Dáil Éireann díospóireacht -
Thursday, 12 Feb 1998

Vol. 487 No. 2

Aviation Policy: Statements.

Minister for Public Enterprise (Mrs. O'Rourke)

I am delighted we are holding this debate as we should hold it at regular intervals. Deputy Yates and Deputy Stagg will know that there is a good committee dealing with the Department, which has already had much impact on the Air Navigation and Transport Bill. We should embrace these occasions rather than viewing them as something to be endured. I welcome the opportunity to discuss many aspects of aviation policy. The topic is broad so of its nature it will range over many issues. I welcome representatives of Ryanair and the aviation branch of the unions to the Gallery.

I am glad of the opportunity to address the House on aviation policy. I believe the aviation policies of the current Government and its predecessors are coherent and comprehensive and I welcome this opportunity of setting our policy forth clearly. At the outset I pay tribute to the vision and foresight of people like Mr. Brendan O'Regan and Mr. Tim O'Driscoll who were instrumental in laying down the framework for Ireland's air transport industry. They may seem like names from the past but they are still very much around. I know their successors will meet equally well the challenges facing the industry today.

During the course of these remarks I will touch on the major aviation related issues of the day and review the performance of Irish aviation over recent years. Policy is not just an accumulation of specific responses, it is the framework from which the specific actions or responses of Ministers derives. For me, aviation policy has an overriding theme and three main objectives. The theme of aviation policy is competitiveness and that is the unifying theme of my policies in transport, energy and communications. The three main objectives of my aviation policy are: first, to facilitate and encourage as wide a range as possible of reliable, regular and competitive commercial air services for Irish tourism, trade, industry and domestic consumers; second, to ensure that Irish airports are cost effective and have high quality infrastructure to meet the current and prospective needs of the Irish economy; and third and most importantly, to ensure the standards of safety of Irish aviation continue to inspire confidence in the use of Irish airspace and technical infrastructure.

A thriving and vibrant air transport industry, ensuring adequate access to and from Ireland for tourism growth, for the business and commercial life of the country and for the development of our trade and commerce, is clearly crucial. This applies all the more in view of our island position and our greater reliance on air transport relative to other countries for getting goods and services to market. Ireland's economy is showing strong growth with low inflation, increasing employment and related benefits. All this augurs well but it is vital that the air transport industry keeps pace with this development. It has to be recognised that while air transport is a key service to support the economy in general, it has in turn been stimulated by the general buoyancy of the economy.

Aviation in Europe has been going through a period of radical change over the last ten to 15 years. We have been a supporter of this change, knowing that we need increased competitiveness, better access to markets, and all the other factors in which aviation plays a key role. The liberalisation process has contributed to a phenomenal increase in passenger traffic to and from Ireland. Traffic between Ireland and the UK increased from 2.7 million passengers in 1987 to 7.6 million in 1997. In the same period, traffic between Ireland and Europe increased from one million to 3.26 million, while transatlantic traffic increased from 0.6 million to over one million. That is a huge movement of people. Statistics sometimes seem dry but, apart from the air freight sector, the aviation industry is concerned with people numbers and the immense increase tells its own tale. This spans Government of different hues, from a minority Fianna Fáil Government in 1987, through Fianna Fáil-PDs, Fianna Fáil-Labour, Fine Gael-Labour-DL and Fianna Fáil-PDs again. In drawing attention to the passenger increase I am not boasting, I am stating facts regarding the last decade.

Irish airlines and those who work in them have played a major part in contributing to this growth. Aer Lingus and Ryanair, despite being major competitors, have performed extremely well over the last couple of years. Aer Lingus, following a major restructuring plan and significant Exchequer investment, now has a clear commercial mandate and its performance will be gauged against that. Ryanair's growth has been remarkable over the past two to three years, to the extent that it now rivals Aer Lingus in terms of overall passenger numbers and market share on its major routes.

In this regard I am delighted to report that passenger numbers continued their strong growth during 1997. Passenger throughput at the State airports reached an all time high of 13.3 million in 1997, representing a 12 per cent increase on the 1996 figure. Dublin Airport showed the strongest growth with an increase of 14 per cent with Shannon and Cork Airports achieving increases of 5 per cent and 6 per cent respectively. Shannon Airport has also shown a 19 per cent increase in the transit passenger segment.

The question which arises now is whether our aviation industry is alive to and properly adapted to meet the challenges ahead. I argue that it is, no matter how daunting those challenges may seem. The industry is poised to continue to compete and be pre-eminent in the field.

As I indicated, the first of our priorities is to facilitate and encourage as wide a range as possible of reliable, regular and competitive commercial air services for Irish tourism, trade and industry. The free market established within the European economic area responds to this objective. In many cases the possibility of new air services may be remote in the short term but the objective is to ensure that should airlines wish to operate between Ireland and these countries at some time in the future they would be in a position to do so. Finally, the State airports and the regional airports are actively involved on an ongoing basis in marketing their potential and seeking to stimulate growth in traffic.

Traffic growth has been unprecedented and the forecasts in the Operational Programme for Transport 1994 to 1999 fell well short of the mark. An unfortunate by-product of this has been congestion at Dublin Airport. The existing terminal was constructed to cater for six million to seven million passengers per annum but there are now 10 million per annum — just before Christmas a young woman became the ten millionth passenger in 1997 through the airport. However, I am pleased to point out that the situation will be alleviated next month on completion of the first phase of a new departure area, which will provide additional lounges, airbridges and shopping facilities. It will greatly improve passenger facilities and assist the smooth flow of passengers through the airport.

When that project is finished work will commence on the extension of the existing terminal, to be completed by summer 2000. These two major projects — in conjunction with associated ones such as the ongoing expansion of the existing departure lounges, the provision of additional car parking accommodation, changes to the internal road network, upgraded airfield infrastructure and provision of accommodation for low cost airlines — will enable the airport to cope with the demands being placed upon it.

The question of adequate public access to Dublin Airport is a matter of great concern to everyone. I am aware that increasing congestion on road access to the airport is leading to great difficulties. A preliminary study on direct rail access to the airport has been received by my Department and we are currently studying its objectives and financial implications. These works are part of capital investment programmes totalling over £200 million at the three State airports over the years 1996-2001. I have already outlined the programme at Dublin Airport. The main element of the programme at Shannon relates to a major rationalisation and expansion of the passenger terminal, while the programme at Cork consists principally of upgrading both runway and passenger terminal facilities.

A vital element of Aer Rianta's mission is continued cost effective delivery of airport services so that there will be the minimum cost imposition on the movement of passengers and goods. This is vital, given the importance of access to transport to the Irish economy. With this in mind, the basic airport charges levied by Aer Rianta on airlines using the State airports have remained unchanged since 1987. In addition, since 1994 the company has operated a discount scheme in respect of growth in scheduled passenger traffic on existing routes.

However, recent developments in 1997 are even more welcome. A new rolling five year traffic growth incentive scheme at the State airports has been put in place with effect from 1 January 1997. The new incentives, like previous schemes, are designed to stimulate traffic growth on existing routes and attract new services to the State airports. Under the present scheme, airlines at Cork and Shannon airports incur no airport charges on growth and new traffic annually for the following three years and enjoy a 50 per cent discount in years 4 and 5. There are similar incentives at Dublin Airport.

Those schemes will contribute towards keeping access transport costs into and out of Ireland to the minimum. The success of the scheme to date can be seen from the record traffic levels. The scheme was piloted in 1997 and has been rolled forward for 1998. Aer Rianta, to both invest heavily in the State airports and keep its landing charges low, depends crucially on the significant revenues which it earns from duty free sales. That topic has been debated by the House for the past two nights and I will return to it briefly later.

As I said at the beginning, the most important and vital objective is to ensure the safety standards of Irish aviation continue to inspire confidence in the use of Irish airspace and technical infrastructure. Not alone should we ensure our own house is in order but we should also continue to put forward ideas and objectives through international fora to ensure the upholding of safety standards worldwide.

An aviation accident has a far greater impact than accidents on other forms of transport. It is necessary if the industry is to continue to thrive that safety be maintained as a priority issue. The Irish Aviation Authority plays a major role in this regard. International fora, such as the International Civil Aviation Organisation, European Civil Aviation Conference and the European Union, continue to examine safety standards on an ongoing basis to see how they can be improved and modernised. We should not just visit safety issues from time to time, instead they should be a continuing theme in aviation policy.

Transport safety issues unfortunately only come into play when there is a serious mishap, which is followed by another lull when the investigations are over. I know I am speaking to the converted, but those who operate airlines must make safety their number one focus. Regardless of competitive pressures, safety must never be compromised.

I will now turn to the bodies involved in the industry — Aer Lingus, Aer Rianta and the Irish Aviation Authority.

Having successfully undertaken a major restructuring programme in the early 1990s, Aer Lingus has emerged stronger and better positioned to meet the challenges posed by the liberalisation and globalisation of the aviation industry. We all trot out those fine words from time to time but what they mean is that the company will be exposed to full market forces. We would be like King Canute trying to hold back the waves if we were to try to keep ourselves cocooned from those forces. It would be comfortable and cosy if it could be done but it cannot. The aviation industry is subject to those market forces every minute of every working day.

Profits in recent years have demonstrated the extent of the turnaround in the underlying profitability of the company — this from a company which only a few years ago had been faced with the worst financial crisis in its history. Following the successful implementation of the Cahill Plan, the fortunes of the group have been reversed. This resulted in net profits of £15 million and £32 million in 1995 and 1996 respectively. The results for 1997 will soon be available.

Against the backdrop of the many challenges facing the group, however, there is a real risk that unless the commercial imperative adopted under the recovery plan continues it may be unable to control its cost base sufficiently and adapt its commercial strategies. I believe the only way to underpin the future viability of the company is to continue to foster and implement a partnership approach to change in an atmosphere of industrial harmony.

The House will be aware that the board of Aer Lingus has been mandated by the previous rainbow Coalition to explore the possibilities of entering into a major strategic alliance, with or without the transfer of equity, and to submit proposals to me, as Minister, and to the Government. The former Minister, Deputy Dukes, wrote to Bernie Cahill, the chairman of Aer Lingus, in that regard in spring 1997.

While it would be premature today to speculate on the strategic alliance issue, a positive Government decision on an alliance proposal would only be taken where such an alliance is clearly in the best interests of securing the future of the airline, having regard to the needs of all stakeholders, including staff. This approach is entirely consistent with Government policy on the State sector.

The House will recall that when answering questions on the subject of TEAM on 16 December 1997, I stated quite clearly there would be no strategic developments in relation to TEAM without the concurrence of TEAM employees. I wish to state clearly there has been no change in this position.

The House will also be aware that Aer Lingus announced subsequently that it had identified FLS Aerospace as its preferred investor. FLS Aerospace is currently engaged in the due diligence process related to that bid.

Deputies will appreciate that all the issues surrounding the possible sale of TEAM to FLS are currently being addressed by management and employee representatives. The issues are varied and complex and include pensions, salaries, the letters of employment which were issued and current arrangements. Neither I nor the Department have received any formal proposal, as yet, from the board of Aer Lingus on the matter.

Any such proposal is, in the first instance, a matter for the board and any recommendation from the board will be considered politically by the Cabinet on its merits, having regard to the interests of all relevant parties. I have the confidence and accord of my Cabinet colleagues, to whom I report regularly on the issue, in this matter.

It is my strong belief that constructive discussions between both sides, with the assistance of the agreed independent facilitator, with full regard for employee rights as well as the commercial issues, is the way forward. The desire to ensure a long-term viable future for TEAM will be my prime concern in examining any proposal from the board.

We have already spoken about Aer Rianta's investment in the State airports. The Air Navigation and Transport (Amendment) Bill is on Committee Stage. It requires about a further hour's work, which has been scheduled for next Tuesday. Report Stage will then be taken in the House. While the consideration of the Bill has taken longer than any of us thought when we embarked upon it, the refusal by myself and our Opposition colleagues to rush it means important changes have been made to the Bill by amendment — with, perhaps, more to follow — and it will be a better Bill for it.

The change in status will not impact on the State's ownership of Aer Rianta. The primary purpose is to provide for the vesting or transfer of ownership of the State airport lands in the company and the termination of the present agency management; the formal powers, duties and function of the company will be set up. The heads of the Bill were approved by the previous Government and the Bill was published last October. I have told the House how we are proceeding on Committee Stage.

A continuing topic of debate is the future of Shannon Airport. Airlines that wish to operate transatlantic services to Dublin Airport must operate at least an equivalent number of direct services to Shannon over a 12 month period. I have been on record since coming into office of reiterating my commitment to maintaining the status of Shannon. I understand the concerns expressed about the stability of traffic at Shannon and believe we can now look at its future in a more positive manner.

The number of terminal passengers at Shannon increased by 40 per cent between 1992 and 1997. Transatlantic traffic at Shannon grew steadily over this period. Continental Airlines will provide a new service from June. The chairman of Aer Rianta told me early bookings at Continental are strong and that it is pleased with them. The route from Shannon to London-Gatwick carried over 116,000 passengers in 1997, it is planning to introduce a higher frequency to Gatwick in 1998 and a new service to London-Stansted.

The development programme under way at Shannon is based on a 5 per cent annual growth in total traffic from 1.5 million passengers in 1994 to some two million in 1998. Actual traffic results to date are ahead of target. The new terminal at Shannon, unveiled by the former Minister of State, Deputy Stagg, is scheduled for the year 2000 and will have facilities and resources, supported by state of the art technology and management practices.

Recent reports have raised the spectre of the possible withdrawal by Aeroflot of services from Shannon arising primarily from the acquisition by the airline of long range aircraft which do not need to stop at Shannon to refuel. Recently, my officials and I had discussions with Aeroflot officials who assured us there is no imminent plan to leave Shannon. I would be foolish if I did not accept that Aeroflot will continue to look at the economics of its operations because it was spelled out to me. Aeroflot also spelled out to me that it has no immediate plans to leave Shannon.

Airports generally attach far greater importance to terminal traffic which is the important traffic category for tourism. There has been strong growth in Cork in recent years, increasing from 700,000 passengers in 1992 to over 1.2 million in 1997 — up by over 70 per cent in five years. Aer Rianta has plans for Cork. It also has plans for a hotel which it will open shortly in north Dublin at the airport.

Mrs. Owen

We could hold our celebrations there if we win the by-election.

Mrs. O'Rourke

Will Members allow me to mention Dublin North once?

Mr. Stagg

Seán Ryan could hold his celebrations there.

Mrs. O'Rourke

I knew the Deputy would say that. Aer Rianta has also submitted plans for a hotel in Cork where there is no by-election.

I recognise the strong interest by all parties in regional airports to which we referred in our programme for Government. I embarked on a series of meetings with management in the regional airports and I tweaked my colleague, the Minister for Finance, and £2 million of Exchequer funding was forthcoming.

Mrs. Owen

I am conscious of the most wonderful picture of the Minister tweaking the Minister for Finance.

Mrs. O'Rourke

I am sure it could be quite delightful if followed through.

Some £2 million was provided in the Estimate and £3 million in the budget comprising a package of £5 million. Regional airports no longer receive EU money. This Exchequer funding will be available for infrastructural improvements at Donegal, Galway, Knock, Sligo and Waterford. All airports would like more funding but they are embarking on work with the money they have received. The essential air services programme concerns Donegal, Sligo and Kerry airports. This programme is being continued in 1998, 1999 and 2000 with extra flights added, including an extra flight from Galway to Dublin. I hope there will be an extra flight from Farranfore to Dublin.

I refer to other topical issues on the Irish aviation scene. Deputies will be aware of the flotation of Ryanair during 1997 which, from the company's perspective, is on a sound footing. We are all familiar with the current industrial dispute at Dublin Airport between Ryanair and members of its ground handling staff. I take this opportunity to state clearly the views expressed by my colleague, the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Harney, and the Minister of State with responsibility for labour, trade and consumer affairs, Deputy Tom Kitt, that it was disappointing Ryanair did not accept the invitation to attend the Labour Court on this matter.

The Labour Court intervention represented an opportunity to the parties to state their case to an independent third party. We must all acknowledge the impressive record of the Labour Relations Commission and the Labour Court in assisting parties in an industrial dispute to reach a settlement of their differences. I am aware the court intends to keep the matter under review. I urge Ryanair to accept the Labour Court's offer to facilitate the parties in any way possible. With such an eminent chairperson, agreed machinery and the chance to resolve this matter, I repeat my belief that this is the route Ryanair should take.

As the third Irish airline competing in the scheduled services market, I am glad Cityjet, despite an initial bumpy start, has successfully come through a period of examinership and re-established itself.

The duty free issue has exercised our minds in recent days and on Tuesday, 400 people attended a conference in Dublin. On Tuesday and Wednesday nights the House debated this issue. I am glad to announce dates for meetings have finally been arranged. I hope to meet John Prescott at a dinner in London on 23 February and my German counterpart on 3 March. We are only the transport ministers and this matter must go through the Minister for Finance, ECOFIN and the Commission, but the swell should come from the ground up. The Secretary of State, Mr. Prescott, is the chairman of the transport Council of Ministers. The Germans, who face a general election, are important players in Europe. We hope to be able to table a matter for the transport Council of Ministers on 17 March in Brussels so nobody need table a parliamentary question requesting to know where I will be on St. Patrick's Day.

I was sorry the House divided on this issue last night because we are all in favour of the retention of duty free sales given the necessary finances it provides. Although we are talking about aviation, ferry companies stand to lose a large amount of revenue if the abolition of duty free goes ahead. The House will understand that both Germany and Britain play key roles in the EU. Time is short and we must press on with this issue. It is a negation of duty and a promise because the EU has not conducted the European-wide study on this matter which it said it would carry out. This was part of a general taxation measure which has not occurred throughout Europe.

I wish to refer to a number of aviation related EU directives which have a particular social dimension. Recently, an EU directive on arrangements for ground handling service at Community airports was adopted. This issue arose in an amendment tabled by Deputy Yates on the Air Navigation and Transport (Amendment) Bill, 1997. I will shortly make a statutory instrument to give effect to this directive. My officials are continuing to discuss with all the interests concerned, including representatives of the workers' the appropriate arrangements to give effect to this directive. Directives are also being considered by the EU Commission in relation to limitations on flight times for pilots and training and competence requirements for cabin crews. I will ensure the necessary consultation with worker representatives on these proposals.

The Government's aviation policy is based on encouraging competitiveness on the domestic and international fronts, recognising the important role regional airports play in regional development and ensuring the maintenance of the highest standards in terms of aviation safety and security. This policy builds on the policies pursued by previous Governments, all of whom had a strong interest in this area. I am glad of the opportunity to note the phenomenal growth in this sector, the forecasts for the future, the infrastructural changes required, the necessity for increased access to airports, the provision of adequate finance to regional airports and the continuation of subsidised air fares for three years. The management and employees must adopt a partnership approach in dealing with these matters.

Mr. Yates

I welcome the opportunity to debate important aviation issues. I wish to share my time with Deputy Nora Owen who will deal in more detail with the Ryanair dispute. Fine Gael believes the issues in this dispute go beyond aviation policy. I appeal to Ryanair to end the dispute and allow third party arbitration through the Labour Court. If representatives of the airline can discuss the matter on "Today with Pat Kenny" I do not understand why they cannot do this. The issues in the dispute involve more than baggage handling, and Deputy Owen will deal with these and the partnership concept in greater detail.

I will deal principally with TEAM Aer Lingus. I am very critical of the way the proposed sale of the company has been handled by the Minister and the Government. The sale is a matter for them and they will have to decide whether they support or oppose it. The Minister's statement in December, made again today — it was also repeated on her behalf during an Adjournment debate last week — that it would be inappropriate to comment until there is a formal proposal, is evasive and intended to be all things to all people.

She has told the management and board that she favours a pragmatic outcome which will ensure the best long-term security and commercial success for TEAM. This means she does not disagree with them. However, at the same time she has told the employees that the deal will not go ahead without "worker concurrence". She is speaking out of both sides of her mouth: she is telling the management to proceed, while telling the unions that she will give them every comfort. Those positions are mutually exclusive as there will either be a deal or there will not.

Mrs. O'Rourke

Exactly.

Mr. Yates

Whatever happens, one side will be unhappy.

It is truly incredible that the shareholder is so unsure and uncertain about her views that she is neither a proponent nor opponent of the deal. This uncertainty and confusion makes it impossible for commercial negotiations to succeed or for clear industrial relations dialogue to proceed. Some of the unions are not prepared to enter into talks because of the political procedure which arises outside industrial relations dialogue. The unions do not know if they should be negotiating with the Minister or management, given her statement on worker concurrence.

Adding to this disorder is the threat, left in the air, of the withdrawal by the board of Aer Lingus of the £65 million loan to its subsidiary if the deal is rejected. Fears of bankruptcy and subsequent redundancy — Aer Lingus will not require 1,200 workers for its maintenance section — have not been dispelled. When I raised the matter on the Adjournment last week the reply did not deal with whether such a threat existed. The Minister did not refer to the most serious threat facing the workers and I call on her to clarify this issue.

This issue has not been handled adequately or correctly. A strategic business development plan should have formed part of the memorandum of understanding between Aer Lingus and FLS Aerospace. FLS should have put written proposals to the workers and set out its response to specific questions on job security, pension fund entitlements, pay and conditions, specific future individual departments such as ground maintenance, in which FLS has much expertise, individual increments and special entitlements such as sick pay and travel concessions. More clarity is also required on the proposed purchase of or withdrawal from the letters of guarantee previously issued to the staff. The failure to do this has resulted in all allegations being sustainable. In such circumstances it is clearly impossible for the facilitator, Mr. Durkan, Mr. Behan or someone else, to reach a consensus. The Minister should immediately instruct the management of Aer Lingus, in conjunction with FLS Aerospace, to provide this documentation.

Local representatives and party spokespersons have been contacted by workers who have genuine concerns. These workers have agreed to the deferment for 16 months of pay increases under Partnership 2000, the deferment of increments and the loss of benefits. There is uncertainty about the transfer of the pension fund which is currently Government backed. They have raised genuine questions such as whether they will start work with FLS on a day one basis with the loss of holiday entitlements gained through service, whether they will start at the bottom of the pay scale, whether they will be entitled to pay increments, whether FLS will require only licensed mechanics, whether qualifications will be recognised and whether they will be entitled to pay if they get injured or sick. If I was buying a business I would set out for everyone the guarantees I could give and put my cards face up on the table. It is incredible that the Minister expects people to proceed without answers to these questions.

Fine Gael's view on TEAM Aer Lingus starts from the reality that one cannot be all things to all people, which is what the Government is trying to be until after the by-elections. Our strategic objective is to have the maximum level of employment in Dublin Airport and the aviation sector in a decade's time. The aviation sector underpins commercial tourism growth and is a vital part of the access transport system. Aer Lingus and TEAM Aer Lingus are relatively small in global terms in this regard. The most relevant contemporary development in global aviation is the consolidation of massive conglomerates in airline and aviation maintenance business.

I accept that Aer Lingus and TEAM have to look seriously and positively at strategic alliances with other operators, including cross-shareholders. This offers the potential to the airline of an expanded transatlantic network which is limited at present. It also offers stronger resources for marketing capacity, the expansion of opportunities world-wide and a certain security for operational activity which a small regional niche player cannot guarantee. Given that the EU Commission has deemed that the injection of equity by successive Governments of £175 million is to be the last, such an alliance provides a basis for access to future investment capital. I favour circumstances whereby the ownership of TEAM and Aer Lingus should change in its own best interests. In any commercial operation, what is successful for the company is in the best interests of its employees. Acceptance of openness to change, given commercial global sectoral realities, does not result in approval for any proposed deal.

Questions must be raised about FLS Aerospace. While it can be strongly argued that its parent company, based in Denmark and operating successfully around the world, has a long and well established multinational repute, the air maintenance division, FLS Aerospace, is more questionable. I have met FLS, which is to answer various questions I put to it. FLS Industries, a global company, is a substantial worldwide player. FLS Aerospace, however, has specialised in older planes and has not been a world leader. It is a relatively new entrant to the field in terms of scale and its profitability has been questioned. Its current profit and loss position and scale of operation do not fully inspire confidence.

The issue of employee shareholding should be put upfront on the table. I put that to FLS and it said it could not give an ESOP within the aerospace company but it would offer it to the parent company. That should be put on the table as well as the answers to the other questions I raised.

The staff have made sacrifices in the implementation of the Cahill plan and deserve the same right as has been given to other semi-State employees, for example, Telecom Éireann, through an ESOP. The success of any air maintenance business depends on the quality, skills and experience of the management team and staff. Many employees blame the existing management structure for many of the past and present problems. Where is the track record or evidence that FLS Aerospace has the proven level of contracts and profitability to ensure the future success of TEAM?

The letters of understanding seem to be legally watertight. This obstacle to any change in ownership seems to be more a matter for litigation and court clarification than for industrial relations. We must, therefore, expedite legal opinion and provide the subsequent parameters of negotiation. The Government must get off the fence. It should say that it opposes the deal, for whatever valid reasons it wishes to put forward, thereby sacking and replacing management. Management has said that the only alternative to this deal is the path to extinction. It also states in its document, "TEAM cannot survive as it is now".

Alternatively, the Government, as shareholder, can be a proponent and persuader of the deal. At least it should set out its assessment of the implications for Aer Lingus of acceptance or rejection of the deal. It seems the unspoken driving force for the sale of TEAM is that Aer Lingus cannot and will not enter into a strategic alliance while TEAM Aer Lingus remains a subsidiary of the parent company. The Minister must state whether it is the Government's view that that is the starting point for any proposed sale.

I do not expect the Government to dot every "i" and cross every "t" in terms of its view on the FLS deal, but it should say whether it accepts that TEAM should remain in 100 per cent ownership of Aer Lingus and whether it supports the discussions entered into by management of Aer Lingus with three companies, after which it chose one. The basis on which semi-State companies are established is that the Government as shareholder exclusively, with the exception of worker directors, appoints the board which appoints the management to be the best brains in that sector. That has been the case since Sean Lemass's time. If there is to be a new procedure whereby the Minister and the Department are to be the font of all knowledge, why not make that explicitly clear to the board? I cannot understand why, each time this matter is debated, whether on "Morning Ireland" or elsewhere, or there is a report about an incident, the Minister is not aware of it. What is her relationship with the chairman, Mr. Cahill?

Mrs. O'Rourke

We have a very good relationship.

Mr. Yates

I have found him to be a very affable and available man. I would have thought it prudent, given the nature of semi-State board meetings and the fact that there can be leaks from time to time, that the Minister might have a word with Mr. Cahill before those meetings so that she would know what is going on and can give straight answers when they are asked on the national media.

Mrs. O'Rourke

I meet the chairman more often than once a month.

Mr. Yates

I wish to deal with the other issues in the aviation sector. When Deputy John Bruton requested this debate, the Taoiseach, in his usual well prepared, Order of Business sound bite, reeled off statements about growth in aviation, buoyancy and jobs, but did not highlight some of the crucial issues and threats to Irish aviation.

The abolition of duty free facilities will result in a 50 per cent increase in airport charges. It will move us from No. 46 to the top ten in the league table of airport charges for Dublin, Cork and Shannon. The record growth we spoke about occurred over a period when airport charges were frozen. If charges are to be increased by 50 per cent from June of next year, the knock-on effect on airlines will be increased fares and retarded growth as much air travel is leisure related and, therefore, discretionary.

I would be much more concerned about the future of Shannon airport, which seems increasingly vulnerable with the departure of Aeroflot and the lack of a replacement. That, together with the decision by the then Minister, Deputy Cowen, to abolish the Shannon stopover, means the mid-west region requires extensive Government support to market and develop new air traffic.

Mr. Daly

When did the Deputy last visit Shannon?

Mr. Yates

I am well represented in Shannon — I see Deputy Carey in the House — and I get first-hand information. I am pleased to inform the Deputy that I hope to visit that area shortly. His constituency executive is preparing the detailed arrangements for my visit.

Our ten regional airports face increasing difficulty in their air services, which are diminishing, and in containing costs. The abolition of duty free sales may be a fatal blow for some of them. Capital programmes are coming to a halt in many airports, despite Deputy Molloy's stroke that masked the overall under-provision of capital for those airports. Their future is becoming increasingly uncertain and a proper marketing programme is needed for them.

Aer Rianta faces not only the loss of duty free income and, as we debated laboriously, liability for the first time for corporation tax and rates, but double payments in the next 12 months — on vesting day it will pay approximately £14 million for assets and a subsequent annual dividend on the company's resources. That amounts to in excess of £30 million, at a time when duty free facilities are to be abolished. The payment for the transfer of assets on vesting day is illogical, punitive and unfair, first, because the company paid for those developments out of its own resources and, second, the existing owner, the Minister, as shareholder of the company, remains the new owner. For the pleasure of a change of company structure on paper presentation, the Government will raid Aer Rianta for more than £30 million.

I do not share the Minister's sunny and happy disposition about all these issues. At the end of the day decisions must be made about TEAM.

Mrs. O'Rourke

What is the Deputy's policy?

Mr. Yates

It needs a clear sense of direction from the shareholder and the Government in terms of biting the bullet or rejecting the proposal. Sitting on the fence will become so difficult as time goes by that I hope the Government does not fall off it. The position of some workers and of management is "never the twain shall meet". It is irreconcilable and the Government will not be able to straddle that indefinitely. It might succeed with the by-election, but not for much longer. In taking constructive decisions, the Minister will have our support. The success and security of the employees is paramount, as is the national interest. We will support whatever option gives the best security to the aviation sector.

Mrs. O'Rourke

That is my policy.

Mrs. Owen

I thank my colleague, Deputy Yates, for sharing his time with me. I will not repeat the issues raised by the Deputy because I want to concentrate my few minutes on the Ryanair dispute, but suffice to say that the aviation industry is a major industry which provides thousands of jobs, particularly in the Dublin airport and Shannon airport areas.

It is not a cliché to say that if the aviation industry or any of the operations at Dublin Airport catches a cold everybody north of the river Liffey takes Lemsip, Anadin or aspirin to cure it as quickly as possible. We in North Dublin know how dependent we are on the tremendous incomes generated at the airport and for the way in which they permeate all the businesses in the constituency and in the area north of the Liffey.

I thank my colleague, Deputy Yates, for raising some of the continuing difficulties at TEAM Aer Lingus. It is not enough for the Minster to make the odd statement saying she will not intervene. Workers at TEAM want to know if she will fulfil the commitments set out in the relevant letters and if she will honour the commitment that only 49 per cent of the company will be sold. Perhaps they will like her answers. In the meantime, they are working in a vacuum, their lives are in turmoil and they do not know where they will be at any time within the next year. The Government is good at sitting on the fence but it is time for the Minister to get off the fence, otherwise she will need a medicament.

Mrs. O'Rourke

Perhaps that is why the Deputy is on Opposition.

Mrs. Owen

The ongoing dispute at Ryanair is extremely damaging. It is damaging to the young workers in the baggage handling section who do not want to be on work stoppages. They have written to me saying they want to be back at work.

Mrs. O'Rourke

They have also written to me.

Mrs. Owen

It is damaging to the morale of the other trade union members at Dublin Airport because they see fellow workers having to take this kind of action. It is also damaging to the national interest because the implications of the dispute go well beyond the baggage handlers. Article 40.6 of the Constitution guarantees the right of citizens to form associations and unions. That is something we cherish.

The various national partnership agreements over the past ten years have enabled us to enjoy unprecedented industrial peace. This has led to large scale investment, increased prosperity and a huge growth in employment. This has arisen because of the efforts of many thousands of men and women who go to work early in the morning or late at night. Both management and workers have gained from their work output.

Social partnership has been the key to our present prosperity. The dynamic, enlightened leadership of the trade unions under social partnership conditions has helped to change the more traditional stereotype of trade unions when they were seen as opposing management on behalf of workers. Social partnership has worked and we must all guard it carefully because the country will lose if it breaks down.

However, it is under severe strain because of the Ryanair dispute. Like other workers, the baggage handlers have the right to have their point of view put forward by a trade union, in this case SIPTU. They also have the right to have their conditions of work and pay examined. If they want representation they have, at the least, the right to make that case in the structures we as legislators have established to ensure that people have their voices heard. They have the right to go to the Labour Court.

Structures are in place to allow for negotiation and arbitration and Fine Gael has always believed that they should be used, not just by workers but also by management. We support the concept of the voluntary code, which has also been supported by the trade unions. The high level group, which was established under Partnership 2000 and on which the unions are represented, made an interim report last Christmas. It recommended that the voluntary code should be used. The group is due to look again at the concept of a voluntary code because of the Ryanair dispute and the way in which the code is being strained to the limit by Ryanair management. In this regard I am reminded of the wisdom of my colleague, Councillor Philip Jenkinson, one of the first to make a statement on the Ryanair dispute, when he said that the regressive policy of management at Ryanair of refusing to recognise the basic right of workers to have their professional negotiators accepted is wrong for the company and the industry. He went on to say that success must be built on teamwork and a progressive company must adopt a partnership approach in seeking excellence of performance from its workforce. Fine Gael hoped that Ryanair would listen to this advice, however, the company's intransigence is putting at risk the acceptance of the voluntary code.

I am amazed that a company such as Ryanair, which has been innovative and open in the past, is now being so short-sighted and cavalier in its approach to the request of its workers. The company is putting at risk the industrial harmony from which it benefited. The growth of the company can be linked to the growth of the economy. Increased prosperity has enabled more people to spend more money on flying.

On 28 January 1998 the Chief Executive of Ryanair, Mr. O'Leary, wrote to Evelyn Owen saying that since the company had not requested the Labour Relations Commission or the Labour Court to investigate or intervene in the action it would not accept her invitation. One can imagine the horror that would have been expressed if Ryanair had made an appeal to the Labour Court and SIPTU had written to it declining an invitation to attend on the basis that it had not sought a meeting. The company should attend the Labour Court.

In a notice pinned to the staff notice board Mr. O'Leary advised that the company had maintained its silence on this issue, was not stirring up debate and had, therefore, taken the lollipop from SIPTU who had used up all its scare tactics. That is not the kind of message to bring people together. Why did Mr. O'Leary see fit to use megaphone public relations to put the case for Ryanair on the "Pat Kenny Show" on RTE Radio 1? The Labour Court is the venue for that. He attempted to answer some of the issues raised by Paul O'Sullivan of SIPTU on the programme. Why did he not attend the Labour Court to discuss them? Perhaps he is right and maybe there is another argument. However, he should not have used a popular radio show to engage in public debate on issues that are specifically suited to the Labour Court and the Labour Relations Commission. It was a mistake. Mr. O'Sullivan will regret that he uttered his first public statement on the dispute on a popular radio show and not within the established industrial relations structures.

I find it hard to decide who has the right information on this dispute. We are told by management that none of the flights has been cancelled yet two people I know who had flights booked with Ryanair arrived on time for their flight but were told without explanation that they would be flying an hour to an hour and a half late. Their flight was not full and the company brought two or three flights together. When they eventually boarded the flight it was packed. This amounted to a cancellation by another name. Such behaviour is affecting the schedules.

Workers at the company have told me that they have been subject to intimidatory action by the management. Will the Labour Court look into this? Perhaps this is not the case, but these workers consider that they are being browbeaten and put under severe pressure. It is not for us to make judgments on these matters. They should be discussed under the relevant established mechanisms, such as the Labour Court and the Labour Relations Commission.

Ryanair has been a remarkable success in the aviation business. The high cost of flying decreased when the company started to operate. However, it has also been the beneficiary of Government policies and decisions. For example, when the Minister of State at the Department of the Taoiseach, Deputy Séamus Brennan, was Minister for Transport he gave the company exclusive rights to fly to Stansted, a route which Aer Lingus had developed. Aer Lingus was not happy about the decision but it helped Ryanair over a difficult period and allowed the company to stay in the market. As flying passengers we were grateful because it ensured lower air fares. Ryanair has benefited from Government policy and it has an obligation to show that it is willing to listen to its workers. It is time it used the system.

The chief executive gained £17 million when Ryanair was publicly quoted. That figure frightened young workers trying to rear families and pay mortgages from their earnings of between £8,000 and £15,000 a year. They listened to Mr. O'Leary say the company will negotiate with workers over his dead body. However, Ryanair would not exist without baggage handlers and other workers. Mr. O'Leary should wake up and listen.

I appeal to Ryanair management not to allow words such as "coercion" and "mandatory" become part of the language of industrial relations. We will rue the day that happens. We have gained from the social partnership approach, the Labour Relations Commission and Labour Court mechanisms. Guilt will fall on Ryanair's head if the words "mandatory" and "coercion" come back into industrial relations. It would be a bad day for management and trade unions if that happened. The continual refusal of Ryanair to come to the table may be to everybody's detriment and force the reintroduction of concepts in social partnership which we do not want. This side has sympathy with the actions of the Ryanair workers and we call on the management to use the mechanisms available. I hope this dispute can be brought to a speedy conclusion for the betterment not only of the Ryanair workers, but also to better the trade union and social partnership system that has been built up so carefully.

Mr. Stagg

I join the Minister in welcoming Ryanair workers who are in the Public Gallery. I also welcome the debate. The aviation industry is undergoing a period of rapid change and it is proper that it is discussed in the House.

The importance of aviation policy to the overall performance of our economy is growing and will continue to do so in the future. It represents a key component of many of our most important industries. In 1996 alone, eight million people went through Dublin Airport. That is projected to increase to almost 12 million over the next decade or so. However, even that figure, although impressive, hides the significance of aviation policy to trade, particularly our export trade.

Recent developments including the deregulation of the industry have opened up to the ordinary population the possibility of using air transport. The emergence of low cost operators in competition with the more traditional high cost services has increased choice and competition within the industry and the net effect has been a substantial increase in the numbers choosing air transport. The high cost and low cost services complement each other.

Tourism, one of our most important and dynamic industries, has benefited. However, if this industry's impressive growth path is to continue, the evolution of a successful aviation policy is necessary. I welcome the part this debate will play towards arriving at that policy. I again emphasise that the Labour Party strongly supports the development and expansion of the Irish aerospace industry. We are anxious that it is allowed to operate with the maximum commercial freedom commensurate with the interests of those who work in the industry and the consumer who must dictate the future. We are open to examining the best structures to achieve those objectives while maintaining democratic accountability in the House and maximising the social control of the industry.

Key to the success of the aviation industry in recent years has been the improved performance of the flagship company in this field, Aer Lingus. The implementation of the Cahill plan, finally agreed between employers and unions, has been central to making Aer Lingus competitive again. The injection of £175 million of equity at the insistence of my party has allowed Aer Lingus to reposition itself within the market and to retain its market share. In so doing, Aer Lingus was allowed escape the problem of under-capitalisation which was foisted upon it by previous Fianna Fáil led Governments. The company's performance since 1993 has vindicated my party's insistence at that time that this investment must go ahead.

However, if it is to continue to grow, Aer Lingus cannot afford to stand still. Such is the pace of change in the worldwide aviation industry, companies which stand still will ultimately fail. My party has an open mind on the question of a future strategic partner for Aer Lingus. As in the past, we are committed to its success. The Labour Party has been to the fore in recent years in securing viable strategic partners for some of our State companies. Strategic partnership has fundamentally altered the debate about publicly owned companies. The sterile debate about ownership, private versus public, which dominated political discourse in the 1980s and early 1990s, has given way to a more realistic discussion about how best a company can maximise its business and employment through co-operation with other companies on strategic issues.

The debate about strategic alliance has particular significance for Ireland. In a global industry, none of our domestic companies, however large, are capable of being world or even European players. To succeed they need to identify niches in world markets and co-operation with major world players is a key component to this. The Labour Party has no difficulty with a strategic partner for Aer Lingus. However, that partner must be chosen on one criteria only, which is the ability of the strategic partner to assist Aer Lingus to grow. The Exchequer has not been good to Aer Lingus in the past. The search for a strategic partner for Aer Lingus cannot be Exchequer driven.

As we saw with the acquisition of a strategic partner for Telecom Éireann, one of the key components of a successful alliance with any company is the full acquiescence following consultation of workers. What is good for Telecom Éireann is also good for Aer Lingus in this regard. Whatever happens at Aer Lingus must be buttressed by the active consent of the workforce and enhanced stakeholding by workers in the future of their company. Unfortunately, the signs are that the Government is not committed to this type of development in the semi-State sector. The Air Transport (Navigation) Bill, for example, which was introduced by the Minister, specifically sets out to undermine the role of worker directors. So much for partnership. It also gives leave to the Minister to sell Aer Rianta without further recourse to the Dáil. The Minister said that is not the case and she will come back to me on that aspect. However, this type of ministerial carte blanche in a Bill creates mistrust and unease among workforces.

The Government appears to have a particular hang up with Aer Rianta. The intent behind the Bill is clear. It is to enable Aer Rianta to be sold off without prior consultation and agreement with its workforce or the Dáil. The Bill is ideologically driven by a Progressive Democrats obsession with the type of privatisation we witnessed in Britain in the 1980s and Fianna Fáil's traditional indifference to the semi-State sector which is contrary to the rhetoric we are used to hearing from that party. The Bill does not meet or attempt to meet the needs of the company as we approach a new millennium. Aer Rianta has been one of our most successful semi-State companies at home and abroad. Its success abroad has shown the way for many Irish public and private companies. In addition to its much publicised international duty sales free sales expansion, Aer Rianta has bought shares in non-Irish airports, including a 40 per cent share in Birmingham International Airport. Many other semi-State companies, such as the ESB, have since followed suit.

Aer Rianta's overall performance is also impressive. Since 1969 when the management of Cork and Shannon Airports was ceded to Aer Rianta, the company has contributed more than £207 million directly to the Exchequer. This figure does not include PAYE and PRSI payments by workers or taxes paid by the company. Some £136 million of that figure represents contributions since 1987 alone, the period which coincides with increased competition in the aviation industry. Prior to 1986, the Exchequer contributed up to £57 million in capital investment to the company. Significantly, since 1987 Aer Rianta has generated its own capital resources. In that period alone, Aer Rianta has funded from its own resources a £224 million capital programme. This is a credible performance by the company under any criteria. Other performance figures are also impressive. Passenger traffic at the airports under Aer Rianta's direct management rose to almost 12 million in 1996, a figure achieved without any appreciable change in staffing levels at the company. Given this background the current approach being adopted by this Government is particularly perplexing.

Like Aer Lingus, Aer Rianta faces challenges in the years ahead, and we have already debated the abolition of duty free, which is the main challenge. This was forced upon us by the cowardice of the current Taoiseach when, as Minister for Finance in 1991, he failed to stand up to his ministerial colleagues in Europe. Last year, Aer Rianta raised over £26 million from the duty free industry. It now faces the total abolition of his source of revenue, with all the implications for higher airports costs and job losses that means, thanks to the Taoiseach. The Government's response to this problem has been paltry. A study to examine the implications for the economy of the abolition of duty free has yet to be published despite being commissioned by the previous Government almost nine months ago. To use an aviation phrase, the Government's campaign to reverse this destructive decision has hardly got off the ground. Deputy O'Rourke has been chosen as the Taoiseach's patsy on this occasion, and she has endured shutting doors all over Europe as she attempts to undo the damage done by the Taoiseach.

Mrs. O'Rourke

Patsy is a new name for me.

Mr. Stagg

The Minister could not be present for the speech of the Minister for Finance on the duty free issue, but he gave the kiss of death to her campaign, saying she should not waste her time or energy on it. The matter is closed and will not be reopened. Deputy McCreevy is known for his directness and honesty, and if Deputy O'Rourke reads his speech she will stop wasting energy in trying to reverse the decision taken by the Taoiseach in 1991. He sold out the duty free industry at a cost of 2,000 Irish jobs.

Mrs. O'Rourke

Why does the Deputy not want me to be active? Does he not want me to act?

Mr. Stagg

Of course I do, but this is now European law, and the Minister for Finance, with all the advice available to him, has told us it is practically impossible to reverse that law, though he said he will try.

Mrs. O'Rourke

Why is Deputy Stagg lying down on this issue?

Mr. Stagg

The Minister's shadow boxing will fool nobody. It will not fool 2,000 workers—

Mrs. O'Rourke

Does Deputy Stagg not want me to go to Germany?

An Leas-Cheann Comhairle

Deputy Stagg without interruption. If the Deputy addresses his remarks to the Chair he might not invite interruption.

Mr. Stagg

I do not intend to dwell on that matter as it was discussed this week. However, it does provide a context within which this Government's attitude to Aer Rianta can be properly appraised. The Government's proposed legislation will do nothing to ensure the future success of this company. It proposes, for instance, to take up to £20 million out of the company for the Exchequer at a time when it is already facing its most difficult challenge since developing the duty free industry and giving it to the world.

It is not just duty free that will go. A smash and grab raid is being carried out for the purposes of turning this organisation into a semi-State body for no good reason. The only justification is that the Government will take as much as it can while it owns the company, as the Minister will still be the only shareholder. The Government proposes taking £20 million from Aer Rianta at a time when it will be forced to increase landing charges by up to 50 per cent. The Minister demonstrated her concern in this area in the debate on the Air Navigation and Transport (Amendment) Bill. She should consider persuading Deputy McCreevy to leave Aer Rianta's money alone; the company needs it more than he does.

The Government's policy towards TEAM Aer Lingus is also being driven, not by the strategic interests of that company or its workforce, but by short-term political and Exchequer concerns. The chosen buyer of the company has limited experience in aircraft maintenance. It deals mainly with cement, an area in which it is very experienced and profitable. On any level it fails the criteria I outlined which should govern any strategic alliance or partnership. The only reason the Government has not already sold TEAM Aer Lingus to FLS is the pending by-election in Dublin North. Notwithstanding the assurances being given to the TEAM workforce by Minister O'Rourke, I predict that the company will be sold lock, stock and barrel as soon as the Labour victory in that by-election is announced. Aer Lingus will withdraw the £65 million in loans it has made to TEAM, precipitating the bankruptcy of the latter and forcing the TEAM employees back to Aer Lingus, where they will be told there is no work and made redundant.

The people of north Dublin can send a clear message to this Government about TEAM Aer Lingus. I remind the Minister of the 1,500 workers doing an excellent job in difficult circumstances in TEAM. They are implementing a five year programme put in place by the last Government and supported by the then Opposition. TEAM is ahead of schedule with that programme, but we are now to sell the company in a rush. I asked the Minister how FLS was picked, and she wrote me a letter to tell me that a trawl was done to see who could buy TEAM Aer Lingus. There were three candidates, but two lost interest so the Government was stuck with the last. Obviously the Minister knows nothing about this; there is no mention of it in her speech——

Mrs. O'Rourke

Deputy Stagg should not fool himself.

Mr. Stagg

——although she is the shareholder who owns the company. Her management is about to sell TEAM to a company about which I have some concerns. I predict that TEAM will be flogged when the by-election is over, contrary to the promises given to the workforce by the Taoiseach, and repeated since by Deputy O'Rourke.

It would be instructive to look at the latest company returns to the Register of Companies by FLS Aerospace Holding, TEAM's new proposed partner. In 1996 the company lost £9.4 million. The company is losing money like a sieve, and if it was quoted on the Stock Exchange its share price would collapse, despite the fact that £34 million was pumped into FLS in 1995 and 1996 by its parent company. This failed to turn around the company's performance. In this sense it compares unfavourably with TEAM Aer Lingus, which is a better operation than the company which is supposed to rescue it. It is not difficult to deduce from the companies' own figures that FLS Aerospace is totally dependent on its parent company for its continued existence. The question must be raised as to how long the parent company will be prepared to bail out its ailing subsidiary. That stark reality, as outlined by FLS aerospace itself, is far from the "blue chip" company promised by the Government to TEAM and its workforce.

There has been much criticism in the House of the letters of guarantee held by TEAM workers, the existence of which forms the only substantial obstacle to the Government's plans. I remind Members that these letters of guarantee were given to the workforce by a Fianna Fáil Government and continuously endorsed by that party. Workers have a right to represent themselves effectively. They have this card and, rightly, they intend to play it. They have my full support in that. The Government has repeatedly stated that any change in the status of TEAM can only come about with the full and active consent of its workforce. It is high time they began to take this promise seriously. However, as the first nine months of the Government's tenure has indicated, promises made prior to its election are cheap. I ask the Minister in the context of TEAM to deal with this matter in a hands on way. The Minister will complain that if she adopts a hands on approach she will be accused of political interference.

Mrs. O'Rourke

The Deputy will have another gripe.

Mr. Stagg

I have heard her make that case previously. She cannot be totally divorced from a situation where the management of one of her companies is proposing to sell the company despite the promises made by the Minister and the Taoiseach to the workforce that only 49 per cent would be sold to the workforce and that the letters of guarantee stand. The Minister must make it clear to her management that it can only sell within the policy guidelines she lays down. All we have heard from the Minister is that she has no news of this and that nothing has landed on her desk. It is time the Minister looked for full briefing from the management on what is happening.

I wish to draw attention to an issue which, though outside the remit of aviation policy per se, is damaging the aviation industry and has much wider implications. I referred earlier to the emergence of low cost carriers. On the whole they are to be welcomed but not on the backs of their workers. I am pleased that my colleague, Deputy Tommy Broughan, will later today launch his Trade Union Recognition Bill. Ryanair, a low cost operator which is hugely profitable for its owners and managers, has achieved these profits by paying low wages to its workers.

In seeking to continue its high profit operation, Ryanair refuses to discuss conditions and wages with the selected representatives of the workers in the company. I roundly condemn Ryanair and its massively wealthy director for his Victorian attitudes. Who does Mr. O'Leary think created the £17 million he has taken out of the company in recent times? The workforce created that money. They are the people he will not allow to join a union and if they do he will not negotiate with it. Does he agree that the workers in his company are entitled to a share of the wealth they have created and to have professionals of their choice to negotiate a fair share of that wealth on their behalf? The answer is obvious, they are so entitled.

I assure Ryanair baggage handlers of the full support of the Labour Party for union recognition and invite some of them back here next Tuesday and Wednesday when Deputy Broughan's Private Members' Bill is debated. I call on the Government today to accept that Bill, given the speeches made earlier.

I welcome the opportunity to discuss this issue today. In three years the single currency will be in place and the Single Market will be a reality. Ireland's capacity to take advantage of that new economic situation to consolidate our recent high levels of economic growth will depend largely on the capacity of our infrastructure to facilitate that growth. Our aerospace industry is a crucial component of that infrastructure and I am concerned that it is not in safe hands with this Government.

Mr. Killeen

I am pleased to hear the Minister lay out her policy on aviation matters. Much of the debate did not concentrate on the global aviation area in the sense that we would understand a national aviation policy. I agree she has a coherent and comprehensive policy but it has to be looked at against a background of a great many Governments who did not have such a policy. On numerous occasions Irish aviation policy has suffered because of the excessive influence of Aer Lingus, particularly at sensitive times. This is something that must be guarded against. Nobody could argue with the tenets of competitiveness based on reliable, regular access, cost effective airports — the key element of any aviation policy — and the safety factor which tends to be forgotten except when a tragic accident is reported in news bulletins. The growth in UK traffic from 2.7 million to 7.6 million over a ten year period is impressive. Those making projections in 1987 would not have come anywhere near to forecasting that growth figure. Given the many variables in aviation policy, it is difficult to predict the likely outcome in any circumstance.

That Aer Rianta has managed not to increase its charges in that ten year period is an important contributory factor to the growth rate. There are others. That the Minister has included it as one of her three key objectives is an important acknowledgment of that fact.

I was interested to hear what Deputy Stagg had to say about TEAM Aer Lingus. If I understood him correctly, he said that if Senator Ryan is successful in the forthcoming by-election in Dublin North the news is bad for TEAM Aer Lingus and its workers. I presume the corollary is that if the Fianna Fáil candidate is successful, the news is good for TEAM Aer Lingus. I would agree with that point of view.

The Minister referred to the free market within the European economic area. Regulations are driven by the Commission to ensure this. The major powers, particularly Britain, France and Germany, control important and strategic slots at their own main airports, such as Heathrow. While technically obeying the European economic free market regulations, effectively because of their power they are able to control it to the benefit of their own national airlines. We need to take cognisance of this because clearly we do not have the same power.

I am interested in the huge level of growth at Dublin Airport. While, at first glance, this may be excellent news I am not convinced that — if it continues — it is in the best interests of Dublin, the nation or the staff. This leads to the creation of more yellow-pack type jobs and plays into the management strategy of the Ryanairs of this world. In the longer term that is not beneficial to Irish aviation interests or to the interests of the State.

We need to look carefully at the road access problems which have been created. The Minister has undertaken a study in relation to train access. The reality is that the cost may be excessive. If growth continues at its present rate over a two or three year period the current and planned extensions will be scarcely enough. In that context I question whether it is sensible and to anybody's benefit to continue to offer the rates of discount which are being offered at Dublin Airport.

Reference was made to the Irish Aviation Authority which plays a key and central role in the entire aviation scene. Excellent standards are maintained by the authority. Excellent work is done and certainly it has made an enormous contribution. Aer Lingus is also a key player and its restructuring programme proved painful for many in the company.