Léim ar aghaidh chuig an bpríomhábhar

Dáil Éireann díospóireacht -
Thursday, 6 Nov 1997

Vol. 482 No. 5

Air Navigation and Transport (Amendment) Bill, 1997: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

This comprehensive Bill which contains 64 sections is worthwhile and can be recommended to the House. Section 17 provides that Aer Rianta may acquire land by agreement, or subject to certain conditions, compulsorily. It also provides that land may be acquired by the company, where the land is not required for immediate use but where the Minister holds that there is a reasonable expectation that the land will be required in the future, for one of the purposes specified in section 18.

I am not happy with this lukewarm section. Perhaps it will give the company the opportunity to acquire land which will not be utilised in years to come. It would be proper planning for Aer Rianta to undertake feasibility studies around all its airports to find out what land is required. Buying huge tracts of land which lie dormant for years is not wise. I hope the Minister will initiate proper planning by Aer Rianta to ensure it acquires sufficient land to meet its requirements in the next decade or two, and thereby ensure it will not invest in property which may not be of paramount importance.

Section 16 assigns to the company the functions previously undertaken by the Minister in relation to the management and development of the three State airports. The company must also ensure that necessary services and facilities are provided at these airports. In addition the company may, subject to certain conditions, establish new airports or become the owner or manager of existing airports.

The logic of Aer Rianta acquiring airports outside the State is dubious. Before this debate was adjourned, I called on Aer Rianta, in the establishment of new airports, to consider areas which have little access to airports. Some parts of my constituency of Cork South-west are 120 miles away from an airport. Bantry Bay is the mariculture capital of Ireland. Mariculture exports need prompt shipment to the continental market to ensure they arrive in first class condition. It is of paramount importance to the development of the mariculture and aquaculture industry along the south-western seaboard that a direct air flight be made available through the construction of a new airport in Bantry. There is a huge demand for this service. There is vast mariculture and aquaculture development in the seashore around Castletownbere, Bantry and Carbery Hundred Isles. If this facility was provided by Aer Rianta, it would help the industry to develop because Bantry is the centre of aquaculture and mariculture development in that area.

We are told mariculture and aquaculture will be the greatest money spinners for this economy in the next decade. If that is true, perhaps somebody will argue in ten or 15 years' time, when I no longer have a seat in this House, for the establishment of an airport in Bantry, like those in Sligo, Waterford or Farranfore. I urge the Minister to ask Aer Rianta to carry out a feasibility study so that a new airport can be built in that area which deserves recognition. I hope the study shows that my proposal is viable.

This is also important from a tourism point of view because the sunny south-west is an important region. There is no train service from Cork city to any part of west Cork. That was taken away in the 1950s and no alternative transport service by sea or air was provided. There is no reason an airport could not be established in Bantry, like that built in Knock by Canon Horan.

Section 27 provides that the appointment, terms and conditions, and removal of the chairperson of the board of directors will be as determined by the Minister, with the consent of the Minister for Finance. I am pleased the Minister for Finance will hold the upper hand in this respect because it is necessary that he should have a say in the appointment and activities of the chairman of the company. Section 25 provides that the Minister may, by order, confer additional functions on the company, subject to conditions which may be specified in the order.

Section 41 provides that the Minister may give a direction in writing to the company requiring it to comply with policy decisions of a general kind related to the functions assigned to the company, or to do or refrain from doing anything to which a function of the company relates, which is necessary or expedient in the interests of the State. The company must comply with such a direction from the Minister. Perhaps this is a little high handed. Will it interfere with the natural running of the company? Will the company be tied to the Minister's coat tails so that it is not able to expand as it would like? Is the Minister wise to include this section in the Bill? Do we need it in the Bill?

I would be slow to support a section which would interfere with progress in any company. Perhaps the section could be reworded in such a way that the company would have to seek the Minister's views on such expansion. It might not benefit a company to tie its hands with too many ministerial regulations.

Air transport accounts for 65 per cent of all passenger traffic in and out of Ireland, which is a huge percentage. I can envisage the day when that figure will increase to 75 per cent and over. The emphasis today is on getting from A to B in the shortest possible time. Time will be very valuable in the years ahead. It was not so valuable when we were growing up because it was not possible for us to travel around the globe as quickly as nowadays. Aer Rianta must focus its attention on how it will handle the escalation in passenger traffic in the next decade.

Air transport is an increasing source of polluting emissions, particularly carbon dioxide and nitrogen oxides. I am pleased to note Ireland is supporting the initiation of action by the European Union to address the problem in the wider international context and with due regard to its effect on national competitiveness. This is a very important matter because polluting emissions must be combated if we are to protect the life of future generations. It is important for Aer Rianta and Irish airlines to meet those requirements.

Aircraft noise poses particular problems in the immediate environs of airports. Ireland is already implementing standards of noise certification and limitation which have been agreed by the International Civil Aviation Organisation through the European Union Civil Aviation Conference. In addition, development planning in the vicinity of airports is monitored and controlled to minimise the impact of aircraft noise. This is a very good attempt by our airlines to minimise such noise. Despite the increase in traffic through our major airports, the EPA reported in 1996 that noise reduction had been achieved by a combination of improvements in aircraft technology and greater attention to operational matters, including noise abatement procedures and the selection of takeoff and landing route orientations to minimise the impact of noise.

I ask the Minister to do everything in his power to retain the duty free service at our airports. From where else will the money come to make our airlines viable? A huge number of jobs will be lost if that service is ended. I ask the Minister to get his European counterparts to support him in this regard and to make a strong case for the retention of the duty free service at our airports.

This Bill seeks to modernise arrangements between the Minister and the commercial State body involved. The Minister described it as a framework document for the operation of State airports into the new millennium and beyond. The genesis of the Bill occurred before the term of the previous Government.

There is a general welcome for the Bill and I have no difficulty with legislation which will provide a framework for the operation of State airports. I am reluctant to strike a discordant note. I do not have ideological but strategic concerns.

While it appears to be minimal, the legislation moves Aer Rianta in a specific direction. Doubtless all the implications of the change, including the gains and losses involved for the company, have been assessed by the Minister, her predecessor and officials in her Department. I am more interested in the gains and losses which might arise for each of the three airports under the new arrangement.

While I am more familiar with Shannon Airport, the difficulties for the future of Shannon are similar to those which will apply to Cork, regardless of the legislative changes. Dublin is in a different situation and may well face difficulties depending on what happens in the future and the moves the new company makes.

We must all recognise the strategic importance of airports for an island such as ours. We have a small open economy which is very dependent on trade and exports. We need access in and out of the country for business travellers and we depend to a huge extent on tourism, which is a growing multi-million pound industry. Deputy Sheehan outlined the importance of airports and the perceived loss to areas which are in difficulty in terms of access to markets and tourists.

It is the intention of the Department to put existing State bodies on a similar footing. For example, the Minister mentioned that Aer Rianta will be more or less on the same footing as the ESB and Bord Gáis. However, I am unsure if that is appropriate for Aer Rianta in view of the strategic importance of the airports.

We saw the difficulties created for farmers when the ferry companies refused to carry stock and effectively ended live shipping. That was overcome to some extent but with great difficulty and at considerable cost to farmers. The collapse of Irish Shipping continues to have implications for the trade of the country, not so much in good times but in a specific political context which does not apply at present but which may well apply in the future. At present, exporters face difficulties arising from the French truckers' dispute. These difficulties point to the importance of strategic access points for an island such as ours.

Aer Rianta's control of airports is not a monopoly, which makes it different from the ESB and some other State bodies. There are regional airports at Galway, Sligo and Donegal with larger ones at Knock and Farranfore. However, the State airports deal with by far the greatest percentage of traffic in and out of the country. Their strategic importance cannot be overstated. For example, airport charges will be set by the new company — a great deal more independently than heretofore I fear. Is there a danger that the need to be profitable will drive Aer Rianta towards a policy which will make it reliant, because of commercial pressures, on higher airport charges? This would act as a huge disincentive for tourism and business traffic at the airports.

Ryanair, the largest independent airline in the State, has been pushing strongly to have a second airport provided in Dublin where it claims airport charges are excessive. I disagree strongly, airport charges are extremely competitive. We have to accept that Aer Rianta plays a constructive role in ensuring that the cost of air traffic in and out of the country remains competitive and will become more competitive in time. That is the direction we need to take.

I am reluctant to offer them advice, particularly in airport matters, but I urge public and trade representatives in Dublin not to make the mistake made in the west where there has been a proliferation of airports. This has not had the effect of improving matters but of dissipating efforts whereby the airports in question have to survive on a smaller traffic base, both outgoing and incoming and, as a result, are less competitive.

Certain currently fashionable economists like to put forward the theory that Belfast has benefited by having two airports but even a cursory examination of the facts will show that airport charges for airlines using either airport are substantially higher and that both airports are in considerable difficulty in ensuring financial survival. I am concerned that Aer Rianta, in its slightly new role, will be pushed by forces such as Ryanair into making strategic decisions that would be disastrous for the country in the long-term.

Many people, inside and outside the House, have reservations about section 41 of the Bill under which the Minister will have considerable powers to intervene where it is felt the company is pursuing an inappropriate line from the point of view of the national interest. The section should be sufficiently strong to allow the Minister to intervene where it is necessary for him to do so to protect the economic interests of the State or for any other strategic reason. Many others take the opposite view.

The outcome of the agreement referred to in Part III of the Bill which deals with the transfer of assets will set the agenda for the new company in a fundamental way. If too high a premium is put on the property to be transferred to the company it may find itself impoverished from the start. This would have knock-on effects and create difficulties for the company. The matter needs to be examined closely to ensure it will not be placed at a huge disadvantage. This also applies to the section which deals with borrowings. Ministerial approval will be required for extra borrowings. It is understandable that the State would wish to retain some control but the figure needs to be pitched at a realistic level. The company will be reluctant to seek the Minister's approval for a project that would place it at a huge strategic advantage.

The current dividend is in the region of £14.5 million. Given that the airports will be liable to rates and other taxes it is difficult to assess what impact the changes will have. It is not clear whether the new rates and charges will be substantially greater than the dividend payable up to now.

It is not clear either whether the company has an estimate of projected net income in the next five years, particularly at Cork and Shannon airports. It is important to remember that, for the most part, the company operates on a cross-subsidisation system under which the high profits made at Dublin are frequently used to subsidise elements of developments at the other airports. In future, the rates will be by way of an individual charge on Cork and Shannon Airports. I am not clear how that will impact on the balance sheet of the company, or in particular on the balance sheet of each of the two smaller airports where substantial works are in progress. Developments at Shannon will cost approximately £23 million, a good deal of which must be met out of company profits. I am concerned that in the future there will not be airport profits at Shannon to pay for developments there. I want to be assured that the cross-subsidisation which has operated heretofore will continue in a manner that does not discriminate against the smaller airports.

I am also concerned about the impact on staff of the changes proposed in the Bill. I particularly welcome the initiative on the part of management, staff and unions in Aer Rianta to co-operate with the contract for constructive participation, of which the Minister has been extremely supportive and encouraging. No doubt she would be well disposed to consider a generous staff shareholding in the new company. From what I have heard her say, and from my private conversations with her, I know she believes in incentive and reward for the staff of Aer Rianta.

Section 32 deals with staff superannuation. There is already a difficulty in the case of some staff who have a complicated superannuation system arising from their transfer from direct employment by the State approximately 15 years ago. They stand to lose, some quite substantially, if this matter is not straightened out in the not too distant future. Some of them are concerned that another change may have a further detrimental effect on their superannuation entitlements. This is something that can be readily dealt with and resolved by the Minister to ensure everybody is satisfied and that there is no loss or threat to their entitlements.

While in many respects laudable, sections 39 and 40 appear, on cursory reading, to encourage what appears to be an almost unhealthy ethos of secrecy in the company. Of course, it has to be recognised that it is a strategic company and that a good deal of its activity ought to be confidential. However, section 7 lists penalties very much more severe than would be applicable in the private sector or in most other State jobs. I do not understand why that should be the case and I have some concerns in that respect.

There are concerns about staff numbers in all three airports. I am most familiar with the position at Shannon where within ten years job numbers have been reduced from just under 1,000 to 470. A similar position applies in Dublin, though not quite as dramatic. I understand that an even more dramatic reduction has taken place at Cork Airport where there are now 120 staff only.

Although the purpose of this Bill for the most part is to modernise a de facto arrangement, there will always be staff concerns about what the future may hold. Jobs are an issue at airports, for Governments and for politicians generally. People working in catering departments at airports will be concerned that this aspect of their operations might be put out to tender and transferred to the private sector. The same could arise in other areas. These are genuine concerns of workers which can and ought to be addressed.

I am also concerned at the treatment of temporary workers in several State or semi-State bodies, including the ESB, where staff on contract work are ever more frequently recruited and laid off without notice. As a former member of a local authority, I welcome the fact that airports will become liable to pay rates. This development represents a potential financial windfall for local authorities. The three authorities involved would argue that they have incurred substantial costs in providing infrastructure for the local airport. In that context, I must advert to the experience of Clare County Council and other local authorities in whose catchment areas ESB power stations are situated. When the change to which I referred earlier was made five to six years ago and rates became liable to be paid directly, the Moneypoint rate became payable in County Clare and the council gained £6.5 million per year. However, this money was promptly lopped off the block or rate support grants the council received from the Department of the Environment. Therefore, with the exception of the ESB paying its rates on time — the Department was also somewhat tardy in forwarding moneys during the period in question — the council gained no advantage in gross terms.

I fear the imposition of rates on airports will prove a substantial burden and will not benefit local authorities by offsetting their costs in providing infrastructures for the various airports. The Minister does not have direct responsibility in this area but I would like to see this aspect of the matter resolved.

I will now deal with the future of the duty free service. Duty free sales have played an enormous role in ensuring that rates for people travelling into and out of Ireland have become increasingly competitive. While the EU Commissioner and other experts are convinced that sales will level out in the short-term, I am certain that the removal of duty free will be disastrous for this country. Due to the fact that Ireland is the only country which does not have a direct land link with its EU partners, I am sure the Government will make every effort to ensure that a derogation is obtained. We must not fool ourselves, however, because this will be difficult to achieve. I am glad that Members on all sides have expressed support in this regard and I compliment the Minister and the Taoiseach for placing this matter, which is central to the survival of competitive air services in the short to medium term, at the top of the agenda.

I wish to comment, in the context of the EU, on bilateral agreements Ireland has entered into with the US and other countries. I understand that as late as yesterday the European Commission made a number of decisions in respect of bilateral agreements. I have not been able to establish the degree to which we will be bound by these decisions but it appears that existing bilateral agreements will be honoured, at least in the short-term. I also note that any member state introducing an "open skies" policy must put in place a phasing in period of six to seven years. I welcome the provision that special cases can be made in the event that regions, industries, etc. in any of the member states are shown to have been detrimentally affected by such a policy. I urge the Minister to ensure that Ireland avails of the derogation and puts together a comprehensive case.

I am frequently accused of parochialism on this issue but I could also make my arguments in national terms. I am surprised that people in Dublin Airport are not putting forward stronger arguments than their counterparts in Shannon and Cork because of the substantial advantages which could be gained. However, that matter should be dealt with by national aviation policy which, in the past, has not been as clear as it should be or taken proper account economic development in tourism and industry. In the context of this Bill's enactment, I look forward to the development of an international air transport policy consistent with the country's needs.

In ainneoin gur oileán í Éire, tríd na céadta bhíomar i gcomhnaí dearfach díograiseach ag iarraidh ceangal agus caidreamh cultúrdha sóisialta agus eacnamaíochta a fhorbairt leis an chuid eile den domhan. Is féidir a rá gur thosaigh Brendan the Navigator é seo nuair a chuaigh seisean chomh fada le Meiriceá agus ba chéim ar aghaidh eile é bunú Aer Lingus i bhforbairt na gceangal sin leis an Eoraip agus leis na Stáit Aontaithe.

Direct flights to and from this country ensured we were not dependent on our nearest neighbour. They provided us with the challenge of responding to economic developments and providing an outward looking people. The foundation of Aer Rianta and the development of the airports ensured that the process was three-way: opening up Ireland to investment and tourism, and, in recent years, immigration.

Aviation has the potential to be the most effective catalyst for economic growth if we allow it to be so, as we have done in the past. We need to be more aggressive, however, in seeking out new markets and attracting new airlines. It is generally acknowledged that the Asia-Pacific region is the major economic growth area. From an Irish point of view this is relevant on two fronts — increased demands for exports and an increase in foreign travel from this region, both tourism and business related. This increase has already been felt and while we still have a balance of payments deficient with most countries in Asia, trade and passenger travel in both directions is showing a healthy growth.

That the world's most profitable airline, Singapore Airlines, is flying the world's most expensive freight aircraft to Dublin suggests growing confidence in the Irish market. We need to take advantage of new technology. The latest aircraft, such as the Airbus A-330 and A-340, offer immense advantages to countries like ours. These aircraft already offer the ability to make a profit carrying only freight, so that even the smallest passenger load is a viable option.

It is conceded that passenger traffic between Ireland and Asian markets is not sufficient to justify direct passenger services, but this area is growing and we should plan for it. The visible evidence of Irish holidaymakers in Thailand, of promotional material for Bailey's Irish Cream in Singapore, or the growing links between Irish medical schools and universities in Malaysia, suggests that our country's cultural and educational expansion is becoming firmly rooted in the Far East.

Within three to four years a new generation of ultra long-haul airliners will bring any part of Asia, Africa or North America within non-stop reach of Dublin, thus further diminishing our peripherality. The importance of this cannot be understated. It provides us with yet another challenge to ensure that our goods and services will be able to compete with any in Europe.

In many ways New Zealand is quite similar to Ireland, with a strong reliance on tourism and trade. It has developed markets in Asia with Taiwan, Korea and Japan. We could follow this example. New Zealand has been able to establish, maintain and develop these links largely due to the Boeing 767 aircraft, which could provide opportunities for Ireland also.

In recommending the development of direct links with the Asia-Pacific region I am conscious not just of a need to facilitate those who wish to market Ireland abroad, but particularly those who wish to make direct flights here.

The success of the International Financial Services Centre makes it all the more urgent for Ireland to be as accessible as possible for business travellers. By feeding into major hubs such as Singapore, Hong Kong or Seoul, most areas of the Asia-Pacific region will be directly accessible from Ireland as, indeed, will the hugely important Australian tourist market. Australia is becoming to us what America was in the 1960s. Young Irish people who have put down roots there, are for the most part earning good salaries and have reasonable spending power. Distance is of decreasing importance and, over the next few years, more direct routings and fewer stopover costs will allow Ireland to become even more competitive in attracting passengers on these routes.

In developing new tourist markets, Bord Fáilte has aggressively pursued the Japanese golfer for whom Ireland offers the dream vacation. Unlike ourselves, however, the Japanese tend to take short vacations and so a more direct route to Ireland would make the golf courses here more attractive to them.

As is the case with European travellers flying to Asia-Australia, many Asian-Australian travellers like to take in as much of Europe as possible during their vacations. Unfortunately, however, Ireland is offered at the tail end of many tours and thus, because of the inevitable overrun in holiday budgets or the sheer exhaustion from travel, we tend to gain little from such tourists. The availability of a direct link from Asia would allow them visit Ireland first which would maximise revenue potential.

Many people would point to Heathrow as being the obvious link between Ireland and the rest of the world. I claim, however, that reliance on travel via Heathrow is a source of major concern. Heathrow is becoming steadily more crowded with terminal, runway and aircraft capacity constraints. As airlines find they have less difficulty in filling their current capacity, the Irish market may well find itself squeezed out. That poses a challenge to Aer Lingus to ensure that we are not dependent on Heathrow.

It is already known that there will be no larger aircraft than those currently available until 2001 at the earliest, and it is unlikely that terminal 5 will be opened until the year 2005. We face a considerable risk, therefore, of our potential being frustrated unless we can take advantage of the newest technology. We could pass the burden to Amsterdam or to Frankfurt but this only delays the inevitable. We have much stronger growth which makes new direct flights possible not only to the Far East but also to Canada and different parts of the United States.

The need to develop new routes outside the European Union is particularly important given the EU's apparent determination to end duty free with potentially serious consequences for Ireland. This issue is one of the most serious facing Irish aviation and the Government must ensure that every opportunity is taken to oppose its abolition.

The duty on tax free shopping was another of Ireland's major contributions to the development of airports throughout the world. It started in Ireland 50 years ago and has developed into one of the most successful and dynamic industries of the EU. The current yearly turnover is over £4.5 billion of which over £100 million is in Ireland. This is important not just in the context of airports and air travel but also in relation to the ports as more than six million people each year enjoy duty and tax free shopping in Irish outlets alone which has a positive effect on revenue and job creation. It is estimated that duty and tax free shopping directly creates approximately 2,000 jobs in Ireland and is a significant factor in keeping down the cost of air and sea travel.

The constituency of Dún Laoghaire, which I represent, is one of the beneficiaries of the tourism industry generated and supported by duty and tax free shopping. Through Dún Laoghaire alone, approximately 10 per cent of the annual passenger turnover is day visitors. That is between 150,000 and 170,000 passengers per year. Many of those take full advantage of the duty and tax free shopping on the outward and homeward journeys and it is certainly an incentive for some of those travelling. The money generated for the local economy in the shops and restaurants cannot be underestimated and it makes a valuable contribution in maintaining the thriving town of Dún Laoghaire.

The ongoing drive to develop the tourism of the area and to attract visitors to stay in the immediate vicinity rather than travel into Dublin would be hindered by the removal of duty free. Indeed the purchase of the HSS, the fastest of its type in the world, was possible because of the reinvestment of profits from the duty free industry. A country such as ours, which no longer has a shipping line, should do everything it can to encourage the development and upgrading of its sea and air links. Revenue from sources such as duty free shopping plays a valuable role in this regard.

From the consumer's point of view duty and tax free shopping should provide a first class international showcase for quality Irish products. They are important export channels opening many new markets for Irish manufacturers at low cost. All of us have made purchases which perhaps we would not otherwise have made, simply because of the tax free incentive. This industry which directly generates over 140,000 jobs in the EU and almost 2,000 in Ireland should not be abolished, particularly in a climate where employment and unemployment are constantly to the forefront of public debate.

Aer Rianta has an advantage in having a wide network of partner airports and duty free operators around the world, in places such as Bahrain, Hong Kong, Moscow and Kuwait. It is vital this purchasing power is used to ensure that the effect of the EU policy, if it is enforced, is minimised. The Government should strongly oppose any attempt to end duty free shopping and at least should press for an opt out clause for Ireland. If all else fails, the Government should at least seek to ensure that passengers whose final destination is outside the EU, for example, a passenger travelling from Dublin to Tokyo via Amsterdam, should be allowed to take advantage of duty free shopping in Dublin.

The success of the celtic tiger and the promotion of Ireland as a major player in the world economy can be assisted by the continuous development of air navigation routes. New markets are constantly being developed to which we must have access. Our growth potential should not be held back by the cost of flying through Heathrow or the risk of being caught in a capacity crunch in that airport. We must respond to the challenge of developing a niche in new markets, such as the Asia-Pacific market, and investigate the introduction of a service to a major Asian hub. The increased visibility of Ireland throughout the region will be enhanced.

The availability of competitively priced direct travel will be crucial in making Ireland an attractive tourist destination and an effective exporter. The Aer Lingus of today could be the Brendan the Navigator of tomorrow.

I compliment Aer Rianta on the management of its portfolio. I congratulate it on its significant growth which can be seen in the throughput of passengers in our airports and in the capital investment undertaken by the company.

When one looks at the growth of Aer Rianta one tends to concentrate on the success of its airports. However, I wish to refer to the excellent development of the hotels sector of the company. Many will remember the financial difficulties experienced by the Great Southern hotel group a few years ago. The group was taken over by Aer Rianta and, having been regenerated and refocused, it has become extremely successful and is making a significant impact in the tourism sector. This shining achievement should not be forgotten and praise should be offered to the personnel involved. In this context I compliment Derek Keogh, who is due to retire from Aer Rianta, on his innovative, progressive and far-sighted approach in spearheading the massive expansion which took place during his time at the helm.

I will take the opportunity in the short time available to me to focus on the Cork scene. In discussing this Bill one must have regard to the opportunities available to Aer Rianta as a stand alone company which must look after its own interests. One must recognise the impact this will have on the three major international airports under its aegis. Therefore, I will speak for some time on the subject of Cork Airport which has been excellently managed over the years. One of its significant features is that it has been operated like a family concern by the staff. It is beautifully designed and the restructuring and additions made to it have enhanced it. It is a well designed, environmentally friendly, homely, welcoming and efficient airport. I congratulate the staff and management and I wish Barry Roche, the airport general manager, well in his imminent retirement. I thank him on behalf of the people of Cork for the excellent way in which he has managed the airport and increased passenger numbers from 400,000 in 1987 to 1.3 million this year. When one considers this is on a par with Shannon, one can see the potential which exists for Cork Airport.

While everyone welcomes Aer Rianta being given autonomy, we in Cork will be wary because there are serious issues involved for us. There is a line of thought which states this Bill will have major consequences for the development of the airport which is one of the fastest growing airports in the country and has trebled in size in ten years. Current profits are roughly £2.5 million. It is alarming for us that those are derived exclusively from duty free sales. With the abolition of duty free sales, Cork Airport faces a real dilemma in terms of its potential growth and the earmarked investment of £30 million over the next few years. Where will this airport find funding with the loss of duty free sales? Shannon receives a £2 million marketing budget each year whereas Cork receives £500,000, although both have the same number of passengers. Aer Rianta and the Minister should examine this to see if Cork is faring well in terms of a marketing budget, especially in terms of future developments and their implications for the airport.

While one must commend the Minister and the Government for their efforts to ensure duty free sales remain, any comparison between Dublin, Shannon and Cork airports shows a significant difference in that the first two are involved in long haul business. They have transatlantic routes and other routes into south east Asia and other faraway destinations. Therefore, duty free sales will be maintained in those airports. Cork Airport only caters for domestic or European flights. Effectively, while one is not clearing the slate in Dublin and Shannon the removal of duty free sales will eradicate Cork's profit margin. It does not auger well for Cork that £500,000 is being taken from that profit and put into a marketing budget. The economics department in UCC conducted a study which sets out the massive impact which the loss of duty free sales will have on the region in terms of cash turnover and employment.

I welcome the Bill and the autonomy it gives to Aer Rianta. However, we in Cork urge the Minister and Aer Rianta to look again at the situation in Cork. If we cannot retain duty free sales or obtain a derogation then a special case must be made for Cork Airport which does not have transatlantic flights as has Dublin and Shannon. We exhort the Minister to examine this possibility as flights from Cork are to European and internal destinations rather than further afield. A possible solution is for Aer Rianta to examine its policy over the next two years and instead of taking £2.5 million back into its coffers to enhance its profit margin it should leave the money in Cork to fund necessary capital projects.

As a result of this Bill, Cork Airport will for the first time face commercial rates between £500,000 and £1 million. This will further exacerbate the situation. The Bill will also require Aer Rianta to pay a capital sum to the State on the transfer of assets. If duty free is removed and commercial rates are imposed in Cork it will result in an operating difficulty for the airport which must be alleviated. The Minister should look again at the situation involving the transfer of assets and the requirement for Aer Rianta to return funds to the Exchequer. A derogation should be put in place for Cork Airport.

I commend Aer Lingus's decision to begin direct flights from Cork to Amsterdam from next year. There is only one flight from Cork to Dublin on Sunday and this creates difficulties for business people and commuters trying to make connecting flights to European and transatlantic destinations. It does not suggest the second city is operating properly. Aer Lingus is providing an appalling service for commuters travelling in and out of Cork.

It is impossible, for instance, to get from Cork to European cities via Dublin or London until the early afternoon. A one day trip between European cities for people living in Dublin or Shannon could take Cork commuters two days. Anybody in business will say that such losses of time cannot be afforded. It is inefficient, not cost-effective and impacts on the profitability of companies.

Two out of three industrial jobs in the south-west region are dependent on exports. Companies need efficient services to get to their marketplace, particularly those in Europe which account for almost half the country's export earnings. Cork's competitiveness in the international market and the further development of industry, commerce and tourism in the south-west region generally is being seriously hampered by a completely inadequate Aer Lingus dominated air service. We, in Cork, feel badly let down.

The trip to Brussels normally takes four hours and the trip to Frankfurt and Dusseldorf takes six and a half hours and five hours respectively. As a result of meeting representatives of Aer Lingus on several occasions, whether with the chamber of commerce or other interested groups, we were given a 6.30 a.m. flight from Cork to Dublin. Unfortunately, that flight does not allow business people to make connecting flights to Europe and this is having a serious impact.

We are also totally dissatisfied with the cost of flights from Cork which are extremely high by international standards. For instance, an Aer Lingus business class fare from Cork to London is £300 while a comparable Ryanair Cork-London fare is £169.

Dublin's industrial development is at saturation point while Cork has major land banks available and skilled staff. We feel Cork should be pinpointed as a prime large-scale project destination. It is important that Cork has the kind of air services which would enhance the prospects of achieving this.

Two further points are worth making. First, as a member of the Committee of Public Accounts during the term of the last Dáil, and in view of the stricture put on Aer Rianta in this Bill with regard to the borrowing requirement, last year I went to the trouble of looking at the debt in semi-State companies and it is staggering. It amounts to in excess of £5.5 billion. That is a cause of concern because almost half of it is guaranteed by the State. In fact, the overall level of State guarantee to the semi-State sector is in the region of 63 per cent. My difficulty with this investment and debt relates to the fact that the Exchequer saw fit to establish the National Treasury Management Agency to manage a national debt of about £28 billion. The agency was able to effect a saving of £35 million in the first year of operations, £75 million in the second and £57 million in the third.

The experience, expertise and skill in managing money of the people working in the NTMA has reaped great benefits in managing the national debt. Does it not appear prudent that the State and semi-State bodies should be grouped together under the umbrella of the National Treasury Management Agency? While this may not be pertinent to the Department of Public Enterprise, the Minister should raise the matter with the Minister for Finance and the Government when considering the management of indebtedness portfolios in the semi-State sector. The National Treasury Management Act, 1992, which set up the agency, provides that the Minister will, as she considers appropriate, consult it on the general approach to borrowings of semi-State bodies. Given that, is it not strange that the previous Government did not refer this to the NTMA? I ask this Government to do so to ensure that effective savings can be made, as has been done with the national debt. I strongly urge the Minister to look carefully at this and to reflect on it with her colleagues to ensure something worthwhile is done.

All speakers have said that while worker directors are on the main board they are not on the boards of the subsidiaries. To be parochial again, since Cork is the smallest airport it has never had the opportunity to have a worker director voted on to the board. While we cannot have a worker director, it is important that a Cork-based director should be on the Aer Rianta board. I urge the Minister to appoint one.

The employees' share option has been mentioned by other speakers. That process has been followed in both Aer Lingus and Telecom Éireann. In terms of an airport's operational efficiency, if workers become more involved, they take a greater interest in the company and feel they have a bigger stake in it. That will have a massive impact on company morale and on the efficiency and effectiveness of the workforce. The Minister has indicated she may look at this on Committee Stage. When we considered the debacle of the Telecom deal in Opposition, we were highly critical of the previous Government's handling of the employee share option. Now that we are in Government we should provide for it in this Bill. The Aer Lingus chief executive stated in a report that the employee share option was one of the most meaningful steps it had taken to achieve co-operation and commitment between management and staff. We have an opportunity to put this in place within Aer Rianta and I strongly urge that we give it favourable consideration.

I welcome this Bill because it will give Aer Rianta semi-State status which will allow it to develop and progress with some freedom. However, the element of the Bill which concerns me is the proposed abolition of duty and tax free sales in 1999. At a time when tourism is increasing it is difficult to imagine doing away with duty and tax free facilities for Aer Rianta and Aer Lingus customers. Why should we do away with them? The duty and tax free shops at airports are mini trade fairs which provide a showcase for the best of Irish products. There is no better way of displaying expert Irish craftsmanship in jewellery, woollens, glass and linen.

The abolition of duty and tax free sales would threaten directly 200 jobs in Aer Rianta and indirectly 2,000 jobs in Irish industry. Aer Rianta would lose approximately £30 million net annually. The original decision of the Council of Finance Ministers in 1991 was taken without a clear assessment of the social and economic implications. The EU member states and the Commission should review that decision.

Holidaymakers will have to dig deeper into their wallets to pay more for their holidays to compensate for the loss of duty and tax free sales. At a time when tourism is promoted as an important European industry, holidaymakers will choose alternative non-European routes and resorts. Passengers travelling from one EU member state to another account for 70 per cent of EU duty and tax free sales. Irish duty and tax free sales per head of population are the fourth highest in the EU.

These sales are highly profitable. Operators use a portion of the profits to contain the costs of service provision, keeping charges and fares low. Ireland is the only EU member state without a land link to the Continent. Over the past decade Ireland has experienced growth in tourism and the reduction in access fares has played a key part in initiating and consolidating the tourism drive. The abolition of duty and tax free sales would halt and reverse reductions in access fares and would make future expansion in tourism more difficult.

Intra-EU duty and tax free sales are a major profit centre for transport operations. The loss of such sales after 1999 would significantly depress operator profitability. A recent study shows that the principal Irish operators consider that the loss of intra-EU duty and tax free sales would cut operating profitability by £64 million in 1996 terms. In response to the ending of duty and tax free sales transport operators have indicated that they would seek to compensate partially for the lost profits by introducing cost effectiveness measures, increasing the range and scale of tax paid retailing, seeking new sources of business outside Ireland and raising customer charges and fares.

Passenger fares and freight rates to and from Ireland would rise as a result of the loss of duty and tax free sales. Increases in charges and fares would be sizeable. Aer Rianta estimates that after the introduction of cost effectiveness and rationalisation measures it would need to increase its fares by 50 per cent in order to restore profitability to pre-abolition levels. Fares on sea routes between Ireland and the UK would increase by up to 20 per cent with smaller increases on routes between Ireland and continental Europe. Airports, ferries and airlines, all of which will suffer a sharp fall in profitability, would be immediately worse off from the abolition of duty free sales. Passengers travelling between Ireland and other EU countries would also be worse off as they would face higher fares and would no longer enjoy access to duty free shopping. Irish exporters to the EU would face higher freight charges for shipping goods to the UK and continental markets because, unlike exporters in other EU states, they would be unable to avoid the increased charges by substituting road or rail deliveries for shipping due to the absence of a land-bridge with Europe.

Nobody will benefit from the abolition of duty free. Everybody will lose, including companies, customers and workers. Why should we agree to this measure? I strongly urge the Minister to review this issue and rescind the decision. If it is proceeded with it will be a disaster for workers and holidaymakers. Also affected will be suppliers and small operators who provide goods to Aer Rianta. Airports which rely on inter-EU traffic will be particularly vulnerable, including the small regional airports which stand to lose most and where jobs will be lost. It is estimated that ticket prices will rise, holidays will be more expensive and EU destinations will lose out to third countries as holidaymakers will go to other resorts.

I am delighted to have the opportunity to contribute to this debate. I am particularly interested in the Bill because I spent nine happy years between 1970-79 working in the air traffic control service in Dublin Airport. Subsequently I spent six months training in Cork Airport.

This Bill may not have much significance for my constituency, Laoighis-Offaly, although there is room for the development of a regional airport in the constituency. Nevertheless, having worked in the business I have maintained an interest in its development. While dealing with this Bill one must consider the involvement of the major players in the airports, namely, Aer Rianta, Aer Lingus and the air traffic control service. Since its foundation Aer Lingus has not only established itself as a safe and reliable airline but has brought pride to the country. It has made a name for itself as a major pilot training airline as well as in training aircraft mechanics, cabin crew and other personnel. In this process it has earned substantial revenue for the State.

The Bill will have no direct impact on the air traffic control services. Nevertheless, continued investment by Aer Rianta in areas associated with air traffic will ensure continuous increases in air traffic and thereby increases in airport revenue. The air traffic control service has seen tremendous improvements since I worked in it in the 1970s. Control of air traffic was then dependent on primary radar. Now the most modern secondary surveillance radar operates at our international airports. Air traffic control at Dublin Airport is housed in its own complex, with a modern state of the art control centre and a new control tower built during the late 1980s.

The 1980s also saw change in personnel in the air traffic control service with the intake of the first female air traffic controllers. The service has gone from strength to strength over the years. I am proud that the Irish air traffic control personnel have a safety record second to none. Investment by way of facilities and equipment should continue and every support should be given to the service to maintain its high safety standards.

There is scope to expand the service and, in so doing, create extra jobs and, by natural extension, extra revenue. I would like to see the provision of air traffic control off north-west Donegal by the Irish Air Traffic Control Service. I understand negotiations are proceeding at present, but currently in this region air traffic control is provided procedurally by the UK services. The Irish radar station at Duncarton could provide radar services. This would mean jobs for the Irish Air Traffic Control Service as well as more revenue and reduced user charges. The professional standards set by the Irish Air Traffic Control Service will ensure that safe practice in air traffic control is maintained by the Irish Aviation Authority, the semi-State body responsible for air traffic control services in the State.

I welcome this Bill and congratulate the Minister for Public Enterprise, Deputy Mary O'Rourke, on bringing it before the House. Airports have come a long way over the past 20 years. The new terminals are efficient and customer friendly. In the past ten years particularly there has been a tremendous level of investment which was needed to cater for the increasing numbers travelling. Passenger numbers in 1970 were of the order of two to three million. Today they are close to nine million. Aer Rianta must continue upgrading and developing airports to provide the best level of service. The Minister recognised this when she said in her introductory speech that one of the major tasks facing Aer Rianta in the medium term will be the financing of airport development. This Bill, by transferring certain powers to Aer Rianta, will allow Aer Rianta a hands on approach in meeting the demands of the future.

Support must also continue for Aer Rianta by fighting to safeguard the revenue created by duty free sales. Any decisions which impact on duty free sales will increase the threat of job losses. Duty free means 1,000 jobs a year or 40 per cent of the revenue coming into Aer Rianta. The loss of revenue from duty free sales would force Aer Rianta to increase charges elsewhere. Losses would have to be compensated for by an increase in landing charges which would, in turn, be passed on by the airlines to the public. In the case of Aer Lingus the loss of revenue would mean an increase in the air ticket cost. It is important for Aer Rianta that costs be kept down by maintaining all areas of revenue. Hence the importance of duty free sales.

I wish Aer Rianta well as it prepares to embark on its own. However, I would like to see the company address other issues at Dublin Airport. For instance, competition will have to open up within the airport itself in order to reduce costs which are often passed on to other companies operating on tight budgets within the airport itself. I refer specifically to security costs to other agencies such as TEAM Aer Lingus, the rates on shops, offices and workshops and car parking costs. Now is the time for an assessment of how to achieve efficiency in costs of services by Aer Rianta. I would also like to see infrastructural investment within the airport. I would like the company examine in time the possibility of an exit traffic route separate from the entrance. I often wonder about the fact that only one bank offers a service in the airport. Competition in this area should be allowed and encouraged.

Aer Rianta should allow competition within airports but it will have to continue to make investments, particularly at Dublin Airport. For example, it should provide more taxiways to serve runway 28 as soon as possible as that would allow high speed turnoffs after landing and reduce separation for landing traffic to three miles rather than the current five mile limit. This would lead to increased landing efficiency and, by extension, increased airport efficiency.

Air traffic at Dublin Airport is increasing at the rate of 9 per cent per year. I understand there is a proposal to have a parallel runway to runway 28 open in the year 2010. Some people's opinion is that this is too far in the future because latest reports show that significant delays will develop at that rate of traffic increase in the next few years. It is essential that Aer Rianta caters for increasing air traffic by providing the new runway as soon as possible.

As a former employee of the airport I have a number of concerns about section 32 which refers to pensions and superannuation. At present, staff in Aer Lingus and Aer Rianta contribute to the Irish aviation and general superannuation scheme for pension and superannuation benefits. Two thirds of the membership of the scheme are Aer Lingus employees. These participants are members of the Irish Airline Pilots' Association and general employees and the scheme has been generally beneficial to date, mainly because of the economies of scale which operate. However, the Bill states that the company may prepare a scheme for the granting of superannuation benefits to or in respect of employees of the company and its subsidiaries. While I understand any proposed new scheme must be laid before both Houses of the Oireachtas, if such a scheme was proposed and agreed and employees transferred to it, the previous economies of scale would not apply. The net losers would be the Aer Lingus employees who make up two thirds of the scheme.

I am also concerned about the proposal in section 32 that if a dispute regarding a claim for superannuation benefit under a new scheme arises, it shall be submitted to the Minister who shall refer it in turn to the Minister for Finance for determination by him. There is a dichotomy in this area; the Bill provides for the transfer of certain functions from the Minister to Aer Rianta but certain responsibilities will be transferred back to the Minister. The usual position is that pension disputes are referred to trustees of the pension fund. I have a number of misgivings about the section but overall I am pleased with the Bill which will further the development of our international airports. I subscribe to the theory that the infrastructural development of the airports will in turn bring about a consistent increase in passenger traffic. The obvious extension of this is increased revenue. I wish Aer Rianta well as it progresses on this latest stage of its journey.

In addition to the three airports run by the commercial semi-State enterprise, regional airports service areas not catered for directly by Aer Rianta. There is also a handful of airstrips around the country and on the islands which require investment. The regional airports include those at Kerry, Galway, Knock and Sligo. A common interest is that if their businesses are successful, it builds up the infrastructural assets of the nation, which is important. They also need to develop their services as an integral part of the regional economies. The integration of regional airports in partnership with the three main airports run by Aer Rianta is most important.

Regional airports face difficulties from the dominance of Aer Rianta in the overall market for landing space in Ireland. There is a huge need to compete in price sensitive markets but at the same time to build critical mass. They also have much in common with facilities in Northern Ireland. The success of each regional airport has been in terms of traffic, volume, range of business and profitability, and individual airports have had to cope with demand. The business of running airports is not one where success is easily achieved, let alone guaranteed. It is becoming more difficult to run regional airports because it was decided to establish them privately, and though substantial private capital has funded them, the EU, the Exchequer and local Chambers of Commerce have played key roles at various times in the development of these airports.

Since the infrastructural development of each region, business interests have been concerned that there is a well-founded reason for Government to encourage the success of private regional airports. It is important that these airports be incorporated in the development of Aer Rianta's role. The success of these airports often depends on State decisions to subsidise capital funding of them; at present they are very underfunded. The special funding and special tax relief enterprise areas which have been successful on the east coast must be applied to the development of regional airports. As the three main airports grow, regional airports play a major role in the success of the airport business. The provision of a special tax relief enterprise area addressed specifically at attracting manufacturing industry and internationally traded services, which have hitherto been established mainly on the east coast and in large cities, is very important. It would be a valuable response by Government to population losses and unemployment problems of areas served by regional airports.

The social and economic position of these regional airports depends on greater support being given to them. A survey of Connacht and Donegal funded by the EU and the Department of Finance in February 1994 spoke of the west being in crisis. The scale of the problem was so great, and the need for action so urgent, that the resolution of the crisis demanded a major partnership between all concerned. One indication of the problem related to population loss: the report stated that if current migration trends continued, the region stood to lose 110,000 people, or one fifth of its total population, in the coming 20 years. It was also pointed out that a further aspect of population loss was the disappearance of large numbers of households and incomes from remote areas where those who remained were old or unmarried. A high level task force set up by the last Government to examine and advise on this issue had a deadline of two months to report. It found that among the issues identified in the industrial section was the continued development and creation of industry in the west, ensuring small business industry would form a central part of economic and employment policy in the west. It also recommended the continued promotion of the west through IDA Ireland for mobile investment and the increased development of existing foreign-owned manufacturing and internationally traded projects and their link to major firms in the west.

This task force recommended that the designated status of the airports for industrial grant purposes be maintained and promoted as appropriate. Its aim should be to attract mobile investment and the existing base of foreign-owned manufacturing and internationally traded projects should continue to be vigorously promoted. The promotion of airports is important to the development of the country.

There is a regional airport in Sligo, and its success depends on the tax designated status it is seeking. That status, the request for capital funding and passenger movement are three crucial criteria for the success of a regional airport. I hope there will not be any difficulty with the EU's query on the granting of tax designation status for regional airports because it would result in major losses in peripheral areas.

On the essential air service programme, I believe Aer Lingus has put out to tender a three year contract starting in January. Aer Lingus operates all three routes at present but it is not clear what will happen when the new contract commences in January. Ireland Airways was awarded the Sligo route earlier this year but failed to honour this contract. It is envisaged that at least three airlines will bid for the service but at present there is little clarification on the new contract for Sligo, although it has been stipulated that two flights be provided each day in summer and one in winter. Kerry has two round trips daily and Galway has been successful in getting a third flight. Sligo has only one round trip at present, which is a major disadvantage to the growth of Sligo Airport.

I would like to highlight duty free facilities, the removal of which would be a major loss. Being in the trade, I know duty free is a major advantage to those travelling aboard by air. In the European context, it will be difficult to reach the right decision on duty free. It will take a number of years to evaluate the impact of the removal of duty free.

Sligo has high levels of unemployment in both urban and rural areas, one of the highest age dependency ratios, a growing number of long-term unemployed, a high level of lone parents and early school leavers. Continuing migration from rural to urban areas will result in a loss of services. Tax designation status to areas adjacent to regional airports would create a huge potential for jobs.

The Government, when in Opposition, promised it would introduce the first regional airports development Bill. Chartering the future of the regional airports, special tax designation status for Knock Airport to create a north Connacht enterprise zone and a study on extending the status to other regional airports are important for the overall growth of airports.

Legislation should make it mandatory for the Minister for Public Enterprise to give a seat on the boards of Aer Lingus and Aer Rianta to nominees of regional airports. All those involved in the industry should be on the boards of those companies. Legislation on regional airports would shift the burden of air traffic control to the State because it is a major cost to regional airports. Regional airports, which are privately run, should be exempt from high rates, which are also a major cost factor.

Recognition should be given to the role of regional airports in industrial development which would ensure a better regional distribution of new jobs. The development of regional airports should be legally underpinned. The special business expansion scheme for regional airports should be encouraged because it has huge growth potential. Regional airports should be placed on a statutory footing and marketing and investor funds should receive special tax status to encourage local investment.

I would like more competition in regional airports from other airlines. I do not need to encourage Bord Fáilte to include regional airports in its promotional work. We should provide incentives so that regional airports and local tourism offices co-operate. Sligo has only one flight per day at midday, which is unsuitable for those travelling to Dublin and is a major disincentive. Additional funding should be provided for the development of airports. Regional airports have a major role to play in the industry and the appointment of nominees to the board of Aer Rianta will bring all the airports together under one body. In view of the proposal to abolish the duty free industry this move will have huge advantages.

The capital funding provided by the State to regional airports should be substantially more than 50 per cent. These airports provide a major public service and in ordinary circumstances operational costs cannot be covered by aviationrelated income. It will not be possible in the future for regional airports to raise the required matching funding to maintain infrastructure and to provide the necessary facilities if grant aid is not substantially more than 50 per cent. I agree that regional airports must be run independently and make a profit — if they are to be successful they must be viable — but if they are to expand there must be a comprehensive re-evaluation of the level of State funding given to them.

If, as seems inevitable, duty free is abolished, airports must look at alternative sources of income. As a retailer I am aware that duty does not apply to all the goods sold in duty free shops at airports. However, customers have a perception that all the goods sold are duty free. The duty free industry is a very profitable aspect of Aer Rianta's business and if it is abolished the company must ensure that passengers are made fully aware that there are still advantages to buying goods in its shops.

The infrastructural development of regional airports is very important. The designated status must be viewed as an opportunity not only to develop the potential of Sligo regional airport but also to provide much needed job creation which will benefit all of County Sligo and the north west region. Sligo is the regional capital of the north-west sub-region and its airport services an area of approximately 40 miles, including all of counties Sligo and Leitrim, significant parts of south Donegal, north Roscommon, north Mayo, Cavan and south Fermanagh. The north west sub-region is one of the most disadvantaged areas and is at the extreme periphery of the EU. There is a significant disparity between it and other subregions in terms of unemployment, population losses, levels of average income, urban bases and population density.

The development of the airport is seen as a key factor in seeking to address the social and economic imbalances from which the area suffers. Sligo regional airport already plays a central role in supporting tourism development which is very important. Many of the major industries which have located in the north-west in recent years have indicated that the availability of a regional airport in close proximity to their plant was a key factor in their choice of an industrial location. This bears out the conclusions of an EU network project report on regional airport development which states that airports assist economic development by providing the infrastructure which enhances transport and communications links to other regions and major areas. That is particularly important when the region is on the periphery of Europe. The success of a regional airport is critical for the development and economic success of the whole region.

Since Sligo regional airport was officially opened in 1983, the board has sought every opportunity to maximise the income of the airport from non-aviation sources with a view to maintaining a viable operation, which is difficult for regional airports since they are run on their ability to make a profit. Many airports offering only one flight per day simply provide a service and make little profit. Were it not for the great commitment of the staff of regional airports they would not be as successful. Legislation should be considered to improve regional airports. They have developed extraordinarily well in recent years but much more work can be done. The changes provided for in this Bill, which I welcome, will result in much development of regional airports.

The EU is questioning the designation of certain areas as disadvantaged. The designation of areas adjacent to airports has great advantages for the development of those areas. The Minister should ensure areas, particularly in the west, are so designated. There is a huge airstrip at Knock regional airport and its success very much depends on industrial development adjacent to the airport. The introduction of tax free zones would attract industry to those areas and I strongly recommend the Minister considers that matter in future legislation. The importance of such a development cannot be over-emphasised.

I welcome the development by Aer Rianta of national airports, but it is important a similar effort is put into the development of regional airports to ensure their viability. With the abolition of duty free sales, which would be a major loss, Aer Rianta should concentrate on developing the many other aspects of retail trade at airports.

I welcome the opportunity to speak on this legislation. The main purpose of the Bill is to grant commercial semi-State status to Aer Rianta. It is extraordinary the company has operated so successfully for many years without such legislation although its absence has not affected the good work of its management and staff. The previous speaker spoke about working at the airport. I worked in the cargo freight section of the airport in the late 1960s and 1970s, probably as a client of Aer Rianta. At that time Aer Rianta operated incubator or start-up units and many of the companies with which I shared a corridor were assisted by it and are now major players in the private business world.

I am speaking on the Bill mainly as a Deputy from the north side of Dublin. I appreciate the employment Dublin Airport and its ancillary businesses have created in that area. Dublin Airport is the major employer on the north side. Large numbers of people from middle class areas and local authority estates are managers, blue collar workers, general operatives or caterers at the airport. We have all shared in the growth of Aer Rianta and other companies at the airport.

When I worked at the airport it was difficult to know — perhaps it did not matter to me — whether a person worked for Aer Lingus or Aer Rianta. It was in that era the companies were formally divided. As one specialises in the running of an airline and the other in the running of the airport, there is not the same movement of people from one organisation to the other. In the 1960s many of those who worked in the cargo section moved to the management side of the airport when promoted.

Until the mid-1980s Aer Rianta spent a great deal of money on capital investment to build up the airport and since then, through generating its own profits, it has invested approximately £200 million. The airport facilities are testimony to its great work. Capital projects undertaken by Aer Rianta, since it started to fund its capital programme, include the new major runway and the Pier 2 extension currently being built. The company's record speaks for itself. Some speakers spoke about it as if it did not pay rates or taxes. For many years it has contributed large sums of money to the Exchequer, as well as providing money for investment in the airport.

We talk a great deal about social exclusion and the fact that big companies usually concentrate on profit, with little concern for other aspects of life. Aer Rianta has been aware of its social responsibility to the area surrounding the airport. I refer in particular to Ballymun. Aer Rianta combined with other State agencies, such as the Ballymun partnership, the Ballymun job centre, FÁS and private sector companies, such as AIB, to set up the Skyline Foundation which to date has created 40 to 50 jobs in Ballymun. Those sustainable jobs are in commercially viable businesses in airport related activities and the agencies are working on other ideas. They have done and are continuing to do good work in that direction. At present 50 people from Ballymun are engaged not in part-time courses but in full employment in the Greencaps Operation. The latest commercially based, sustainable enterprise is the flyer bus which brings people from car parks furthest away from the airport to the terminal. The airport has expanded to the extent that some of the car parks are half a mile or more away from the terminal.

The efforts of Aer Rianta to combine with other State agencies to create employment for people in the general hinterland of Dublin Airport, such as Ballymun, is noteworthy. The Bill provides for maintaining Aer Rianta's commercial focus. I would like to think it would never be dominated by pounds shillings and pence and that it will continue to be conscious of the good work to be done in creating employment, such as that generated through the Skyline Foundation.

The main concern is that Irish airports may lose their duty free facility. The revenue generated at Irish airports from duty free sales to inter and intra European travellers represents a far higher percentage of overall duty free revenue than that generated at most other European airports. Nearly 90 per cent of duty free sales at Irish airports are to people travelling to other European states. We are trying to turn Dublin Airport into a European hub, but we must recognise that in airports in London and other places there are many more passengers travelling to the States and other parts of the world.

We are an island nation. I am aware efforts have been made by the Government to change the duty free regulation. We must avoid being sucked into a Brussels decision on this. The position here is different because of the nature of our island State and the destination of practically all passengers leaving Dublin Airport is to European capitals. The position might be different in Shannon where there are more flights to transatlantic destinations. We must win this fight otherwise we will be in deep trouble.

Irish airlines would lose considerable revenue and profits from the abolition of duty free sales. Despite all the good work done by Aer Rianta to try to broaden its ancillary services, the only way to offset the considerable loss of revenue that would result from the abolition of duty free sales would be to increase airport charges but that would result in higher air fares.

Other Deputies may be concerned about airports other than Dublin. Aer Rianta has shared in the growth of tourism in Dublin in recent years. Much of that tourism is due to co-operation between those involved in the tourism business — Aer Rianta, Dublin Tourism, hotels, Aer Lingus and private airlines. Much of the extra business is due to innovative measures designed by Aer Rianta, in particular helping airlines setting up new routes by offering them huge discounts on landing charges.

Dublin has become a major destination for weekend trips. This success may not continue because other European cities are imitating Dublin, which was perhaps not first in the field. London, Paris, Amsterdam and Edinburgh were primary destinations but for the past few years Dublin has been a preferred destination for weekend trips. Aer Rianta has facilitated this by initiating innovative charging systems.

Other Deputies are envious of Dublin's success in tourism. Some people seem to be hankering back to the Shannon stopover even though passenger figures in Shannon have increased since the change in the stopover policy. If figures in Dublin are up 10 or 20 per cent and those in Shannon only 3 or 4 per cent, the answer is not to blame the change and grab something Dublin has. The answer may be for airports and tourism bodies outside Dublin to emulate its success rather than ordering flights arriving at Dublin to go somewhere else. People will go to a destination they find attractive. We should be congratulated if the organisations co-operating in Dublin tourism present themselves in an attractive way. People from Cork, Limerick or wherever should not take from this.

There is concern about the proposed abolition of duty free sales. Duty and tax free sales constitute one of the EU's most successful and dynamic industries. It started in Ireland and Aer Rianta has been to the fore in the business over the years. More than six million people enjoy duty and tax free shopping at Irish outlets each year and for many a visit to the duty free shop is a very important part of their trip. Duty and tax free shopping directly generates over 100,000 jobs in the EU and about 2,000 jobs in Ireland. Duty and tax free sales play a major role in keeping down the cost of air and sea travel. Without them, airport charges and ticket prices could increase by as much as 50 per cent for all travellers, including visitors to Ireland. Low cost airlines would probably be the most seriously affected. If duty and tax free shopping is abolished, the cost of travel to Ireland will increase and this could seriously threaten our tourism business.

Duty and tax free shops provide a first class international showcase for quality Irish products. They are an important export channel as they open many new markets for Irish manufacturers at a low cost. I know the Government is trying to persuade Brussels to change its policy in this regard and that EU Transport Ministers would support such a change. The final decision is with the Council of Finance Ministers. We cannot abolish duty free shopping because its effect on employment on the north side of Dublin would be considerable. It is a different ball game for a European country with a land boundary.

Staff in Aer Rianta should be allowed to buy shares in the company. That seems to be the trend in Aer Lingus and Telecom Éireann. It would be a shame to pass this legislation without giving the staff in Aer Rianta an opportunity to do so.

Some speakers criticised Aer Rianta. The taxpayers helped Aer Rianta to develop and, like all State agencies, it must co-operate with private industry. However, that does not mean it should hand the results of its hard earned efforts to private industry. When I worked at the airport, Aer Rianta co-operated with private industry and many people became major players. However, it is ridiculous to suggest that Aer Rianta should hand over its land. It has a responsibility to ensure its land bank is sufficient for future development. If private industry feels obstacles were placed in its way in recent years, that was due to the lack of drainage facilities at the airport, not the non-co-operation of Aer Rianta. I hope the Government's recent decision to approve in next year's capital programme the money for the new north fringe sewer as well as the opening of the M50 motorway will free up unused land and allow private industry with an interest in general airport ancillary warehousing, custom clearance, etc., to work with Aer Rianta, which will co-operate with private industry in the future, particularly when the new north fringe sewer is in place.

The primary purpose of this Bill is to provide for the termination of the present State airport management arrangements and to set up Aer Rianta as a normal commercial State body. I welcome, in principle, the measures to regularise the current agency position of Aer Rianta and to place it on the same pitch as other semi-State sponsored bodies.

Aer Rianta was set up in 1937 and has managed Dublin Airport since its construction in 1940. It was later responsible for managing Shannon Airport, Cork Airport and other regional airports. The core business of Aer Rianta is the operation and development of the three main airports at Dublin, Cork and Shannon. However, its successful and progressive involvement in other activities, such as hotel ownership and duty free shopping, has assisted Aer Rianta in its success story to date.

The success of Dublin Airport has had a tremendous impact on the continuing progress of the economic and social life of the north side of Dublin. I congratulate all involved on the success of the development to date and their foresight and initiative in planning such facilities. The record shows their confidence in the potential for development of the national and local economy, in particular their commitment to Dublin's north side. The clear commitment and level of investment by Aer Rianta and the State is a crucial element of our transport policy. It has direct importance in strengthening the infrastructure needed for economic development, tourism and industrial export growth.

Last year, Aer Rianta handled almost 12 million passengers and 146 tonnes of material handling freight at its three airports. The growth in both passenger and material handling have stretched capacity to the limit at Dublin Airport. One crucial factor that must be given top priority is the need for a direct fast-track rail link from Dublin Airport to the city centre and the existing transport network.

In recent years, there have been some improvements in the road network to the airport. However, there are still some areas of the north side which do not have the necessary infrastructure to accommodate the escalating traffic demand. Passenger numbers through Dublin Airport have grown every year, with over nine million passengers last year. Airport employees also make daily journeys to and from the airport which operates on a 24-hour basis. Those of us who have visited premier airports in other capital cities will know there is usually a rail link from the airport to an existing transport network. It is time to prioritise the need for such a link to Dublin Airport.

While I welcome the strategic plan to invest £200 million over the next five years, it is important to ensure the necessary structures and public transport services outside the airport campus receive equal investment. Bottlenecks and missing links are a feature of the existing infrastructure in the local communities. Traffic jams and associated traffic problems, such as rat running through residential areas to avoid bottlenecks, are escalating. They cost us dearly in terms of productivity, the disturbance to residential areas and the cost of traffic calming measures.

The current buzzword in the area of transport is "networks". We are led to believe that networks are the arteries of today's marketplace. They are also the life blood of competitiveness. In order to support the continuation of the successful development and competitiveness of Dublin Airport we must target the appropriate structures and networks. One must highlight in that respect the need for a rail link which would not only benefit our generation but also the generations to come.

Duty free sales is the other issue which has been raised recently in regard to Aer Rianta. Duty free sales represent a vital element of Aer Rianta's business and generate huge cashflow and income. Its duty free shops represent a great investment over the years and have created good job opportunities.

Aer Rianta will not be alone in being affected by the banning of duty free sales. The wider dimension must be considered, including the position of the supply companies. I have been contacted by many who will be affected if the EU plan for abolishing duty free shopping after June 1999 is approved. My brother has vividly explained to me the importance of duty free sales to the drinks industry in which he is involved.

The Minister outlined her opposition to the abolition of duty free sales. I congratulate her for lobbying hard and wide on the issue. I understand that the Minister for Finance has commissioned a study into the consequences for Ireland of the abolition of intra-community duty free sales and the Taoiseach has recorded his support for the retention of duty free.

Where do we go from here? The Taoiseach is due to attend an EU Heads of Government summit within the next few weeks. He should obtain an agreement to the retention and future of duty free sales. Ireland should make it clear that it does not wish to participate in their abolition. Most of the speakers in this debate have taken that position.

It has been suggested that we could obtain a derogation order. However, that would leave our position vulnerable. We should not lose sight of the fact that we are a major player in the EU. Ireland has always been constructive and co-operative on EU matters. However, like some of our EU partners we have difficulties on this issue. We can surely be constructive and co-operative, but committed to the retention and future of duty free sales.

We should also not lose sight of the fact that the EU represents the democratically elected Governments of its member states. I hope the Taoiseach takes up my suggestion on seeking agreement at the forthcoming EU summit to the retention and future of duty free sales. His position would be strengthened if he had the written support of all our MEPs. We will closely watch developments in this area.

There has been great co-operation among the workforce at Aer Lingus for the advancement and development of our national airline. The development of TEAM Aer Lingus was sold to the workers as a step in the right direction. Letters of comfort were issued by the then Minister to certain personnel to establish the appropriateness of the development of the company in the overall context of the development of Aer Lingus.

The workers had to embrace radical and difficult changes initiated by the top management. Most of the workers are still there but the top management has gone with big handshakes. Despite the best efforts of the workers the financial future of the company is of grave concern. They have been let down by successive Governments and left to carry the can through thick and thin.

The financial problem of Aer Lingus and TEAM Aer Lingus has raised its ugly head periodically. In June 1994 Deputy Quinn, when Minister, said: "TEAM Aer Lingus is faced with a major financial crisis which will lead to the company's closure unless steps are taken to rectify the problem immediately". He went on to use the words "the company will not survive unless. .." This gives us a clear picture of what the employees have had to face. They have repeatedly been asked to accept change, in the interests of the company, necessitated mainly by decisions over which they had no control.

This week I was disappointed when the Ceann Comhairle's office disallowed a question I had tabled to the Minister for Public Enterprise about the letters of comfort signed by the then Minister in which certain undertakings were given to the employees of Aer Lingus who transferred to TEAM Aer Lingus. The Ceann Comhairle's office has decided that it is not a matter for the Dáil. I cannot understand this. It is a matter of deep concern to the employees. I ask you, a Leas-Cheann Comhairle, to investigate the matter and indicate in greater detail why it is not relevant. Your office should obtain copies of the letters of comfort——

I have copies here.

——and explain why I cannot get an answer to my question. I tabled a further question to ask the Minister for Public Enterprise the current financial position of Aer Lingus and TEAM Aer Lingus; the current profit or loss per week of these companies; the cumulative debts; and her views on these matters. The Minister who has approached me about the matter has been more than co-operative. It was the Ceann Comhairle's office which disallowed the question about the letters of comfort. I would appreciate your co-operation, a Leas-Cheann Comhairle, and that of your office in having the matter rectified once and for all.

It is not in order to discuss decisions of the Ceann Comhairle's office in the House. I ask the Deputy not to continue on the subject.

I appreciate that but I am taking the opportunity to ask you to investigate the matter and clarify it for me. I look forward to hearing from you. The matter of Aer Lingus and TEAM Aer Lingus should be revisited with a view to putting in place a clear and unambiguous strategy. Working in co-operation with each other, there is no problem that cannot be overcome by tapping into the spirit and attitude of the workforce, particularly in Aer Lingus and TEAM Aer Lingus. There is no hill we cannot climb. If the House will excuse the pun, there are few heights we cannot reach.

What is needed is the announcement of a clear target whereby workers can clearly see the direction in which the company is moving and understand their present status and the positive strengths and future of the company with sound employment prospects and real job opportunities. I look forward to monitoring the continued success of Aer Rianta. I congratulate the company on its achievements to date, the enhancement of its infrastructure, facilities and services and the continued maintenance, upgrading and enhancement of its airport structures. Last weekend I travelled abroad for a few days and on passing through Dublin Airport I had an opportunity of observing these very considerable improvements generally.

As we approach the festive Christmas season, I want to pay special tribute to those involved in perpetuating the spirit of that season at the airport for the many thousands of people who avail of the holiday to travel abroad in addition to the many thousands of our emigrants who return home at that time. It has always offered a warm traditional welcome to all passing through. I congratulate them on their continuing work, particularly all those involved in the delivery of Aer Rianta's routine and ancillary services.

This Bill marks a watershed in the history of Aer Rianta. I want to express my appreciation of its important work over many years which is so important to us as an island nation. As a public representative for Dublin North I am extremely aware of its immense importance to that constituency and look forward to its continuance even though it appears, from a reading of the Bill, the company will have to come to terms with some radical changes.

Before the last general election a considerable number of people employed at Dublin Airport and others generally interested in Aer Rianta inquired whether it was intended the company, or elements within it, would be privatised. From what the Progressive Democrats were saying in the course of the general election campaign, it appeared that if they had any role in the matter the company would certainly travel down that road very quickly. When this Government was formed, with a Department of Public Enterprise replacing the former Department of Transport, Energy and Communications, many people employed at Dublin Airport wondered whether this change did not constitute a first step toward Aer Rianta, and similar companies, being privatised.

Management in particular at Dublin Airport have been eagerly awaiting many changes there, but there is grave disquiet that considerable interest is being paid to private banks on foot of loans and debts incurred by Aer Rianta. The perception that has arisen from the events to which I have referred and the introduction of this Bill must be addressed. The Bill must be amended in several ways to ensure this. For example, the staff of Aer Rianta are seeking representation because the worker-director position does not seem to be in place. I believe they feel that appointing one or two worker-directors would make little difference because it would be a token recognition of the workers' involvement. There must be a realistic involvement of staff in this area. There is also an opportunity to introduce employee shareholding and open it to a significantly large percentage of staff so that their involvement would be meaningful.

Recent evidence indicates that public service pensioners are extremely unhappy because they believe they have been sidelined in respect of the performance of the Celtic tiger. I again draw the Minister's attention to the approximately 2,000 Aer Rianta staff who partake in the aviation pensions scheme, the membership of which also includes employees of Aer Lingus. The Bill does not deal, to any great extent, with their position following its enactment. I call on the Minister to set in motion a proper ballot of the Aer Rianta staff who partake in that pension scheme to permit them decide if they should be part of the new development which will come into play when the Bill is enacted.

The management of Aer Rianta have generally welcomed the Bill. I hope they do so with their eyes open in respect of future changes involving viability. Everyone wants to see such changes continue because the derogation that allowed for lower landing fees was put in place on foot of concerns expressed by Ryanair and Aer Lingus.

The staff and management of Aer Rianta have stated that its duty free shops have been extremely important in cushioning the blow from reductions in landing fees. However, as other Members stated, duty free is under threat. If that threat is not averted there is a possibility that a serious diminution of Aer Rianta's resources will occur, particularly as it is likely to be obliged to pay rates in future. This situation must be resolved before the Bill becomes law. It is too great a factor in Aer Rianta's future operation to be left to the hope, political will, vigour and commitment of the Minister and other members of the Government. I note that the British airport authority is bracing itself for the changes by sanctioning a 15 per cent increase in landing fees. The Financial Times reports that the authority hopes to put in place an internal UK duty free operation. In light of our brave talk about fighting to retain duty free — I hope we succeed in that struggle — the authority seems to be admitting defeat.

The Minister will not need to be reminded that in the past Fianna Fáil seemed quite willing to sanction the demise of duty free sales while under the impression that greater benefits would accrue from endorsing the Maastricht Treaty. It seems now, however, that those benefits will be in the short-term whereas duty free would be a long-term benefit. It is a bit late to change one's mind on the road to Damascus, but I hope the Pauline conversion will be assisted by a miracle in political terms. It would be a help if the Taoiseach was to admit he had been wrong when he allowed duty free to be signed away by the EU.

The Bill should refer to the importance of continuing and improving neighbourly relations between airports and their surrounding hinterlands. The growth in passenger numbers has been a huge factor in increasing profits at airports, but it has also had a negative impact. People living around Dublin Airport have contacted public representatives on the impact of runway development and noise created by engine testing.

I received a letter from Aer Rianta which states the company's intention to implement a range of measures which, I hope, will improve the situation. The company has identified a new location for engine run-ups during the more sensitive hours from 8 p.m. to 9 a.m. Aer Rianta is also engaging in direct negotiations with various airlines and overhaul companies to find a more permanent solution.

During those negotiations I hope the Minister will encourage Aer Rianta to be as interested and active in talking to communities which are close to airports. Such communities have been seeking recognition but their efforts are often thwarted by legislation passed in this House. The Environmental Protection Agency Act, for example, which came into force before I was elected to the House, does not govern airport noise. As a result communities living in the vicinity of Dublin Airport require legislation to protect their interests.

The airport, however, is free to choose to co-operate and, generally, co-operation is completely voluntary.

On the other hand, a private airport such as Farranfore must clear all the hurdles of the planning process by complying with conditions laid down by An Bord Pleanála. It seems to me that Aer Rianta has not been called to account. I give it credit for having co-operated voluntarily with communities to some extent, even though the law does not provide that it must do so and that is a huge failing.

Section 23(1)(c) of the Bill states that the principal objects of the company shall be to provide such facilities, services, accommodation and lands at airports owned or managed by the company for aircraft, passengers, cargo and mail as it considers necessary, The transport requirements of the airport should be included in this section as one of the facilities to be accommodated. Car parking is a huge money spinner for Dublin Airport, but I wonder whether that is being seen as the overriding factor to put off the day when public transport could be provided, as it is in other cities, to cater for increasing passenger numbers. I also wonder if the car is being regarded as the primary means of getting people to the airport.

The bus service to Dublin airport is currently run on a skeleton basis. As well as servicing growing towns like Swords, the buses must also pick up tourists and other passengers at the airport where, unfortunately, the citizenry is forced to depend on public transport. Likewise, tourists coming into the airport in the past with bicycles were directed to the motorway to travel to Dublin, which we all know is illegal. Signs have now been put up in that regard because Aer Rianta's attention has been drawn to the problem. That type of problem should not arise if we have a rounded transport policy which needs to be included in this Bill. There is no rail link to the north side, as mentioned earlier. Aer Rianta could have done more to lobby for that and the Government should have listened more closely to the calls made to include the airport and Swords along that line.

The other facilities that have been talked about do not explicitly include aircraft maintenance which, particularly with regard to TEAM, will be to the forefront of people's minds in the forthcoming by-election in Dublin North. I urge the Government to clear up the confusion and address the matter of the broken promises made to employees at TEAM. The letter of comfort signed by Deputy Seamus Brennan when he was Minister for Tourism and Transport is still in existence. I know this matter has gone to court and has been the subject of intense debate but that letter gives an assurance to existing Aer Lingus employees working in TEAM that they will be recognised as Aer Lingus employees. It is time for those commitments to be honoured.

In the interests of air safety the Minister should address the tendency for employment at TEAM to be increasingly on a short-term contract basis. People with many years of experience now find they are being cast aside in favour of short-term contract employment. Those with many years of experience and expertise should be at the forefront of aircraft maintenance. That applies to management as well as people employed on a contract basis.

The issues raised in the debate so far, whether dealing with duty free, public transport, the rail link, employees' concerns, pensions, etc., pale into insignificance when one reads section 41 which allows the Minister to give a direction in writing to the company requiring it to comply with policy decisions of a general kind made by the Minister in relation to the functions assigned to the company by or under the Act, or to refrain from doing anything to which a function of the company relates, and that the company shall comply with the direction under this section. That is the end of the matter.

The Minister retains considerable power and she should elaborate further on the way that power is to be exercised. Will it be in the interests of the employees to require a ballot to be taken when issues arise relating to pensions, terms of employment or contract employment in sensitive areas such as aircraft maintenance? Will a death knell be sounded when it comes to greater privatisation, and will that be done regardless of whether it is the preferred option or the considered wisdom of the staff and management at Aer Rianta? Will the Minister clarify that because, as matters stand, section 41 will override any of the issues debated here and we need to know if that section will be used to the extent suggested on a first reading of the Bill?

I thank Deputies for their contributions. It was a wide-ranging debate which included contributions from many Deputies, not just from those who live near airports or who represent constituencies in which airports are located. The broad and helpful debate demonstrated a degree of consent for the Bill. Obviously there are matters of conflict to which the last and other speakers, including Government Deputies, alluded. I had hoped to encourage a free ranging debate in which Members could have their say, as is proper for a Second Stage debate.

We are an island nation and airports and those who run and use them are increasingly important. The days when airports were exotic places and those who travelled by airplane were élitest people are thankfully long gone due to competition, charter flights and "bargain" flights. Most citizens now have an opportunity to travel by air so Aer Rianta and its business are important in people's lives. It has been the objective of the company since its establishment, particularly since Derek Keogh assumed control, to have this legislation passed. I inherited the legislation from the previous Administration and I was glad to move forward with it. Members appear to support the measure.

A number of speakers mentioned worker-directors and expressed concern that I might abolish the concept of worker participation in Aer Rianta. I am strongly in favour of such participation. However, there was concern because there are no explicit provisions relating to worker-directors. The Worker Participation (State Enterprises) Act, 1988, provides that onethird of the board of directors of Aer Rianta must be worker-directors. Of a board of nine members, three are elected by the staff under the election procedures in the Act. Nevertheless, Deputy Stagg, Deputy Gilmore, Deputy Higgins and others voiced concern. If reassurance is necessary, I am prepared to look at or put forward an appropriate amendment to copperfasten the position of worker-directors on the board. The term of office of the existing worker-directors is coming to an end and elections are currently taking place to replace them. The term of office of the new worker-directors will commence from 1 January next.

Several Deputies suggested that the chief executive be an ex officio board member. I will reflect on the suggestion. I do not have a hardline ideological position on it. It appears to be the correct option for some boards while it is unsuitable for others. The board is small and I do not favour enlarging it. Nine members are sufficient. Deputy Stagg and I argued about numbers of board members on a previous occasion in the context of Bord Telecom.

Members also mentioned that a prohibition on the Minister for Finance from selling or transferring shares was not included in the scheme of the Bill approved by the last Government. Deputies need not worry that the company could be sold without reference to the House. That will not happen. Deputy Stagg and Deputy Higgins suggested the inclusion of a provision to prohibit the transfer of the State airports into a subsidiary company and the sale of that subsidiary. I will examine the suggestion. I would not countenance a Minister allowing the directors to sell the State airports leaving only a shell company as a way to circumvent this legislation. Deputies will be aware of the Department of Finance guidelines on the corporate governance of State bodies. These are being updated and will deal with matters such as that. Any future Minister should comply with these guidelines.

Deputies also raised the issue of providing for employee shares in the company. The Bill does not address this issue or the issue of privatisation. Its sole purpose is to regularise the status of the company without changing it. It neither rules out nor promises anything on employee shares. This is neither the time nor the vehicle to address that issue. We can examine it at a later date under different legislation.

Much was said about regional airports. The main thrust of the Bill is to end the existing arrangement between Aer Rianta and the State airports. There is little in this Bill about regional airports; what provisions there are relate to safety and security and these apply to all airports. Questions were asked, especially by Deputies Yates and Gerry Reynolds, about whether Aer Rianta would be directed to take over any of the regional airports. The answer to that is a categorical "no" because the regional airports are privately owned and I have no intention of bringing them under State control.

Many Deputies on both sides of the House spoke of duty free sales and our vigorous commitment to retaining them. The Taoiseach will attend the Luxembourg summit on employment in two weeks' time and will raise the issue publicly with the other Heads of State. That will raise the matter to a plane which will give it momentum. Meanwhile, I am working on the issue with my transport colleagues. While I realise the issue has wider implications, I reaffirm my commitment to it.

I thank everyone who spoke on the debate. I am pleased I was able to reintroduce the Bill, although it was mainly the work of the previous Government. I will be open to amendments and I am also thinking of tabling some myself. I look forward to Committee Stage.

Question put and declared carried.

Acting Chairman

When is it proposed to take Committee Stage?

Next Wednesday, with the agreement of the Whips.

Committee Stage ordered for Wednesday, 12 November 1997.