Dáil Éireann debate -
Friday, 24 Jun 2005

Vol. 605 No. 2

Air Navigation and Transport (Indemnities) Bill 2005 [Seanad]: Committee and Remaining Stages.

SECTION 1.

Ms O. Mitchell

I move amendment No.1:

In page 4, subsection (1), line 16, after "Act" to insert the following:

"and being one which is required to be covered by the registering state pursuant to EU Regulation 2407/92 and EU Regulation 785/2004".

My difficulty with the Bill is that I do not accept Irish aviation would be grounded if the Bill were not passed, which is a fairly fundamental difficulty. On Second Stage, I referred to the fact that exclusion clauses exist at present, for example, for radioactivity damage. I do not understand why that situation cannot continue. It seems this is being done because the EU requires us to do it. It seems perverse of the EU to bring in regulations requiring insurance that is not available and putting an onus on states to provide that kind of cover.

Having said that, I am not convinced that is what the EU is doing because, with regard to the caveat I referred to earlier, it requires in circumstances where commercial cover is not available that it will determine the circumstances in which insurance is required by the State, or where indemnity must be given by the State. As far I know, the EU has not determined the circumstances. The onus is on it. The purpose of the amendment is to make it specific that cover would only be given if the EU requires it, which I do not accept it does. It is a belt and braces approach.

Mr. Cullen

Regulation 2407/92 concerns requirements for the granting and maintenance of operating licences by member states in regard to air carriers established in the Community. It does not concern other aviation activities, such as the operation of airports or the provision of services at airports. Regulation 785/2004 establishes minimum third party and passenger insurance requirements for air carriers and aircraft operators.

Both regulations together do not encompass all the potential aviation activities that may need cover for Irish civil aviation to continue functioning, such as the operation of airports, service provision at airports and the provision of aircraft hull insurance for air carriers or aircraft operators. This amendment would mean that airports, for example, could not be indemnified should the need arise, which is now a major issue. It would not be appropriate to place this kind of limit on the type of activity that can be covered by an indemnity. It will be a matter for the Government, in the first instance, and the Minister for Transport, with the agreement of the Minister for Finance, to determine what undertakings and activities should be covered by indemnities to ensure Irish aviation continues to function. On that basis, while I understand the purpose of the amendment, I cannot accept it.

Amendment put and declared lost.

Section 1 agreed to.

Sections 2 and 3 agreed to.

An Leas-Cheann Comhairle

AmendmentNo. 2 is out of order.

Amendment No. 2 not moved.

Section 4 agreed to.

An Leas-Cheann Comhairle

AmendmentNo. 3 is out of order.

Amendment No. 3 not moved.

Sections 5 and 6 agreed to.

An Leas-Cheann Comhairle

AmendmentNo. 4 is out of order.

Amendment No. 4 not moved.

Sections 7 to 13, inclusive, agreed to.

SECTION 14.

Ms Shortall

I move amendment No. 5:

In page 10, subsection (5), line 40, after "effective" to insert the following:

"and likely to come to the attention of the recipient of the notice within a reasonable time".

This section allows the Minister to serve notice of termination of indemnity by e-mail. All of us know e-mails go astray and people say they did not receive them. It seems to be an informal method of notifying people of termination. The implications of termination are momentous for the operator concerned. There should be a more formal mechanism for doing that.

The intention of my amendment is to ensure that the notice is not just sent, but that there is some recognition of the need for the person to have received it. I propose the insertion of my amendment and it is a reasonable proposal. Sending an e-mail telling someone his or her insurance cover is terminated seems a casual way of doing it and there should be a mechanism to ensure it has come to the attention of the recipient.

Mr. Cullen

I did not realise all these amendments were ruled out of order. I was ready to deal with them. If I am permitted to raise the point of the amendment to section 7, the Deputy is correct. One may want to reduce or increase. It is not urgent now but it may well be in a year. This matter will have to be examined then. The Deputy was correct and we will probably take account of this later. The Deputy twigged something that covered one side of the coin but on the other hand we may want to reduce as much as raise the amount to account for inflation. It is not essential at the moment but in a year or two when we re-examine this Bill that issue will be raised again.

Ms Shortall

Is the Minister stating that the Leas-Cheann Comhairle's ruling may result in a charge on the Exchequer in so far as he will have to allow us more time here?

Mr. Cullen

I do not want to open up a debate on the matter. I was simply acknowledging the Deputy's point, which is not a bad one.

Ms Shortall

I ask the Leas-Cheann Comhairle to note this point.

Mr. Cullen

The Deputy's amendment No. 5 would mean there could be uncertainty about when an indemnity would terminate. If a condition of terminating an indemnity were that it must be transmitted in a manner likely to come to the attention of the intended recipient there could be a legal challenge on the meaning of the section. The current text of section 14 is absolutely clear that the latest a termination will take effect is one hour after the Minister issues the termination, regardless of how or when it is received by the air navigation undertaking. It is a matter for every undertaking to ensure it is in a position to receive and act upon an act of termination at very short notice.

The possible circumstances that could surround a termination of an indemnity could involve an incident with a dirty bomb or an electromagnetic pulse. If a decision were taken to suspend or terminate an indemnity there must be absolute certainty on when the termination takes effect. This amendment would introduce a significant element of uncertainty and therefore I do not propose to accept it.

The Deputy raised the point and we sought legal advice on the matter. The intent of the Government is clear. It is to protect the taxpayer and put the onus on the other side rather than on us, which could open up the possibility of legal challenges. We want certainty from the moment the termination isissued. Within one hour it has legal effect and that is the basis of it.

Amendment, by leave, withdrawn.

An Leas-Cheann Comhairle

Amendments Nos. 6 and 7 are related and may be discussed together.

Ms Shortall

I move amendment No. 6:

In page 10, subsection (6), lines 43 and 44, to delete paragraph (a).

I propose these lines be deleted because under section 14(6) notice of termination could take effect before it is received. This is unsatisfactory. We are trying to ensure that notice of termination is received first, before termination occurs.

Mr. Cullen

This is the same territory as the last amendment. The impact of this amendment would be to eliminate the one-hour notice of termination or suspension. I will not read out the response I gave to the Deputy's last amendment.

As part of the conditions we will agree with the undertakings on the method by which notice of termination will be made so that termination can take place immediately. We will agree with them a precise method of how we do that. There will be no uncertainty on what we will do with each undertaking to make sure it is the best arrangement from its perspective as well as from the State's perspective. It will be helpful to do that. For the same reasons as with the previous amendment, I will not accept this amendment.

Amendment, by leave, withdrawn.

Amendment No. 7 not moved.

Section 14 agreed to.

Section 15 agreed to.

SECTION 16.

Ms Shortall

I move amendment No. 8:

In page 11, subsection (6), line 40, after "indemnity" to insert "in respect of a particular incident".

I suggest this to ensure that section 16(6) should not be a backdoor mechanism to repeal this Act by stealth. The intention is that the Minister could lock down liability for a particular incident but not for air navigation generally. This clarifies that this action will be taken in respect of one particular incident.

Mr. Cullen

The purpose of an order under section 16(6) is to set down a date before which all claims on foot of any indemnity must be received so that the State can be certain that all claims have been received and that compensation can be apportioned appropriately. The purpose of this Bill is to allow civil aviation to continue to function in the face of a withdrawal of certain insurance by the insurance market. However, if there is an incident involving a dirty bomb or an electromagnetic pulse it cannot be said what would happen after. We do not know. A decision on whether indemnities would be withdrawn would be taken after the incident. An order made under this subsection is intended to wrap up any claims against the State on foot of indemnities. While it is not envisaged that more than one order would be made, my advice, from the Office of the Attorney General, is that there is nothing in the current text preventing further orders from being made in the event of a subsequent incident leading to claims. On that basis, and on foot of the advice of the Attorney General, I do not propose to accept this amendment.

Ms Shortall

Is the Minister stating that the intention is to have the flexibility to end all cover?

Mr. Cullen

Yes. To some degree, we do not know what might happen in an incident and the scale of it. We are trying to be as cautious as possible from the taxpayers point of view.

Amendment, by leave, withdrawn.

Section 16 agreed to.

Sections 17 and 18 agreed to.

SECTION 19.

Ms Shortall

I move amendment No. 9:

In page 12, after line 13, to insert the following subsection:

"(2) The Air Navigation and Transport Acts 1936 to 2004, the Air Navigation and Transport (International Conventions) Act 2004 and this Act may be cited together as the Air Navigation and Transport Acts 1936 to 2005.".

This is a technical amendment. I thought it was standard practice that there be a collective citation listing all of the air navigation Acts. I suggest it would improve the Bill to do so.

Mr. Cullen

The Deputy is correct in her assertion but there is a specific reason this is not the case here. While it is a common feature of Irish legislation that Acts may be grouped together as a series, it is not a requirement nor does it affect the validity of any part of the Act or Acts in question if they are not grouped together. In this case, the Parliamentary Counsel has advised that it is not necessary to group this Bill with the other Air Navigation Acts. This Bill is a stand-alone one dealing with a particular issue and, consequently, it is not necessary to link it to any of the earlier Air Navigation Acts.

We do not want to give the impression that this Bill will form part of all the other Acts, and will give some permanency and currency of attachment to the Acts. It is a specific, stand-alone measure and I want to keep it separate from the other Acts. That was the advice of the parliamentary counsel and I can understand the reason in this case.

Ms Shortall

I accept that the Bill deals with a distinct aspect of air navigation but I would have thought that, mainly for administrative reasons, there would be a collective citation.

Mr. Cullen

I do not have an issue with that. I am used to dealing with Bills, as we all are, but the parliamentary counsel's advice was specific on this one. The strong advice was to keep it separate and do it this way.

Amendment put and declared lost.

Section 19 agreed to.

NEW SECTION.

Ms O. Mitchell

I move amendment No. 10:

In page 12, after line 13, to insert the following new section:

"20.—(1) This Act shall cease to be in operation at the expiry of 12 months from the date of its coming into operation unless a resolution has been passed by each House of the Oireachtas resolving that the Act shall continue in operation.

(2) The operation of this Act may from time to time be continued in force by the passing of a resolution by each House of Oireachtas while the Act is still in operation.

(3) Where a resolution referred to in subsection (2) is passed pursuant to that subsection the Act shall continue in force for the period specified in such resolution, which shall be a period of not more than 12 months.".

Having heard the Minister's response, I realise that both he and those who prepared the Bill recognise the enormity of what we are getting ourselves into. That is my thinking behind tabling this amendment. The Minister will recognise that this sunset clause was lifted in its entirety from the 2001 Act.

The Minister has included a requirement that a ministerial order would be laid before the Dáil every 12 months, but that does not amount to Dáil scrutiny. The opportunity to scrutinise the material, while being in possession of all the information, is missing from the Bill. I do not feel we have that provision in the legislation.

I have not moved this amendment for the reason it appeared in the 2001 Act when it was anticipated that circumstances would change and that perhaps insurance would become available again. I do not think that will happen and the Minister is right in that respect. I have moved the amendment, however, to force the issue in this debate for a number of reasons, first, to give it the proper scrutiny and, second, to do so in the context of knowing what other countries have done in the meantime.

We do not know if these countries provide the same kind of insurance. In particular, we should know what the European Commission is doing in this regard. If accepted, the amendment would force the Minister to put pressure on the Commission to bring forward its solution to this problem. It seems perverse for the Commission to require the taking out of an indemnity now, which cannot be purchased. It is therefore putting an onus on each State to provide something that could be calamitous. In many cases in the past, such an indemnity system was not even required in the aviation sector — for example, concerning the radioactivity indemnity.

The amendment aims to bring the debate on this matter before the House when we are in possession of all the information, as well as putting pressure on the European Commission to come up with a solution by establishing a fund. After all, this matter has obviously been on the Commission's mind for a while. It has been thrust on us suddenly, although not overnight, and has been in gestation for a number of months. It is up to the European Commission to provide this fund if it feels this kind of cover is essential. I want that pressure to come from us, as I am sure it will come from other EU member states if they are doing the same as ourselves. We are making a major commitment in this regard.

Mr. Cullen

There has been strong resistance from all governments to this issue. The Deputy is correct in the sense that it was flagged for some months, but that is why we were not giving an indication, overtly in any fora, that EU governments might consider this. However, it became clear this month that we had no choice. The effect of the amendment would be to insert a sunset clause in the Bill. Currently, there is no such clause in the Bill. As the Deputy and I accept, since the withdrawal of insurance, there is expected to be a permanent change in insurance conditions. Insurers do not intend to go back to covering dirty bomb and electronic-magnetic pulse risks in future. Therefore, it is not appropriate for the new Act to have a provision for it to lapse automatically, although I accept why the Deputy has moved the amendment.

The consequences of an accidental and unintentional failure to renew the Act could result in the collapse of an airline or the closure of an airport. The Oireachtas will continue to have an appropriate degree of control because section 2(7) includes the usual provision for laying Government orders before the Oireachtas and for either House to be able to pass a resolution to annul the order within 21 days. The fact that the Bill cannot lapse automatically is also balanced by the 12-month maximum timespan for orders and indemnities, which means that indemnities cannot be put in place and then simply left there indefinitely. That is part of what we are all trying to achieve.

The Bill also provides that indemnities can be terminated at any time should that become appropriate. In the broader sense, we do not know at this stage what Europe may come up with or what the legislative base will be. We may well have to come back on foot of whatever Europe-wide agreement is reached. I hope that such an agreement would move the goalposts quickly away from governments to establish a European mutual fund. I have no difficulty in keeping people informed, as they should be. We did not want to have that provision in the Bill in case, for whatever reason, the timeframe lapsed and we ended up without cover. For those reasons I cannot accept the amendment.

Amendment put and declared lost.

Title agreed to.

Bill reported without amendment and received for final consideration.

Question put: "That the Bill do now pass."

The Dáil divided: Tá, 59; Níl, 15.

Tá

• Brady, Johnny.
• Brady, Martin.
• Browne, John.
• Callanan, Joe.
• Callely, Ivor.
• Carey, Pat.
• Carty, John.
• Costello, Joe.
• Crowe, Seán.
• Cullen, Martin.
• Curran, John.
• Dempsey, Tony.
• Dennehy, John.
• Ellis, John.
• Ferris, Martin.
• Fitzpatrick, Dermot.
• Fleming, Seán.
• Gallagher, Pat The Cope.
• Gilmore, Eamon.
• Grealish, Noel.
• Gregory, Tony.
• Hanafin, Mary.
• Harkin, Marian.
• Keaveney, Cecilia.
• Kelleher, Billy.
• Kelly, Peter.
• Kirk, Seamus.
• Kitt, Tom.
• Lenihan, Brian.
• Lenihan, Conor.
• McGuinness, John.
• Moloney, John.
• Moynihan, Donal.
• Moynihan, Michael.
• Mulcahy, Michael.
• Murphy, Catherine.
• Nolan, M. J.
• Ó Caoláin, Caoimhghín.
• Ó Fearghaíl, Seán.
• Ó Snodaigh, Aengus.
• O’Connor, Charlie.
• O’Dea, Willie
• O’Donnell, Liz.
• O’Donoghue, John.
• O’Keeffe, Ned.
• O’Malley, Fiona.
• O’Malley, Tim.
• Pattison, Seamus.
• Penrose, Willie.
• Power, Peter.
• Sexton, Mae.
• Shortall, Róisín.
• Smith, Brendan.
• Stagg, Emmet.
• Treacy, Noel.
• Upton, Mary.
• Wallace, Dan.
• Walsh, Joe.
• Wilkinson, Ollie.

Níl

• Durkan, Bernard J.
• English, Damien.
• Enright, Olwyn.
• Hogan, Phil.
• Kehoe, Paul.
• McCormack, Padraic.
• McGrath, Paul.
• Mitchell, Olivia.
• Murphy, Gerard.
• Naughten, Denis.
• Neville, Dan.
• Perry, John.
• Stanton, David.
• Timmins, Billy.
• Twomey, Liam.

Tellers: Tá, Deputies Kitt and Kelleher; Níl, Deputies Kehoe and Stanton.

Question declared carried.

The Dáil adjourned at 1 p.m. until 2.30 p.m. on Tuesday, 28 June 2005.