I move: That the Air Navigation and Transport Bill, 1936, be now read a Second Time. It would be well, I think, at the beginning, to outline briefly the international position of the control of air navigation and the present position in the Saorstát. Aviation, as Deputies know, has provided us with a form of transport, the outstanding characteristic of which is speed. It is over the greatest distances that this feature of speed provides the most advantage, and the limits set by political frontiers to surface transport cannot be applied in the same way to transport in the air. It seems clear, therefore, that for the development of international air transport uniform facilities for the passage of aircraft into and over States are required. As might be expected, therefore, even in the early stages of air transport development, the subject was one for international consideration with a view to its regulation.
A first attempt to effect international regulation of air navigation was made in 1910, but it was found impossible to reach a unanimous agreement on a draft convention. The idea was taken up again at the opening of the Peace Conference in 1919. It became clear that, owing to the war, very considerable advances had been made in aerial transport, and the result was that in October, 1919, there was signed at Paris a Convention relating to the regulation of aerial navigation. The Saorstát is a party to this Convention which laid down principles to serve as a basis for uniform national regulations for the control of international flying. These principles, I think, might be briefly summarised as follows: that every Power has complete and exclusive sovereignty over the air space above its territory; that each contracting State undertakes, in time of peace, to give free air passage to the aircraft of other contracting States; that each contracting State may prohibit flight by aircraft over certain areas of its territory, and that each contracting State may conclude special conventions, not contradictory to the general principles of the International Convention, with non-contracting States.
The Air Navigation Act of 1920 implemented the International Convention and, in addition, provided for certain consequential and supplemental matters not covered by the Convention. This Act is the existing statutory authority for the regulation of flying in the Saorstát, and under it various orders and regulations have been made from time to time. For a considerable time the Government has been closely examining the question of air transport and, in connection therewith, the reconsideration of legislation applying to air navigation came up for consideration. It was considered advisable, having regard to all the circumstances, to introduce the present Bill. I think Deputies will fully appreciate that, if only on account of the passage of time and the general progress of civil aviation which has taken place in the meantime, modifications and amendments will have to be made in the 1920 Act. But there is also the further important consideration that the steps which are now definitely about to be taken for aviation development in this country, to which I shall refer later, make it even more necessary that new legislative provisions should be made for the regulation of air navigation and transport. The Air Navigation and Transport Bill, 1936, contains no startling innovations. The House has already had experience of the application of the principle of public control and regulation of other forms of transport, as, for example, the road and railway measures which it has passed during recent years. This control which has been found desirable from experience in other forms of transport is now being adapted and modified to suit aerial transport, and is being applied to aviation in the present Bill.
Other matters dealt with in the Bill arise from the International Conventions of Paris, Warsaw, and Rome in connection with air transport. Provisions are outlined in the Bill, by which the contents of these conventions, and the principles laid down in them, may be specifically applied to aerial transport in Saorstát Eireann. Furthermore, co-ordination and economy of air transport development will be secured by centralising such development in one principal company.
There are ten Parts in the Bill, and I think the best course would be if I dealt briefly with each one of these. Part I is preliminary and general, and contains the usual sections covering definitions, fees, orders and expenses. It provides in Section 8 for the repeal of the Air Navigation Act, 1920. It has been decided to repeal that Act because it is thought better to incorporate the whole law in a single statute of the Oireachtas, and in so far as the provisions of the Act of 1920 are still found to be required, they will be re-enacted in this Bill.
Part II deals with the international convention signed in Paris in 1919 and re-enacts a section of the Air Navigation Act, 1920, which empowers the Executive Council to give effect, by Order, to the convention. The section gives power to compel compliance when an aircraft disobeys signals, and to pay the annual contribution towards expenses of an international commission which was set up under the convention of 1919, which is also re-enacted. Provision is made for the continuance in force of existing certificates, licences, orders and regulations, made under the earlier Act.
Part III provides for the implementation of the international convention for the unification of certain rules relating to international carriage by air which was signed at Warsaw in 1929. The convention was acceded to by the Government of Saorstát Eireann by a formal notification to the Government of the Polish Republic, made on 20th September, 1935, and was presented as a White Paper to the Oireachtas by the Minister for External Affairs. This convention is limited in its application to the international carriage by air of persons, luggage or goods, performed by aircraft for reward. It lays down amongst other matters certain conditions as to the contract of carriage both for passengers and goods. It sets a limit to the carrier's liability in respect of death or injury to passengers, and in case of loss, damage or delay to goods. In Section 18 of the present Bill, the liability imposed on the carrier by the convention is substituted for any liability of the carrier in respect of the death of a passenger under any statute or at common law, and the benefit of such liability is made available for such members of the passenger's family as sustain damage by reason of his death. Power is taken in the Bill to apply the provisions of the Convention of Warsaw by Order of the Executive Council with any necessary modification to carriage by air which is not international.
Part IV makes provision in respect of damage by aircraft to persons on land or water. Liability for surface damage is at present governed by Section 9 of the Air Navigation Act under which absolute liability, subject to the defence of contributory negligence, is imposed on the owner of the aircraft or in certain circumstances on the hirer. This section, which makes proof of negligence or intention on the part of the owner unnecessary, is re-enacted in the Bill. Under this Part also we come to the important new feature by which provision is made for a system of compulsory insurance by the owner of the aircraft against the liability imposed, and for the limitation of such liability, or, in other words, for compulsory insurance against certain third party risks. The Government has already thought it desirable in the case of motor vehicles to make compulsory a policy of insurance or alternative security for the protection of third parties. In the general interests of the community it is considered that similar provision should be made in respect of aviation and that the third party on the ground should be guaranteed reasonable compensation in the event of damage to person or property from the flying of aircraft. The necessary steps will be taken, before this chapter of the Bill is brought into operation, to ensure that as far as possible reasonable rates of insurance will be made available and that the protection of the injured third party from the adverse effects of omissions or misrepresentations on the part of the insured or the action of the insurer will be secured. I should point out with reference to this question of compulsory insurance against third party risk that an international convention dealing with the question of compulsory insurance and the limitation of liability for damage to a third party on the surface in the case of aircraft engaged in international air transport was signed at Rome in May, 1933, but has not yet come into force. Power is taken in this Part of the Bill to give effect to that convention by order of the Executive Council when it is considered necessary and expedient to do so.
Part V is concerned with the establishment and maintenance of aerodromes by the Minister for Industry and Commerce and by local authorities, and the acquisition of land and water rights, etc., for this purpose. The Minister has already power to establish and maintain aerodromes and to acquire land for that purpose either by consent or compulsorily. The repeal of the 1920 Act, to which I have referred, makes the re-enactment of this provision necessary. Some minor defects found in the provisions of the 1920 Act have been removed or remedied and advantage is taken of the present opportunity to replace the existing method of the compulsory acquisition of land, which involved the Military Lands Acts, 1892 to 1903, by the more direct and more expeditious procedure of acquisition by order, subject, if considered expedient, to a prior public inquiry, and to the incorporation in such order of the Acquisition of Land (Assessment of Compensation) Act, 1919, and the Land Clauses Acts. It is considered desirable, also, that the efforts of local authorities to establish and maintain aerodromes should be facilitated by extending their present powers of acquisition to cover acquisition by compulsion, subject to the consent of the Minister for Industry and Commerce. The provision of aerodromes and landing-grounds is essential to the development of aviation, and the acquisition of sites therefor should not be held up by the unreasonable demands of property owners. The Bill accordingly provides, in Section 41, for the application of the powers now held by local authorities under the Public Health (Ireland) Acts of 1878 and 1896, and the Local Government Act, 1925, to the acquisition of land for the purposes of this Part of the Act. In order also to encourage co-operation between local authorities in providing aerodromes, provision is included in the Bill for the making of a contribution by a local authority or a harbour authority to the expenses of construction of an aerodrome undertaken by another local authority and for the setting up of a joint committee of management with representatives of the different contributing bodies. Provision is also made to extend the borrowing powers of local authorities to meet expenses incurred in the establishment of aerodromes.
Part VI of the Bill is made up of provisions similar to those in the Air Navigation Act, 1920. It excepts aircraft from action for trespass or nuisance by reason only of flight over property at a reasonable height and in compliance with air regulations. It also specifies the liability and penalty for unnecessary dangerous flying.
Part VII contains a number of administrative and miscellaneous provisions. The sections in the Act of 1920 dealing with wreek and salvage, investigation of accidents, infringement of patents, and jurisdiction, have been brought up to date without involving changes in principle, and the amended provisions are included in this Part. In addition, the powers at present held under the Merchant Shipping Acts relating to ships in respect of collisions, signals of distress and urgency, and the making of regulatory bye-laws by harbour authorities have been extended to cover their application to sea-planes. Provision is also made in this Part for the detention of aircraft to secure compliance with any of the requirements of the Bill, and to prevent aircraft from flying when unfit to fly. The procedure for the detention of aircraft is on the lines of that applied to vessels by the Merchant Shipping Act, 1894. The Minister for Industry and Commerce is also empowered in Part VII to collect statistics and such other information as he may specify by order from air transport concerns and the holders of licences for customs aerodromes. Finally, air transport undertakings are placed in the same position as regards the carriage of mails as railway, tramway and omnibus undertakings. That is to say that the General Post Office may require them to carry mails.
I now come to the Parts of the Bill which will, I think prove of greatest interest at this stage. They are Parts VIII and IX which provide for the formation of a principal national air transport company and subsidiaries and for the restriction, with a minor exception, of internal air services to those carried on by the company and its subsidiaries. The House, I think, will fully realise the great importance of air transport in our time. In fact, aerial transport might be described as the special expression of the spirit of the age, the spirit of scientific achievement. It has gripped the imagination of the people of our time in a way that few other things have. This wonderful success, which riders of the air have achieved, in subduing the elements and utilising the powers of nature for the benefit of humanity, has awakened sympathy and interest everywhere. Furthermore, aerial transport has provided a most important link which has brought the nations of the world nearer to one another and has done a great deal to cultivate better international understanding and better feelings amongst the peoples. But apart from these considerations, which are considerations of importance, there are also very practical and economic considerations which Governments of the present day must have regard to, in considering the development of air transport within their territories. Although transport by air is, comparatively speaking, in an early stage of development, wonderful progress has been achieved. What is certain is that Governments everywhere are attaching more and more importance to the development of aviation within their own territories. They are fully alive to the tremendous possibilities of air transport development. In fact, even in the internal transport systems of many countries, air transport has become a serious rival to other forms of transport.
In the international sphere, it is undoubtedly becoming a matter of first-class importance particularly to the larger countries, both from the point of view of their own prestige and of their commercial and political influence in the world, to give more and more attention to the development of the air arm. Very many of them have taken practical steps to encourage aerial development within their own territories and internationally. So far as we here in Saorstát Eireann are concerned, I think we have reached a very important stage in connection with air transport development. In fact, having regard to the international developments that are going on, the position is that this stage is a very significant one for us and one to which we ought to advert in the most complete manner. The routes along which international traffic will pass are now being determined and it is of importance that the Saorstát should be in a position to utilise such advantage as is afforded by its geographical position on the fringe of the Continent of Europe, to establish its claim to inclusion on these routes in which it is interested.
The Government, I think I may say, have taken, and are taking steps under the present measure, to ensure that, as far as we are concerned, we shall do our utmost to utilise whatever position we may have, and whatever opportunities may offer, to secure our appropriate place in future developments and to participate in the economic and other benefits which may follow for our people and our State. So far as internal air services are concerned, it is of the first importance that there should be sufficient traffic available for the maintenance of such services once they are established. When they are established and working, I think it is clear to everybody that they provide for the acceleration of the carriage of passengers, mails, and urgent freight, and for connections with the main international services. It is clear, therefore, that whilst having regard to international developments in air transport, we must also have regard to domestic developments and make our arrangements accordingly, so that both internal and external developments in so far as we can regulate them or influence them, will proceed hand in hand.
A problem now arises in connection with the whole question of the future policy of Saorstát Eireann with regard to the development of air transport. That is, having made up our minds to follow a certain policy, what steps should the Government take to implement that policy, and what manner of organisation should it set up. What has been the experience in other countries, and what are the best lines for us to follow? The Minister for Industry and Commerce and his Department have been giving a good deal of attention to this matter for a considerable time past, and they have been influenced by the fact that the tendency in Europe has been towards the formation of large-scale companies to operate all domestic and foreign air transport under close Governmental supervision. In France, for example, the company Air France was formed by a decree of the Minister for Air, in 1933, by an amalgamation of four companies and by taking over the assets of a fifth in liquidation. In Germany a very similar development occurred. After the European War, several air transport companies came into existence. These early companies underwent a process of grouping and regrouping until in 1924 German air transport was in the hands of two rival concerns. Following a period of very rapid development, the rivalry between those two companies developed into harmful competition and duplication, and eventually, as a result of Government intervention, a single combine, the present Deutsche Lufthansa, came into being in April, 1926. In Holland the Government hold a large share of the capital of the principal company, the Royal Dutch Air Lines (K.L.M.).
The tendency, therefore, is for modern Governments, in some form or other, to induce or require restriction of competition in air transport services. I think we may attribute this tendency on the part of modern Governments to a desire to eliminate utterly wasteful competition and to see that as far as possible the highest standards of safety will be observed. In June of last year the Minister told the House that aviation development in the Saorstát would be organised on sound lines with proper equipment and under Irish control. The Government have decided that development on these lines can best be secured by the establishment of a national company which will control directly or through subsidiaries all internal services in the Saorstát and all participation in international services from the Saorstát. We have come to this conclusion, after carefully considering the merits of the case for a long period. We believe that all the advantages are on the side of creating a national transport company in which will be unified and centralised all the air transport activities with which we have to deal in the Saorstát. We consider that that is the most economical and most effective way and, having regard to all the circumstances of this State, by far the most suitable method of organisation we could set up. Provision for the formation of such a company is made in Part VIII of the Bill, and Part IX restricts the operation of all internal services to this company and its subsidiaries.
The control of any regular services between Saorstát Eireann and any other country is effectively secured by the Air Navigation (International Lines) Order, 1935, which makes it necessary for the authority of the Minister for Industry and Commerce to be obtained before such service may be established by either a Saorstát Eireann or a foreign company. It is proposed to exercise this restrictive power in favour of the national company and to give it the support of the Government in its relations with foreign Governments and competitors. Among other advantages, it is hoped, in this way, to secure for the company reciprocal treatment in the countries concerned.
If we are to have any air development in Saorstát Eireann and if the Government are embarking on a large policy, I think there can be no doubt whatever that we are entitled to see that any efforts we make, and any expenditure we may commit the country to, will be utilised in such a way as to make the future commercial development of the country as economical and effective as possible.
I come now to the finance clauses of the Bill. Part VIII provides for the formation of the company and empowers the Minister for Finance to take up by subscription shares of the company and to underwrite any public issue. The Government is satisfied that if there is to be any development of aviation in this country, on the reasonable scale contemplated, the State will have to take the initiative, and, at least in the early stages, will have to provide the necessary capital. One million pounds has been fixed as the nominal share capital of the principal company. I should explain, with reference to this, that the share capital will be only called up as and when required.
In Section 72 the Minister for Finance is empowered to guarantee, if he thinks fit, any issue of debentures by the company. It is not possible at this stage to indicate what liability the State may incur under this section, but I should like to call attention to the fact that it is provided in the Second Schedule that so long as the Minister for Finance holds not less than one-tenth of the share capital, the company's right to issue debentures is subject to his consent.
There are two other matters in this financial Part of the Bill which require special mention. One is the provision for the payment of subsidies in Section 76 and the other for the loan by the principal company to Aer Lingus, Teoranta, in Section 77. With regard to the matter of subsidies, Deputies will appreciate that the principle of the subsidy, where it is working, has been accepted by certain other countries because they have considered it essential for the proper development of certain types of air lines. Some such provision may have to be made by Saorstát Eireann for the development of certain routes. Section 76 provides that the House will have an opportunity of examining any proposal to pay subsidies for the development of air service in Saorstát Eireann wherever the Government think such to be suitable and necessary. The procedure will be that under this section of the Bill the Minister for Finance may from time to time by Order authorise the payment of subsidies to the company on such terms and conditions as may be specified in such Order laid before the House. These Orders may be annulled or ratified and provision is made accordingly in the measure now outlined. The section limits the aggregate amount which may be authorised to be paid to the company by way of subsidy to £500,000, and no such Order may be made after the expiration of five years from the date of the passing of this Act.
I should say here, with regard to this financial proposal, that it is impossible at the moment to give details of the expenditure which has to be investigated. A definite figure—which is at present under consideration — is not available and it is not possible to give the House all the details we would like to give it at the present moment. I hope it will be satisfactory if I point out at the moment that any proposal in connection with the granting of a subsidy will have to come before the House, and to come before it specifically in the way of an Order laid upon the Table and which can be discussed.
There is one other provision of a financial nature and that is in Section 77 of the Bill. It is provided that as soon as may be after the registration of the company, the company may, with the consent of the Minister for Finance, lend to Aer Lingus Teoranta, a sum sufficient to discharge any liabilities of that company. This provision is necessary in order to regularise the position created by the formation of a subsidiary company prior to the formation of the parent company itself, which is to finance it. It is entirely a legal matter and the present procedure has been adopted as a result of legal advice.
When moving a Supplementary Estimate in November last, the Minister gave the House an indication of the Government's plans for the initiation, at the earliest possible date, of air transport services between Saorstát Eireann and Great Britain. The arrangements he then outlined for the setting up of a Saorstát company to operate these services, on a basis of joint working with a British company, have since been completed. Services were inaugurated on the 27th of May on the routes Dublin to Bristol, Dublin to Isle of Man, and Dublin to Liverpool via the Isle of Man. In furtherance of the policy to operate strictly on commercial lines, these services link up with express trains on the other side of the Channel. Further schemes for the development of services from the ports of Cork and Galway are under consideration, but I again stress the fact to which the Department has already called public attention, that the provision of suitable aerodromes is an essential preliminary to the operation of regular air lines. The provision of direct services to Liverpool and London from Dublin is also being considered.
I should say, in connection with this international service, that reciprocity is required by all countries and the grant of landing rights in Great Britain involves the grant of corresponding rights here to a British company. The knowledge and experience of the British company, which is one of high standing, is now made available for the joint committee of management of Irish Sea Airways, and in making the arrangement for a joint working Aer Lingus, Teoranta, has not limited its independence to any greater extent than any ordinary business agreement for joint working limits the independence of both parties to the agreement. As I have already stated, both companies have equal representation on the joint committee of management, and expenses and receipts will be pooled.
The remaining sections of Part VIII deal with the relations of the principal company with the Minister for Finance, and provide for the exemption of the company and its subsidiaries from the application of the Control of Manufactures Acts, as was done in the case of Comhlucht Siuicre Eireann, Teo.
Part X deals with the control and regulation of certain classes of aviation business and is in furtherance of the policy I have already outlined for the restriction of commercial flying to the principal company and its subsidiaries. The interests of the company would be adversely affected by unrestricted operation of the private chartering of aircraft and it is, consequently, proposed as from a day to be appointed to permit such operation only under licence. Persons who were on the 1st of January of this year engaged in the provision of charter services will be entitled, as of right, to a licence to continue to operate. The same restriction is proposed for pleasure flights or, as they are usually called, "joy rides," and for instructional flying. I should, perhaps, mention, with reference to this matter of licences, that the Minister will have power to attach conditions to any licence which he may grant. He will have power to refuse an application for renewal of a licence, and he will also have complete discretion to revoke a licence, under Section 95. It is not considered feasible to extend the licensing provision to journeys under charter originating in another country but aircraft engaged in such flights will not be allowed to take up passengers for hire or reward within the Saorstát without a licence. The remaining provisions of this Part of the Bill cover the grant, renewal, transfer and revocation of licences and do not call for any special comment at this stage.
These are the main principles of the Air Navigation and Transport Bill. Although the Bill looks rather formidable, the principles of control, as I have already mentioned, have already been applied to other classes of transport and are well known to and appreciated by the House. The Bill is easy to understand and will not provide any great difficulty in its later stages. Amendment may be necessary on points of detail but, generally speaking, I think it will be conceded, that under the terms of the Bill, the Government are making definite and adequate provision to enable the Saorstát to take its due part in the development of aviation. With the financial aid which the State will provide and the control which it will exercise through the provisions of this Bill when it becomes law, I have no doubt we shall be able to ensure that future development will be carried out by and for the benefit of Saorstát nationals as far as possible. Finally, I think I am safe in prophesying that with the interest, financial and otherwise, which the State will in future have in the development of commercial aviation in and through Saorstát Eireann and with the direction which it will be able to give policy, that development will proceed on lines which will make certain the economic working of commercial services and the highest standards of operation in commercial and private flying.
