Dáil Éireann díospóireacht -
Wednesday, 12 Dec 2001

Vol. 546 No. 4

Written Answers. - Future of Aer Lingus.

Jan O'Sullivan

Ceist:

61 Ms O'Sullivan asked the Minister for Public Enterprise the outcome of the Transport Council meeting on 6 December 2001 with regard to State investment in Aer Lingus and assistance to airlines as a result of the events of 11 September 2001; and if she will make a statement on the matter. [32011/01]

Trevor Sargent

Ceist:

65 Mr. Sargent asked the Minister for Public Enterprise the outcome of negotiations on the future of Aer Lingus to date; and the position and plans of the Government regarding these negotiations. [32024/01]

Minister for Public Enterprise (Mrs. O'Rourke)

I propose to take Questions Nos. 61 and 65 together.

At the Transport Council meeting on 6 December last, I again made my case to the Commission about the need for an expansion of the horizontal four-day compensation measure for EU airlines as a result of the events of 11 September 2001.

I stated that I was very satisfied that the airline industry had responded to an exceptional situation quickly and appropriately by taking painful and often drastic measures to respond to market conditions. However, the scale and exceptional nature of the crisis also demanded a measured but adequate response from the Commission and from member states.

I pointed out again that the four-day compensation measure agreed at the Transport Council on 16 October was minimalist and inadequate having regard to the scale of the crisis and the US emergency aid package. I repeated that we must not allow terrorism to damage our industry and that these dreadful circumstances should not be used by anybody pursuing a consolidation agenda to fast-track their aims. I stated that Ireland had already notified the Commission of the details of our scheme for the payment of the four-day compensation to Irish airlines. A number of claims have been received from Irish airlines and payment has already been made to Aer Lingus. Payment will also issue to another Irish airline this week.

In my concluding remarks, I said that Ireland would be availing of the provision agreed at the October Council that member states may make a case for compensation beyond the four days based on objective criteria. We have already advised the Commission of our intention in that regard. I referred again to the strategic importance of Aer Lingus transatlantic services and that we therefore retained the right to make any proposal to the Commission regarding any form of investment in Aer Lingus which the Irish Government may deem appropriate.

While some member states did express support for Ireland's position, no agreement was reached about an expansion of the measure. In particular, the Commission remained resolute that the horizontal measures already agreed were adequate.

In addition to the four days compensation measure, Aer Lingus has furnished information about the full costs of the impact of the terrorist attacks for the month of September. My officials will be notifying the Commission of this amount and advising that we have asked the company to provide the relevant figures to the end of December when they become available. On receipt of that information I will submit a case to the Commission under the provision agreed at the October Council.

Specifically regarding the Aer Lingus survival plan, as the House will be aware, the Labour Relations Commission issued proposals on 28 November on pay and work practice changes relating to the plan. In addition, in accordance with the Government decision of 23 October, talks between officials in the Departments of Public Enterprise and Finance and the unions are progressing on an increased shareholding up to a total of 14.9% by the Aer Lingus employees in the company, including the quantum of existing shares held by staff. I am hopeful that a satisfactory outcome will be achieved shortly. I welcome the fact that SIPTU has already commenced a ballot of its members on the LRC proposals. IMPACT has yet to indicate when it will commence a ballot of its members. All parties are aware of the need for urgent agreement on the plan which is vital to ensure the survival of a fundamentally restructured Aer Lingus capable of providing the maximum number of sustainable jobs.