Regional Airports.

Dáil Éireann Debate, Thursday - 27 May 2004

Thursday, 27 May 2004

Questions (20, 21, 22)

Jimmy Deenihan

Question:

11 Mr. Deenihan asked the Minister for Transport if he will make a statement on the future of the regional airports. [15768/04]

Denis Naughten

Question:

15 Mr. Naughten asked the Minister for Transport the subsidy provided to each regional airport per passenger over the past five years; and if he will make a statement on the matter. [15778/04]

Pádraic McCormack

Question:

78 Mr. McCormack asked the Minister for Transport his plans for the development of regional airports; and if he will make a statement on the matter. [15777/04]

Written answers

Minister for Transport (Mr. Brennan)

I propose to answer Questions Nos. 11, 15 and 78 together.

The programme for Government provides for the continued support of our six regional airports. My Department provides a range of financial mechanisms in support of this objective but it is important to note that the regional airports are not in receipt of State subsidies as such.

With regard to capital funding, grant aid of approximately €9 million has already been paid to the regional airports under first round allocations of the regional airports measure of the national development plan, NDP. The primary objective of this measure is to facilitate continued safe and viable operations at the regional airports. A further round of projects will be considered for funding under the measure later this year.

My Department also administers a grant scheme to assist the regional airports with marketing, safety and security related current expenditure. The total amount provisionally allocated in the Estimates for 2004 is €2.24 million and the individual amounts for each airport will be determined shortly.

My Department provides subvention to contracted regional air carriers for the operation of essential air services under the public service obligation, PSO, regime. EU Council Regulation (EEC) No. 2408/92 allows member states to establish a PSO in respect of scheduled air services to an airport serving a peripheral or development region, where such air services are considered essential for the economic development of the regions concerned and where air carriers are not prepared to provide such air services on a commercial basis. In accordance with this regulation, the Government has established PSOs on routes linking Dublin Airport with the airports in Kerry, Galway, Knock, Sligo and Donegal. The total cost of air service subvention to PSO carriers amounts to over €20 million per annum.

Regarding subsidy per passenger, it is important to note that subvention is not allocated by reference to the number of passengers using the services, per se. The governing regulation stipulates that subvention should be based on the losses actually incurred in operating the routes, taking account of costs and revenues generated by the services, subject to a ceiling represented by the amount put forward in the tender submitted by the successful air carrier during the tender process. In any event, the subvention level per trip per passenger for the past five years is as follows.

PSO subvention per trip, one way, 1999-2003

	1999	2000	2001	2002	2003
	€	€	€	€	€
Kerry	13.71	12.17	44.27	54.59	55.17
Galway	18.55	18.86	46.57	47.19	51.67
Sligo	41.60	35.75	120.10	101.78	80.49*
Donegal	90.57	77.28	119.80	110.78	80.49*
Knock	—	—	233.17	226.58	224.87
Derry	—	—	113.89	95.10	77.56

* Subvention level for Sligo-Donegal is based on the subvention and passenger levels on the combined Sligo-Donegal contract, hence it is not possible to distinguish individual levels per route.

Following a recent review of the PSO programme, I am currently exploring ways of restructuring PSO specifications and contractual arrangements to ensure that, in the long term, an appropriate level of air access to the regions can be facilitated on a cost effective basis within the annual Estimates provision, while also encouraging maximum commercial initiative on the part of the regional airports and air operators. I intend to bring proposals to Government later this year and to relaunch before the end of the year a revised specification for services on all six routes to commence in mid-July 2005.

The Government's commitment to regional airports will continue. However, the scale of Exchequer assistance to the regional airports will have to be carefully assessed in line with general airport and aviation policy and the availability of Exchequer funds.