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Dáil Éireann Debate, Thursday - 27 June 2013

Thursday, 27 June 2013

Questions (17, 34)

Joe Carey

Question:

17. Deputy Joe Carey asked the Minister for Transport, Tourism and Sport the position regarding the legislation to merge Shannon Airport and Shannon Development; and if he will make a statement on the matter. [30984/13]

View answer

Éamon Ó Cuív

Question:

34. Deputy Éamon Ó Cuív asked the Minister for Transport, Tourism and Sport his plans to review the €3 travel tax; his plans to encourage further development of the air connections to Ireland; if he is satisfied with the activities of the newly independent Shannon Airport Authority; and if he will make a statement on the matter. [31065/13]

View answer

Written answers

I propose to take Questions Nos. 17 and 34 together.

These relate to the merger of Shannon Airport and Shannon Development. As I pointed out in my replies to Dáil Question Nos. 7 and 63 on 15th May last, work on the preparation of the Heads of a Bill to provide for the merger of the Shannon Airport Authority (SAA) and a restructured Shannon Development is on-going in my Department, in conjunction with the Department of Jobs, Enterprise and Innovation and with the assistance of the Attorney General's Office.

I expect to introduce the Bill to the House during the autumn session.  When the Heads are finalised and approved by Government, I will refer them to the Joint Oireachtas Committee on Transport for their consideration prior to drafting.

Of course, the plans and preparations for the merger are continuing and I am very satisfied with progress  to date by the newly independent Shannon Airport Authority (SAA).

As I pointed out last month, the high-level Steering Group of key Departments continues to meet on a regular basis and the Chairman of SAA serves on this group. Transition teams at senior management level are also in situ in both Shannon Airport Authority and Shannon Development to ensure the smooth implementation and management of the merger while also ensuring that normal day-to-day business and operations carry on uninterrupted.

Following the successful conclusion last month of a facilitation process between management and union representatives in Shannon Development to address a number of staff issues, staff transfers from that company have commenced to Fáilte Ireland, Enterprise Ireland and the IDA.  Some staff are also being redeployed to other agencies in the region.  A voluntary early retirement and voluntary redundancy scheme was also successfully concluded last month in Shannon Development with 25 staff availing of the scheme.

The new Chief Executive of the Shannon Airport Authority and of the proposed new Shannon entity took up his post on 10th June and the key priority for him and the board of SAA is to halt the decline in passenger traffic, and then reverse it.

I am confident that Shannon can have a successful long-term sustainable future, now that the board and management are free to determine that future themselves.

As regards the travel tax, the Government’s offer to abolish this tax in return for an increase in capacity and the restoration of cancelled routes and reduced capacity stands. The purpose of the offer was to stimulate inbound tourist traffic. While there have been some positive developments in relation to additional capacity in 2013, particularly on US-Ireland routes, linked to both general traffic demand and the expected increased traffic relating to the Gathering, overall the response from the airlines to date has been inadequate. The Government has made it clear that it will need to see a significant growth in capacity and routes across the full range of sectors and airports before consideration can be given to abolishing the tax. 

In relation to the development of air connections to Ireland, the three State airports offer a range of incentive schemes to airlines to maintain and grow their business at those airports. This includes the Growth Incentive Scheme which was introduced as part of the Government's Jobs Initiative aimed at encouraging inbound tourism.  Under this Scheme, a total of €1.5m was rebated by the DAA to airlines in 2012 for increasing their passenger numbers during the year.

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