This concerns the definition of the terms used. Will the Minister give us an overview of the Bill, the need for it and the Department's role and the State's role in taking on this insurance? A huge indemnity of \9 billion is being covered by the State. No one wants to see that ever being draw down, but will the Minister explain how she sees the structure working? Will the State become some form of broker or insurance agency?
Air Navigation and Transport (Indemnities) Bill, 2001: Committee Stage.
SECTION 1.
Question proposed: "That section 1 stand part of the Bill."
No, absolutely not.
How will it be operated?
It is only an emergency provision. All of this was dealt with on Second Stage in the House. We are dealing with the amendments here and I do not intend to go over Second Stage again. It is an emergency piece of legislation which is retrospective in nature. Had it not been introduced the airlines could not fly and the airports could not operate. We will not be brokers. It is an emergency provision for a specific length of time and is extended month by month to allow airlines and airports to continue to operate.
Question put and agreed to.
SECTION 2.
I move amendment No. 1:
In page 4, subsection (1), line 13, after "exists" to insert ", or is likely to exist,".
This is a technical amendment and we are accepting it.
Amendment agreed to.
I move amendment No. 2:
In page 4, subsection (2), line 15, to delete "may" and substitute "shall".
Deputy Stanton has some good help on this. This amendment is also being accepted. The word "may" would give more flexibility but the word "shall" will not cause a problem so we accept the amendment.
Amendment agreed to.
I move amendment No. 3:
In page 4, subsection (3), line 21, to delete "making" and substitute "commencement".
It would seem more appropriate to have this in force from the time of commencement of the order. They may actually be two separate dates and there could be quite an amount of time between the two. It would be tighter to have it from the commencement of the order rather than the time of making the order.
The Deputy suggests the word "commencement" rather than the word "making". We considered this but cannot take this amendment because the existing wording uses the word "making" intentionally so that it is clear that the period of six months runs from when the order is made and not from an earlier date specified in the order when the state of difficulty commenced. The word "making" is more precise.
This particular case will be backdated.
We have backdated it to 24 September.
So, the order will not be made until legislation goes through. Is that right?
Yes, we could not make it till then.
How will it be actually backdated then?
It allows for retrospection to 24 September. All European countries adopted that date.
Where it says "not exceeding six months from the commencement of the order" does it mean six months from 24 September rather than from some time in the next month or two?
No, forward into next year following the Bill's enactment.
I will withdraw the amendment for now but may reintroduce it on Report Stage.
Amendment, by leave, withdrawn.
I move amendment No. 4:
In page 4, between lines 41 and 42, to insert the following subsection:
"(7) Every order made by the Minister under this Act shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the order is passed by either such House within the next 21 days on which that House has sat after it is laid before it, the order shall be annulled accordingly but without prejudice to anything previously done thereunder.".
This amendment is being accepted. The Deputy has had very good advice.
Amendment agreed to.
Section 2, as amended, agreed to.
Sections 3 and 4 agreed to.
SECTION 5.
Amendments Nos. 5, 6 and 7 are related and may be taken together by agreement.
I move amendment No. 5:
In page 5, subsection (1), line 13, after "of" to insert "such".
In the drafting of some Bills there appears to be an amount of superfluous language. I am in favour of simplifying the text of Bills to make them more understandable. By making the changes recommended in these amendments, this Bill would become more understandable. In other jurisdictions, it seems to be the norm to use everyday rather than legal English. These changes would not make a huge difference.
When I was in Opposition I, too, had a thing about language and could not understand why Bills could not be more understandable. Our draughtsmen said that the amendments should be rejected unless the Deputies had a convincing case in their favour, and provided all three were being accepted.
I wish to press the amendments. I thank the Minister for what she said and I look forward to the language in Bills being more user friendly. These amendments do not make any material change to the section but just make it more user-friendly. Acceptance of the amendments would set a precedent for making legislation more user-friendly for the ordinary person.
Amendment agreed to.
I move amendment No. 6:
In page 5, subsection (1), line 14, to delete "granted subject to a condition or conditions".
Amendment agreed to.
I move amendment No. 7:
In page 5, subsection (1), line 15, to delete "such".
Amendment agreed to.
Amendment No. 8 is out of order as it involves a potential charge on the Revenue.
Amendment No. 8 not moved.
Question proposed: "That section 5, as amended, stand part of the Bill".
Essentially what we are trying to say here is that if "at the option of the Minister" were added, the situation would not be so black and white and could give rise to a contest. The effect of amendment No. 8 would be to avoid a conflict between section 5(4) and the more general provisions of section 10 (1)(c). The amendment would relocate section 5(4) in section 10 as a specific instance of the more general provision and would therefore avoid any conflict or ambiguity. I ask the Minister to consider that.
Question put and agreed to.
SECTION 6.
I move amendment No. 9:
In page 5, subsection (3), line 37, to delete "Notwithstanding" and substitute "Without prejudice to".
This is a technical drafting change. If the word "Notwithstanding" is not changed it might have the effect of undermining the limit of \9 billion set in the previous subsection.
Amendment agreed to.
On section 6, has the cost of insurance gone up?
I am sure it has.
Amendment No. 10 proposed by Deputy Stagg is out of order and is along the same lines as the last one.
When all the indemnities are taken together the State's liability will be limited to \9 billion. This is the approximate euro equivalent. The Deputy asked whether insurance in general and air insurance has increased. I am sure it has by two or three times in the past number of months. It will be a great burden on airlines.
Amendment No. 10 not moved.
Section 6, as amended, agreed to.
SECTION 7.
Amendments Nos. 11 and 12 may be taken together by agreement.
I move amendment No. 11:
In page 6, subsection (3), line 15, to delete" 23" and substitute "24".
These are technical drafting changes. Amendment No. 12 is consequent on amendment No. 11.
Amendment agreed to.
Section 7, as amended, agreed to.
SECTION 8.
I move amendment No. 12:
In page 6, subsection (2), line 27, to delete" 23" and substitute "24".
Amendment agreed to.
I move amendment No. 13:
In page 6, subsection (3), between lines 41 and 42, to insert the following:
"(d) the financial circumstances of the Air Navigation Undertaking concerned at the time and its ability to pay any such premiums.”.
As the Minister said earlier, there is going to be a huge load on airlines regarding insurance. My understanding is that the Minister must charge or recover from an air navigation undertaking a charge or charges fixed by the Minister. I suppose this is related to the premium that the company would normally pay. Instead of paying it to an insurance company or broker the airline will now pay it to the State. The airline or air navigation undertaking will, I presume, be paying various premia. We are talking about airlines, airports, security companies, baggage handlers and refuellers, so there is quite an amount of administrative work involved. If the air navigation undertaking is under financial pressure, is it possible for the Minister to take that into account? Must the Minister charge the full premium at the going rate? We are aware of the difficult circumstances that some of these companies are experiencing. Is the Minister able to waive these charges? The amendment seeks to take into account the financial circumstances of the air navigation undertaking at the time.
Who pays?
The State would waive the payment. There would not be a payment.
But a payment must be made or there is no insurance.
The State would insure the company without a payment being made.
But somebody has to pay. You cannot get insurance without payment. This Bill is merely intended to fill a gap. We could not discriminate in favour of an airline that said it could not pay because it was in bad circumstances as against an other airline. It would also be regarded as State aid. I would not differentiate between different airlines and decide what airline could pay and what airline could not.
What kind of Bills are we talking about here? How much money will the State be taking from the airlines by way of premia?
We can get the Deputy that information. It is only a short-term measure to enable the airlines to keep flying.
I understand that completely and the Minister has made that point on a number of occasions. There is a change here.
We are not paying premia in case the Deputy thinks we are.
I know that. My understanding is that the Minister may recover from an air navigation undertaking a charge or charges. Perhaps I misunderstand it. My understanding is that instead of the company paying an insurance company the airline will pay a premium to the Minister. Is that correct?
Yes.
Has the Minister any idea how much that would be in the case of Aer Lingus?
No, I have not. But I can get that information for the Deputy. Obviously the payment is based on the number of passengers. It is really a single insurance on every passenger carried. If there was a huge act of terrorism, God forbid, it would be each individual passenger that would incur the liability if he or she died or was injured. We are talking about the capability of the airline to compensate for the loss of life or for injury.
How are these charges to be set?
They are set by insurance companies.
But the insurance companies are not involved. They have pulled out of the market.
Each airline is told to keep on pressing. Part of the Government decision on this was that each airline would continue to seek insurance premia and insurance quotations and the charges are set by the EU.
By the European Union?
This is EU-wide. It was adopted at the European Council of Ministers meeting and it is applicable to all countries.
Am I correct in saying that the air navigation undertaking means not just the airline but——
Yes, it means baggage handlers and airports - everything involved in airline flights.
Quite a number of companies will be involved in paying premia to the Department. Is that correct?
No. They are not paying us.
Who will they pay it to?
They are paying at the moment because this Bill has not passed.
But when the Bill is passed, will they be paying premia?
Yes.
Will they be paying them to the Department?
Yes.
So you have quite a numberof ——
Different companies.
——different companies - all the airlines, airports, refuellers and so on. How is that to be administered? This relates to my initial point.
There is a cost in terms of administration. We discussed that at the meeting of the European Council of Ministers.
Will this be administered by the Department? It will be quite an amount of work in terms of insurance business. It is insurance business. Maybe the Department has expertise in how to do this. Will the Department farm this out to a broker? This was done in Britain where a number of brokers set up an insurance company called the Troika which provides insurance policies under the scheme to fill the gap about which the Minister keeps talking.
We would not have the in-house skills for that.
How will it be done?
It will have to be done by a company.
What will that cost?
The company will have normal charges for operating insurance premia or quotations.
What company will do it?
Coyle Hamilton is an insurance agent with which we do business.
That company will do it.
That is the company we deal with, yes.
Typically, how much money would be involved? Approximately what would be the monthly charges? This section states that the Minister may fix charges. This goes to the root of what I am discussing.
When it states the Minister may fix charges, it will be on the advice of Coyle Hamilton or whatever insurance company we use. Clearly, I would not have the knowledge or expertise to fix charges.
There was a period of grace after 11 September.
That was between 14 and 24 September.
It lasted ten days. Since 24 September, there have been letters of comfort.
They were renewed.
Are premia to be paid by the companies to cover that period?
They would have to be.
Does the Minister know what they are?
No, but our insurance brokers are working them out.
Are they paid to the State?
Yes, they are paid to the Department.
That is fine.
Is the Minister saying the State will act as an insurance company?
No, we will have an insurance company.
Is the Minister saying that she will charge a premium in the same way as an insurance company would charge for the cover she is granting? What will she do with the profit? The chance of a war induced crash in Ireland involving an Aer Lingus or other plane is remote
I hope so.
I also hope so. However, if the Minister makes a normal commercial charge for insurance, she will make a very handsome profit. However, that is not the intention of the Bill.
No, it is not. How could it be? The intention of the Bill is to help the airlines to fly and the airports to function. The moneys will not come to us but will go to the Exchequer.
As we were on strike earlier, we did not get the opportunity to deal the Bill on another Stage. My understanding was that certain costs would arise for the Minister.
The costs would arise for the insurance company.
The State would indemnify the airlines against certain risks and certain costs would arise as a result. In the event of a claim, there would be huge payments. There will be certain costs for the Department in having to hire an insurance company, etc. If the premium is normally £100 per £1 million covered, what does the Minister think she will charge them?
We will do whatever we are advised to do by our insurance people.
Will she charge them a commercial insurance premium or will she cover the cost of the operation to the Department?
The main paperwork will be done by a company such as Coyle Hamilton. They will tell us how much the handling charges are. Clearly, there will be Civil Service work involved in dealing with Coyle Hamilton and the airlines. However, that is normal work carried out by civil servants.
There is no question of the Department acting as a normal commercial insurance company where it has to make sure it takes in enough to cover costs.
No, it will not be like that. We would not be able to be brokers because the Department does not have a broker's licence. However, we must take advice from insurance brokers.
If airlines were previously paying £100 per £1 million insured to a commercial insurance company prior to 11 September, they will now get indemnity from the State for considerably less and this will be an advantage to them.
It would be if the premium was less. However, insurance companies are charging more because of uncertainty.
What out of pocket costs to the State will the Minister collect with these charges? What will it cost to do this?
We do not want to make money on it, if that is what the Deputy is talking about.
That is what I am talking about.
We will not seek to make money on it. We are trying to be of service for a limited period.
Can we return to the amendment?
We are talking about the amendment. We are trying to ascertain how much it will cost the airlines to carry on with this insurance. Will it be the going commercial rate, which the Minister has said is now three times what it was, or will it be less than that? Deputy Stagg suggested it might just cover expenses. However, the Minister earlier said that the European Union was setting the premium payable. If that is the case, it will be a sizeable amount of money.
Is the Deputy referring to the cost of insurance?
Yes. The airlines will have to pay a premium for insurance. We are trying to determine if that will be the going commercial rate, which is three times what it was, or if it will be less than that.
No, it is the going commercial rate, which is higher than it used to be.
Will those moneys be paid to the State?
They will be paid to the Exchequer.
We still have no idea how much it will cost.
Our insurance people are working that out. Before we come to Report Stage, that should be much clearer.
If a company is in dire financial straits, an increased insurance premium of that magnitude could be very important.
Yes. However, the State could not be the arbitrator of which companies could or could not pay it. One of the unfortunate outcomes of what happened on 11 September is that the premium for airlines has increased so much.
This might force some companies out of business because they cannot pay the premia.
Companies being forced out of business is very serious anyway. However, deciding to give State aid to one and not another would not be appropriate.
The State will only cover this area of insurance. I regard this as a very low risk area.
I hope the Deputy is right.
I am sure I am. The number of commercial aeroplanes that are attacked during a war is very limited. If it happens, obviously there is a huge claim. Ordinary crashes are much more regular and these are already covered. This only addresses war actions and yet the Minister will take full commercial premia. Unless something goes wrong resulting in a pay out, the State will end up with a big surplus.
If that arose it would only be on a temporary basis. It is not possible to balance the two. Due to the events of 11 September, insurance premia are very high and that is understandable. In time fear should recede and we hope there will be no attack. In that event, the premium should go down.
Unless there is a crash following an attack, the State will take in a large amount of money. What will happen to it?
There is still a risk. How and when can one decide that risk is clearly gone?
The premia, although they are substantial, are flea bites by comparison to what would be paid out in the event of a crash.
If there was a crash, yes.
From that point of view, no matter how much is taken in, the Minister will not have enough money in that kitty to pay out.
The total amount is up to £9 million, is it not?
It is a huge amount, but the amount the Minister will take in will be tiny in comparison to what would have to be paid out in the event of an accident. I cannot understand why——
We are trying to strike a balance - it seems to me that is the intention - between the current fear, the size of the premia and keeping the airlines and airports in operation. Hopefully, as time passes, that fear will recede but the question is whether the premia will come down. One very rarely hears of insurance premia being reduced in any sphere. I cannot be sure whether the insurance industry will continue to regard this as very risky business.
I have read the explanatory memorandum, the Minister's speech and this particular section and I was under the clear impression, from all of those, that the Minister would have the power to make charges to compensate for any costs that would arise for the Department. Now the Minister is saying she is really setting up an insurance premium type of payment.
We want the airlines to revert to dealing with this on their own account. This is only a temporary measure and each Government decision, extending it from month to month, said the airlines should set about arranging their own insurance. This is a very temporary arrangement.
We are tending towards a Second Stage debate. As I understand it, amendment No. 13 is intended to take account of the financial resources.
It goes to the core of the matter. Throughout the world, all governments are in the same position as Ireland in terms of indemnifying airlines for massive sums of money in the hope that the airlines will eventually obtain their own insurance cover where war risk exclusion is concerned. It is disappointing that we do not have figures for the amount which would accrue to the Exchequer with regard to the premia to be paid. Section 8(2) refers to "charges fixed by the Minister", indicating that the Minister fixes the charges. The amendment simply proposes that, in fixing the charges, the Minister would take into account the financial circumstances of the air navigational undertaking concerned at the time and its ability to pay such premia. It does not say the Minister would waive them.
I would not be in a position to take that into account. To do so would involve a judgment and differentiating between airlines. It would involve applicants, supplicants and the whole issue of state aid.
I will withdraw the amendment but I reserve the right to raise the matter on Report Stage.
The amounts will be specified on Report Stage.
Has the European Commission issued directions or guidelines on the particular issue involved in section 8(3)(a)?
Yes, we have those guidelines. I will make copies available to the Deputy.
Amendment, by leave, withdrawn.
Section 8, as amended, agreed to.
SECTION 9.
Question proposed: "That section 9 stand part of the Bill."
The section states: '"provision of civil air services to, from or within the State" includes services provided to civil aviation relating to the maintenance of aircraft in the State, or emergency, technical or transit stops at an airport or aerodrome to which scheduled commercial air services operate in the State." What is the position in relation to airports or aerodromes where scheduled commercial air services do not operate in the State? For example, if an aircraft had to land at Baldonnel in an emergency situation, would it be covered by the provisions of this section? I believe scheduled air services do not operate from Baldonnel.
The whole purpose of this section is to allow civil aviation to continue. It refers to the issue of indemnities to Irish licensed airlines and to airport service providers whose services are essential to support civil air services. The objective is to limit the exposure of the State. It relates to Irish licensed airlines and aircraft entered on the Irish aircraft register. A large number of aircraft operated by various foreign licensed airline carriers are listed on the Irish register maintained by the IAA and carry Irish nationality. Insurance arrangements for those are a matter for the foreign carrier and the particular State responsible for licensing the carrier.
It should also be noted that, while indemnities will be issued only to Irish licensed airlines included in this category, air services operate between non-Irish airports, for example, Ryanair services from Stansted in the UK to Charlerois in Belgium. Similarly, the airport and service companies operating in Ireland, to which the Minister may issue indemnities, provide services to all airlines that fly into Ireland. The amendment which the Deputy put forward would increase the exposure of the State and would require further financial expenditure.
My question is simple. If an aircraft has to make an emergency, technical or transit stop at Baldonnel, is that situation covered under this Bill?
No, it does not apply, although an aircraft may land at Baldonnel.
The situation would not be covered by this emergency legislation?
No, because it is a military aerodrome.
That seems rather ironic. In the event of a bomb scare on a plane, a military aerodrome might be the most appropriate place for an emergency landing. Perhaps the situation is covered under military law - I have no information on that. For example, if there is a small plane with a terrorist on board who intends to crash into Sellafield, but is persuaded to land at Baldonnel, that situation is not covered.
It is not covered by this Bill but it is covered under military law.
Is it covered to the same extent?
I do not know if it corresponds fully to what we are doing in this Bill.
Is an aerodrome a military airport?
I understand that "aerodrome" is a general term.
Under the definition in the 1936 Act, the word "aerodrome" means any definite and limited area, including water, intended to be used either wholly or in part for or in connection with landing or departure of aircraft. It would be useful to know if that includes Baldonnel. The Minister does not appear to have considered that aspect. In the context of a terrorist incident, Baldonnel would be an obvious place to land, unless the plane is too big.
Is it suggested that a terrorist be allowed to land?
A military location would have advantages in terms of dealing with that kind of emergency and securing the situation. Perhaps the Minister would consider this matter in advance of Report Stage.
Yes, if the Deputy wishes. We are not discussing the amendment. We are not allowed discuss it. That is the reason.
I am told that the Government carries the insurance risk for military activities, and always did.
However, this would be a civilian plan. We could be said to be splitting hairs because this might not happen. However, if we went back a few months we might have said that the events of 11 September would not happen. We must deal with the fantastic and look at every issue. The Minister raised the issue of terrorists. I understand that terrorist acts are not included usually in war risk exclusion. That is separate. A war risk has to do with one state declaring war on another. Terrorists are not states so are their acts included?
Here, yes.
The insurance applies regarding 11 September because it was a terrorist act and the war risk did not kick in because of that. We are talking about war risk in this Bill.
Terrorist acts are included.
Question put and agreed to.
SECTION 10.
I move amendment No. 15:
In page 7, between lines 22 and 23, to insert the following subsection:
"(2) Without prejudice to the generality of subsection (1), failure by the recipient of a Ministerial indemnity to comply with the terms of a condition referred to in subsection (1) or (2) of section 5 may, at the option of the Minister, render the Ministerial indemnity null and void.”.
After page 7, line 22, the Bill reads, "as if the Minister were, to the extent of the liability referred to in the Ministerial indemnity concerned, the insurer under the policy of insurance concerned." After that line, I want to insert the following words: "Without prejudice to the generality of subsection (1), failure by the recipient of a Ministerial indemnity to comply with the terms of a condition referred to in subsection (1) or (2) of section 5 may, at the option of the Minister, render the Ministerial indemnity null and void."
Will the Deputy explain exactly what he means by that?
I was afraid the Minister would ask me that. Essentially, I am saying that there is a danger that the Minister may not have the option of rendering the Minister's indemnity null and void. The Minister could be caught in all situations. It would help in this regard if we put in the words, "at the option of the Minister".
The matter is covered in section 5(4), but perhaps there is no harm in putting it in again. Section 5(4) reads: "Failure by the recipient of a Ministerial indemnity to comply with the terms of a condition referred to in subsection (1) or (2) may, at the option of the Minister, render the Ministerial indemnity null and void."
Amendment, by leave, withdrawn.
I move amendment No. 16:
In page 7, subsection (2), line 26, after "concerned" to insert "or its insurer".
This amendment seeks to add the words "or its insurer" after the word "concerned." It would be reasonable to expect that there would be an insurer and that the insurer should be cornered as well as the undertaking concerned. Perhaps the Minister will look at that.
Section 10(2) has been deliberately restricted to claims that might have been made against the air navigation undertakings to protect the Exchequer. I do not fully understand that. Will the Deputy leave the matter with me until Report Stage?
I will.
Amendment, by leave, withdrawn.
Question proposed: "That section 10 stand part of the Bill."
The section clears up a matter that we discussed earlier in that it says that the Minister is seen to be the insurer under the policy of the insurance concerned. Line 21 states: "as if the Minister were . . . the insurer under the policy of the insurance concerned." The Minister is acting as the insurer of the insurance company. Deputy Stagg asked the question earlier and there was some confusion about it. That makes it clear that the Minister is the insurer. Perhaps the Minister will comment on section 10(1)(a) on the defences to a claim for indemnity. What kind of indemnity does that involve?
It gives the Minister all the defences against claims that would have been available to the insurance company if that insurance company had continued to provide the indemnity.
Such as?
Whatever an insurance company provided for in its claims and whatever standard defences it would put up. It provides all the defences against claims that would have been available to the insurance company if that company had continued in place. It provides that the Minister, in lieu of the insurance person——
We are assuming that there are standard conditions across all insurance companies and that they would all be exactly the same.
Generally speaking, that is the case. If one takes out car insurance, defences apply in each case also. There would be nuances of variation across insurance companies but the general principles would apply. However, there is another important protection in section 10. It ensures that the issue of indemnity by the Minister does not give any additional rights to a person compared to those they would have had if the insurance had continued in force.
Question put and agreed to.
SECTION 11.
I move amendment No. 17:
In page 7, subsection (1), between lines 31 and 32, to insert the following:
"(a) be required to make reasonable efforts to obtain affordable insurance in respect of the risks concerned,”.
This amendment seeks to ensure that an air navigation undertaking seeking the issue or renewal of a ministerial indemnity in its favour shall be required to make reasonable efforts to obtain affordable insurance in respect of the risks concerned. That should be written into the Bill. It is reasonable to expect the companies to demonstrate that they have sought to get insurance in the same way that if one cannot get car insurance, one must demonstrate that and the State will then help one to get insurance.
If people say they cannot get car insurance, the State will help you. That is correct.
In the same way, we do not want air companies availing of what might be a slightly cheaper system for them and saying "The State will indemnify us." Let the companies demonstrate first that they cannot get insurance.
What the Deputy has said is what the Minister, Deputy McCreevy, said every time he renewed the one-month insurance indemnity. He kept saying that the company should try to get its own insurance and should continue to do that.
Like Kildare people.
Maybe it is, but I am now coming to the point. We told them that each time. However, the Deputy is talking about the words "reasonable" and "affordable." Those words are too judgmental. It is like another version of the Deputy's amendment. Who is to decide what is reasonable or affordable? It is implying that different companies would require different treatment, which would give rise to State aid pleas.
I understand the point the Minister is making and I am prepared to raise the matter again, if it is permissible, without the words "reasonable" and "affordable".
Without "reasonable" and "affordable".
Perhaps the Minster will look at the matter.
They should be encouraged to hurry up and get their own premiums. To include "reasonable" and "affordable" would mean that we would have to decide what is reasonable and affordable.
I will withdraw the amendment.
The amendment can be tabled without the words "reasonable" and "affordable".
I am not sure if I can do that.
It can be done on Report Stage.
Perhaps the Minister will see if an acceptable amendment can be found.
We can come up with something.
Perhaps the Minister needs to have a look at it.
Yes, as we should be encouraging them to do it.
Amendment, by leave, withdrawn.
Question proposed: "That section 11 stand part of the Bill."
This section seems to oblige companies involved in the aviation industry, not only airlines but also baggage handlers and security companies, to apply to the Minister for indemnity. What happens if a company does not make such an application? Has the Minister received applications in respect of this indemnity?
Yes.
How many applications have been received?
About 30 applications have been received
Does that figure cover all companies?
Yes, it includes companies under various categories, including airlines, baggage handlers and airports.
Is the Minister satisfied that they are all covered?
Yes, I am sure of it.
The Minister might be aware that in Canada it was covered without a need for formal communication. It is curious that there is a loophole in case somebody does not make an application and is consequently not covered.
It is right that there should be a formal application, and that has happened.
Thirty applications have been received.
It will also be necessary to provide documentation to calculate the appropriate charges to be levied on foot of the indemnities.
Is it possible to get a breakdown of the 30 companies that have applied, outlining what type of companies are involved?
Yes, that will be done.
Is it possible to do so before Report Stage?
Yes, I am sure we have a log of such matters.
Question put and agreed to.
SECTION 12
Amendment No. 18, submitted by Deputy Stagg, is out of order as it involves a potential charge on the Exchequer.
Amendment No. 18 not moved.
Question proposed: "That section 12 stand part of the Bill."
I accept the Chair's ruling as I was given a note saying that the amendment would be ruled out of order. Section 12 seems to exempt the Minister from liability for culpable delay or default. The Minister should correct this if it is the case, as I cannot do so.
The explanatory memorandum explains that section 12 makes clear that the Minister is not obliged to give an indemnity and provides that no liability will attach to the Minister if an indemnity is not given, is delayed or is made in error.
I have no difficulty with the fact that the Minister will be exempt in such circumstances. If the Minister is responsible for people not having insurance, for example because indemnity was not given on time, because paperwork was incomplete or because the deadline was not met, why should the Minister be exempt from liability?
The Minister is being officially indemnified from not providing the indemnity in time.
I do not mind that if a positive decision was made to refuse cover for any reason.
The Deputy is concerned about problems arising from possible ministerial tardiness.
Yes. There may be problems if the Department is lazy.
Yes, that is a fair point.
I do not wish to suggest that Departments are ever lazy.
Yes. I could agree to that, but I am not allowed to as a result of the Chair's ruling.
Perhaps the Minister will consider the issues raised by my amendment for Report Stage.
It is a fair point and I will look at it.
Question put and agreed to.
Section 13 agreed to.
SECTION 14
I move amendment No. 19:
In page 8, subsection (2), line 22, to delete "has landed and taxied to a standstill" and substitute "has landed, taxied to a standstill and the passengers and crew have had a reasonable opportunity to disembark".
The words "the passengers and crew have had a reasonable opportunity to disembark" should have been in this Bill from the outset as the fact that an aeroplane has landed and taxied does not mean that passengers have disembarked. The amendment extends the indemnity to cover a possible hostage situation in which an aircraft may remain under the control of terrorists after it has landed.
Amendment agreed to.
I move amendment No. 20:
In page 8, subsection (5), line 35, after "effective" to insert "and shall take effect when it is received".
I wish to amend section 14, so that "and shall take effect when it is received" will appear after "notice of suspension or termination of the operation of Ministerial indemnity may be given in writing, by telephone, fax, electronic mail or in such other manner as may to the Minister appear effective." It is standard that a cancellation takes effect only when notice of it has been received and such a provision is included in many Acts. If the words are not included, a cancellation may take effect without the knowledge of those involved, as the message may be still in transit. I wish to provide that a cancellation will take effect when it is served.
The concept of termination taking effect when notice of it is received is not appropriate as this section provides for the possibility that a termination may take effect at a later date. Under the letters of comfort that have been issued and continue to be issued, airlines will be given 24 hours' notice and all other businesses at the airport, such as ground handling companies will get four hours' notice. The concept of termination happening when notice of it is received, as suggested by Deputy Stagg, opens the possibility of legal argument about the exact moment of receipt of notification. It is better that a set period of notice, as I have outlined and as is allowed in the letters of comfort, is provided.
Is the Minister saying that a period of time may elapse after the decision to issue the notice of suspension or termination of theoperation of ministerial indemnity? If such a decision were taken at noon, for example, would time elapse before the suspension would take effect?
A period of 24 hours for airlines——
Why is that not outlined in the Bill?
——and four hours for all other businesses at the airport.
Does that not need to be written into the Bill?
I suppose we should do so, although there are conditions attaching to the Bill. As of now, the letters of comfort allow for time periods of 24 and four hours.
That is fine, but as the Bill reads, a notice of suspension of termination is effective from the minute it is signed by the Minister in his or her Department. The companies involved may not receive a warning that they are operating without indemnity or insurance.
Yes.
I would be happy if the conditions outlined in the letters of comfort were applied to this.
Section 14(1)(b) states that the Minister can decide to give notice of suspension of termination “with effect from a time and date specified”.
It could be the time and date on which the notice was signed.
The time and date would be specified in the notice.
The specified time and date could be the time at which it was signed by the Minister. It could be 12 p.m. by the time the Minister signed it because the other person did not know about it on the date. That does not give you the 24 hours or the four hours.
The letters of comfort now have 24 hours and four hours.
They could, but do not.
They do not. We can talk to the person concerned. My assistant has said that all Ministers are not expected to behave reasonably.
Civil servants love saying that.
They do, but it does not wash. It should not happen instantly. The Deputy is saying that it should happen upon receipt of the letter.
That is what I am saying. The Minister is saying that in practice it will happen later than on receipt. It should be specified in the conditions.
Will the Deputy resubmit the amendment on the next Stage.
I withdraw it to be reinserted.
This section is curious. I am trying to visualise the circumstances in which the section would be relevant. If something happened to an aeroplane in flight, it landed and everyone disembarked, the indemnity could be removed. What circumstances are we talking about? Why is this section included?
It is the key element in limiting the Exchequer's exposure. It gives the Minister the power to suspend or terminate all indemnities with immediate effect. It limits exposure if you can do this, for example, in the case of another attack.
The aircraft has landed and the people have left it. At that stage if it explodes you are just caught for the aircraft.
In the case of an aircraft in flight an indemnity will not terminate until it lands and everyone gets off. If indemnities are terminated, airlines must get their aircraft to land at the nearest airport or as soon as possible unless they get specific permission to fly to another airport. The section is a mechanism for limiting the Exchequer's exposure.
I accept what the Minister says, but I am curious as to how the exposure is limited.
The craft is covered while in flight, when it lands and until it empties.
Everyone is off it and it is empty. Therefore, I am curious. Is it there in case there was a bomb on the aircraft and it blew up at that stage? Does it provide for the case of an airfield being attacked?
Maybe it followed on from the original.
Will the Minister have a look at that and come back to us to tell us why it is there?
I will talk it through on Report Stage.
Amendment, by leave, withdrawn.
Section 14, as amended, agreed to.
SECTION 15.
Question put: "That section 15 stand part of the Bill."
This section allows the Minister to reinsure all or part of the liabilities associated with the indemnities. No plans exist to do this immediately, but it may be the appropriate way to reduce the risk to the Exchequer if an insurance difficulty were of long duration and if reinsurance was available. It is a caveat and an assurance.
Question put and agreed to.
SECTION 16.
Amendments Nos. 21 and 22 are related and may be discussed together, by agreement.
I move amendment No. 21:
In page 9, subsection (1), line 7, after "Minister" to insert "and within such time as may be reasonably specified by the Minister".
There are two amendments to this section, one tabled by the Opposition and one by us. Both basically say the same thing, except that ours says it in a much longer way.
The Minister is much more long-winded than I am. My amendment seeks to protect the public purse and the Minister within such time as is specified by the Minister. The Minister has elaborated on that in her technical wording.
I am saying what Deputy Stagg is saying, but it takes me two pages to do so.
I am, like the former Taoiseach, a one-line man in this case.
That was a one-line memo.
The longer amendment is better. Big is beautiful in this case.
Amendment, by leave, withdrawn.
I move amendment No. 22:
In page 9, between lines 10 and 11, to insert the following subsections:
"(3) Subject to subsection (4), if the Minister is of the opinion that there is a possibility that the value of a claim or claims in respect of a Ministerial indemnity or indemnities issued under this Act may exceed in aggregate the limit of \9,000,000,000 referred to in section 6(2), the Minister may determine that the claim or claims shall not be paid until the full extent of such claim or claims has been established and shall cause a copy of such determination to be sent to each air navigation undertaking to which a Ministerial indemnity has been granted or renewed.
(4) Where the Minister has made a determination under subsection (3), the Minister may make an interim payment to the air navigation undertaking concerned in respect of a claim admitted and proved, on such conditions as the Minister thinks fit, including a condition as to repayment to the Minister of any overpayment if the provisions of section 6(4) apply.
(5) The Minister may, following consultation with the Minister for Finance and the Minister for Enterprise, Trade and Employment, make an order fixing a date and time before which an air navigation undertaking wishing to make a claim against the Minister on foot of a Ministerial indemnity may make such a claim.
(6) Where the Minister has made an order under subsection (5), no liability shall attach to the Minister or the State arising from the Ministerial indemnity other than in respect of claims duly made in accordance with this section prior to the date and time specified in the order.
(7) Where the Minister proposes to make an order under subsection (5) he or she shall cause a draft of the order to be laid before each House of the Oireachtas and the order shall not be made until a resolution approving of the draft has been passed in each such House.
(8) The date and time fixed by the Minister in an order made under subsection (5) shall be not less than 6 months from the date of the making of the order.”.
Amendment agreed to.
Section 16, as amended, agreed to.
Section 17 agreed to.
SECTION 18.
Question proposed "That section 18 stand part of the Bill."
We still do not know the amount of money involved.
This section provides for the payment to the Exchequer of the moneys.
We have no idea how much money.
The Minister, Deputy McCreevy, gets everything.
We have not a notion of how much money will be involved.
We will have a better idea when the insurance firms provide us with instances.
Question put and agreed to.
SECTION 19.
Deputy Stagg has submitted amendment No. 23, which involves a potential charge on the Exchequer, as does amendment No. 24, which is consequential. Amendments Nos. 23 and 24 are out of order and may not be moved.
The legislation will fall into disuse. It may be revived or kept in force from time to time by the methodology outlined in section 19(2). It should be amended so that if it is needed in the future it can be revived. Circumstances in which the legislation is required could arise in five years' time when the Act is no longer in force. The British did this with their 1952 Act.
They were able to revive it. They did not have to introduce emergency legislation.
How was it decided that my amendments involved a potential charge on the Exchequer?
How was that conclusion arrived at?
They would have the effect of committing to the revival of the Act after it ceased to be in operation, thus permitting the Minister to incur liabilities or potential liabilities which would not otherwise arise.
I understand now that there is a potential charge. If the Minister thinks it a good idea she can amend the Bill.
I remember speaking to the relevant UK Minister at the special meeting in September and he said they did not have to enact emergency legislation because they had an Act they could prod into life.
We will have one now.
It is certainly a fair point.
I cannot propose such an amendment because were such a provision made it has the potential to force the Minister to reindemnify and that is a potential charge on the Exchequer.
It is a good idea. The UK Minister was able to immediately revive the relevant Act, but we were not.
The Minister can propose the relevant amendment, but I cannot.
I understand. I will take advice on that and see what I can do.
I withdraw my amendment.
It cannot be moved. We have to protect people from the generosity of some Ministers.
Amendments Nos. 23 and 24 not moved.
I move amendment No. 25:
In page 9, subsection (3), line 26, after "resolution" to insert ", which shall be a period of not more than 12 months".
This amendment will avoid a once-off, indefinite renewal of the legislation and will ensure that any renewal is for not more than 12 months.
The Deputy is saying that if we revive the legislation it should be in force for 12 months. I accept that.
Amendment agreed to.
Section 19, as amended, agreed to.
SECTION 20.
Question proposed: "That section 20 stand part of the Bill."
My assistant brought the following point to my attention.
I know him well.
There is a pervasive grammatical error in that in the phrase "Ministerial indemnity" the word "ministerial" should begin with a lower case "m" as it is an adjective.
Yes.
For example, in the Constitution the word "constitutional" is lower case.
It is an adjective, which cannot be capitalised.
Yes. "Ministerial" in this instance should be lower case.
As an English teacher, I fully agree. What does Deputy Stanton think?
I feel the same way.
Question put and agreed to.
Title agreed to.
When will Report Stage be taken?
That is a matter for the Whips.
Before we conclude, there are two further Bills.
There is a Bill on the rail procurement agency.
The Transport (Railway Infrastructure) Bill, 2001.
We are not taking it now.
No.
We also have the Radiological Protection (Amendment) Bill, 1998. Will the Minister give an indication of when these will be completed. It is important to deal with them immediately.
We cannot deal with them this week.
I suggest next Tuesday.
Next Tuesday, by agreement.