Deputy Michael D. Higgins was in possession.
Private Members' Business. - Aer Lingus: Motion (Resumed).
The following motion was moved by Deputy Jim Higgins on Tuesday, 19 June 2001.
That Dáil Éireann:
recognising the success of the national airline, Aer Lingus, the company's proud record of quality service since the airline was established 65 years ago and the importance of the national airline to an island nation, condemns the Minister for Public Enterprise for:
–her failure to protect or promote the welfare of the company over the past four years;
–her failure to promote a positive industrial relations climate within the company;
–her total confusion and lack of vision as to the airline's role and future;
–her decision to allow the company to be sold by way of a trade sale;
–her failure to ensure that the Aer Lingus workers are made aware of the Government's intentions and calls on the Government to:
–abandon immediately any plans to sell off Aer Lingus by way of a trade sale; and
–make a clear statement as to what Government plans are for the future of the airline.
–(Deputy J. Higgins,Mayo).
Debate resumed on amendment No. 1:
To delete all words after "Dáil Éireann:" and substitute the following:
–notes the Government decision of December 1999 authorising the Minister for Public Enterprise to initiate an initial public offering – IPO – of shares in Aer Lingus;
–notes the Government's decision was heavily influenced by the need to strengthen Aer Lingus' capital base and to position the company to prosper and grow against the background of radical restructuring in the global aviation industry;
–notes that the company's trading position in 2001 has been severely affected by the impact of industrial unrest and the foot and mouth outbreak and increasingly by external market conditions;
–recognises that, as a result, it will not be possible to complete the IPO in the near future;
–commends the Minister for Public Enterprise for taking action to address the needs of Aer Lingus in its changing environment by having her advisers examine all sale options, in addition to an IPO, to ensure the company's future going forward and to report back to the Minister for Public Enterprise on their findings; and
–welcomes the fact that arising from the Minister's recent discussions with unions, agreement has been reached on the resumption of negotiations on the increased shareholding of 9.9% of the company for Aer Lingus employees.
–(Minister for Public Enterprise).
The substance of my remarks last evening was that Aer Lingus, its staff and all those who have looked after its progress over the years deserve the clarity and support of a Government policy that will assure its future, which can best be done by keeping it in public ownership. I would like to share what remains of my time with Deputies Seán Ryan and Broughan.
I am very pleased to have this opportunity to speak on the Private Members' motion on Aer Lingus. I am a very angry Deputy. I am angry at the antics of the Minister, Deputy O'Rourke, in recent years, particularly in recent months. If the Taoiseach allows this to continue it will have a detrimental effect on the future of our national carrier, Aer Lingus, and its workforce of approximately 6,000 people. I acknowledge that Aer Lingus has experienced trading difficulties this year. The primary reason for these difficulties was the fall-out from foot and mouth disease, which resulted in the cancellation of 70% of bookings on the Atlantic route. Since the foot and mouth disease crisis began, holiday bookings have literally ceased and have not yet restarted. This season will be a disaster as far as the American tourist trade is concerned. The downturn in the aviation industry worldwide has been another factor in trading difficulties for Aer Lingus.
The Minister has made great play of the industrial relations issues at Dublin airport. Obviously I am concerned at any breakdown in industrial relations, especially when the resolution of these disputes necessitates the withdrawal of labour. It is very easy for the Minister to blame the workers, however, it takes two to tango. The frustration that built up in the workforce as a result of low pay has origins in the Cahill plan in 1993 whereby the workforce made major sacrifices to save the company at the expense of the introduction of a low pay regime at the airport. It was always obvious that in the so-called Celtic tiger economy the workforce would not be prepared to continue on this low pay strategy indefinitely. In that regard, it was imperative that the Minister and the board and management of Aer Lingus should have been in a position to acknowledge this problem and enter into meaningful negotiations at the time to reach an agreement with the various workforces and thus prevent the inevitable withdrawal of labour.
I was there in 1993 when the workers were pressurised into making decisions. They made decisions which necessitated them leaving Aer Lingus. They were harassed if they did not vote a particular way. There was blood, sweat and tears. There were resignations from the company from some who did not want to leave. It was a sad experience and one I never wish to see again. The Minister's proposals for a trade sale would be an utter disaster. It would set a confrontational atmosphere at the airport which is in no one's interests, particularly the State and the people.
It should be noted that the industrial relations problems which were highlighted by the Minister in her speech were the least significant of the other factors affecting the profitability of the company. There is a perception, encouraged by the Government, that hundreds of millions of pounds were poured into a black hole called Aer Lingus in north Dublin. Nothing could be further from the truth. In its 60 years, the company received £175 million in 1993 as part of the Cahill plan and £60 million in the previous years. Compare this to the investment made by Governments throughout Europe and it will become clear that we are not at the races.
I want to put this investment into perspective. The 6,000 employees within Aer Lingus have paid more tax back to the Government in the past five years than the total investment made by Governments since the establishment of the company. I want the Minister to involve the workforce and the unions in trying to ensure the future of Aer Lingus and jobs in it and in this country. We will not achieve this under the proposals emanating from the Minister. I look forward to the comments from Government backbenchers, including my colleagues, Deputy Wright and Senator Glennon, on this issue.
During the Order of Business this morning we had for a brief time a Progressive Democrats majority on the Front Bench when the Tánaiste and the Minister for Finance, Deputy McCreevy, were two of only three Ministers present. It is fair to say that a fairly harsh right-wing ideology has emanated from those two Ministers over the past four years. It shows bitter hostility to the European social model and to workers' rights generally, especially the right to belong to a union, and there is a long-standing determination to wipe out the State enterprise system completely. A key aim of theirs is to leave no strong State enterprise behind when this shaky and discordant Government ends.
We had the fiasco of the Eircom sale and the rip-off of hundreds of thousands of Irish families. Below these political figures, we have a flock of circling vultures, several of them Fianna Fáil placed men, who have been stuffed on every available seat on semi-State boards and whose only aim is to hit the jackpot when privatisation occurs. In the past few weeks we have been faced with the farcical attempt to get rid of Aer Lingus in a quick trade sale. This is the culmination of the Minister for Public Enterprise's complete lack of planning, or even thought, with regard to State enterprise, especially our national airline.
Why did this crazy idea of a trade sale arise at this point? It can only be that this shaky Government knew it could not go for an IPO at present because of general economic problems and the downturn in tourism and travel. Fearful of the imminence of the general election and its certain defeat, the Government hatched the mad trade sale plan to privatise Aer Lingus as quickly as possible and facilitate the privatisation of the whole air travel business in Ireland.
Like Deputy Stagg, I was amazed to hear the Minister, Deputy O'Rourke, on early morning radio last week. I was sure it was one of the wonderful actors from "Bull Island" imitating the Minister. I was stunned to realise on Wednesday morning that it was the Minister herself waffling about Martina Hingis's shoes. At that very time she was proposing one of the most serious changes to the Irish economy and, as Deputy Stagg rightly said, a plethora of legislation remains with the Department of Public Enterprise.
Aer Lingus's possible trade sale prices, as quoted by financial journalists, are laughable. Due to our island status the company has been indelibly linked with the reputation of Ireland since its formation in 1936. On every airport runway in Europe and America the magnificent workforce of Aer Lingus upheld the highest possible images of our nation. Since 1994 the workforce has made great sacrifices in return for Government investment and their own ESOP. The 1999 annual report shows the fundamental soundness of Aer Lingus, with one million passengers on the US routes, passengers on European routes up by 18% and more than two million passengers travelling with the company on the London routes despite fierce competition. It is only one year into Aer Lingus's participation in the One World alliance with distinguished airlines such as American Airlines, British Airways, Cathay Pacific and Iberia to name a few.
I accept that late last year and early this year there have been difficulties. Cabin staff have moved from SIPTU to IMPACT and there have been a series of stoppages when workers tried to participate in what they rightly perceived was the additional revenues of Aer Lingus. In the past few months there has been a downturn in tourism due to the foot and mouth disease crisis. The company has also been affected by the downturn in the American economy and latterly the difficulties experienced by the chief executive. Despite this, Aer Lingus remains a remarkably sound company. We need a national airline because irrespective of what happens on the investment front, there are major obstacles to allowing our national airline to fall into private hands. Thankfully, as an island nation we have a series of bilaterals with other Governments. A key responsibility of the Government is to protect our national interests. Can we depend on airlines such as Ryanair, which threatened to move to Stansted or Charleroi when the slightest difficulty arose, or on an airline that pursues a hypocritical and vicious anti-union policy?
There is a bright future for air travel generally. It is projected that passenger numbers will rise by at least 50% over the next decade and new aircraft have come on stream. In that context, Air Lingus should have a bright future, but it needs a Minister and Government that is committed to national economic aims and is not prepared to wipe out a body of achievement in the area of public enterprise.
I wish to share my time with Deputies Wright, Killeen and Daly.
That is agreed.
I listened to the Opposition last night and I never heard so much rubbish and blame being laid at the Minister's desk. It is not true that there is ambiguity and paralysis and that there is no coherence in the Government's policy on Aer Lingus.
It is even worse than that.
The Government's vision and policy on the airline is clear. It wants to secure the future of the airline as the key carrier to Ireland's main markets in Britain, Europe and the United States. Due to its small size, the nature of the industry and its capital requirements, the best option is for the airline to be privatised. All privatisation options for the airline, which include a trade sale option, are to be examined. The Minister for Public Enterprise has not been panicked into announcing that she will examine a trade sale option for the airline. She would be negligent if she did not examine all possible options for the airline. She has asked her advisers to examine other options for the sale of the airline, to take soundings of interest from potential investors or buyers and to report back to her in a number of weeks. The Minister has apprised the Aer Lingus unions of her intentions regarding the privatisation of the airline and she has reopened discussions on the increased shareholding for Aer Lingus employees.
During the past four years Aer Lingus has expanded its services. It has opened new routes to Munich, Stockholm, Madrid, Los Angeles, Amsterdam, Cork and Washington. New aircraft has come on stream and further new aircraft is to be delivered in 2003. In addition, the company has become a full member of the One World alliance of airlines. The strategic alliance offers significant benefits for Aer Lingus passengers travelling to and from Ireland.
It is not true that the airline has stumbled from crisis to crisis. Aer Lingus has returned operating profits over the past four years, it has purchased new aircraft and upgraded services. TEAM Aer Lingus was successfully sold to FLS Aerospace. The current trading difficulties of the airline are attributable to industrial relations difficulties in the airline, the outbreak of foot and mouth disease and softening economic conditions, particularly on the important US market. Aer Lingus recognised that it had a low pay problem and this is being addressed. Regrettably this has resulted in strikes which have disrupted passengers. The Minister cannot be blamed for the industrial relations difficulties in the airline. The State's industrial relations machinery was available at all times to assist the resolution of the industrial relations difficulties.
The possibility of British Airways or any other airline purchasing a share of Aer Lingus is pure speculation and premature. No decisions have been made about a trade sale and any sale process would be conducted in an open and transparent manner by the Government. To suggest that the Minister is hawking the airline around the world is a gross insult to our intelligence.
The question of continuity of senior management in Aer Lingus is a matter for the board of Aer Lingus. The Minister has no function in relation to the appointment of the chief executive of Aer Lingus Group plc. These are matters for the board of Aer Lingus. Casting aspersions on particular board members is not appropriate. Board members are taking on public service obligations for relatively little remuneration and the board of Aer Lingus is to commended on its stewardship of the airline. The board is to be congratulated on the measures put in place last April to stabilise the trading position of the company given the difficult trading circumstances facing the airline. There is no evidence to suggest that management in Aer Lingus is bureaucratic and over-centralised. It is the duty of the management and board of the airline to maximise their resources for the commercial benefit of the business and all stakeholders.
The valuation of the company depends on its business plan, profitability and market sentiment towards the airline sector. Airline valuations have declined on the capital markets and Aer Lingus is no exception.
Despite the overall difficulties being experienced by Aer Lingus it is gratifying and reassuring to know that many parts of that company are performing well and are contributing positively to the economy. For example, Aer Lingus employs 200 people in its operation at Cork Airport. That number has grown consistently in line with the phenomenal growth in traffic through Cork Airport in recent years. Passenger traffic has doubled in the past six years and will reach 1.8 million passengers this year despite the difficulties posed by the outbreak of foot and mouth disease earlier in the year. Aer Lingus handles the bulk of that traffic and is consistently striving to improve the service to customers.
I am aware that Aer Lingus is involved in serious consultation with Aer Rianta at present about the facilities that it requires for the imminent airport expansion project. This will include airbridge access to ensure passengers can board flights without getting wet, as we all do on occasions.
While that development is awaited, Aer Lingus has not stood still. It has provided three sets of covered steps to protect passengers from the elements. It has made a significant investment in an upgraded gold circle lounge for business passengers, which is a welcome improvement for the growing number of people who fly in and out of Cork Airport daily. Even more significantly, it has doubled capacity on the Amsterdam-Cork route to a twice daily return service, all Heathrow flights are now served by the new airbus fleet which has increased capacity, the Cork-Dublin route benefits from increased capacity and, in conjunction with Aer Arann, there are eight return flights daily between Cork and the capital. Fokker 50 aircraft have been replaced by the BAE 146 four engined whisper-jet and Boeing 737 has been largely replaced by the larger state-of-the-art Airbus 321 and 320.
Aer Lingus has invested heavily in the latest computer technology and this will also result in improved customer service. Internet reservations are now available and the involvement of Aer Lingus in the One World alliance, with partners such British Airways, means that a wider range of code-sharing services are available to would-be flyers.
In addition to the 200 direct employees at Cork Airport, Aer Lingus has approximately 100 air crew based in Cork. This is a welcome development and is an effective boost to the local economy as well as a sensible arrangement whereby staff can live and work in their chosen local area. Further contributions to the Cork economy comes from the purchase of goods and services. It is not insignificant that approximately 20 air crew stay overnight at Cork hotels seven days a week, 365 days a year.
Aer Lingus's investment in Cork, together with the unprecedented investment in airport infrastructure and allied to other public investment in roads such as the Jack Lynch tunnel, is evidence of confidence in the future of its Cork operation. It is not alone in having such confidence because new airline inquiries are coming fast and furious into Cork.
Overall, despite passing difficulties, the staff of Aer Lingus in Cork are a well motivated group of people dedicated to the highest standards of service. They are committed to the safety, quality and personal service that has been the unique hallmark of generations. The current Aer Lingus staff are living up to our highest expectations and Cork is the best example of this.
Why get rid of them then?
There is no question of getting rid of them and the Deputy knows that better than I do.
Why betray them?
The Minister, Deputy O'Rourke, has committed, through Aer Rianta, £60 million for the development of Cork Airport. The development has started and machines are on site – Deputy Noonan was there a few months ago and could not see any machines on site, but they are there now. By the time it is finished and taking inflation into account, the development will be worth £100 million.
The Great Southern Hotel was opened by the Minister a few weeks ago and I was delighted to be by her side and witness the praise that was heaped on her by the different local sectors, ranging from Cork County Council, Cork Corporation and the chamber of commerce to the various other bodies associated with Cork. The development will involve a new terminal, a new departure area, six airbridges and a new runway extension and alongside that there is the wonderfully constructed e-commerce park which was built in partnership with Aer Rianta, the ICC and private investment. A new director has been appointed to Aer Rianta for the operation in Cork. That was done at the behest of the public representative of Cork who wanted a director for the Cork operation on the board of Aer Rianta. I am delighted the Minister responded positively to that request. I commend the airport manager, Joe O'Connor, and John Smith of Aer Rianta, all the staff of Aer Rianta, the Aer Lingus staff station manager and the helpful Aer Lingus staff in Cork Airport for the excellent service they give.
A new airline will operate from this country shortly. Negotiations are ongoing and Aer Rianta expects to conclude a deal—
The Deputy is the Minister for Cork.
The Deputies should listen. Aer Rianta expects to bring in a new low cost airline, Go Airlines, in the coming months to operate from Dublin—
(Mayo): The Deputy should not believe all he reads in the newspapers.
—and eventually from Cork.
As a public representative for Dublin North, I have had the privilege of representing a substantial number of the workforce of Aer Lingus and Aer Rianta at Dublin Airport. I have every confidence in the workforce and management team in Aer Lingus.
Over the past few years the workforce has had to deal with serious situations at the airport and has implemented the Cahill plan through much difficulty and great sacrifice. As a result, large profits were achieved by the management team and workforce in recent years. I believe that despite the difficult circumstances of the past year, the management and workforce of Aer Lingus can bring the company back to profitability and reach the solutions that are required for its future development.
As the people of Fingal know, Aer Lingus has always been a proud and determined symbol of the State and the forward-looking vision that continues to inspire Irish people. Our location at the edge of the Atlantic and Europe was never seen as a disadvantage so long as the national airline was available to provide a link over miles of ocean.
As a Fianna Fáil Deputy, I am entitled to outline the record of the Fianna Fáil Party over the past 65 years since the foundation and development of the company under Éamon de Valera.
Fianna Fáil got rid of TEAM.
The company developed into the jet age under Seán Lemass and wide-bodied aircraft were introduced in the fleet under Jack Lynch. Under the Administrations of Charles Haughey and Deputy Albert Reynolds, the Aer Lingus route network grew to encompass extensive services throughout Europe and America. Under the current Administration and with the implementation of the Cahill plan, the company has moved from the extremely difficult position of the early 1990s to making profits of £60 million in 1999. Aer Lingus flies to six destinations within the United States. Two of these were inaugurated under this Administration.
There can be no argument that the airline has benefited from the Cahill plan. Agreed and advocated within Europe by a Fianna Fáil-led Government, this plan forced the airline to make the radical adjustments that were necessary to operate an airline in what must be one of the most challenging and changing business environments. The staff of Aer Lingus had to subordinate their ambitions to ensure the ongoing viability of the airline. That is seen in the sacrifices made by many families in the Dublin North constituency and elsewhere to ensure the company survived. As a result they saw the airline re-establish itself, refocus on its core business—
What about TEAM?
—refit its fleet and provide a service of which the Irish people can be proud. Route networks grew, passenger numbers increased and after a Government decision in late 1999 a plan was approved to initiate a public offering of shares—
They will be waiting for Fianna Fáil in the long grass.
The Deputy's colleague, Deputy Seán Ryan, remembers the long grass from the last election—
They returned me.
—after the former party leader's promises in 1992. However, that is a matter for another day.
The Government's objective in selling the airline was to provide the airline with a capital base to grow and expand within a worldwide aviation industry that is extremely volatile and unpredictable. It is well known that virtually £300 million is required for reinvestment in the company. That capital funding must be found and it is incumbent on all Members to support the Minister in ensuring that all options are on the table to secure the best interests of the company. We must ensure the capital funding is made available.
Proof of the volatility in the market can be seen in the formation of the One World alliance, in which Aer Lingus joined with British Airways, Quantas and other prominent world airlines to find security and prosperity in integrated services and support. A year before Aer Lingus joined this alliance, the largest global airline alliance, Opposition Members believed that nobody would be interested in Aer Lingus, that it was too late and that an alliance would not be secured, but they have been proven wrong.
Circumstances have not been favourable for the national airline in the past few months. After years of patience and restraint under the strict regime of the Cahill plan, some employees have demanded that their needs should become the focus for the airline. Unfortunately, this led to industrial action in an era which is now intolerant of such activity. It has created a crisis of confidence for the airline among its customers as to whether its services are reliable. No airline, regardless of how large or prosperous it is, can afford such a crisis in today's demanding environment.
Among the circumstances which have led to the difficulties that exist is that this House unanimously asked people not to travel abroad during the foot and mouth disease crisis. That request was made in the national interest. Other factors such as the cost of fuel, industrial unrest and the costs incurred to overcome that unrest have caused great difficulties for the company.
I believe the Minister is right to ensure that all options for sale are fully discussed—
Which option?
—in a calm and reasonable manner.
The Government is conducting a fire sale.
Once all options have been investigated and assessed, it is imperative that the right decision is made to ensure that proper capital funding is made available to the company. Every Member of the House accepted that last night and tonight. I am glad the Labour Party Members on this occasion, unlike in the past, recognised in their contributions the real problems that face Aer Lingus at present.
One issue that was raised last night and in which my colleagues are heavily involved is the campaign of Aer Lingus and Aer Rianta pensioners to have their pension rights properly regulated and advanced.
The Government let them down as well. It has had four years to do something.
We will ensure that the Government recognises its campaign for proper pension provision.
Is the Deputy saying the Minister is going to deliver?
I wish to share my time with Deputy Daly.
Acting Chairman
Is that agreed? Agreed.
I commend the Minister on the forthright manner in which she outlined the position last night. It is right that the cards are put on the table and that we examine the facts. There is no merit in pretending there are no problems or in refusing to face up to reality. It is even less helpful to pretend that the company is in terminal decline, as some have sought to do, or that a magic wand of State intervention can be waved as a type of cure all for the current difficulties.
Aer Lingus is an excellent brand name. On balance, it is a good company which has served the country well. It has a first class workforce which takes pride in the company and in their work. It has a wonderful record of customer service – customer service tends to be synonymous with the brand. The company is fully capable of providing a world class service in terms of quality and competitive price. Ultimately that will be required of the company in the long-term. However, it is a small airline in international terms and is in urgent need of investment and, perhaps, outside expertise.
I am anxious to mention the difficulties in the Irish airline general employees' superannuation scheme which were outlined to Members by the Retired Aviation Staff Association. Their demands, which were initially quite wide, have been modified considerably. I consider them to be just demands and they must be addressed. The current difficulties in Aer Lingus cannot be used as an excuse for not dealing with obligations to former employees. It is well to remember that many of these people became former employees or retired during the Cahill plan era when 1,200 of the workforce left their employment. This must be faced up to regardless of difficulties which might be encountered.
The airline business is notoriously cyclical and many Members will have been surprised and even shocked by the April figures released by the Association of European Airlines which are both sobering and worrying. It is the first year-on-year decline in passenger volumes since autumn 1991 for all the major European airlines combined. Those figures incorporate a 4% decline on the north Atlantic route. The Minister is quite right to take account of these figures. Everybody is aware of the difficulties which arose because of the foot and mouth crisis and, as previous speakers have said, people were being urged not to travel. It was inevitable there would be a greater effect on Aer Lingus than on any other airline. It would be very foolish to take the view that that is likely to continue. We can have a deal of confidence that when that difficult period has been put in the background, there will be an improvement in the figures.
I welcome the fact that the unions have re-entered negotiations in relation to the additional 9.9% of worker shareholding which they were negotiating up to the middle of last year. They already hold 5% in the company and I believe it is encouraging that they are talking to the Minister about an increase.
We must face up to the urgent need for fleet replacement and the balance between aircraft owned and leased must be altered. We must also face the fact that all the major European airlines, some of which are huge in comparison to Aer Lingus, have sought private capital in their own countries and elsewhere and it is inevitable, and perhaps desirable and necessary, that Aer Lingus goes down the same route.
I was delighted to hear the Minister indicate very strongly that she will ensure that whatever option is taken at the end of the day – all options are being examined – the airline will continue to comply with EU licensing regulations. I understand this requires that it be owned directly by an EU state or by nationals in the state. In order to continue to have rights within the EU the airline will have to comply with these requirements. For those of us who live in the Shannon region it is equally important that the requirements of the bilateral air service agreements be met in terms of the airline being substantially owned and effectively controlled in the country. The bilateral agreements which have been exercising the minds of many people in my area have not been examined in great detail and it is not entirely clear what is meant by that requirement.
I was delighted to hear the Minister indicating last night that the intention is that the airline will continue to comply with the requirements and that whatever clarification is needed will be sought in advance of any decisions being made. On foot of the Minister's speech last night and what she has told me in conversations over the past several months I am confident she is on course to ensure the future viability of Aer Lingus and the company's workforce.
In the past eight years or so Aer Lingus has had a very successful run of business and I wish to avail of the opportunity to put on record our appreciation to the board, management and staff of Aer Lingus for restructuring the company. In common with most other international airlines it is now apparent that there is an international business fall-off which is affecting long haul and business travel in a significant way. An international slump in business travel is predicted. It is expected that next year will be one of the toughest years since the Gulf War, and experts are predicting it is time to fasten the seatbelts and prepare for a fairly bumpy time. It is hard to expect Aer Lingus to avoid the effects of this.
Yesterday Swissair announced it is shedding a fairly major part of its business. Currently it has debts of $3 billion and is trying to concentrate on its core business to avoid a collapse of the company. Two French companies went into bankruptcy this week. Sabena and TWA, two very strong international airlines, have scrapped plans this year for putting a new fleet in place. There is a big battle at present for control of Air New Zealand, with Singapore Airlines, Qantas and others in competition for the airline which is suffering very severe difficulties.
In such an environment it is understandable that Aer Lingus is having difficulties. Part of its problem is that the planned expansion anticipated this year did not materialise. In an effort to bring up the numbers travelling they reduced fares but I do not believe that strategy will now work. The business Aer Lingus is anticipating this summer will level off. The strong US dollar has affected business between here and the west, and the main concentration must now be on consolidating its business and endeavouring to concentrate on next year. It is obvious there will be a necessity to take some remedial action to deal with the situation.
In my view, and in the view of most commentators, the basic structure of Aer Lingus is sound. It will probably have to tighten up in terms of operating costs and it needs some funding, which it has always identified as necessary, to ensure its fleet expansion. Given that there will be some difficulties in the business for some time, it is important we keep in constant touch with developments in Aer Lingus and endeavour to support the airline in so far as we can.
Nothing can be more damaging to the future of the airline than negative comment and the kind of tabloid headlines we have seen about the future of the airline over the past few weeks. The one thing the airline does not need at this time is that sort of negative comment. The management requires that we in particular, as Members of the Oireachtas, give them our backing and the confidence to face the challenging times ahead, recognising they will have difficulties but that they have had very good years. It should be possible to find an opportune way to support the airline in this difficult period. The basic structure of the airline is sound. It may need to carry out some reorganisation, but I am confident the current difficulties in the airline can be overcome and that we will soon have Aer Lingus back to its full strength.
How does one deal with the problems in international business if travel numbers are in decline? The indications are that this decline is regarded as temporary. This week at the Paris air show, Airbus Europe received one of the biggest orders ever, worth over £6 billion, for the provision of new aircraft. The order books for new aircraft at Airbus Europe are at record levels. The people manufacturing and leasing aircraft are confident that while there are difficulties in the aviation business, they are temporary and the long-term prospects for international aviation and travel are sound. That is borne out by the fact that manufacturers who make the aeroplanes, such as Airbus Europe and Boeing, have full order books, are expanding their services and are providing more aeroplanes. The large international leasing companies are placing orders such as that placed yesterday for 111 new aircraft. This shows that in the long-term the international aviation business will thrive and develop. There is a temporary situation which needs to be addressed and I am sure that the Minister and the Government, in their wisdom, will ensure that the temporary difficulties of Aer Lingus will be overcome and the long-term viability of the company will be secured.
I wish to share time with Deputies Cosgrave, Ring, Crawford, Sheehan, Sargent, Ó Caoláin and Higgins.
I am please to have the opportunity to speak in support of the motion put forward by my party colleague, Deputy Jim Higgins. We must admit that there is a problem in Aer Lingus but it would be wrong for the Minister to react in panic, saying that she has tried everything else and now we should put the company up for sale to the highest bidder.
We must return to basics and look at why we have a national carrier in the first place. Ireland is the only nation in the European Union which depends on access by air and sea. Therefore we have a unique interest in maintaining a national carrier and in ensuring that air access is not threatened in any way. That is a important strategic interest which overrides much of what has been said here tonight. Our trade links depend to a large extent on maintaining these connections. The tourism industry depends on there being access to our country from abroad. The so-called Celtic tiger economy depends on executives and others being able to travel quickly, conveniently and safely between Ireland and the United States, other countries in Europe and countries around the world. If Aer Lingus is to be sold off and then possibly broken up, the likelihood is that it would disappear, we would be totally dependent on other airlines to service Ireland and we might actually end up setting up a national carrier again in order that the economy would survive. There fore, let us go back to basics and be terribly carefully about what we are doing. There is a great deal at stake here. The argument that there is a strategic interest must be made.
We have seen what happened, for instance, when the railways were privatised in Britain. Now even the Tories are saying it was not a good idea. We have seen what happened in California when the electricity sector was totally deregulated; that has not worked out well.
What we need to know now is where lies the future for Aer Lingus and what kind of package can be put together to ensure its survival as an entity. This is not the time to flog Aer Lingus to the first company which offers to buy it. We must be very careful and hasten slowly.
I note that in the past number of years, particularly since 1998, the Government has been searching for a strategic partner and looking into the possibility of an IPO, and now it is talking about getting rid of it. The impression one gets from this Minister is of a child who gets a new toy, plays with it for a while and when it gets broken wants to dump it.
The foot and mouth disease crisis definitely affected Aer Lingus and all airlines operating in Ireland. The downturn in the economy of the United States is also certainly affecting the company and the industrial disputes have not helped either, but I would suggest that this is a time to stand back and take stock.
I note for instance that, due to the way we in the Oireachtas conduct our business, we have not be able to invite Aer Lingus before the Oireachtas committee to examine the issues at that level. The committees have not been given the resources by the Government and therefore we are totally dependent on the civil servants. The civil servants are doing their best but, with all due respect, when a political decision must be made the resources should be made available to the politicians in order to help them make those decisions. All along, the committees have not been able to do their work because two Oireachtas inquiries have sucked up all the resources and this is not good enough. This House has an obligation and a duty to oversee the work of Ministers, Departments and semi-State companies such as Aer Lingus. If we are not being provided with the resources to do that, then we cannot do our work properly. Hence we are left with the mess we see before us.
Aer Lingus joined the Oneworld alliance about a year ago. I would contend that that development should be given a chance to work and expand. It is too soon to discard it. We should expand that alliance, which has already proved successful for Aer Lingus.
I fear for what will happen if we go down the road suggested by the Minister. She is cute the way she has put out the suggestion of a trade sale. She has decided to throw it out for discussion and eventually, unlike a rolling stone, it will gather moss. Eventually people will begin to accept that it is a good idea and before we know where we are, the company will be sold. I do not think that is good enough.
There are other issues concerning Aer Lingus and many colleagues on both sides of the House alluded to these in this debate. If one travels to any airport in the world, one will come across the Aer Lingus logo. Aer Lingus has been a great ambassador for Ireland over the years. It has also been a very safe airline and that is one of the things foremost in my mind any time I get on an aeroplane. I know that it is safe to travel with Aer Lingus because it has a great safety record. The Aer Lingus cabin crew and ground staff act as fantastic ambassadors for Ireland the way they welcome tourists, business people and others and the Aer Lingus logo must have been a welcome sight for Irish people travelling abroad down the years.
I would say this to the Minister and the Government, let us bear in mind what has happened in the past but let us look to the future with confidence and not panic. It is not time to sell or privatise Aer Lingus.
I compliment Deputy Jim Higgins on tabling the motion at this time. This once great symbol of the State is now reduced to a company where fear is the common factor among the workforce. A staff who made many sacrifices now find that their future is uncertain due to the decision of the Minister for Public Enterprise to take the airline to the bargain basement sales. Abandoning the option of flotation for a sale to a trade purchaser is not in the interest of the airline, its staff, the shareholders or the Irish people. The Minister has nothing to offer. She has not ensured the protection of the national carrier at any point during her four years as Minister.
Aer Lingus has played an important part in the perception of the nation by the Irish people. It truly was the flag carrier, setting a standard image of Ireland for the people. When times were hard for the company, the staff were prepared to make sacrifices, take controlled wage increases and look at how changes in practices could restore the fortunes of the company, and now their Minister wants to flog them in a little trade deal.
The Minister has ruled negatively over a climate of poor industrial relations. The staff are unhappy and believe they are exploited and their welfare is exposed. They can no longer see a clean path for the airline. Uncertainty about to the company's destination has led to confusion among the employees about the security of their jobs. That poor level of industrial relations is now having a negative impact on the workforce and on the public perception of the airline itself. This is because the Minister has failed this company.
The Government must take control and make amends for this mishandling of the situation. The Government must be resolute in stating that no trade sale of Aer Lingus will be allowed. It must set out and chart the future direction and goals of this company.
Uncertainty currently exists for the 5,000 or so employees who reside throughout north county Dublin. They are genuinely concerned about their employment, fearful that in a trade sale they will be demoted to second class, employment will be slashed and their jobs will be put at risk. The staff want assurances that they will be able to put bread on the table, that there will be money to meet the mortgage repayments and that they have a long-term future with a quality employer. These people have made sacrifices. They do not now wish to become the sacrifice of the incompetence of this bad and poorly performing Minister.
A large number of those involved in building this company are now pensioners of it and they, too, fear for their future. They have to put bread on the table. They worked long hours and sacrificed their families in building up the national carrier. They fear their income and security will be damaged by any sell-off. They want this Minister to ensure they are protected, no matter what happens to the airline in the future. They campaigned, for four years, for proper pension rights and have still not obtained them. Those people must be looked after.
I compliment Deputy Higgins for tabling this very important motion. There have been very serious developments in Aer Lingus over recent months at board, company and national level. People are concerned.
Aer Lingus, RTE, the GAA and Guinness are trade names associated with our success. They have always portrayed a positive image of this country. I am not afraid to be Irish and have always been proud of Aer Lingus. We used to call a neighbour of mine Aer Lingus because every time a plane passed over the west – and many planes passed over bringing our emigrants abroad – he would say to a child passing, "look up, it's Aer Lingus". It did not matter what plane was flying over.
I am very disappointed with Aer Lingus. Knock Airport was let down badly by Aer Lingus when it needed support. It was mean and greedy. Aer Lingus has, in the past, been subsidised by the taxpayer. People living in Mayo and Connaught pay taxes. Aer Lingus should have given us some support when we needed it.
I would not like to see Aer Lingus turning out like many of the other carriers which operate here. A constituent of mine brought a case to my attention about two weeks ago. He and his wife were to travel to England and had purchased tickets from Ryanair. On the morning they were due to travel, the woman had a stroke and was unable to travel. Both of these people are in receipt of social welfare payments. The woman has recovered sufficiently to be able to travel to see her family in England but Ryanair will not replace the original ticket. That is unfair treatment. We must have competition. We must retain Aer Lingus. I do not think Aer Lingus operates in that way. I have always found Aer Lingus to be fair, decent and honest.
I am an auctioneer and I know there is a time to sell and a time to buy. Now is not the time to sell Aer Lingus, but to invest in the company. Now is the time for the airport, the board and everyone involved to put their heads together to ensure the company becomes more successful. Sometimes those involved in running Aer Lingus forget about their customers. We witnessed one and two day strikes at Christmas time. Who were they hurting then? They were not hurting the Government or the unions, they were hurting their customers. That is why figures have dropped. People have lost faith in Aer Lingus. People were hurt and disturbed by their actions. They cannot depend on a company which operates in that way.
The Minister, the Government and everybody involved in Aer Lingus should get their act together. We all want to be proud of Aer Lingus and wish to see it go from strength to strength.
I thank Deputy Higgins for the opportunity he has given this House to discuss this very important issue.
Aer Lingus has had a proud and good record for providing a quality service since its foundation 65 years ago. It is of paramount importance that we do not put our heads in the sand and say there is no need for change. We have all seen the figures and know of the difficulties currently facing Aer Lingus. One has to question the turnover of senior management under its current chairman and the Minister for Public Enterprise, Deputy O'Rourke. That turnover has been extremely frightening in recent times.
The staff relations issue has caused major problems and has not enhanced the situation at Aer Lingus. There may be a need for staff restructuring. Some would tell us that staffing levels at Aer Lingus, compared with some of its competitors, is too high. Whatever restructuring takes place, those working in the company deserve proper pay.
My main worry lies in the obvious difference of opinion between the Taoiseach and the Minister concerned. It is fairly obvious from the Minister's comments that she favours a trade sale. The Taoiseach appears to favour flotation. Neither is in the best interest of Aer Lingus or this country. Competition is important. Ryanair and others have helped to reduce prices for travellers, be they business or tourists. Getting some short-term gain from the sale of Aer Lingus will not guarantee a quality service for our people. We are an island nation. We have to have a top quality air service if we are to remain as one of the more prosperous countries in Europe.
I was in Canada on business last year. I will not forget what happened in Toronto Airport where Air Canada operates a monopoly. An aircraft had to be taken out of service as a result of technical problems. Passengers were put up in a very poor quality hotel for 24 hours with no information as to what was happening. Nobody could have cared less about them. It is a clear example of monopoly. We have witnessed companies being forced into situations where the banks become the bosses. People in the farming community have witnessed the take-overs of PLCs. Well run co-ops, maintained through their board members and shareholders, had to go down the road of public flotation. We know what that has meant to the workers and farmers concerned.
We should ensure we do not make any mistakes with this company. It is one of our greatest assets. Tourist and business people enjoy flying with Aer Lingus. The staff are the most courteous which I or any other traveller have come across. We need to restructure the company. We need to offer it financial support but we need to do so in a meaningful and proper manner. We should not put it up for a quick sale.
I dtosach báire ba mhaith liom mo bhuíochas a ghabháil le Fine Gael as a gcuid ama a roinnt and say we will be supporting the motion and the Labour party amendment. The Green Party, Comhaontas Glas, supports the development of Aer Lingus as a national carrier in State ownership and we will resist the ham-fisted tactics by the Minister or anyone else to sell off the company. I had a parliamentary question disallowed which asked the Minister if she will confirm that any form of privatisation of Aer Lingus will not proceed in advance of the next general election. I and my constituents want an answer to that question tonight. Go pearsanta táim an-bhródúil as Aer Lingus, mar Ghael. Is beag comhlacht a léiríonn cothrom na féinne maidir le húsáid na Gaeilge agus tugann Aer Lingus tosaíocht do chomhlachtaí eile agus don phobal i gcoitinne.
Aer Lingus has greatly benefited this country through the returns it has made to the Exchequer from its profits and in north Dublin by sustaining thousands of families and local communities, many of whose members work at Dublin Airport. Loyalty and pride in the company are very high but morale is severely undermined by the Minister's prediction of future losses while at the same time advising AIB and Citygroup to find a buyer for this flagship State company over the next month.
Loyalty has been greatest among the members of the Retired Aviation Staff Association who, as public sector workers, have seen their pensions fall by over 25% since 1989 relative to other public sector groups. One pensioner I know has been left with £70 per month from his time working for Aer Lingus. After 16 months of hollow expressions of concern the Minister has today verbally undertaken to get justice for the RASI through the Minister for Finance. We know from documents disclosed under the Freedom of Information Act that she has failed the pensioners to date and has not been demanding justice for the retired workers of Aer Lingus.
Unless the workers, pensioners and management can trust the Minister's integrity and ability the company will not prosper. For this reason she needs to renew her efforts on behalf of Aer Lingus and her trust in and respect for the company, which forms a vital part of the country's economic infrastructure. Aer Lingus needs a good Minister and good management, not threats and a sell-off. It does not need absentee landlords calling the shots in this country's commercial and social life, as was the case in colonial times.
My time is short and my message is brief and blunt. It is very simply, hands off Aer Lingus. I deplore the mismanagement of the national airline by the Government and I vehemently oppose any proposal to privatise the company in any way.
It is a scandal that the Government and its predecessors could even contemplate opening the doors to the international corporate vultures who cannot wait to get their claws on this national asset. This is a strategic company, one that has the loyalty of Irish people at home and abroad. It has been built up by successive generations of Irish taxpayers into one of the flagships of the Irish economy and it is one of the most respected airlines in the world.
I support the main thrust of the Fine Gael Party motion but I wish it had gone further. The fire sale of Aer Lingus to the highest bidder, which now seems to be on the Government agenda, is unacceptable. The privatisation by initial public offering is equally unacceptable.
I wish to record my support for the amendment tabled by the Labour Party Members. The shambles of the Eircom privatisation and the questions arising in the Moriarty tribunal about the Esat Digifone mobile phone licence show where this Thatcherite agenda has led us. The Esat Digifone franchise was sold by the Government for the pathetic sum of £15 million. The company was sold on for £2 billion, making a personal fortune of approximately £250 million for Mr. Denis O'Brien.
No doubt others are lining up to make similar killings with the privatisation of the national airline. Is this how the Government wishes to extinguish the proud name of Aer Lingus? Let it not be forgotten that successive Governments have tied the hands of this democracy by agreeing to EU competition rules which prevent us from aiding Aer Lingus with State funds if we so decide. Stealing someone's property and selling it back to them is simple extortion. That is what the privatisation of Aer Lingus by public sale would amount to and it must be stopped.
(Dublin West): Of all the outrageous privatisations undertaken or proposed by this Government, the proposal to privatise Aer Lingus is among the most reprehensible. This Coalition Government, comprising Fianna Fáil and the Progressive Democrats, is saturated with the philosophy of privatisation which is at the heart of EU policy. It is driven not by the well being of working people in the corporations pro posed to be privatised nor by the well being of the consumer and the ordinary people, but solely by the drive for more profit and the greed of the major multinnational corporations which dominate the EU. They are organised at the European round table and they have essentially dictated policy to the EU.
The Government is in hock to big business and despite the rip-off surrounding the granting of the second mobile phone licence to private individuals, it is proposed to proceed with this sale in a similar manner. Private individuals were favoured during the granting of the second mobile phone licence and cronies of the Government were given a massively valuable asset to speculate with, to sell to multinational corporations and to make a fortune for private individuals. Doubtless it will be shown that, legal or not, there was corruption at the heart of that transaction. The people who benefited demonstrate their patriotism by being tax exiles. They will not even stay in the country to pay their taxes.
I call on Aer Lingus workers to resist the piracy being planned by the Government on their airline. I also call on the people of north and west Dublin to support the workers in a massive campaign to defeat this proposal by the Government. Aer Lingus should be maintained in public ownership but with significant changes. The management needs to be completely changed. The hacks and cronies of the major Establishment political parties should be unceremoniously ejected from the board to begin the process of reformation. It is incredible that the major political parties continue to fill the boards of semi-State companies with people who have no expertise in the companies concerned and whose only claim to be on them is their cronyism with the parties appointing them. If that is not corruption what is?
A board representative of the workforce through a genuine democratic process should be put in place. If the workers of Aer Lingus are brought into the heart of the company in a democratic way the company can be transformed by the infusion of those who know best how it could be run most successfully. Representatives of the travelling public and the communities dependent on the airline should also be included.
I am glad this motion was put down but the Fine Gael opposition was only to the trade sale and not the flotation. The Labour Party opposes flotation but I did not hear any Labour Party representative say that if the party is to be in Government after the next general election it will be a condition of entering Government that Aer Lingus should not be privatised. That type of commitment is required if the party is serious about keeping Aer Lingus in public ownership.
As the Minister said in her speech, she is prepared to work with all interests to ensure the future of Aer Lingus. In this regard I fully endorse her initiative over two weeks ago to appraise the company unions of her intentions concerning privatisation. The discussions on an increases shareholding for Aer Lingus employees are to be resumed tomorrow. The Minister has clearly stated that the way forward is through partnership, especially between the Government, management and unions.
Many contributors to the debate referred to the company's current difficulties. These difficulties, which have affected the company's performance this year, arise from the impact of the industrial relations unrest, the foot and mouth disease outbreak and, increasingly, from the deteriorating global economic conditions. They are compounded by the company's increased cost base resulting from pay settlements and significantly higher fuel costs this year. As the Minister said, it is also worrying that the major airlines are reporting deteriorating performances for this year as this would appear to signal an emerging downturn in aviation.
In light of the deteriorating financial position now forecast for 2001, Aer Lingus management and staff must quickly resolve all outstanding industrial relations difficulties, refocus on the needs of the business and address internal issues over which the airline has direct control. This is crucial if the airline is to have the ability to cope with any emerging downturn. There is no ambiguity regarding the Government's policy for Aer Lingus. It has clearly outlined its intentions concerning the future of Aer Lingus and is committed to the privatisation of the airline. That policy takes account of the realities of the global airline market, the size of Aer Lingus and the need to position the company in the market to ensure that it is able to compete effectively in an industry undergoing significant changes.
The Minister said that she will not allow a crisis similar to the painful crisis that occurred in Aer Lingus in 1993 to develop. It is clear that strong and resolute decisions are required in relation to the future of the airline to ensure that this does not happen. The House would not be forgiving if the necessary measures were not taken now to secure the future of the airline. It is therefore entirely appropriate that the Minister should explore all possible options for the future of the airline, including a trade sale.
The Minister outlined the sequence of events which led to her current position. The IPO has been delayed because of the industrial relations unrest and the financial downturn. Against this background, the Minister asked her advisers to look at alternative sale options for the airline, to take soundings of interest from potential investors or buyers and to report back to her within a few weeks. She said that if there is merit in alternative sale options, having regard to the report of the advisers and other relevant issues, a formal sale process will be launched at the appropriate time, which will be open and transparent. It is too early to speculate on the outcome of the advisers' work.
The Government should be commended for not shirking its responsibilities in clearly identifying that Aer Lingus's long-term future is best served by moving the company to the private sector. This is not part of an ideological agenda to privatise State controlled assets. It is based on a clear realisation of what is in the best long-term interests of the airline as a small niche carrier in a very competitive market.
Aer Lingus has made, and continues to make, a significant and valuable contribution to Ireland's economic and tourism development by providing a range of quality services to destinations in our main markets in Britain, Europe and the United States of America. It is the Government's wish that the airline should continue to play this role in the future irrespective of its ownership status. The House can be assured that whichever sale option is chosen, or whenever it occurs, the Government will ensure that appropriate arrangements are put in place to protect Aer Lingus's traffic rights to Europe and the United State of America. These mechanisms have been deployed in the privatisation of State controlled airlines in other jurisdictions.
The Minister has asked me to reiterate, as she indicated in replies to questions today, that she has taken a keen interest in the concerns of Aer Lingus and Aer Rianta pensioners about pension increases. She will convey those particular concerns to the Minister for Finance in due course. The Government is clear in its policy for Aer Lingus, which it believes best guarantees the future of the airline. It will pursue this policy in partnership with management and unions.
I thank Deputy Higgins for raising this important matter. There is talk of a trade sale of Aer Lingus, but I hope it will not be a discount sale similar to the sale involving Eircom. Many people bought shares in Eircom but that experience may be one of the reasons the Government is considering a trade sale of Aer Lingus instead of a public flotation.
Ireland is an island nation and it depends the national carrier to promote the country as a major tourism destination. If the airline is sold, given that business is void of sentiment, any new owner will not have the same sentiment with regard to the promotion of Ireland. The caveats in the sale must be considered given that a basement price has been offered for Irish Steel. The figure of £300 million was offered, which is unbelievably low. The fact that the Minister is having discussions on the basis of such a low figure raises questions.
The Government is getting rid of the State's family silver. This is being done at a time when the economy is booming and taxation receipts are increasing, but what will happen in ten or 15 years? What is the purpose of the sale? The Government is obviously fearful of taking any risks with regard to a major asset, but the sale is very ill-advised.
Sligo regional airport started with the help of Aer Lingus some years ago and I thank the company for its support. Air access and equal access are considered fundamental in any region which hopes to be competitive in the future. Currently, both national and international routes are totally incapable of servicing existing passenger and freight requirements in the Sligo area and the Government must consider the development of regional airports.
When in Opposition, Fianna Fáil promised to support the development of regional airports. Funds have been allocated under the national development plan, but I am doubtful about when the airports will be able to avail of those funds. Only £11 million has been committed under the national development plan to regional airports. This says everything about the level of support for regional airports and their low level of priority.
Between 13 million and 14 million passengers come into Dublin Airport while Knock International Airport is hopelessly under-utilised. It has the potential to be a highly important element of infrastructure for almost all the BMW region, but the Government has done nothing about it. The plans to improve the highway infrastructure under the national development plan increase the prospect of vastly increased business from the midlands and other areas. The majority of the 13 million passengers come through Dublin Airport. Why has the Government not decided to direct traffic to the west, starting in Shannon and moving up along the west coast? The necessary facilities are available but they are under-utilised.
The Minister indicated that the current position at Knock International Airport does not provide the basis for further involvement by the taxpayer. However, Aer Lingus may be sold at a give-away price. There is a lack of commitment to regional airports although they have the potential to generate business in areas that have been marginalised in the past, such as Galway, Sligo, Waterford and Donegal. The potential for development and generation of business should be considered.
Eircom was sold for a very low price, but the people who bought the company did so as an investment. I know from business that such people are answerable to shareholders. They are not answerable to constituents or the taxpayer. It is a different ball game and instead of opting for a quick sale, the Minister should undertake a root and branch examination of the company. Why must the State sell this asset when it is making money? There is no justifiable case for it.
I ask the Minister to consider the development of regional airports. When in Opposition, the Fianna Fáil Party said it would invest in such airports. However, to date, that has not happened. In Sligo, the support promised by the Government has not been forthcoming and I ask the Minister to explain why.
I support the Fine Gael motion on Aer Lingus. I concur with the question posed by Deputy Perry as to why Aer Lingus needs to be sold. State enterprise has gone out of political fashion rather dramatically over the past four or five years. Just because it is out of political fashion does not mean there should not be any future for a State enterprise which has played a key role in turning this country around. Many decisions to privatise State enterprises throughout the European Union and worldwide have been correct, but there have also been incorrect decisions made. We need a balanced approach to State enterprise and particularly to our national airline, Aer Lingus.
The Minister of State, Deputy Jacob, said that Aer Lingus has made and continues to make a significant and valuable contribution to Ireland's economic and tourism development by providing a range of quality services to destinations in our main markets in Britain and elsewhere. We have to reflect very seriously and give maximum consideration to the future of our national carrier. The references to auctions made by the Minister, Deputy O'Rourke, in recent weeks regarding Aer Lingus have not been very helpful. Any State asset being put through the auction rooms of the Minister, Deputy O'Rourke, who made some disastrous moves in regard to Eircom, would be met with great reluctance by the public. I hope that the Minister of State, his colleagues and wiser counsel will prevail and that the Minister will reflect very seriously before she moves to sell our national airline, and that she would in particular rule out the prospect of a trade sale.
I support what has been said by Deputy Perry regarding the regional airports and the need to further develop the regions. At this stage Cork is bigger than a regional airport but I think it needs more investment. I look forward to the time when we will have regular transatlantic flights into Cork. We have the facilities and the runway capacity but we need a stronger signal from Government to our national airline that there should be regular transatlantic flights. It would make a difference to the airport and the region. The other aspect of representation as far as Cork is concerned, relates to Aer Rianta more than Aer Lingus. The point has been made time and again that the Cork region needs representation on the board of Aer Rianta. The Minister has made certain moves in that regard but I would like to see more progress.
I support the motion and put on record my view that while public enterprise can be considered for privatisation and outside investment, it should not be automatic that we have to privatise every public enterprise. Just because it is the political fashion throughout the European Union does not mean that it is always correct. I hope the Minister moves with caution in regard to Aer Lingus and that she casts aside the question of a trade sale and if she does move down the route of privatisation, that she will do it with more care and attention than was the case when she went to privatise and sell off Eircom. We do not want an Eircom disaster mark two happening to Aer Lingus.
(Mayo): This is a very sad occasion. This debate should not be happening at all. We should be celebrating the success of Aer Lingus and talking it up. We should be buoyant about Aer Lingus rather than, as the Minister has done, talking Aer Lingus into an early grave. This is like saying the obsequies for Aer Lingus. We came in here yesterday evening expecting that the Minister would sketch out some kind of development plan. All we got from her was a list of the trials and tribulations of the company.
I thank all the Deputies who contributed to this debate, particularly those from all sides of the House who supported the sentiment of the motion. I thank especially the Deputies on the Opposition side who unanimously supported the thrust of the motion and will vote for it tonight. I thank the Labour Party and Deputy Stagg for agreeing with the motion. We also agree with their amendment and I think that essentially we are singing from the same hymn sheet. They amend the motion to say that we recognise that the strategic role of Aer Lingus can best be guaranteed by the airline remaining in public ownership. As regards the disposal of Aer Lingus by way of either IPO or a trade sale, the first is not on in either the short or long-term, and the second may be on in the long-term provided we get our act together.
We came in here expecting a positive response, but as Deputy Stagg said last night, all one has to do is look at the performance of this Minister. It has been one hare-brained idea after the other, excellent from the point of view of photo opportunities but hopeless from the point of view of managing her Department. Look at the Eircom debacle which has left 500,000 small shareholders searching their empty pockets and wondering why did they borrow or why did they use their small savings.
Let us look at her performance with regard to the other State utilities. Deputy Stagg referred to the Minister last night as the Molly Malone of the midlands – cockles and mussels, selling fish at any price, whether it is ESB or the INPC it did not matter as they were all up for sale. The final insult to Aer Lingus must have been her statement that she is prepared and determined to move the company to the private sector. From 1936 to 2001 this company has given 65 years of excellent and proud service to the flying public and to the welfare of this nation. This is an airline that flew the flag for Ireland and put us on the international stage long before the era of mass communications. It is an airline with an unrivalled service ability and one that has won the affection of the travelling public both Irish and international. It is an airline with an unparallelled safety record. It is an airline that made £55 million in 1999 and £60 million in 2000 and then yesterday evening in the midst of her enthusiasm to sell off Aer Lingus, the Minister informs us that she is putting it up for sale. Whether it is a car boot sale or by way of Dutch auction or jumble sale, she is selling it off with about as much emotion as somebody selling a rag doll at a bazaar.
She told the international predators out there, the vultures, that Aer Lingus is going to record a loss this year. Imagine any Minister selling a product, talking down their own product, but particularly a national utility, saying it is going to make a loss. We are not six months through the year and do not know what the returns are but the Minister is telling the predators in the international community, the vultures and venture capitalists, that the airline that she is putting on the market to sell off to the highest bidder is going to record a loss this year. Could one be more demeaning to an airline which has done this country proud? Yet that has been the attitude of this Minister.
As Deputy Stagg said last night, this is coming from the republican party, the so-called Nationalist party, the soldiers of destiny who have absolutely no vision or optimism when it comes to the national airline. Airlines go through tough rocky patches, it is a cyclical business with ups and downs, but eventually if the company is strong enough and gets enough encouragement it will come through. The problem is that this Government has not given Aer Lingus the kind of leadership or support it needs; indeed the opposite has been the case. For the past four years there has been a series of industrial relations problems and instead of sorting them out one by one they were allowed to accumulate and in the last nine months the airline was grounded on successive days, each day costing £2 million. Over the past three years alone there have been three chief executives. When the Government should be investing in and resuscitating the airline all it got was negative comment and little by way of a helping hand.
Tonight we are debating the demise of an airline which is part and parcel of what we are, an airline which is on a par with Guinness in terms of reflecting Irish and Irishness. It is a brand label which has carried the flag throughout the world.
We will not tolerate what this Minister is proposing. What we are collectively saying is hands off Aer Lingus; it is not for sale. Take down the for sale sign, put your money where your mouth is, refloat the company and let it go forward into the next decade and on into the century with the sort of confidence shown by those who founded it in1936 who had that pioneering spirit. Give Aer Lingus the role it deserves and the role it must have, a unique national carrier in State ownership.
Amendment put.
Tá
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Ahern, Michael.Ahern, Noel.Andrews, David.Ardagh, Seán.Aylward, Liam.Blaney, Harry.Brady, Johnny.Brady, Martin.Brennan, Matt.Brennan, Séamus.Briscoe, Ben.Browne, John (Wexford).Byrne, Hugh.Callely, Ivor.Carey, Pat.Collins, Michael.Cooper-Flynn, Beverley.Coughlan, Mary.Cullen, Martin.Daly, Brendan.Davern, Noel.Dennehy, John.Doherty, Seán.Ellis, John.Fahey, Frank.Fleming, Seán.Flood, Chris.Gildea, Thomas.Hanafin, Mary.Harney, Mary.Haughey, Seán.Healy-Rae, Jackie.Jacob, Joe.Keaveney, Cecilia.Kelleher, Billy.Kenneally, Brendan. |
Killeen, Tony.Kirk, Séamus.Kitt, Michael P.Kitt, Tom.Lenihan, Brian.Lenihan, Conor.McGennis, Marian.McGuinness, John J.Martin, Micheál.Moffatt, Thomas.Molloy, Robert.Moloney, John.Moynihan, Donal.Moynihan, Michael.Ó Cuív, Éamon.O'Dea, Willie.O'Donnell, Liz.O'Donoghue, John.O'Flynn, Noel.O'Hanlon, Rory.O'Keeffe, Batt.O'Keeffe, Ned.O'Kennedy, Michael.O'Malley, Desmond.O'Rourke, Mary.Power, Seán.Ryan, Eoin.Smith, Brendan.Smith, Michael.Treacy, Noel.Wade, Eddie.Wallace, Dan.Wallace, Mary.Walsh, Joe.Wright, G. V. |
Níl
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Allen, Bernard.Barnes, Monica.Barrett, Seán.Bell, Michael.Belton, Louis J.Boylan, Andrew.Bradford, Paul.Broughan, Thomas P.Browne, John (Carlow-Kilkenny).Burke, Liam.Burke, Ulick.Carey, Donal.Clune, Deirdre.Cosgrave, Michael.Crawford, Seymour.Currie, Austin.D'Arcy, Michael.Deasy, Austin.Deenihan, Jimmy.Dukes, Alan.Enright, Thomas.Finucane, Michael.Gilmore, Éamon.Gormley, John.Higgins, Jim.Higgins, Joe.Higgins, Michael. |
Kenny, Enda.McCormack, Pádraic.McGinley, Dinny.McGrath, Paul.Mitchell, Gay.Mitchell, Olivia.Moynihan-Cronin, Breeda.Naughten, Denis.Neville, Dan.Ó Caoláin, Caoimhghín.O'Keeffe, Jim.O'Shea, Brian.O'Sullivan, Jan.Owen, Nora.Penrose, William.Perry, John.Rabbitte, Pat.Reynolds, Gerard.Ring, Michael.Ryan, Seán.Sargent, Trevor.Shatter, Alan.Sheehan, Patrick.Shortall, Róisín.Stanton, David.Timmins, Billy.Upton, Mary. |
Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Stagg and Bradford.
Amendment declared carried.
Question, "That the motion, as amended, be agreed to", put and declared carried.