Skip to main content
Normal View

Tuesday, 3 Jul 2012

Priority Questions

Sale of State Assets

Questions (1)

Timmy Dooley

Question:

84Deputy Timmy Dooley asked the Minister for Transport; Tourism and Sport when he expects to make a decision on the Government shareholding in Aer Lingus in view of the recent Ryanair bid; the factors that will be considered when reaching a decision; and if he will make a statement on the matter. [32390/12]

View answer

Oral answers (9 contributions) (Question to Minister for Transport, Tourism and Sport)

In an announcement to the Irish Stock Exchange on 19 June, the board of Ryanair announced its intention to make an all-cash offer for 100% of the share capital of Aer Lingus.  Under the takeover panel rules, Ryanair must issue its formal offer document to Aer Lingus shareholders by 17 July, setting out in detail the terms of its offer.  As the Government is a minority shareholder in Aer Lingus, under Irish takeover panel rules, there are restrictions on what any member of the Government can say about the proposed offer at this time.  For the moment, like all shareholders, the Government will await the formal offer from Ryanair and also the response of the board of Aer Lingus. The European Commission will also have to consider the proposal when it receives formal notification of the offer from Ryanair.

In considering the formal offer, when it is made, the Government will take account of four factors: what is best for passengers in terms of connectivity and air fares; what is best for taxpayers in terms of the price we can get for the stake; what is best for the economy overall in terms of competitive access to services in and out of Ireland; and the views of the regulatory authorities on any bid.

I welcome the Minister's statement of fact to the House. I accept that to an extent he is restricted in what he can say on the decision the Government will ultimately make. He has outlined the four areas it will consider. On three, if not four, headings it will find it impossible to accept the proposed offer by Ryanair. The first is a potential reduction in competition if the two airlines were to be owned by the one entity. That would represent bad value for the taxpayer in terms of the impact it would have on the capacity of the State to continue to offer low fares to the wider tourism and business sectors. From a regulatory point of view, the ensuing domination by one entity in controlling such a large volume of activity, across the Irish Sea in particular and into near European markets, would cause serious concern. This is an island nation which depends heavily on access not just to continental Europe but also to the wider world.

Will the Deputy ask a question, please?

In addition to what the Minister has said, given that the Government has decided to dispose of the shareholding in Aer Lingus, as previously announced, has he considered how he might protect the Heathrow Airport slots, in particular, and access to Heathrow Airport from this country to provide for onward connections to the wider world? If so, what is the result of the consideration? The Heathrow Airport connection has been identified as being of significant benefit and strategic importance.

I will come back to the Deputy.

Ryanair's continued existence on the share register of Aer Lingus has been a significant retarding factor for Aer Lingus. Has the Minister discussed the matter with the chief executives of the two airlines in his various contacts with them?

There is very little we can do to protect the Heathrow Airport slots. At the time of privatisation having a golden share might have been a good idea, but there is nothing to prevent the company from leasing the slots. This could be done by the board at any time. The sale of the slots would just require a special motion.

It is clear that airlines across Europe are consolidating. If Aer Lingus has a buyer in the future, probably the best way to secure access to Heathrow Airport is to have a buyer that wants to feed that airport rather than one that wants to use the slots for another purpose. It seems the British Government is changing its position on a third runway at Heathrow Airport, which means we may find there will be more slots in the future than we thought. Now that British Airways has taken over BMI, I am reassured to see that it is maintaining access to this country for purely commercial reasons. I am pleased to see that the fears in that regard have not materialised.

The issue of Ryanair continuing to own approximately 30% of Aer Lingus comes up in conversations with the CEOs of the two companies, but it is now one for the United Kingdom Competition Commission. There would be greater clarity on the future of Aer Lingus if the United Kingdom Competition Commission were to determine whether Ryanair could continue to remain as a shareholder of Aer Lingus before the Government makes decisions.

I accept the Minister's point on future plans for Heathrow Airport. While the State retains an interest in Aer Lingus, it has the capacity to influence board decisions through the appointments made by the Minister on behalf of the Government. Although I had noted his point about the golden share, it was not possible to arrange it at the time, as doing so would have been in contravention of EU rules.

Will the Government consider the formulation of a battle plan to protect slot access at Heathrow Airport? In this regard, will it consider establishing a working group to table proposals to the Minister and his Department in order that a vital and necessary element of Ireland's connectivity might be protected?

I have no concerns about access to Heathrow Airport. There is access through Aer Lingus and British Airways. Last week my Heathrow-Shannon flight was full, which I was delighted to see. These connections work because they continue to be profitable. Should the State be in a position to sell its 25% stake, this is the kind of conversation we would like to have with a buyer. Among the other issues we would like to discuss are protecting the company's brand and access in so far as possible. Once 75% or 100% of a company is sold, one's influence is limited.

Public Transport

Questions (2)

Dessie Ellis

Question:

85Deputy Dessie Ellis asked the Minister for Transport; Tourism and Sport if he will provide an update on the meetings he has attended with trade unions representing workers based in bodies such as Iarnród Éireann, Dublin Bus and Bus Éireann to discuss the effects of the cuts his Department has made. [32097/12]

View answer

Oral answers (8 contributions) (Question to Minister for Transport, Tourism and Sport)

The Deputy's question relates to meetings with trade unions representing workers in Iarnród Éireann, Dublin Bus and Bus Éireann. I have not formally met trade unions working on behalf of any of the three companies. As I am sure the Deputy is aware, discussions have taken place between unions and Irish Rail, the outcome of which was recently accepted after a ballot of members. In the case of the bus companies, I understand negotiations with the relevant trade unions are ongoing.

In budget 2012 the Government announced cuts of approximately €22 million for CIE and to the rural transport scheme. Irish Rail, Dublin Bus and Bus Éireann carried much of the 8% loss in funding, resulting in fare increases and the further downgrading of services. Routes were closed, while others were limited and changed to adapt to the lower funding level. Our poor and, in many places, non-existent public transport system was further run down. In early June Bus Éireann and Dublin Bus announced that they would need to put substantial numbers of their workers on the dole if the latter did not engage in so-called reform. This reform is simply a rowing back on the achievement of decent pay and conditions for workers and the delivery of a decent service. This is not a choice - it is the inevitable consequence of large cuts to already underfunded services. Ireland's State transport companies are among the least subsidised, with Dublin Bus and Bus Éireann-----

A question, please.

I am coming to it. Budget 2013 is being framed an I am asking that we not erode services further. Will the Minister of State give an indication to this effect and that there will not be major cuts? Many of the services and workers cannot take any more. In my area bus services have been cut, with significant consequences. I urge that further cuts not be made.

In my portfolio I have travelled around the country quite a bit and engaged in dialogue with the relevant workers. As recently as yesterday, I met workers during my travels. In the case of CIE, I will continue to engage with the workers informally and their representatives formally. The situation is not pretty and is difficult to address, as I hope the Deputy appreciates. Passenger numbers have decreased by 21.7% from their height in 2007, while revenue has decreased by €56.8 million, or some 11.4%, from its height in 2008. The reduction in the subvention from its height of €45.6 million in 2008 was necessary. It is a difficult scenario. There will be a 20% reduction in subvention from 2012 to 2014.

There is a cost recovery programme and the Deputy is aware of what is happening in Irish Rail. It would not be appropriate for me to comment on the position of Bus Éireann or Dublin Bus as those companies are in the middle of negotiations. We are considering various other mechanisms to try to improve the volume of people using public transport in conjunction with the great efforts of unions with management in maintaining or limiting costs across the three organisations. I encourage the Deputy, as a spokesperson on transport, to be part of the discourse in promoting public transport. Recently there was the launch of the national route planner, the Leap card and real-time passenger information. There are also other initiatives, including rolling out Wi-Fi across a number of services. We must get more people using public transport. We all have a responsibility in this regard given the very difficult position in which we find ourselves.

I promote public transport and I believe in it. If there is to be a reduction of 20% in the subvention over the next couple of years, it will have significant repercussions. We should not reduce our public subsidies as there will be significant consequences. It is important for us to engage with trade unions, which represent workers, and the Minister of State should meet those representatives to reassure them that services will be maintained as best they can.

I thank the Deputy for his comments. Irish Rail engaged in very detailed negotiations with unions and I am pleased the ballot was passed and the negotiations concluded in a satisfactory way. There are ongoing negotiations with the representatives of staff in Bus Éireann and Dublin Bus which preclude me from commenting in detail on the outcome. I am enthusiastic about the co-operation being shown by all parties in these negotiations in very difficult times. The management and unions working together should be welcomed and endorsed because of their position and the statistics I outlined earlier.

Deputy Mattie McGrath is not here at the moment so we will proceed to Question No. 87.

Question No. 86 not taken.

Tourism Promotion

Questions (3)

Timmy Dooley

Question:

87Deputy Timmy Dooley asked the Minister for Transport; Tourism and Sport the current status of the Gathering Project; and if he will make a statement on the matter. [32391/12]

View answer

Oral answers (5 contributions) (Question to Minister for Transport, Tourism and Sport)

The question relates to the current status of The Gathering project. I presented proposals for The Gathering Ireland 2013 at the Global Irish Economic Forum last October.  Fáilte Ireland is the lead agency for the implementation of the initiative and has put in place a project executive team to implement it.  Tourism Ireland has specific responsibility for promoting The Gathering in overseas markets and has also provided staff for the project team.

The event is intended to be the biggest tourism initiative ever staged in Ireland and will consist of a year-long programme of festivals, events and other gatherings.  The St. Patrick's Day festivities were used for the overseas launch while a major domestic launch took place on Friday, 11 May 2012 in Dublin Castle at an event attended the Taoiseach, the Tánaiste, the Minister of State with responsibility for tourism, Deputy Ring, and me.  In recent weeks the Minister of State, Deputy Ring, has attended events in Manchester and Glasgow to mobilise support among the Irish communities in Britain and I will be attending an event in Brussels next week. Further major publicity events in our main overseas tourism markets are planned for the remainder of the year.

A series of Gathering community meetings are being held throughout Ireland to engage and mobilise local communities and to provide an opportunity to people to learn more about The Gathering and how they can be a part of it.  Meetings have taken place in Roscommon and Castlebar, with a meeting in Ennis planned. A website has been established with information on how people can play their part in the event, including online support for potential organisers to submit queries and download promotional material. In addition, social media channels are on stream to promote the event.

In terms of resources, a specific ring-fenced additional €5 million allocation has been provided to Fáilte Ireland this year. This allocation will primarily be used for establishing the support structure and for marketing.  Efforts to secure additional resources for The Gathering will be targeted at engaging potential partners and sponsors. The Irish tourism trade is also directly involved and is being briefed on progress on an ongoing basis.

I thank the Minister for the reply. He is aware his Government set an increase in tourism and visitors to the country as a key strategic component of its jobs initiative. In doing so the Government reduced the VAT rate on tourism related products, much to the annoyance of private pensioners who, effectively, had to pay for that. At one stage the Minister questioned to some extent the ability of that measure to increase employment, and that speaks for itself.

The tourism numbers for the first three months this year, from the beginning of March to the end of May, show a reduction of approximately 1.1% compared with last year. There have been approximately 18,000 fewer visitors to the country. There has been a reduction of approximately 5.7% of the British market and, when one sets this against the fall-off of approximately 3% of Britons travelling in Europe generally, it represents a significant fall-off from our nearest neighbour and our most important market. What specific measures has the Government taken to address this significant fall-off from our nearest neighbour in the context of promoting Ireland generally and working towards The Gathering next year?

The Gathering primarily relates to next year. Inbound visitor number figures for last year were favourable. There was an increase of 6% on 2010 after several years of decline. To date this year we are behind target. We had targeted a 4% increase this year but so far there has been a 1% decrease in visitor numbers. This varies however. For example, there has been an increase from mainland Europe, a significant increase in some cases from Germany, France and the Nordic countries. There has also been an increase from the long-haul market. The figures from America are slightly down, by approximately 2%, but they have been improving in the past three months. Numbers from America were up by 1% on the same period last year. The figures from Britain are disappointing. For the first five months the number of visits from Britain were down by 2.3%, set against a 3% fall in the British market in general. There are fewer British people travelling on account of the ongoing recession there, but we are not losing market share. The March to May figures shows a 5.7% fall but we should not necessarily read too much into three month statistics for Britain. Overall the figures are down 2.3% to date this year and this wipes out the gains we are making from mainland Europe, Asia and the Middle East.

I welcome the fact the Minister recognises the figures are disappointing. It is incumbent on the Government to do something. While one should never read too much into any particular statistical snapshot, it is an indicator. There has been an effort by the Government to clap itself on the back to some extent because of the notional 6% increase last year based on the figures for the previous year. My recollection is that the increase was based on the ash cloud. When the figures are adjusted to take account of the significant reduction in traffic as a result of that event, the increase disappears. I urge the Government to continue to invest heavily in promoting Ireland abroad in whatever way it can and to have in place a strategic plan to ensure we do not lose market share or visitor numbers.

I offer the figures from mainland Europe. Figures from Germany are up 10%, figures from France are up by 6%, figures from Italy are up by 9%, figures from the Nordic region are up by 9.5% and those from the Benelux countries are up by 8%. There are several factors which explain why the British market is depressed and they do not apply only to this side of the Irish Sea.

New television advertisements will feature in the coming weeks in Britain, France and Germany, in cinemas in Britain, the United States, Spain and Italy, and there will be outdoor advertising in Britain. There will be some events around the Olympic Games, including a Gathering event. The focus will be on these top four markets in particular. I am reasonably confident we will see better figures in the coming months. This has been the suggestion from the industry for the coming months, the peak season, because the bookings are strong.

Swimming Pool Projects

Questions (4)

Richard Boyd Barrett

Question:

88Deputy Richard Boyd Barrett asked the Minister for Transport; Tourism and Sport if he will provide funding to Dun Laoghaire Rathdown County Council, in the interests of promoting tourism, to ensure that the full plan to restore the baths in Dun Laoghaire is able to progress immediately; and if he will make a statement on the matter. [32103/12]

View answer

Oral answers (9 contributions) (Question to Minister for Transport, Tourism and Sport)

The question relates to the restoration of the Dún Laoghaire baths. Fáilte Ireland has responsibility for the operation of the tourism capital investment programme. The development of the project referred to by the Deputy is primarily the responsibility of the relevant local authority, Dún Laoghaire-Rathdown County Council. I am informed by Fáilte Ireland that no application has been received by it in respect of the project. If a local authority, or any other body, identifies a tourism project with the potential to increase significantly visitor numbers and which it believes would be eligible for tourism capital funding, it should engage directly with Fáilte Ireland. However, the level of grant allocations and approvals under the programme is such that the existing capital allocations for 2012 and 2013 for tourism product development are fully committed.

In 2004, in the biggest demonstration since 1921, 5,000 people marched in Dún Laoghaire to demand that the council abandon proposals to build a ten-storey private apartment block on the site of Dún Laoghaire baths and force a commitment from it to restore the public swimming baths. The demonstrators later forced it to commit to a plan in this regard. After a long delay and endless foot-dragging by the council, last night the Minister's Labour Party and Fine Gael colleagues voted to give €1.5 million to the Dún Laoghaire Harbour Company to place a barge off the east pier in Dún Laoghaire. The county manager, in supporting the proposal for a barge off the east pier, stated it would allow the council to "exit the baths thing". Does the Minister believe it is acceptable for his Labour Party and Fine Gael colleagues and the county manager to show such contempt for the wishes of the public, so strongly expressed over ten years, that they would abandon the plan to have a swimming pool back on the site of Dún Laoghaire baths? Would it not be in the interests of the State's tourism infrastructure and the Government's stated commitment to develop tourism to give the people of Dún Laoghaire what they want, namely, restored Victorian swimming baths on Dún Laoghaire seafront? Acceding to the people's demands would boost tourism in Dún Laoghaire and the wider Dublin area. I ask the Minister to intervene in this regard by getting the council to restate its commitment to provide the swimming baths and by having the Department become directly involved in providing funding therefor.

I am flattered a little by the Deputy's question. I am the Minister for Transport, Tourism and Sport and have a considerable number of responsibilities across a number of areas, including aviation and the ports, in respect of which I work with the Ministers of State Deputies Alan Kelly and Michael Ring. I am a little surprised that the priority question from the Technical Group is essentially about a local issue affecting Dún Laoghaire-Rathdown County Council, in which I will not intervene because it is a matter for local government. It is a matter for the elected representatives on the council to make decisions without having regard to me. If they want to talk to us about their plans or capital funding, we will be happy to do so. However, they have not done so as yet. I am advised that they have allocated €2.5 million from the capital budget to carry out works on the pavilion and baths site and provide a jetty and other amenities. This is entirely a matter for the council to decide. I do not have a role.

Dún Laoghaire seafront is a national tourism asset of great significance. Dublin is the biggest tourism hub in the country. To develop the seafront in Dún Laoghaire and provide amenities there is of national significance. There was widespread support across the city of Dublin for the campaign against the privatisation of the seafront and to demand the restoration of Dún Laoghaire baths. There was support from all over the country because people understood restoring the public swimming amenity and the Victorian heritage of the seafront would be a great boost for tourism in Dublin and that the provision of amenities would be of citywide and national significance. It is, therefore, the Minister's business. His Fine Gael and Labour Party colleagues on Dún Laoghaire-Rathdown County Council are playing politics with the issue to the detriment of the interest of the residents and the Government's stated objective to develop tourism infrastructure and create employment therefrom.

I am not sure what question the Deputy is asking, but I wish to make two comments. Dún Laoghaire Harbour is a wonderful amenity for the State. I often visit and will be attending the youth sailing championships there in the near future. I do not know whether renovating the Victorian baths would result in international tourists flocking to Dún Laoghaire. That would have to be assessed, but I trust the elected representatives in Dún Laoghaire to make these decisions for their area.

They promised the people a swimming pool, but they have not delivered.

It is a matter for the council chamber.

More broken promises.

Perhaps the Deputy might return to it in due course.

Top
Share