Joint Committee on Transport and Communications debate -
Wednesday, 1 Jun 2022

Future of the An Post Network: Discussion (Resumed)

Acting Chairman (Senator Gerry Horkan)

The purpose of today's meeting is for the Oireachtas Joint Committee on Transport and Communications to continue its consideration of the future of the An Post network. We recently had a productive meeting on this matter with The Irish Postmasters' Union, and we are expecting An Post to meet the committee on 15 of June to continue our consideration.

Today I am very pleased to welcome, on behalf of the committee, the Minister of State at the Department of Transport, Deputy Hildegarde Naughton, who is accompanied by Ms Jenny O'Hora, principal officer with the Department of Environment, Climate and Communications. I thank the Minister of State for accommodating the committee with this rescheduled meeting.

Witnesses are reminded of the long-standing parliamentary practice that they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable or otherwise engage in speech that might be regarded as damaging to the good name of the person or entity. If the witnesses' statements are potentially defamatory in respect of an identifiable person or entity, they will be directed to discontinue their remarks. It is imperative that they comply with any such direction.

Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable. I remind members of the constitutional requirement that members must be physically present within the confines of the Leinster House complex to participate in public meetings. I will not be able to permit a member to participate where they are not adhering to this constitutional requirement. Therefore, any member who attempts to participate from outside the precinct will be asked to leave the meeting. In this regard I ask any member partaking via MS Teams to confirm, prior to making a contribution to the meeting, that he or she is on the grounds of the Leinster House campus. If attending in the committee room, members are asked to exercise personal responsibility to protect themselves and others from the risk of contracting Covid-19.

I now invite the Minister of State, Deputy Naughton, to make her opening statement.

Deputy Hildegarde Naughton

I thank the Acting Chairman. I thank the committee for the opportunity to give an update today on the future of the post office network. I am joined today by principal officer, Ms Jenny O'Hora from the Department of Environment, Climate and Communications.

Colleagues will be aware that An Post is a commercial State body with a mandate to act commercially. It has a statutory responsibility for the State's postal service and for the post office network.

Postmasters are independent SMEs contracted by An Post to run post offices and the Department does not have a direct relationship or contract with them. They are not State employees, nor are they employees of An Post. As such, they are not paid a fixed salary. Their income is derived on a fee-per-transaction basis.

The agreement reached between An Post and the Irish Postmasters' Union, IPU, in 2018, which was supported by 80% of the IPU's membership, has underpinned significant change and investment to redefine the post office network, including reducing the number of post offices, modernising the postmaster contract and an acceptance that new business lines were required, along with capital investment in the network. This is a vital part of the delivery of An Post's strategic plan. To implement the plan, the cost of which was estimated to be in the region of €150 million, the Government provided a long-term low-interest loan of €30 million to the company in December 2017 to support and protect the renewal of the post office network and the continued fulfilment of a five days per week mail delivery service.

As set out in the programme for Government, we are committed to a sustainable An Post and post office network as a key component of the economic and social infrastructure of Ireland. I have met the chairperson and the chief executive of An Post. They fully understand the Government's position. I have met the IPU three times. I addressed its annual conference last October and will do so again on 4 June.

The Government recognises the importance of a high-value and high-quality post office network to our citizens across the country as well as the central and trusted role of postmasters in our communities. The network's social value was particularly evident during the pandemic and the demonstrated commitment of staff and management to supporting our communities, in particular the elderly and vulnerable, has been commendable. Through its network of 900 post offices, An Post continued to provide key Government services to citizens, including through its existing commercial contracts with the Department of Social Protection and the National Treasury Management Agency, NTMA.

The financial challenges facing postmasters are well documented and arise mainly from the decline in mail volumes and the move to electronic transactions in both mail and the post office network. The pandemic has exacerbated these challenges and impacted the transformation programme for the network. In recognition of this and the significant role played by postmasters during the pandemic, I worked with An Post and introduced the pandemic relief fund in 2021, which was worth €8.5 million over an 18-month period. This commenced on 1 July 2021 and will continue until the end of this year. The fund aims to incentivise new business by increasing product commissions while also incorporating an element of protection for business declines due to the pandemic. In addition, An Post undertook to invest €400,000 over an 18-month period in postmaster training to help equip postmasters with the skills and information they need to maximise the business going through their post offices.

I recognise that there are genuine concerns around the future of the post office network and a potential cliff edge scenario where significant numbers of postmasters choose to retire at around the same time in late June or early July. This could see citizens losing their local post offices as well as the wealth of services available to them through those offices.

I am pleased to advise the committee that, as announced yesterday, I secured approval this week for a proposal that will see a funding intervention by the Government of €10 million per annum over a three-year fixed term from 2023 to 2025, to be distributed by An Post to the post office network. This is the first time that the Government has agreed to introduce such a package. It will help to support a sustainable, nationwide post office network in line with the commitment in the programme for Government. It also aims to ensure access to important services of social value across the post office network and that there is a network of sufficient scale in place for the public to access these services across the country. It also provides clarity for postmasters in terms of any decision that they may need to make about their future. It will be disbursed in a manner that seeks to mitigate the genuine financial challenges faced by many of our post offices while acknowledging the need for continued commerciality and modernisation, as has been the company's strategic goal for the network in line with its agreement with the IPU.

An Post is a strong commercial semi-State and its strategy seeks to build on its growth and diversification. The network is one of the company's core strengths and the continued development of the network and its services is a vital component of its sustainability. An Post will continue to seek and win new business actively and to explore opportunities to develop new or enhanced product lines for the post office network. I understand there are a number of initiatives under active consideration by the company.

The Government is committed to working with An Post and postmasters to ensure that the network continues to play a strong role in delivering State services. The Government will continue to engage on the issue to ensure that we can protect and safeguard the network in line with the programme for Government commitment. The one-off nature of this intervention seeks to copper-fasten the transformation under way and incentivise a network of strong, commercially focused enterprises.

Decisions regarding retirement or closure are ones for each of the independent postmasters to take. The Government's intervention does not mean that some post offices will not close due to retirement or personal decisions, only that they should not close due to lack of Government support. It is the Government's intention to avoid those decisions being necessary on foot of economic hardship. The Government hopes that closures will decelerate in order to facilitate initiatives by the company to take off and bear fruit, permit time to assess the findings of census 2022 and whether demographic changes might change the trajectory of rural businesses, and allow for the transformation programme to conclude and new commercial practices to be adopted.

I thank the committee for affording me this opportunity to address it.

Deputy Darren O'Rourke

I thank the Minister of State for attending our meeting. I have a number of questions to raise. Many Members around the country will have heard from their local postmasters about the need for additional supports, so this funding commitment is welcome. When will it kick in? I am conscious that the IPU asked for €12 million. How does that compare? What is the Department's assessment? In what way will the fund be allocated? The Minister of State mentioned it would be distributed by An Post, but on what basis? There is an interdepartmental group. What is the prospect of other services making their way to An Post?

Regarding closures, we heard from the Minister of State about natural attrition. What will it look like in practical terms if a postmaster or postmistress does not want to continue? Will there be an opportunity for someone else to pick up the baton or will that office be let go?

Deputy Hildegarde Naughton

The payment will begin on 1 January 2023. The pandemic relief fund was agreed and put in place. I worked on it with An Post, the IPU and officials in the Department. It comprised €8.5 million over 18 months and will come to an end on 31 December, hence this intervention's start date of 1 January.

The Deputy's next question was on the €10 million following the Grant Thornton reports.

Deputy Darren O'Rourke

No. The Government has committed to €10 million while Grant Thornton suggested €12 million.

Deputy Hildegarde Naughton

Yes. I will explain. First, I commend Ms O'Hora, who spearheaded this matter in the Department with her team. This unprecedented development was hard fought for.

This is the first time in the history of the State we have had State intervention in the post office network. A huge amount of work happened. I will give the Deputy a little background on the €10 million. There has been long-standing engagement with An Post on the viability of the network. There have been meetings between the Department and An Post over the last two months. I would say there have been two meetings per week on engagement around what a financial support package would look like, and especially the social value. We are all aware of the social value but it is about trying to get a-----

Deputy Darren O'Rourke

Count it.

Deputy Hildegarde Naughton

-----figure on that. We engaged and the Department engaged with officials in the Department of Public Expenditure and Reform. There were two economists involved in this as well, so again this is all based on evidence and looking at the scale of population these post offices were going to service. That is where the €10 million has come from, namely, through an awful lot of research and evidence and in conjunction with the Department of Public Expenditure and Reform. This is public money and we need to ensure it is well spent.

Deputy Darren O'Rourke

It is an interesting idea and there are a lot of different groups. Did the Department build new models on how to account for social impact or social value? Are those publicly available? Is this a departure from Government or the Department? There are a lot of groups that make their case based on their social impact and it can be hard to quantify.

Deputy Hildegarde Naughton

As postmasters are independent - they are sole traders - it was hard to get a clear picture of the value and what was happening across the country. They are not State employees. The economists, the Department of Public Expenditure and Reform and An Post fed into this to assess the population, the distance within populations of access to a post office and the services they provide. There was a huge amount of work on that figure.

How it is going to be allocated was the Deputy's next question, I think. A grant from the State will be given to the postmasters through An Post. How that will be worked out is something on which An Post and the IPU will be in consultation. It will then be approved by the Department of Public Expenditure and Reform. Something very important I should have said at the outset is this has to be approved in terms of the state aid rules but we have got a clear run and all of this has been talked through with the relevant officials and there should be no issue there. It is subject to state aid rules, it will be worked out with the Department of Public Expenditure and Reform in relation to how it will be administered but it will be An Post paying the postmasters, and there will be consultation there.

Deputy Darren O'Rourke

Will that be based on a formula? Does the Minister of State know what criteria will apply?

Deputy Hildegarde Naughton

That is a very good question. It is like a pyramid system and my focus is on the post offices that need the support the most. They are the target area. What I wanted to do with this package is ensure there is no postmaster who is closing because he or she feels his or her post office is not viable. The number one target here was to ensure our post office network is intact. If anyone wants to retire for personal reasons, which I think was one of the Deputy's later questions, it will be his or her decision. If somebody wants to take up the postmaster role it will be advertised again. We are all very aware in our own constituencies of post offices where somebody retires and when the role is advertised it is not picked up because it is not viable. This unprecedented package gives postmasters certainty. Talking to one or two, they are now not going to retire, knowing this package is in place. This is for their communities. It is about what this does for our local communities so they have access to those critical public services. I was talking to one postmaster about what would happen if they closed down, as they were intending to do before this package came. The local community would have had to do a 30 km round trip to access banking facilities but now the postmaster can provide them.

Deputy Darren O'Rourke

The other question was about the additional services and the interdepartmental report.

Deputy Hildegarde Naughton

On the interdepartmental report, this is very clear. When I came into this role this was my number one priority, that is, trying to bottom out the offline services in that report. It was very clear, and I think the postmasters knew this themselves, that the offline services report was not going to be the silver bullet in itself. However, we have to look at providing offline services not just within the Department of the Environment, Climate and Communications or in the Department of Transport. We are looking, for example, at motor tax and the potential around that. Likewise, the Revenue and the Department of Social Protection are looking at other services. This financial package is giving the breathing space and the time for all of Government to look at what potential offline services could be provided. That is in line with our Town Centre First policy as well. That relates to the interdepartmental group, so this is a whole-of-government approach to try to identify this. As members know, the Government has a digital strategy and 90% of our services are provided online but 10% of the population cannot, or do not want to, access services online. The post offices would be able to facilitate that.

Deputy Darren O'Rourke

That work is ongoing.

Deputy Hildegarde Naughton

Yes. It is a cross-Government matter. It is not just one Department. There are potentially some services that are available but they are under contract at the moment so we have to wait for those. It must be a whole-of-government approach for there to be offline services available for communities across the country.

Deputy Darren O'Rourke

I thank the Minister of State very much. This is a measure that has been welcomed, I see, by the IPU. I commend the Minister of State and her team on getting it over the line.

Deputy Cathal Crowe

I thank the Minister of State and Ms O'Hora for being here this evening. I was down home in Clare last night and met a group of postmasters. It was the latest in a sequence of meetings I have had. There was the IPU and Mr. Tom O'Callaghan of the Independent Postmasters Group and I was just getting a gauge from the small and the large postmasters on what they are facing and the challenges, and trying to take the pulse of the whole thing.

Today is historic because this is Government committing funding it never has before to the network. It is important to acknowledge that. It is also important to say the genesis of the problems facing the network lies in the slow dismantling of that once-famous S52 contract. It was very much a fit-for-purpose contract. As the Minister of State said a moment ago, postmasters do not receive a salary. They are paid on a transactional basis. The old S52 contract ensured if you went in for a social welfare payment or whatever transaction, the larger post office received a little bit less in transaction payments. It was positive discrimination to put more money into the smaller rural post office. Cumulatively across the year, and across many years, that ensured the network as a whole remained viable. What was on offer a few years ago was a brand new contract. Some jumped at it. I think there are now 440 remaining on that old S52 contract. Some of them are struggling but they see a future. However, the 560 or so that moved onto the brand new contract are in trouble. Today's announcement is positive. It throws a lifeline but they will continue to be in trouble unless there is a whole suite of new transactions and services that breathes viability into those post offices and puts money in their pockets. From the outset, Mr. O'Callaghan, the IPU and all individual postmasters looked for money and for subvention but were very clear that alone would not be enough.

I have a number of questions. The first is the postmasters sought €12 million, so why €10 million and not €12 million. I want to qualify that as well because last week the IPU was upstairs here briefing Deputies and its representatives said for every €1 million less than the €12 million, 100 post offices were put at risk, so why €10 million and not €12 million? I would like an answer to that first.

Deputy Hildegarde Naughton

I have answered that previously with Deputy O'Rourke. Again, this was work on foot of information coming from An Post, working with officials in my Department, the Department of Public Expenditure and Reform and economists to look at quantifying the social value. It is important to say as well the pandemic relief fund is an €8.5 million fund over 18 months. What I am announcing this week is a €10 million fund every 12 months. It is significantly more than what postmasters are currently receiving from the pandemic relief fund, which runs out at the end of the year. It is very important to say getting this unprecedented package for postmasters in place is no small feat.

We want to give them the space to attract more business and incentivise them to drive more business through the post office network. That is through banking and all of the other services but to work with An Post to drive that business. An Post is providing training and supports to postmasters and postmistresses.

Today, I want to call on the public to use their local post office. We have all attended public meetings across the country to talk about the survival of local post offices but there is an obligation on people. People value their post office but they need to use it as well and this funding gives post offices a timeline or a breather in which to drive new business. Also, the funding will act as an incentive for postmasters to increase business.

Deputy Cathal Crowe

Normally, people do not squabble over whether funding is €10 million or €12 million. I welcome the funding, it is historic and shows that the Government has stepped up to the plate. One can juxtapose that with everything that was said here on 18 May by Mr. Ned O'Hara, and Mr. Sean Martin who said "Anything less, even €11 million, would probably put 100 post offices at risk." How can we reconcile that? Is there scope for review? In the greater scheme of Ireland Inc. and all of the public expenditure in the country then €2 million is small money but when one juxtaposes it with what Mr. Martin said then it becomes quite significant and stark.

Deputy Hildegarde Naughton

To be very clear, this funding package supports the post offices that are most in need. AIso, if a post office closes then it is not because there is a lack of viability or income. That is very clear in terms of this package. This is evidence-based. A huge amount of work has gone into this package over the past few months between NewERA, my Department, the Department of Public Expenditure and Reform, and information that came from An Post and the IPU. I understand that the IPU has welcomed the funding. We are saying that no post office will close because of a lack of income. It is up to post offices to drive more business through their network and this package will incentivise them to do so.

Deputy Cathal Crowe

I take everything that the Minister of State has said at face value. Is it conceivable that some post offices, including the largest one in the country on O'Connell Street, will get none of this funding while others will get plenty?

Deputy Hildegarde Naughton

There are 900 post offices in the network and they will all receive funding but on a pyramid basis. The aim of this funding is to help the post offices that are in most need. I do not want to see unnecessary post office closures and not because they lack viability for those reasons. Every community is afraid that the local post office might close so this week we have put in place an historic package to ensure that every postmaster now knows that if they want to retire or step away then that is for their own personal reasons.

Deputy Cathal Crowe

I ran an average over the package. So I divided €10 million by 900 and came up with €11,111. Such a sum is insulting to post offices, leaving aside the GPO even on its worst day. The Minister of State has said that there must be a scheme but post offices have closed in County Clare such as Broadford post office. The post office in Lisdoonvarna closed but, thankfully, it will reopen as a new contractor has been found. My party colleague in west Cork, Deputy Christopher O'Sullivan, has been fighting to keep the Goleen post office open, which is due to close this week. Closures happen far too often and a pyramid approach probably will not work. I would say that a threshold and anything over that would not get it and anything under that should get huge subvention.

Deputy Hildegarde Naughton

I should have said the funding will be subject to state-aid rules, which do not allow us to give funding to a viable post office. The funding will target the most vulnerable post offices.

Deputy Cathal Crowe

I have a question about the disbursal of funding. The Minister of State has answered my query to a degree when she responded to Deputy O'Rourke. Postmasters have asked whether the funding will be tax free. Will the funding be an overhead fund to cover the costs that they face? Will it reflect the fact that some post offices struggle more than others?

Deputy Hildegarde Naughton

Yes.

Deputy Kieran O'Donnell resumed the Chair.

Deputy Cathal Crowe

Last July, the Government promised a strategy that would tackle the realm of offline services and people are still waiting. Postmasters have said that the funding is good and welcome it but funding alone will not save the network and a whole range of offline services are needed. My dad does not use a laptop or a smartphone but he is one of those people who drives to his local post office on a Thursday to collect his pension. Let us be ageist. The Minister of State and I are of a similar age and I probably only go to a post office to buy stamps or post a parcel. We need to find a way to get way more people in through the doors of post offices and not just people who are drawing down pension or social welfare payments or people who post a parcel once or twice a year. We need to see an awful lot more offline services available in post offices too. The postmasters have made some suggestions to the Minister of State and they made some suggestions to me when I met them in County Clare last night. The payment of college fees is possible through bank and student services but that is not possible yet through post offices. Now, when a woman in paid employment goes on maternity leave her maternity payment goes through the bank only but the children's allowance can be paid through banks or a post office. That is another situation that could be changed by ministerial order.

The passport issue has become a debacle. It was insulting to the post office network that the Passport Express service was renamed last week. A pay per passport was always something good. The application was always something good and rapid but it is not like that anymore. The postmasters have said that they have undertaken a huge amount of anti-money laundering work for the last number of years without being compensated. What more can be done? A sum of €10 million is good but it does not bring them up to the full sustainable level of €60 million per annum and postmasters will need a lot more. I ask the Minister of State to tell us more about the offline strategy.

Deputy Hildegarde Naughton

The Deputy asked if the fund will be taxed. The funding is not a salary but is a State grant that will be paid through An Post to the postmasters.

Deputy Cathal Crowe

Will it be tax free?

Deputy Hildegarde Naughton

It is a State-aid grant that will be paid through the post office.

Earlier I mentioned offline services. It has been made very clear that the report will not be a silver bullet hence the real need to have a financial package in place while those services are being identified but not just one Department, not just my Department and not just the Department of Transport. For example, the Department of Transport is considering the possibility of motor tax but it will take time to roll that out and assess feasibility. Revenue has considered the potential of possible services. The Department of Social Protection is also considering further services for the post office network. All of that work forms part of our Towns First strategy and there must be a whole-of-government approach when it comes to the provision of offline services. I agree with everything that the Deputy has said and how a certain number of people do all of their business online. Offline services must be available and need a whole-of-government approach and in the meantime a financial package is in place to protect the post offices that are in danger of closing.

Deputy Cathal Crowe

I thank the Minister of State. I apologise to Ms O'Hora for not asking her questions but thank her for everything that she has done and is doing.

Deputy Hildegarde Naughton

She did so much of the work.

Deputy Cathal Crowe

The funding is good but it alone will not be enough. Last July, or 11 months ago, we believed that we were going to hear about the offline strategy and we need it now. There are really smart ideas coming from guys like Mr. Tom O'Callaghan in County Clare in regard to the introduction of something like Kiwi Bank and Sparkassen. The ideas have been fed to the Minister of State's Department and IPU have supplied them to it so the Department knows what can be done.

Deputy Hildegarde Naughton

It must be an all-of-Government approach.

Deputy Cathal Crowe

Yes.

Deputy Hildegarde Naughton

Every Department must be involved. I agree with the Deputy and that is why it is not just one Department doing this work; in the meantime we have a financial package.

Deputy Cathal Crowe

I would appreciate if the Minister of State could light a match under some of the Departments. She has used the analogy of a silver bullet and I believe that the S52 contract is the poison arrow in the side of the post office network because, as all of the postmasters will state, it is slowly ensuring that 300 post offices will eventually close, unless there is a sustainable model for them. Some post offices have already closed, including post offices in Whitegate and Broadford in my own county of Clare. We need a comprehensive plan and it needs to happen quickly because January 2023 is the cliff edge on which the S52 contract's dismantling will come back to haunt the network. I ask the Minister of State to focus on this matter and thank her for her work.

Deputy Hildegarde Naughton

I thank the Deputy.

Chairman

I thank Senator Horkan for chairing the meeting in my temporary absence. I thank the Minister of State and apologise for being delayed.

Senator Gerry Horkan

I thank the Minister of State for her opening statement and welcome news. Will she please explain how the €10 million will be used as I am not sure she explained that in her opening statement? Why was the figure of €10 million chosen rather than, say, €8 million or €15 million?

Deputy Hildegarde Naughton

These were figures based on information we received from An Post working with the Department. It was quite difficult to get an assessment because postmasters are sole traders, are not paid by An Post, are their own brokers and are small or medium-size enterprises.

Senator Gerry Horkan

My apologies for interrupting but at the same time, I presume An Post knows how much every single post office earns through the An Post network, because it is paying the postmasters. It knows from its own database that there is a post office at the bottom of the list which earns very little and one at the top of the list which earns a great deal. It has a full range of data and presumably knows how much income every post office generates.

Deputy Hildegarde Naughton

There are 900 different postmasters with different cost bases and that makes sense because we all know post offices in different locations, where some are co-located and where some may be part of another building, so there are different cost bases.

Senator Gerry Horkan

They also have equally different revenue bases.

Deputy Hildegarde Naughton

We knew that the income on that was €10 million. That was clear from the analysis and evidence around this.

Senator Gerry Horkan

This is not the revenue of €10 million but is a subsidy or Government support of €10 million.

Deputy Hildegarde Naughton

That is it exactly. It is also important to say that the pandemic relief fund announced last July was €8.5 million over 18 months. This is €10 million over 12 months. This is substantially more than the pandemic relief fund which comes to an end at the end of this year. The postmasters wanted clarity by the end of June, this month, on that because many of them were going to retire or leave. Now, a number of them - I am obviously not speaking for them because it is a personal decision for them - will reflect and perhaps stay on, knowing that this package has been put in place. If the post office is readvertised and if somebody is interested, they know that they will be taking on a viable post office.

Senator Gerry Horkan

Will each post office know how much of the €10 million they would be entitled to?

Deputy Hildegarde Naughton

That will be worked out with An Post, working with the Irish Postmasters' Union, IPU, on a pyramid basis. We will be targeting those post offices that are most in need of support. There will also be incentives built into that and this will then be approved by the Department of Public Expenditure and Reform. The key aim here is to prevent closures of our existing post office network and that is what this funding is doing.

Senator Gerry Horkan

It is possible that there is quite a number of those post offices with the least amount of transaction-based revenue that will get the most of this funding and that some at the higher end of transaction-based revenue will not get any of this €10 million. Would that be a fair comment?

Deputy Hildegarde Naughton

Everyone-----

Senator Gerry Horkan

Everyone will get something.

Deputy Hildegarde Naughton

Everyone will receive something but it will be based on incentives and on a pyramid system where we are targeting those which are least viable at the moment. This makes sense.

Senator Gerry Horkan

That makes total sense. I agree.

Deputy Hildegarde Naughton

That is the concern right across the country. This is about communities and people having access to their local post office.

Senator Gerry Horkan

It is an element, therefore, of having a public service obligation, PSO-type levy. I probably should not even mention aviation after the last three hours of discussion we just had, but routes are subsidised to places like Donegal. We are not subsidising routes to London or Brussels but we have PSO-type passenger services because they are needed and would not be commercially viable otherwise.

Deputy Hildegarde Naughton

It is grant aid which is based on state aid rules and we all know the criteria around state aid. This is about funding post offices which otherwise would not be able to-----

Senator Gerry Horkan

This is similar to how we are funding broadband which I know is also part of the Department of the Environment, Climate and Communications.

To touch on the wider network of An Post, where does the Minister of State, An Post or the Department see the network in three, five or ten years' time? I expect and anticipate that with broadband and as more of the population becomes digitally native, or grow up in this area, that we will have fewer people who are less comfortable with it. Many people became more comfortable than they had been before the Covid-19 pandemic out of necessity. As we get more and more broadband, there will be more people applying for services through this medium. We know over the past week or so about passport applications virtually going fully online or perhaps that being the direction of travel.

Certain services that were used in the post office a great deal will be used less. There is more mail being delivered through emails as opposed to by An Post. That does not affect the postmasters as such because that is more the commercially generated items and An Post would be more concerned with the delivery end of these services. There are about 880 post offices, plus about 50 company-owned post offices, giving a total of 930. Does the Minister of State believe that in ten years' time we will still have 930 post offices or does she anticipate that there will be a natural progression towards consolidation from where we are now?

Deputy Hildegarde Naughton

My aim with this package is to ensure that our existing network of post offices remain open. It is my aim and objective, as well as An Post's, to drive more business and to get more services into these post offices. That is why, as well as part of my call today, which is a very positive and historic day for post offices, that we are asking local people to start using their local post offices and to find out about their services.

We have two banks leaving the State now and there is great potential there for An Post and for the post office network to provide these services in local towns and villages across the country. This is giving the post offices and postmasters that breather to work with An Post through the extra services that can be provided. My objective since day one when I came into this Department was to get this over the line and it has involved a great deal of hard work, including by the officials within my Department which I cannot overstate. It is unprecedented because it is about saying that we value our post office network and want these services to remain in our rural and urban communities, but we also want them to build now and to drive business and extra services.

That off-line piece will be very important. This is an all-of-government piece where every single Department will be looking at what services it could provide in the off-line space. There is the digital strategy of Government which states that 90% of the services are to be provided online but that leaves 10% of our population who will want to use off-line services. This is the time and there is further work to happen in this space.

Senator Gerry Horkan

It is very fair to say the An Post brand is a very trusted one which I cannot overstate, similar to the way the Minister of State cannot overstate the value she places on her Department officials. The An Post brand is far more trusted than many of the pillar or other bank identities are. There is an element of doubt about the banks but everybody trusts the An Post network even if it is piggybacking on the AIB and Bank of Ireland networks to provide the front end of those banks which are pulling out of towns.

There is an age problem with the customer base in that it is generally older people. I have asked people, both younger and older, how often they use and are in post offices and what they were there for. I know people in their 60s and 70s who would be there two or three times a week and would use it for many things. I know people who used to go to my local shop which had a post office. They would go in, get their money at one counter and then bring it to and hand it over at the other counter.

People, however, under the age of 50, 40, or 30 are not using them in anything like the way that people of an older cohort are. My worry about that in the longer term is that we need to provide additional services. We are talking about these “additional services” in a vague sense but has the Minister of State any particular services which her Department is targeting?

We set up, for example, a national driver licensing system. Could we have done that through the post offices? This might not have involved every post office but perhaps 100, 200 or 300 of the larger post offices could have said that they could handle taking photographs, processing the paperwork and spreading that revenue instead of having 25 driving licensing centres, or whatever the number is. The alternative was that we could have had that service process through the post offices.

Perhaps there are other systems, such as social welfare payments and identity issues to ensure there are is not fraudulent activity and so forth, even if these payments are being made directly to back accounts, where recipients may have to come in, present themselves, and show that they are available for work, etc. What exactly is the Minister of State talking about in respect of these services?

Deputy Hildegarde Naughton

Taking the Department of Transport, for example, motor tax is one area we will be looking at in providing that revenue. That Department said that it would potentially have services that could be provided off-line and could go through the post office network. The Department of Social Protection has also said that. That is why that as part of that interdepartmental group this needs to be a whole-of-government approach. It is not for me to certainly say that within the Department of Transport we can look at these services. Some of these services across government are out on contract at the moment, so one has to wait until those contracts end. The identification of a robust off-line service has to be done at an all-of-government level.

Senator Gerry Horkan

I worry when the Minister of State mentions, for example, motor tax. I do not know what the percentage is but I presume that the percentage of people doing that online at this stage is very high. We all remember the old days of having to go in, queue up, and bring this, that, and the other document. Now one can do this with a series of clicks and it arrives two days later. Over time that is going to happen more often. It is about the services which involve checking people's identities, whether it is for jobseeker's allowance or pensions, and establishing if they are still in the State and are still entitled to get what they are getting.

There is scope there. However, I wonder if we see the network being 930 five or ten years hence or if we see it being 600 or 400. Has there been any examination of that?

Deputy Hildegarde Naughton

There is a huge drive in An Post and it has the capability to pitch for online and offline services there. That is what my aim is. At the end of the day, this is about communities. What is the aim here? The social value is difficult to try to quantify but we all appreciate it. It is that the service is there. We know the effect. I spoke to a postmaster yesterday, as I mentioned earlier. The impact of that postmaster closing down will be huge across a 30 km return journey radius for local communities. Regarding the value and the services that can be provided locally, offline as well as online, I believe An Post will be well equipped to provide that. My answer to the Senator's question is that now is the time to do this, but also every Department needs to be identifying those potential offline services as well.

Senator Gerry Horkan

The subsidy or grant option for those in need of it most is a great idea. Ideally, it is all the better where it can be commercially viable without the need for subsidies. The message that needs to go from this committee to all our friends and to all the people who value the service is very much a case of use it or lose it. They need to give people the business. We had a ferry service in Dún Laoghaire, and marine is in the portfolio of the Minister of State's other Department. There were 1.5 million people going through Dún Laoghaire ferry port in 1998 and there were 150,000 people going through it 15 years later, so the service closed. If a service is not used, it will close. If people want the service to be maintained, they should use it more often and encourage friends and family to use it as well. That is how we will have a thriving network.

I thank the Minister of State and her departmental officials for all their work.

Senator Timmy Dooley

I will be brief. I sincerely thank the Minister of State for what she has achieved. In 2016, when I was the Opposition spokesperson on this issue, I and others, through engagement with the Irish Postmasters Union, An Post and others, produced a paper which circulated as Fianna Fáil policy. It spoke about the provision of a public service obligation. The genesis of that was a methodology for providing funding to post offices that were not viable, with the intent of ensuring they would remain open to provide a service that was needed but which was not viable because not enough people were using it. People had moved to digital platforms and that is continuing. The paper recognised that people in a certain age cohort were never going to change and go onto the digital platform and stated a belief that they were still entitled to that service regardless of whether others had adopted a digital platform. There was certain resistance in the Government at the time. I am pleased today to see the culmination of that work and the Minister of State's input into it along the way. I am very thankful to her and her departmental officials for seeing the merit of it.

There is no doubt that this is a battle that was hard won, and I have no doubt that the Minister of State encountered resistance in different quarters. During that time, I and others have continued to engage with various Departments and particularly the Department of Public Expenditure and Reform, which took some convincing. I am pleased that has happened. The Minister was certainly on board at an early stage. With a push from the Minister of State she has succeeded in getting officials to a point of understanding the benefit that a post office means for rural Ireland. It is actually greater than just the service that it provides or the number of people to whom it provides it. I have used the phrase previously, but the harp over the door of the post office has a significance. It says to other businesses and people who live in the community that the State still has a value in this gathering, collective or community.

I could quibble over the €10 million or €12 million, but that would undermine the massive achievement that has been made. Next year, when the Minister of State returns to the committee, and I hope she is still in office, we can argue the toss about whether it is €11 million, €12 million, €13 million or €14 million, but I do not want to take from what she has achieved. Knowing the resistance that would have existed within the bowels of the greater government, the Minister of State has achieved an amazing amount. I talk regularly to Mr. Ned O'Hara. I have great respect for him and his team in the IPU, who really value and recognise what has been achieved here. Mr. O'Hara has been a pioneer. There have been detractors who have gone their own way. They have not amounted to much. There are people who seek to undermine the work of the IPU. I believe that is wrong and negative in the extreme.

There are issues around services that need to be addressed. We will look at that in another piece of work. People are throwing in ideas, and I have heard for years about Sparkassen banks and community banks. There is a failure to recognise the work of the credit union movement. In Germany, there are various banking systems. It is entirely different. It has community banks, but we do not have community banks. That is not the solution in the short term. If we go to a community banking model, how long will that take? It will take a lifetime. What we want is a recognition that the State values post offices, and it is always the case that if one values something, one must be prepared to pay for it. The Minister of State has achieved that, and well done to her.

I have ongoing engagement with postmasters. Again, I do not want to quibble about the details, but I will make a point. An Post has done very well under David McRedmond, who has a phenomenal team around him. He has shown great leadership and a great vision. He has turned the company around. I recall when I was in that role in 2016, and the Minister of State and I have discussed this, that the then Minister, Deputy Naughten, called me at midnight one night to tell me he was taking a memorandum to the Cabinet the next day that was going to increase the price of a stamp to €1, such was the perilous state of the finances of An Post. That is only a few years ago and that has changed because of the work of David McRedmond and his team. The only suggestion I have for this is that the €10 million be spread among the postmasters rather than the post offices that fall within the ownership of the company. They will be well able to manage the viability issue or lack of viability if such exists. I appeal to the Minister of State that in the disbursal of that €10 million she limit it to those post offices that are on contract to postmasters. That may help to resolve the €2 million gap between where the IPU is and where the Minister of State is. I do not expect a direct response on this, nor am I posing it for such.

I acknowledge the work Ms Jenny O'Hora does. What she does is well known and recognised. It is a huge achievement for her, the Minister of State and the Department to have moved the dial so much in what is being done, because the State does not take decisions like this lightly. There are others who will wish to move on and talk about other aspects of it. I just wish to reflect on that and to thank them so much for what they have achieved.

Deputy Hildegarde Naughton

I thank the Senator. It is much appreciated.

Senator Timmy Dooley

Unfortunately, I have to leave to speak in the Seanad.

Chairman

I call Deputy Ó Murchú.

Deputy Ruairí Ó Murchú

I am sorry I gave time to Senator Dooley because it is very difficult to follow that. We all have been here previously for previous iterations and there is no need to go through what we all believe regarding the post office network, the vital work that is done by the network and by postmasters in particular and the part that plays in rural Ireland. Post offices also provide major services in urban settings. It is about ensuring we have a viable network. Is it possible at this stage to get any detail about some of what Senator Dooley was saying? How is it intended to break up the €10 million grant allocation? Has there been any discussion on how that will be divvied up, for want of a better term? Is it on the basis of size? Is it going directly to the post offices run by postmasters or what is the situation?

Deputy Hildegarde Naughton

It is based on state aid rules approval which has to be got, but there will not be an issue with that.

Deputy Ruairí Ó Murchú

I accept that. I am just curious.

Deputy Hildegarde Naughton

It is a pyramid system so it will be targeted at the post offices that are most in need and struggling the most. It will be based on that.

An Post will be working with the IPU on the consultation in that regard. Approval from the Department of Public Expenditure and Reform will be required. I do not yet have the details of it. They have to be worked out. However, that is the principle. My primary aim was to ensure that no post office would close because it was not viable. That is why the pyramid system is in place. It is there to protect the existing network.

Deputy Ruairí Ó Murchú

It is a basic-----

Deputy Hildegarde Naughton

There will also be an incentivised payment to promote commerciality as part of that mix. The details have to be worked out but we are protecting the most vulnerable post offices.

Deputy Ruairí Ó Murchú

That is it. It is a basic formula that will protect the most vulnerable, and there will be significant interaction between An Post and the IPU.

Deputy Hildegarde Naughton

There will also be incentivisations for commercial activity as part of that.

Deputy Ruairí Ó Murchú

That is vital. My next question concerns the review process that is being completed across every Department in respect of State services, including the banking services that An Post has started to provide. There is a need for those services, as some of the major banking institutions are closing their more rural branches. What is the timeline for bringing that process to a conclusion and putting those services in place? Long term, it will probably change the amount the State will need to pay, whether it is €10 million or €12 million.

Deputy Hildegarde Naughton

Is the Deputy referring to the provision of banking services?

Deputy Ruairí Ó Murchú

I am talking about two issues. On the review process that the Minister of State is engaged in, I am referring to the notion that at some stage we will be coming up with a battle plan for An Post from the point of view of State services that it may be able to employ on the basis of a transactional payment. Beyond that, there is the work that An Post is doing. It should be facilitated as far as possible. I am referring to State services and banking services. Where are we in respect of the timeline?

Deputy Hildegarde Naughton

An Post is actively working on commercial initiatives that can be rolled out across the network. That is something it is working on. The work on offline services or other State services is happening at an all-of-government level. As I said at the outset, when I looked at the interdepartmental report, it was very clear to me that this alone would not be enough to keep our post offices open. That is why the historic financial package needed to be put in place. An all-of-government approach must be taken on the issue. There is the Town Centre First policy. The post office network providing services is at the heart of it. That is why the process has to involve every Department. The work on offline services and other potential State services must be led at a government level. An Post itself is very well placed to tap into more of the online, as well as offline, services. That is what it is looking at currently.

Deputy Ruairí Ó Murchú

How quickly could we see that happen?

Deputy Hildegarde Naughton

I am aware that representatives of An Post are appearing before the committee in the next few weeks. That is something to raise with them. I know that An Post is actively looking at further incentives and business that can be driven through the post office network.

Deputy Ruairí Ó Murchú

That would be very welcome for people who could access it. Alongside that, the financial package can ensure that the post office network remains viable. I appreciate that the Minister of State has come before the committee to discuss the post office network, but usually I request some element of leeway. I will digress now to another element of her portfolio that has received significant media attention recently.

Representatives from the DAA appeared before the committee earlier. We all spoke about the disaster, from a reputational point of view, that was Sunday at Dublin Airport. Beyond that, we discussed the impact it had on individuals who missed their flights. Upwards of 1,400 people were affected. It was an absolute shambles and there were chaotic sights. We have seen the four-point plan that has been published. We realise that staffing is an issue, without getting into the ins and outs of the number of staff who have been laid off. During the meeting we tried to raise some issues with Mr. Dalton Philips. I accept that the Minister of State's engagement with him has been significantly greater than the interaction we have had with him. We want to know if there are any resources that can be brought to bear on the situation beyond those which the DAA is engaging at the moment? We understand the difficulties involved in getting staff cleared to work in particular parts of the airport. Has everything been done to put in place as many resources as we can to allow for circumstances where, for example, staff are absent due to illness or for some other reason? There is not a huge amount of leeway.

Deputy Hildegarde Naughton

As the Deputy will be aware, I have had ongoing engagement with the DAA. I do not need to say it, but we are all very clear that what happened on Sunday cannot happen again and cannot be repeated. We have had very robust engagement with the DAA. I know that representatives of the authority appeared before the committee earlier and, therefore, members are well briefed on its plans. I will monitor the delivery of the plan over the weekend very closely, as will the Minister for Transport and the Government. I have told the authority that it needs to put in place all measures to ensure that passengers catch their flights this weekend, that it must communicate clearly with passengers, and ensure that passengers can move safely through the airport. I have made clear that anything that can be done should be done to accommodate those measures. I am constantly engaging with the DAA. We will review the matter, which is critical. It is about passengers having confidence in flying not only this weekend, but beyond it. It is all about the delivery of the plan that the DAA presented to the committee over the weekend. We will monitor the situation very closely.

Deputy Ruairí Ó Murchú

We must ensure that we do not have a repeat of the events of last Sunday again. If the system works, it will address the reputational damage that has been done. It is fair to say that the DAA representatives told us that they have a plan in place. They told us that if the authority has all resources that can possibly be put at its disposal, it will get through it. However, the representatives made clear that there is no element of wriggle room for the authority. The organisation is still understaffed. I am sure the Minister of State has had multiple discussions with the DAA on matter, but the part that I am not clear on is whether any other staff can be made available in the short term, while accepting the difficulties and the issues with clearance and all the rest that needs to be done. I am sure that the Minister of State has had a significant number of conversations on the issue, and has considered every State service that we have at our disposal and every airport.

Deputy Hildegarde Naughton

These are the questions that I have put to the DAA. The crux of the issue seems to be around the security staff who are X-ray scanners and are specially trained. That seems to be the issue. There are other issues across the airport around managing queues. There are plenty of companies out there that provide services to manage crowds going to concerts, for example. If the DAA needs to hire such companies, it has the resources to do so. The authority must put in place what is required. The organisation has presented its plan. I will engage with the DAA every day this week. I will be actively monitoring progress and ensuring that the plan is delivered. That is what the passengers are looking for. To answer the Deputy's question, I have told the authority that the resources must be put in place for whatever needs to be done.

Deputy Ruairí Ó Murchú

Has the DAA put in any request for assistance to the Government? We had much conversation around the use of the Army. Sometimes these things can make good press releases and do not necessarily deal with the reality of the issue. From the Minister of State's response, am I correct that the DAA has the facility to use outside resources?

Deputy Hildegarde Naughton

Of course. The DAA is a commercial entity. On the issue of the use of the Army, it has been mentioned by the DAA and it has come up in discussions. It is unclear what the Army would do at this point, particularly coming into the weekend. As I have said, the crux of the matter is around security officers who are specially trained and have to have a particular certification to do that specialised work. On crowd control, there are plenty of companies across the country that could be employed to do that kind of work. Nothing is off the table regarding Government assistance. However, the DAA must ensure it is maximising every resource it has, including looking outside the organisation itself. The DAA is a commercial entity. It is the authority's responsibility to manage passengers and do whatever is needed for that.

We meet them every day to discuss whatever is needed. We will see the delivery of this plan over the weekend and that will tell us a lot about-----

Deputy Ruairí Ó Murchú

This is make or break. We obviously had the issue of the 37 employees, including 20 people who did not show up for multiple different reasons. I accept the staff are under pressure. There were also the 17 where the DAA made a mistake in rostering. There may be an issue with its systems. There was a cyberattack at some stage resulting in more of a manual process than it would like. The DAA has said it dealt with that issue and it should not arise again.

Deputy Hildegarde Naughton

It is critical. The staff in Dublin Airport have been fantastic despite being under enormous pressure in recent weeks and months. I have received considerable positive feedback about the staff dealing with passengers in very difficult circumstances. It is important that staff are paid. Issues with IT and salaries need to be dealt with immediately. People cannot be working overtime and not getting their wages. All those issues need to be solved.

Deputy Ruairí Ó Murchú

Pay and conditions are a definite-----

Deputy Hildegarde Naughton

Those are matters for the DAA. I have been very clear that it needs to deal with these issues and come out with clear communications to the passengers, particularly this weekend, reassuring that them that while there may be queues, they will get on their flights and they will be able to move through the airport in a safe manner. We are expecting the public to be given that reassurance this weekend.

Deputy Ruairí Ó Murchú

There was a general discussion about the Army and State services. However, what is required are trained people who are certified and other people could be taken in from the private sector or elsewhere to help in the short term.

Deputy Hildegarde Naughton

They have gone through the training required for security and all that. The question is what the Army would be asked to do. Would it be managing crowds of passengers? Other organisations can do that.

Deputy Ruairí Ó Murchú

Exactly. I agree with the Minister of State.

Deputy Hildegarde Naughton

Nothing is off the table from the Government's point of view. The DAA needs to ensure it does all it can do to maximise its resources and manage the passengers. As we all know, the Army is involved in critical valuable work.

Deputy Ruairí Ó Murchú

I accept that.

Deputy Hildegarde Naughton

We do not want to call it in unnecessarily when other resources can be used by a commercial entity, the DAA, whose role is to manage passengers through the airport. I am listening to them. I have met the chair of the DAA and I have met members of the DAA management board every day this week. Yesterday I met representatives of SIPTU to discuss workers. I am acutely aware of all the issues. This comes back to the delivery of the plan announced today. This is not about Deputy Ó Murchú or me. It is about the passengers having confidence in their safety and ensuring they can get away for their holidays or wherever they are travelling to.

Deputy Matt Shanahan

I thank the Minister of State for attending. I also thank Ms O'Hora for her great work. I do not think there is a grouping of Deputies in Leinster House with more concern about the post office network than the Regional Independent Group. In the term of this Dáil we have introduced three Private Members' motions in October 2020, July 2021 and May 2022, which the Government accepted. Today is largely a good day. I welcome the Minister of State's announcement of an annual subvention of €10 million. It begins to recognise the social value of the post office network.

I support Senator Dooley's call that the subvention would not be given to post offices owned by An Post - it has enough resources to manage its own business. It should be kept for the private ownership within the post office network which is where it is most needed. The Minister of State mentioned several times that the subvention is to be given through An Post and then on to the individual postmasters. I ask her to confirm that no PRSI will be applicable if it comes through An Post and is paid to the postmasters. Will it transfer to the individual postmasters without a tax implication?

Deputy Hildegarde Naughton

This is a grant from the State going to postmasters via An Post. There is no tax liability from our side on it. A tax liability would be up to An Post. The intention here is that this funding is going to the postmasters, protecting the most vulnerable. It is a direct grant from the State to the postmasters via An Post. We do not have any involvement with tax, PRSI or anything like that.

Deputy Matt Shanahan

Given that we are taking a pathway, I do not know what the financial implications are in terms of the franchise arrangements for private operators, but there should not be a tax liability for this funding coming through to the individual postmasters. I ask the Minister of State to take that up with An Post or get approval from the Department on the treatment of that.

The Minister of State has spoken at length about the activity that may come on stream down the line. A couple of things have not been mentioned so far today, including the immediate ability of post office franchisees to develop additional transaction revenue. A previous proposal was for post offices to be able to print all government forms. Rather than people needing to go to the local authority office or request forms from the tax office, they could go to the post office where they can be printed from PDFs. The post offices have access to every form the government produces and they could charge a transaction fee of 50 cent or something like that based on a PPS number. That is a social service that could be provided really quickly.

The Minister of State spoke about An Post linking in with the banking sector. There is already an agreement between bankers and An Post. The problem is the transaction fee is very low. However, that model could be replicated for KBC and Ulster Bank which are exiting the market. We know that will not be without pain. Perhaps An Post could get in the middle of that bun fight, for lack of a better term, to provide services. It is obvious that the banks acquiring those assets are having considerable difficulty subsuming those accounts into their banking systems.

The Minister of State mentioned motor tax a number of times. People in local authorities always tell me how pressed they are for staffing. In the Dáil today we were shouting about not having enough staff to process disability grant applications and yet we have people retained in motor tax departments throughout the country. Surely that is something that could be expedited. I know the Minister of State spoke about a whole-of-government approach. Can the Department of Transport not move responsibility for motor tax into the post office network straight away? Why do we need to wait for every other Department to figure out whether it is a good or bad idea?

Deputy Hildegarde Naughton

The issue of printing was raised with me by postmasters who were identifying some of these services they could provide. That is a good idea and I will ask my officials to explore it with An Post.

The Deputy is right about the opportunities with the provision of banking through the post office network. The commercial contracts are negotiated by An Post and so it would need to be through that avenue. I believe representatives from An Post will appear before the committee this month. The Deputy should raise the transaction fees for banking with them. I agree that we need to look at more offline services and Government services. Motor tax, from the Department of Transport, is an area that needs to be fleshed out. I know the Deputy is saying that rather than waiting for all Departments to come forward, one service from one Department could be provided. However, I do not want us to lose track of the bigger picture of every Department working together on this. It should not be ad hoc and piecemeal.

This has to be like a Town Centre First approach. We are looking at-----

Chairman

I must interrupt the Minister of State. There is a vote in the Dáil. I propose to Deputy Shanahan that we would pair.

Deputy Matt Shanahan

Okay, that is fine.

Deputy Hildegarde Naughton

Can I pair? I do not believe I am paired.

Chairman

Would the Minister of State be okay if we were to suspend the meeting?

Deputy Matt Shanahan

Or perhaps the Minister of State can arrange another pair?

Chairman

There are two of us here.

Deputy Hildegarde Naughton

Has it been ringing long?

Chairman

We have no non-Government members. It is myself and Deputy Joe Carey who are the two remaining.

Deputy Matt Shanahan

I apologise I must leave momentarily to take a call.

Chairman

If I could find another. We just need a pair. Either way we just need one more.

Deputy Hildegarde Naughton

Okay.

Chairman

Deputy Carey can go to the Dáil Chamber and then the four of us will be paired off. By that time it may have concluded. I suspect it may be just a once-off vote. What is the vote for?

Deputy Hildegarde Naughton

The vote is regarding the Circular Economy, Waste Management (Amendment) and Minerals Development (Amendment) Bill 2022.

Chairman

Typically that is one vote. I would prefer us to conclude the meeting. I propose to suspend the meeting for three minutes to see how we get on. Is that okay?

Deputy Hildegarde Naughton

Yes.

Cuireadh an suí ar fionraí ar 6.51 p.m. agus cuireadh tús leis arís ar 7.11 p.m.

Sitting suspended at 6.51 p.m. and resumed at 7.11 p.m.

Chairman

I call Deputy Shanahan.

Deputy Matt Shanahan

I was happy to support the Minister of State's visit to Waterford Airport last week. It was opportune, given what happened at Dublin Airport over the past weekend. As she is probably aware, a media probe in recent days reported that it seems private investment of approximately €8 million has been secured for Waterford Airport. Local authority funding of €2 million is additional to the Government's previous commitment to provide €5 million for the development of the runway extension and ancillary buildings at the airport. This will allow Boeing 737s and Airbus A340s to land there for the first time. The visit of the Minister of State was welcome, but I would like to hear very shortly that once shareholder agreement is hopefully reached and an application is submitted, the Department will be ready to go. I ask that this money not be tied up as part of a public procurement piece in terms of development. I request that it be given to Waterford Airport in the form of grant moneys and that the airport will be able to spend it as it wants, as was the case with national aviation funding that was paid directly to Kerry Airport last year in the form of subvention funding. Otherwise, we will be caught up in a plethora of public procurement issues and difficulties.

The cost of building the runway extension has increased by nearly €2 million since it was first mooted approximately 18 months ago. Potentially, it might increase again. The people of Waterford and the south east and I will be expecting that the Government will provide for any shortfall and that no one will come back and state that the estimate for the cost of the runway extension has gone beyond the envelop that was previously discussed. I remind the Minister of State that €160 million was put into a national aviation package more than two years ago and that Waterford Airport was completely bypassed in that regard. The stopgap funding that was being paid up to 2019 was also withdrawn.

What has happened at Dublin Airport has shown for the first time that our aviation policy is flawed. Too much traffic is going through Dublin. We are trying to build capacity in one place, and we are not looking after the regional airports such as Waterford, Cork, Shannon and potentially Sligo and Ireland West Airport Knock. I ask the Minister of State to have a serious review of this matter. It is stated in the programme for Government that it is the Government's intention that circumstances in the south-east region will improve and that Waterford will be the driving economic power there. In order to have a functioning region, we need to have a functioning airport. That is long past due.

The retention of rescue services in the south-east region is also very important. I was glad to hear the Minister of State reiterate that Waterford will remain a 24-7 base in the new configuration. It is very important that we move on to the next step. We have been too long waiting for this to happen.

Deputy Hildegarde Naughton

I thank Deputy Shanahan. It was a very positive visit to Waterford Airport and to celebrate 20 years of the search and rescue service there. To reiterate what I said when I visited the airport, the commitment from the Government to help fund a runway there still stands. There are conditions around that, of which everyone is aware, regarding a proposal coming from Waterford Airport in respect of private investors. We await the outcome of that. Developments in that regard sound positive on the basis of the Deputy's account. As he is aware, we have to go through the public spending code, as does every project. This is public money. I await the proposal, and I look forward to that for Waterford Airport.

The continuation of search and rescue services in Waterford is critical. We have seen the value of it. The event I attended was a wonderful occasion to mark the Trojan work, dedication and commitment of all those involved in search and rescue and all the volunteers, and, of course, to remember those who lost their lives in the act of rescuing or being rescued. I reiterate my commitments on the importance of search and rescue services and in respect of working with Waterford Airport in respect of the Deputy's plans.

Deputy Joe Carey

I welcome the Minister of State. This is a very positive day. I congratulate her and her team on securing €30 million for the An Post network. We have had many conversations in recent times, both here and in the Fine Gael Parliamentary Party room, with colleagues including Deputy O'Donnell, me and many rural Deputies and Senators. I congratulate the Minister of State on her strong engagement with us, as politicians. I pay tribute to the Irish Postmasters Union and to Ned O'Hara, who engaged with us a very constructive way. I also pay tribute to the postmasters in County Clare with whom I engaged when they came to my office.

What is being done is ground-breaking. It is the first time the Government has invested directly in the post office network. It is a realisation that the post office is much more than just a service. I understand that more services will come on stream as a result of this injection of moneys. The report from the interdepartmental group is yet to be published. Will the Minister of State provide some insight into what she envisages it will contain? What type of additional State services does she envisage will be available from the post office network?

Deputy Hildegarde Naughton

I thank Deputy Carey for his engagement with me and my officials in respect of this important matter. It is important that we get the message out to people that they need to use their post offices in order to support the network as we roll out services. An Post, which is an independent, commercial, semi-State company, has a strategy and a mandate to ensure that there is increased services and that it helps the post office network to get these services on board. That is its role. Representatives from An Post will come before the committee in the next few weeks. It is important that the committee asks them about the company's plans to support the services and to help postmasters and the network to grow.

The interdepartmental group was looking at offline services and what different Departments could provide in regard to such services. It was clear to me when I became Minister of State that that alone was not going to keep the network of 900 post offices throughout the country open. That is why we needed this financial support. In the meantime, we need to look at taking a cross-Government approach in order to identify potential offline services that An Post would bid for. They would be put out to public procurement, and it would be up to different agencies to pitch for them. This is why it is important that when An Post comes before the committee, members talk about the importance of it bidding for these potential services in order that, according to its mandate and strategy, it will help to grow the network.

The Department of Transport has identified motor tax as a potential service that could be provided. The Revenue Commissioners have also outlined a number of services to be looked at.

These are being fleshed out the moment.

The Department of Social Protection is also considering some services. This needs to be driven by the Government rather than just the Department of the Environment, Climate and Communications. This is the problem. We have a Town Centre First strategy, which I know the Deputy is very aware of because he comes from a rural constituency. How do we ensure that our villages and towns thrive? The post office will be a key part of that but we need to make sure that every single Department is looking at potential offline services. Online services should also be considered. It is part of An Post's remit to look at online services. It is important that we work across Government in that regard. It is a work in progress. This is giving the post offices and the postmasters breathing space. An Post has a very significant role to play here because it is part of its mandate and strategy to ensure the network grows. We had the census recently. That will shed new light on where people are living and on remote working. Many people have gone back to their home towns and home villages. New light will be shed on the services that people now require in their local areas and where these services are required.

Deputy Joe Carey

That update is really positive. The role postmasters, postmistresses and all of those involved with the post office network played during the Covid pandemic was clear for everyone to see. As we emerge from the pandemic, this injection of money is really welcome. It gives postmasters and postmistresses certainty for the future. They can plan and look forward to developing their businesses and their services further. It is very encouraging to hear the Minister of State say that the State will be there. She is not just saying it. She has managed to put this package together and she deserves great credit for doing so. It is fantastic. I have no doubt that she had many a battle in many a room with many officials and other Ministers. A great deal of credit is due to her on this. Well done.

I will move on to the Minister of State's other area of responsibility, that of aviation. We had a long meeting in committee room 2 with the DAA earlier. I will not go over it, but I have heard the Minister of State's comments in recent days. I know she is trying to do the best she can as Minister of State with responsibility for aviation. It has been a problem of mismanagement in the airport. Mr. Dalton Philips assured us today that the DAA hopes to have plans and resources in place to deal with the numbers it expects to go through the airport this weekend. This issue exposes the frailties in our national aviation policy. Some 87% of passengers are funnelled through Dublin Airport, which is a really sad indictment of our national aviation policy.

Last week, Mr. Conal Henry, the recently appointed chairperson of the Shannon Group, came before this committee. He was put forward for the job by the Minister of State and the Minister, Deputy Eamon Ryan. He got a ringing endorsement from the Joint Committee on Transport and Communications. In the course of his interaction with us, he pinpointed amendment of the national aviation policy as a key ambition of his as chairperson of the Shannon Group. He pointed out that there is one really dominant airport and four others that fight over the remaining 13% of traffic. That is not sustainable on an island of our size. The Minister of State will understand the economic importance of an airport to a region. I represent County Clare, Shannon, the mid-west region and the western seaboard. It is just critically important. Some 40% of foreign direct investment, FDI, companies are based in the Shannon region. They need connectivity, whether to mainland Europe, the US or anywhere else in the world. They need that. One of the primary reasons many of those companies set up in the region is that connectivity.

We should consider the investment Government has made in Shannon Airport, even in recent years. The committee visited the airport and looked at the new scanning system it has. Some €4.6 million was invested in that equipment, which means that, having gone through pre-clearance for the US, people can now go through just one security check. Passengers travelling through Dublin have to go through two, and that airport's equipment is not up to date.

It is easy to make the case that it would make more sense to have more people flying to and from Ireland through Shannon, as was previously the case with the stopover. We need, by means of a national aviation policy, to encourage airlines to provide for that. We also need key hub connectivity through the airport, especially in this post-Brexit era. We have connectivity to Heathrow, which is very welcome, but prior to the pandemic it was planned to have connectivity to Paris. There was also a Lufthansa service to Frankfurt but this is not back on track yet. I know Government has given money directly to airlines to fly and to re-establish routes, which is very welcome. I hope that will happen but we really do need a fair slice of the cake to enable airports outside of Dublin to take the pressure off Dublin Airport. It cannot all be about one really dominant airport. We need to spread it out. National aviation policy should be brought in line with key Government policies like Project Ireland 2040. The aviation policy is in total variance with that. It is also at variance with the regional economic strategies, which the Minister of State will be familiar with. We need to recognise airports like Shannon Airport as economic drivers.

In some ways, the airports are like the post offices, which the Minister of State is after sorting out. They should be looked at in that way. They are more than just airports. They are of regional importance. They are also of importance to the country in providing a counterbalance to Dublin. The events in Dublin over recent days tell us that everything is being funnelled through Dublin because of existing policy, which needs to be amended. Deputy Shanahan mentioned the need to amend national aviation policy as well. I have no doubt that Deputy O'Donnell will also do so. The Minister has confirmed to me on the floor of the Dáil that he is committed to reviewing aviation policy. When will that happen? For me, it cannot happen quickly enough. It must also involve consultation with stakeholders in the regions and throughout Ireland. This could result in a win-win for everyone. We can have a sustainable network of airports which all have specialties. I was talking about Shannon Airport and American transatlantic traffic. The airport could major in that. There could be something for Cork, Knock and Waterford as well. We need to cut up that cake in a more equitable way so that we all benefit.

Deputy Hildegarde Naughton

I thank the Deputy for his comments about An Post. I want to acknowledge Ms Jenny O'Hora from the Department. She was instrumental in leading on this matter and getting this package over the line. With regard to aviation, regional connectivity is absolutely critical. I am from Galway and use Shannon Airport regularly. It is great to walk through the baggage control having all your liquids. You do not have to take anything out of your bag, not even your laptop or phone. It is a very swift and easy route to travel. As the Deputy will know, we included Shannon Airport in the regional airports programme because of the Covid pandemic and the concern I had to ensure that Shannon, and Cork for that matter, would be in a position to rebound coming out of the pandemic. That is why they were included in the regional airports programme for the first time. There is also a marketing fund available for the Shannon Group, which was also doing a really good job before the Covid pandemic.

With Ms Mary Considine, the CEO, and the new chair, Mr. Conal Henry, the group has a dynamic team who are up for driving more connectivity to the mid-west. I do not need to convince the Deputy about the importance of this.

Airlines will choose where they want to go in the market. The review of the national aviation policy started in 2020 just before the pandemic. A pause was put on the review and rightly so because we had to deal with the pandemic. The thinking, which was correct, was that we needed to wait until the pandemic ended to see how aviation would settle, what the travel patterns would be and whether people would travel for business again. The census will also feed into the review. We will resume the review this year and it will involve a large amount of consultation.

Deputy Joe Carey

That is great to hear and I welcome it. When does the Minister of State envisage the review recommencing?

Deputy Hildegarde Naughton

I imagine it will start again in the latter part of this year.

Deputy Joe Carey

And it will involve consultation.

Deputy Hildegarde Naughton

Absolutely. It has to.

Deputy Joe Carey

That is welcome.

The Minister of State mentioned the regional airports programme. I understand that, to qualify for the programme, an airport must have fewer than 3 million passengers to be in compliance with EU state aid rules. This year is the first year that Shannon was ever in the programme, which is welcome. Shannon has not reached 3 million passengers in a long time. Will the Minister of State assure me that it will continue receiving this critical revenue until such time as it reaches at least 3 million passengers? She is the Minister of State who allocated the money and she can see the good use that it has been put to, for example, installing important security equipment, baggage haulage facilities and so on that make it easier to get through the airport. The public might not see all of that, but significant amounts of money have been invested in Shannon, much of it directly by the Shannon Group. For the first time, we are receiving money under the regional airports programme. It is being put to good use. We are in competition with the likes of Dublin, so it is not an even playing field. Surely we should be included in the airports programme going forward.

Deputy Hildegarde Naughton

My priority is to ensure that we can maintain regional connectivity. Shannon Airport is critical for the mid-west. I am constantly reviewing this matter. Shannon meets the criteria for the regional airports programme - it has scheduled flights and its passenger numbers are what they have been for two years in a row. We must ensure that we maintain Shannon Airport and that it thrives and develops as we come out of the pandemic. In 2021, €22.4 million went to Shannon Airport in current capital funding under the regional airports programme and the Covid supplementary support scheme, which allowed the airport to negotiate with airlines directly and to do the business it does best. It was not just a case of the Government giving money. The regional airports are commercial entities and they, including Shannon, were functioning well before Covid. The funding went to them to increase their connectivity. Under the regional airports programme, Shannon has received €4.3 million in capital allocations this year.

I am committed to ensuring that Shannon is supported as we leave the pandemic. We are not out of it fully yet. Passenger numbers are increasing in Dublin Airport, as they are in Shannon Airport, but we are constantly examining this matter in order to ensure that Shannon is getting the supports it needs for aviation and connectivity. I am from the west, so I understand the situation well and know the importance of having the airport for foreign direct investment, tourism and so on in the region. I am preaching to the converted.

Deputy Joe Carey

Regarding this year's allocation under the regional airports programme, I believe that there was only a commitment of one year. When will the Minister of State make a decision on next year and the year after?

Deputy Hildegarde Naughton

We have already announced the capital funding for this year's regional airports programme. Operational funding will be announced later this year. I imagine it will be at the end of the year.

Deputy Joe Carey

For next year.

Deputy Hildegarde Naughton

Yes.

Deputy Joe Carey

Does the Minister of State envisage Shannon continuing to be in the programme next year?

Deputy Hildegarde Naughton

That is my understanding, but I will revert to the Deputy and we can have an ongoing engagement. I assure the Deputy that there is a commitment to support Shannon Airport in whatever way we can and to ensure that it does the business that it does best, which is commercial activity and engaging and negotiating with airlines. We do not want the funding to just be a handout.

Deputy Joe Carey

Absolutely.

Deputy Hildegarde Naughton

Shannon does not want that either. It wants to do its own business and we want to facilitate it in doing so.

Deputy Joe Carey

That is welcome. If that is the case, though, then it is news to me because there had only been a commitment of one year. If the funding continues into next year and the year after, it will be welcome. It was a key objective outlined by Mr. Henry. The issue was also raised with me by Ms Considine. If Shannon continued to have access to the vital funding stream of the regional airport programme next year and the year after until such time as we reached 3 million passengers, we in the Shannon region would broadly welcome that. The Minister of State might confirm that to me in writing.

Deputy Hildegarde Naughton

Officials in my Department will be engaging with Shannon Group's CEO on supports as we exit the pandemic, as we have been with all airports across the country. I will revert to the Deputy.

Senator Jerry Buttimer

I welcome the Minister of State and commend her on the €30 million over three years to support and continue developing a sustainable post office network nationwide.

The network is under pressure. Our committee has met and extensively dealt with postmasters and postmistresses. I thank them for their interactions with us. Regarding the interdepartmental report on Government supports, what was the main emphasis in terms of the post office network's future?

Deputy Hildegarde Naughton

It was apparent to me early on after entering my Ministry that the services being explored by various Departments would not be adequate to maintain the existing post office network and that more work needed to be done across the Government in order to identify potential services that could be provided offline. Under the Government's digital strategy, 90% of services are to be provided online. That leaves 10% that could be offered offline. We need to undertake a larger body of work to identify those services. An Post would be in a position to bid for services, be they online or offline.

There are two strands to this. First, there is an all-of-Government approach to identifying the offline services, bearing in mind the digital strategy. Second, An Post could bid for services as part of its mandate to ensure that we have a thriving post office network across the country.

Senator Jerry Buttimer

The Minister of State spoke about the social value that An Post and the post office network bring. What are her plans for the 900 post offices? How do we incentivise Mr. Murphy or Mrs. Murphy to take over a post office where the postmaster or postmistress is retiring?

Deputy Hildegarde Naughton

What this financial package does – it is what the postmasters and postmistresses were asking for from me and the Senator as they travelled around the country – for the first in the history of the State is to ensure that if a postmaster or postmistress wants to retire for personal reasons, it will not be because his or her post office is not viable. In other words, it will not be because of economic reasons. As such, a viable post office will be on offer to someone else who might be interested in taking up that position.

The issue throughout the country was that in many cases where postmasters decided they were going to retire for whatever reason, nobody came in to replace the postmaster in a particular town or village. This financial package ensures that where that happens, and if somebody wants to retire for personal reasons that is fine, the position will be advertised and somebody can potentially come in and take over that post office.

Senator Jerry Buttimer

Is it the case that the Government is not closing post offices down but is trying to keep them open? When a post office is threatened with closure, its future is not just a Government activity. Surely, there must be bigger buy-in from the Irish Postmasters' Union and local communities, with local authorities and the Government.

Deputy Hildegarde Naughton

It is up to the postmaster. There will be incentives for providing more services, be they banking or whatever, working with An Post on the provision of these services. An Post is providing training to postmasters. It is also its role to identify and work with postmasters on the provision of extra services. There is also a call on members of the public to use their local post office. If they want a viable post office network, they should ensure they go out and support their local post office. This is-----

Senator Jerry Buttimer

On that last point, is that the nub of the problem? The public - an gnáth duine, the citizen, and all of us living in our communities - are not thinking about or using our post office network in sufficient numbers. How do we make the public - men, women and children - use it? I remember going to school when we had post office stamps, which helped us to save. We then had TSB Bank staff come into schools. Have we lost our way a little in terms of the public and the citizen? How do we attract them to come in? In fairness, the postmasters have been extraordinarily strong advocates of the post office network yet the people are voting with their feet, which is little unfair because the post office network is a fantastic service delivering a multiplicity of services, as we know.

Deputy Hildegarde Naughton

I agree with the Senator. We have a role to play in saying members of the public need to use their local post office and getting that message out there. I have attended public meetings where people were outraged that their local post office was closing but, when we go through the numbers, the footfall is just not there in some post offices. We have a role to play, as does An Post. This is part of the modernisation of our post office network. An Post representatives will come before the committee in the next few weeks, as will the postmasters working with them, regarding those extra services that will hit every age group in society, be it for banking or local services, and will attract people and communities to using the local post office in their towns and villages.

There is a body of work to do. I agree with the Senator on that. This is a role for postmasters and An Post. This financial package is giving them time to ramp up the level of service, and the awareness in our towns and villages, and help them modernise the post office service throughout the country.

Senator Jerry Buttimer

Please do not take this wrong way, but the citizens' assembly seems to be a port of call for every potpourri of issues. I have often thought about this. I have followed our committee's work and I appreciate the major effort the Minister of State has made to engage with An Post for which she deserves huge credit. Her last comment concerned getting the public to use the post office network. Should the Government consider a citizens' assembly to discuss the future of the post office network and how we can get the public to use our post offices?

Deputy Hildegarde Naughton

It is about providing the services the public will use and are interested in using so they will want to go to the post office. An Post has a strong role in that. It is focused on the modernisation of the network. It has done a significant amount of work over the past number of years on turning it around. This is a very important and pivotal moment for the post office network. It is down to the company, An Post, working with postmasters and the Government to identify services, especially banking. Let us be innovative and creative. This is the time to do it but fundamentally this is a commercial entity and a semi-State body. It is up to An Post, working with the IPU and the Government, to identify services that will make the network attractive for people to use.

Senator Jerry Buttimer

The fundamental task we all have to collectively work to achieve is more people using the post office service. An interdepartmental group was set up to examine the feasibility of government services being moved over to the post office network. There was also an announcement today. I believe we need a citizens' assembly to discuss the future of the post office network because it is not just Ireland that is having difficulties with its post office network and the delivery or use of postal services.

I will digress, with the Chairman's permission, by returning to the issue of aviation in the short time left to me. I will remind the Minister of State, members of the committee and those watching that Cork Airport is the second airport in the country. It had 2.8 million passengers pre-pandemic. I support Deputy Carey's call, which is a call I have made, that the regional airports programme, notwithstanding the European Union state aid rules, must be retained for Cork and Shannon airports to incentivise marketing and route delivery. If it is not, we will have worse chaos than we had last weekend.

Deputy Hildegarde Naughton

I thank the Senator for those comments. I am on the record in stating the importance of having that regional connectivity. As the Senator knows, we funded part of the new runway at Cork Airport. I was honoured to officially open it. It is critical we maintain our existing airport network, which was what I was focused on during the pandemic. We now need to keep reviewing this constantly to ensure our airports have the necessary supports in place to increase connectivity, not only regional but international connectivity, as Cork and Shannon airports do. I am very much focused on this issue and on ensuring we have a strong aviation sector. We work with our airports but it is up to them to negotiate directly with airlines. It is important to state they are commercial entities. Cork Airport is exemplary in attracting-----

Senator Jerry Buttimer

I was not going to refer to Cork at all in this next question because I do not want to be too parochial. I appreciate the Minister of State has to wear the Ireland hat, despite the fact she is, like Deputy Carey, probably coming from the perspective of the west, as is the Chair, which is fair enough. Has the Minister of State, the Minister or the Government sat down with the airlines, to which we gave money for route incentivisation? This afternoon, Mr. Dalton Philips informed us in his presentation and under questioning, that the money, some €97 million, went to the airlines for route development. Some 85% of air traffic passengers are using Dublin Airport. There is now a duty on the Minister of State or the Minister, or both together. The Taoiseach is from Cork, as is the Minister for Public Expenditure and Reform, Deputy McGrath, and the Minister for Foreign Affairs, Deputy Coveney. We have three Cabinet Ministers from Cork and if they cannot deliver balanced regional aviation development, then God knows where we are going. There is a need for the Government to sit down with the airlines to say how we can distribute the 85% of passengers going through Dublin Airport between Cork and Shannon in a way that makes Dublin Airport less congested than it was last weekend.

Deputy Hildegarde Naughton

The decisions airlines make regarding where they fly into are commercial.

Senator Jerry Buttimer

We gave them money as part of the pandemic response.

Deputy Hildegarde Naughton

Absolutely. The money we gave, for example, to Cork was €8.3 million. That was for Cork Airport to directly engage with airlines, to attract and to incentivise them to bring in more-----

Senator Jerry Buttimer

We gave Aer Lingus money as part of the package. Surely the Minister for Finance, Deputy Donohoe, the Minister for Transport, the Minster of State or someone sat down with Aer Lingus and said "Hang on a second. Aer Lingus has not resumed a number of flights, for example, out of Cork". Has it been asked why? Will those flights come back?

Emerald Airlines is taking over some of the short-haul flights. What is its policy? What is its mission statement now in respect of the short-haul flights in Europe? I appreciate that the Department cannot do everything - I am not trying to suggest otherwise - but the Government can proceed on behalf of the people. We have Project Ireland 2040, of which we are all supportive because it is about regional development, but if everybody who lands in Ireland lands in Dublin Airport and if suddenly things are going nowhere other than Dublin, we will not benefit from the increase in passenger numbers as we should.

Deputy Hildegarde Naughton

I am ensuring that our airports are supported. Cork Airport received over €22 million last year in a range of supports. That included the regional airports programme and the Covid supports. Airlines make their own commercial decisions as to where they will go. It is up to the airports to deal directly with them. I take the points raised earlier about regional connectivity and having balance in respect of our airlines, but we need to be careful as a Government. The airlines would be the first to tell us that they make their own commercial decisions as to where they will fly. The national aviation policy, as I said to Deputy Carey earlier, was under review in 2020. The pandemic put a hold on that. We will resume that review at the end of this year. I know that these issues are very important, but regional connectivity is of critical importance, from my point of view. That is why unprecedented funding was given to our regional airports in particular over the past two years. I will continue to review this constantly in order to see what else we can do to ensure we have that connectivity.

Senator Jerry Buttimer

I applaud the Minister of State, lest she think I am being critical of the role she played in ensuring that funding was given to Cork, Waterford, Knock and Shannon, for example. I thank her for that. Dalton Philips said today that the airports were losing €1 million a day. My point is that the Government, like the Government before it, is all about regional development and the regions. If, however, in the context of aviation, everything centres on Dublin, we are really at nothing. That is why I am concerned. I hope and I ask the Minister of State - Chairman, you might take up this point again later - that our committee is involved as part of the review of the national aviation policy. I am not sure how the Minister of State will do this or what her proposal in respect of that review is, but it is critical not only that airlines are sat down with and spoken to about their plans and the need for that regional connectivity, as the Minister of State said, but also that we look at the tourism bodies and how they interact in respect of promotion of the Wild Atlantic Way, Ireland's Ancient East or whatever else. It is critical that the future of our airports and our aviation sector not be just about Dublin Airport. I know that that is not the Minister of State's aim, but it needs to be said to the airlines as part of the review.

Finally, I thank the Minister of State for being here and for her engagement, in particular on An Post, which has been very positive. I thank her for her work and wish her well in her endeavours.

Deputy Hildegarde Naughton

I thank Senator Buttimer.

Deputy Matt Shanahan

May I clarify something Senator Buttimer said? I reiterate that Waterford did not receive any funding from the regional airports subvention or any Covid moneys, which is what Senator Buttimer said. That was just incorrect.

Chairman

I have no doubt but that Senator Buttimer will-----

Senator Jerry Buttimer

I am sorry. I included Waterford Airport in my remarks as an example. I did not mean to refer to it in the context of getting funding but, rather, in the context of connectivity. I am happy to clarify those remarks for Deputy Shanahan. I know he is still hurting after the day below in Waterford, but they will rise again.

Deputy Matt Shanahan

We take our beatings easily.

Chairman

It has been a long day. I have a couple of questions. I very much welcome the €10 million for An Post. Nothing is more locally based than An Post. There is a post office in Caherconlish, a rural village in my constituency, on the outskirts of Limerick. It is having difficulty securing a successor to Kitsy Hickey, who has been the postmistress there for over 40 years. Her predecessor was there for nearly 60 years. Between them they have done nearly a century. The position has been re-advertised by An Post. I very much welcome that this funding has come forward and that Kitsy Hickey is staying on for an additional month to enable us to secure a postmaster for Caherconlish village. It is in that context I welcome the funding. I have just a few brief questions. When will the €10 million come into being? What will be the process for people to draw it down? There was a pandemic support payment. The Minister of State made reference to it in her speech. Was it for €8 million? Was that provided by the State to An Post?

Deputy Hildegarde Naughton

No, that was An Post.

Chairman

It was in-house.

Deputy Hildegarde Naughton

Yes.

Chairman

Does the €10 million, in essence, just counteract the €8 million? I need to understand when the €10 million will come into being and what the process will be for people applying for it.

Deputy Hildegarde Naughton

The €10 million will come into being from 1 January of next year. The €8.5 million pandemic relief fund negotiated between the IPU and An Post was over 18 months. This €10 million is over 12 months.

Chairman

That is significant difference.

Deputy Hildegarde Naughton

Yes.

Chairman

One is over 18 months and the €10 million one is over 12 months. That is in 2023. That is great. It is good to hear that. What about the process by which to draw it down?

Deputy Hildegarde Naughton

This needs to get state aid approval, which we are very sure we will get. It will be a grant given by the State to the postmasters but through An Post, so An Post will administer the grant. It will be done in consultation between the IPU and An Post and will then be approved by the Department of Public Expenditure and Reform.

Chairman

This will apply purely to the self-employed contract category of postmasters.

Deputy Hildegarde Naughton

Yes.

Chairman

How will they claim? How will the process work?

Deputy Hildegarde Naughton

The exact workings of that have to be figured out between the IPU and An Post, and then it will be agreed by the Department of Public Expenditure and Reform. The aim is to target those that are struggling the most so as to ensure that we can keep the existing post office network open and that those that are most in need will benefit most. How it will work out will have to be worked out between An Post and the IPU.

Chairman

How long does the Minister of State anticipate it will take to get state aid approval? Has this been submitted to the European Commission?

Deputy Hildegarde Naughton

The Government decision was yesterday.

Chairman

Tuesday.

Deputy Hildegarde Naughton

Yes. I would say very soon. There is no issue with this.

Chairman

As for getting down to negotiations and discussions with An Post and the IPU, I presume the Department, An Post and the IPU will sit down and come up with how people would apply. How long will that take?

Deputy Hildegarde Naughton

It will be ready by 1 January because the €8.5 million pandemic relief fund ends on 31 December. It will be in time for that. That is a guarantee.

Chairman

Will an implementation group be set up? What will be the mechanism by which it will be agreed how it will be allocated?

Deputy Hildegarde Naughton

An Post will administer it. I do not have the details as to how that-----

Chairman

Are they being worked on?

Deputy Hildegarde Naughton

They will be, between the IPU and An Post.

Chairman

It is a matter of sooner rather than later. The Minister of State is going to the IPU conference. Is that this week?

Deputy Hildegarde Naughton

Saturday.

Chairman

The big issue, as the Minister of State will be aware, is that the pandemic payment finishes at the end of the year. The postmasters must give six months' notice to An Post if they decide to retire. Many of them will want to make a decision at the end of June. It is extremely important that the Department give some outline as to how the scheme will work and, generally, the level of payments that will be involved. The last thing we want is for there to be any degree of uncertainty as to how much they will get. There may be postmasters deciding to relinquish their positions at the end of June and they will go for the safe bet of retirement. That is not what we want. I know this is a really tall ask, but I ask that a serious body of work be done between now and the end of the month to give a general outline.

I am not expecting it to be the finer detail but, generally, the postmasters would be aware of the level of support they get from the State. I know it is a tall ask but they have to give six months' notice and 30 June is the date. I am sure the Minister of State is familiar with that. It is very important so we might follow up on that. Overall, it is a very good news story.

It is important that people would understand that the €8.5 million is over 18 months and the €10 million is over 12 months. I cannot say enough for the post office network. I remember many years ago hearing a certain businessman speaking about setting up a business in Ireland and he said the network is where the cost is. We have to harness An Post as a community service with its network. There are several points. When the driving licence comes up for renewal, could An Post tender for that? We have to find other elements and have a national perspective to bolster what it does. It has gone into banking and I believe there is huge scope to promote this area.

The committee might follow up with the Minister of State to get some flesh on the bones prior to the end of June. I suspect the Irish Postmasters’ Union and its members will be very interested in that, particularly given the pandemic payment has been a huge factor with them in terms of support. I very much welcome that and commend the Minister of State on the great work she has done in this regard.

It would be remiss of me, given Deputy Naughton’s role as Minister of State with responsibility for aviation and international travel, not to make reference to our meeting with the DAA today. I do not know if she has had the opportunity to watch it.

Deputy Hildegarde Naughton

I did. I saw part of it, not all.

Chairman

It was a constructive and productive meeting. There are a number of factors and we would ask the Minister of State to follow up on that. If the weather is bad, there can be people queueing outside T1 and T2 in the rain, which is unacceptable for us as a committee. We ask the Minister of State to follow-up. We made it quite clear to Dalton Philips, the CEO, and his colleagues in the management team that that cannot take place. It is unacceptable in this day and age that people need to do that.

Second, those in the DAA appear to have very little wriggle room in terms of the available manpower. They were given additional manpower of 40 people but 30 of those will be trainees, three are coming from Cork and seven are part of an internal reallocation. They were down 37 during the weekend, with 17 of those due to a monumental management cock-up with regard to trainees who were not certified but who were included in the roster, and there were 20 absentees on the Sunday. To get through this weekend is very important. There are many things that we welcome. They are opening a lot more lanes and there will be 12 lanes at peak times, and they have the 40 staff. However, they do not appear to have any contingency in terms of staff on call, which is a worry for the committee.

The rain is a huge factor and it needs to be quickly nailed down. They need to find some way to ensure that if it is raining, people are inside. It is not acceptable that people are outside. We ask that when people are queueing, they would give out water and look after people with food, which was not happening last weekend.

We ask the Minister of State to keep a serious eye on what is happening. We have said to them that we will look to bring them back in again by the end of June. They expect that, by that time, they will have all of the 167 additional security checkers in place for the summer schedule. It is very regrettable what happened last weekend. We can talk about this all we want but the bottom line is that there was a cock-up in the rostering and that was a management failure, pure and simple. It should not have happened. There will be absentees. Our only concern is that there is very little headroom in terms of staff. If they get fair weather and the 40 are there, it looks like they will get through with a pinch, but it is something that we need to keep an eye on.

I assume the State stands ready so that if there is a need for further supports in any form and things happen over the next couple days, the Minister of State, Deputy Naughton, the Minister, Deputy Ryan, and the Government stand ready to provide support. I do not believe it is tolerable for any member or any customer, and the general public will not put up with what happened last week if there is a repeat of it this weekend. Whatever needs to be done will have to be done. Is the Minister of State committed to that area?

Deputy Hildegarde Naughton

I reiterate that this can never happen again. I have had daily meetings with the DAA and I met with the chair of the DAA and with the SIPTU trade union because I know staff are under huge pressure there at the moment. I agree with the Chairman in regard to ensuring that passengers are not outside in the rain and that cover has to be provided for them, and I am categoric on that. Yes, those in the DAA are under pressure with staffing, particularly security staffing, which requires experience, specialised training and expertise in that area. What they really need to do is communicate with the public and reassure the travelling public that people will be able to make their flights safely and with ease of access. There may be some queueing but people will be moved through as quickly as possible. For anything they need to do now, they need to start doing it in order to ramp up their resources. If that means going out to a private company to help them with managing queues and to relieve their own staff on those duties, that needs to be done.

Chairman

We have asked them to be proactive. All going well, it will be okay at the weekend. People will be queueing but, hopefully, not for an inordinate length of time and they will get their flights. However, if there is any question at all that this is running into serious trouble very early or at any stage, passengers and the general public will not accept anything like what happened last weekend. It is unacceptable on every level. It is very important that the Ministers keep a watching brief and whatever supports are required at any moment in time, the State must provide that support.

Deputy Hildegarde Naughton

I absolutely agree. This plan has to work this weekend and I will be monitoring and watching this acutely. Passengers will be the first to say whether they have confidence in this plan or not, so this has to work this weekend. I will be in daily contact with them.

Chairman

There is also the future plan on the summer schedule.

Deputy Hildegarde Naughton

Absolutely.

Chairman

We will conclude. I thank the Minister of State, Deputy Naughton, and her official, Ms O’Hora. As I mentioned, the joint committee will be meeting An Post on 15 June and we will be closely monitoring progress in regard to the An Post network. We will follow up with the Minister of State to get some outline of what is due to be in place by the end of June. It is critical to ensure we do not have people retiring because we need to maintain the postmasters.

The next meeting of the joint committee will be in private session on Microsoft Teams at 4 p.m. on Tuesday, 14 June.

The joint committee adjourned at 8.08 p.m. until 1.30 p.m. on Wednesday, 15 June 2022.