is being achieved with buses in that routes can sometimes be amalgamated and the new route serviced by the same buses. I acknowledge that much remains to be worked out in this area but I am clear of where we want to get to and I want to get there in 2004.

That is as clear as mud.

The Minister should visit Sandyford to find out what it is like to have no bus service.

Taxi Hardship Panel.

Seán Crowe


112 Mr. Crowe asked the Minister for Transport if he will report on the progress made in implementing the taxi hardship payments scheme. [7077/04]

Area Development Management Limited has been engaged to administer the taxi hardship payments scheme which is implementing the recommendations of the taxi hardship panel report in accordance with the relevant Government decision. The scheme was formally launched in November 2003 and application forms were issued to all persons who made submissions to the taxi hardship panel.

Newspaper advertisements were placed in the national newspapers on 6 November 2003 inviting applications under the scheme from those who held taxi licences at 21 November 2000; are able to demonstrate that they have suffered extreme personal financial hardship following loss of income arising from the liberalisation of the taxi licensing regime; fall into one of the six categories identified by the taxi hardship panel report; and are tax compliant. ADM is proceeding with the processing and assessment of applications as the application forms and associated required documentation are returned to them. Payments under the scheme commenced in December 2003.

I understand from ADM that it had received a total of 1,025 applications as of 25 February 2004. Hardship payments totalling €2,458,000 have been made to 204 qualifying persons to date and a further 163 applications are expected to come before the ADM board on 3 March for decision. Of the outstanding applications, 657 are awaiting processing. Additional information or clarification has been requested from applicants in approximately 80% of these cases.

The time taken to process applications and to make payments depends on the completeness of the information and supporting documentation in each case. Newspaper advertisements were again placed in the national newspapers on 27 February 2004 inviting applications under the scheme and advising of a closing date of 30 April 2004 for receipt of applications.

In light of our Presidency of the European Union and the possibility that this issue will be raised again soon in the European Parliament, will the Minister outline his reasons for his outright rejection of the report of the Committee on Petitions of the European Parliament, which described the payments made under the taxi hardship payments scheme as "derisory and inadequate" and called for a complete review of the matter? Will he outline what, if any, correspondence he has had with the committee's chairman, Mr. Vitaliano Gemelli, and the nature of any such correspondence?

Is the Minister aware of reports that hundreds of taxi drivers and their families are considering taking legal action against the State over the hardship caused by deregulation of the taxi industry and the manner in which it was handled by the State? Has he taken legal advice or consulted the Attorney General in this regard? Does he accept that the total value of taxi licences before deregulation was €400 million and that the suggestion that the Government's pay-out will amount to €15 million, or less than 4% of the value, proves the argument of groups such as FAIR that taxi drivers will continue to suffer extreme personal financial hardship?

On a personal note, has the Minister been approached by people who have suffered hardship, particular individuals who have had to remortgage their homes and, if so, what is his message to them? Does he not believe that he has a political and moral responsibility to them?

As the Deputy will be aware, when the taxi hardship panel was established its eminent members were asked to investigate how the State could help alleviate the genuine suffering experienced by many families and individuals arising from the liberalisation of the taxi industry. For legal reasons, the issue was never described as a compensation issue but one of hardship. On foot of its investigation, the panel recommended that any future payment scheme should not exceed an amount of €15 million. To date, almost €2.5 million has been paid out and I have provided details on the outstanding amount.

I met the Committee on Petitions of the European Parliament, which made a strong case for additional funding. Notwithstanding the conflicting views of the committee and the taxi hardship panel, the Government accepted the recommendations of the latter.

As regards the legal actions pending against the State, the manner in which these proceed is a matter for the taxi drivers concerned. I have been approached many times in my clinic and officially by many people who have suffered in this area. While the measures the Government has taken are not sufficient — we would like to do more — we established a sensible process in which three esteemed persons examined the matter and recommended the current approach as the best support the taxpayer could give to people in the taxi industry. I am proceeding on that basis.

Does the Minister accept that the Committee on Petitions, whose findings were the opposite of those of the panel established by the Minister, is also an eminent group of individuals, which is impartial? The reality is that people continue to suffer and the matter has not been adequately addressed. People have been forced to remortgage their houses, while others, who may be in poor health or widowed and had set aside licences as a nest egg, have been left with a "derisory and inadequate response", to use the words of the Committee on Petitions. It is not surprising that the Minister opted for the panel over the committee, given that the latter argued in favour of making more money available to the taxi industry. It is up to the Minister to devise other ways to raise money to try to address the issue.

I met the Committee on Petitions at the request of Proinsias De Rossa, MEP, who led the delegation. Although the committee made a strong case, as I pointed out, we followed a definite procedure in establishing a taxi hardship panel which examined the matter in detail and from an Irish perspective. I am not suggesting the EU petitions committee did not take an Irish view of this, it did but it also took a broader view of it. The Government opted for the taxi hardship panel conclusions and proceeded on that basis. That is no reflection on the evidence of the petitions committee.

That concludes Priority Questions. We now come to deal with Other Questions. I remind Members that supplementary questions and answers are confined to one minute.