Joint Committee on Transport and Communications Networks díospóireacht -
Tuesday, 9 Feb 2021

Issues Facing the Aviation Sector: Discussion (Resumed)

Chairman

The purpose of our second session is to examine the challenges facing aviation workers and travel agents. On behalf of the committee, I welcome Mr. Paul Hackett, board member of the Irish Travel Agents Association, ITAA, and Mr. Pat Dawson, its CEO. From the Irish Air Line Pilots Association, IALPA, I welcome Mr. Evan Cullen, president, and Mr. Alan Brereton, vice president. From Fórsa, I welcome Ms Ashley Connelly, aviation sector organiser, and Mr. Johnny Fox, assistant general secretary, service and enterprise division. From Connect Trade Union, I welcome Mr. Paddy Kavanagh, general secretary. From SIPTU, I welcome Mr. Neil McGowan, aviation sector organiser, and Mr. Tony Carroll, industrial aviation sector. I thank the witnesses for participating at such short notice.

All witnesses are reminded of the long-standing parliamentary practice to the effect that they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable or otherwise engage in speech that might be regarded as damaging to the good name of the person or entity. Therefore, if witnesses' statements are potentially defamatory in respect of the identified person or entity, they will be directed to discontinue their remarks. It is imperative that they comply with any such direction. For witnesses attending the meeting remotely outside the Leinster House campus, there are some limitations to parliamentary privilege and they may not benefit from the same level of immunity from legal proceedings as witnesses who are physically present. Witnesses participating in this meeting from jurisdictions outside this State are advised that they should be mindful of their domestic law and how that may apply to the evidence they give.

Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person or entity outside the Houses or an official either by name or in such a way as to make him or her identifiable. Members are also reminded that they are only allowed to participate in this meeting if they physically locate in the Leinster House complex. In this regard, I ask that, prior to making a contribution, they confirm that they are on the grounds of the Leinster House campus.

For anyone watching this meeting online, Oireachtas Members and witnesses are accessing this meeting remotely. Only I as Chair and the staff essential to the running of the meeting are physically present in the committee room. Due to these unprecedented circumstances and the large number of people attending remotely, I ask everyone to bear with us should technical issues arise.

I draw everyone's attention to our severe time limitations, for which I apologise. I ask witnesses and members to operate within their time slots. I want the witnesses to be able to give the committee their key messages and requests on behalf of the people they represent so that we can leave this meeting with a collective view. However, I am conscious of the lack of time.

I invite Mr. Cullen, who has four minutes. I apologise for the time limitations, but we are where we are.

Mr. Evan Cullen

IALPA welcomes this opportunity to appear before the Oireachtas Joint Committee on Transport and Communications Networks on behalf of the 1,200 professional pilot members in Ireland. Mindful of the short time available to us today, this opening statement is short and focused on one or two key issues identified by IALPA members as significant for the continued survival of the aviation sector in Ireland.

We refer to recent news coverage and reported comments from the Tánaiste in The Irish Times on 26 January that "international travel was unlikely to reopen until sometime in the future, but certainly not for the summer". It appears that there is now a prevailing narrative that international travel is preventing Ireland from becoming a Covid-free island like New Zealand. Clearly, the Government shares this view and is preparing to close Ireland to international travel further for the foreseeable future.

The €80 million support package for the aviation sector announced in November was essentially a grant for Ireland's airports, the majority of which are State owned. The funds left over for the airlines may have, at best, covered a few days' worth of losses. Our airlines are intrinsic to the success of an island nation like Ireland, and they supply economic lifeblood, bringing, among other things, foreign direct investment and an estimated €10 billion into the Irish economy annually. Every aircraft that leaves Ireland will represent lost jobs and lost GDP. It is an economic fact that if our airlines are allowed to go out of business, the consequences for the Irish economy will be devastating.

Most governments have recognised such dangers and have accepted that if they are to intervene to prevent airlines operating for the sake of virus suppression, they must ensure those airlines do not go out of business as a result. New Zealand, so often our favoured Covid comparator, moved quickly to extend supports worth $900 million to Air New Zealand. Much closer to home, the list includes €10 billion for Lufthansa, €7 billion for Air France, €2.5 billion for British Airways, and €1.2 billion for TAP Air Portugal. The UK Government provided a loan worth €670 million to Ryanair, an Irish airline, such was the value it placed on its contribution to the UK economy. We have provided the committee with a copy of recent media coverage detailing the state aid approved by the European Commission for dozens of European airlines from their respective governments. Why does Ireland remain an outlier as the only European country not to provide meaningful financial aid to its indigenous airlines?

The window remaining for decisive action is fast closing. Airlines plan and budget for their vital summer schedules at this time of year and they will soon have to make hard decisions based on expected market conditions. Our Government needs to understand that creditors and airline owners will not allow for yet another lost summer. They will cut their losses and move their money and assets to other countries that support aviation. The market will not save Ireland's airlines.

If international travel must be suppressed into the future, significant financial aid for Irish airlines is the only option available to avert sectoral collapse. If the Government acts to suppress travel, the Government must also act to save our airlines from the destruction that such interventions cause. They cannot have it both ways. We implore the committee to lobby the Government to provide meaningful financial aid to Ireland's airlines before it is too late.

Over the weekend it was reported that Aer Lingus accessed that €150 million loan facility. We understand that was to address a problem it had last year. It will not do anything for the problem that has now been created because the Government has cancelled the summer of 2021. In our submission we also include an IATA document on the importance of air transport to Ireland. We also provide detailed information on the dozens of airlines across Europe that have received direct government aid.

Ms Ashley Connelly

Fórsa represents over 80,000 members, including around 5,000 workers in airlines, airports, air navigation bases, aviation regulatory bodies and air traffic control. Eleven months of pay cuts, lay-offs, redundancies and job insecurity along with continued uncertainty about the future have put aviation workers and their families under significant strain. For many, mortgage and other debt incurred during this period will be a burden for years to come. It is not sustainable for these members to continue to endure this hardship. With no early end to travel restrictions in sight, thousands of jobs will remain at risk unless the State acts now.

While the industry and its staff have benefited from State wage supports, Ireland continues to lack a European-style joined-up Government approach to underpin jobs in the sector, protect aviation infrastructure and ensure the survival of a viable post-pandemic industry. This runs the risk that Irish aviation will be left behind when the rest of the world moves on, with potentially devastating implications for the national economy and employment in the aviation sector, and the sectors and communities that depend on it.

It is highly likely - if not certain - that aviation will be among the last industries to emerge from this crisis yet the Government has been slow to engage fully with stakeholders. Recommendations from the task force for aviation and this committee have been largely ignored. This inaction is placing an entire industry at risk along with the jobs and connectivity it supports.

Fórsa’s written submission to this committee gives a detailed assessment of the impact of the crisis across the industry and contains a range of recommendations both for the sector as a whole and for specific companies. I will draw particular attention to three industry-wide requirements. First, we make recommendations regarding income supports that acknowledge their contribution to the sector and its staff while highlighting the need for a flexible, industry-specific approach for this phase of the aviation crisis. There is a strong risk that the employee wage subsidy scheme, as currently constructed, will lack the flexibility required to underpin employment relationships in the sector, which is essential if we are to position the industry to bounce back post Covid. Fórsa is proposing an aviation income support scheme similar to that in place in Germany, which enables employers to reduce hours rather than laying staff off, with Government income support for the time employees cannot work. Second, we emphasise the need for Government-led social dialogue with employers and unions to underpin a sustainable and thriving aviation industry as we emerge from the pandemic. Third, Fórsa is calling for the Central Bank to adopt European Banking Authority, EBA, guidelines for the extension of mortgage payment breaks in 2021. The European guidelines do not currently apply in Ireland, where the application process is slow and onerous. After 11 months of income reductions and no early sight of recovery, this is placing avoidable strain on our workers.

Ireland went into this crisis as a major force in global aviation and our connectivity to the rest of the world plays a crucial role in supporting economic activity and attracting inward investment. It is, therefore, crucial that we act collectively to ensure that the industry not only survives the impact of this current crisis but is fit to perform robustly as and when safe international travel resumes. Fórsa’s approach has been to work closely with aviation employers to maximise job protection but this approach cannot succeed without significant and continuing Government support and intervention. The union continues to call for any such support to be contingent on the avoidance of compulsory redundancies and the offshoring of Irish aviation jobs.

Mr. Paddy Kavanagh

I will not take as long because most of the points have been made and I do not want to repeat them. To summarise, since we last met in November, the situation for our members has continued to deteriorate and has got much worse. Connect not only represents members in the airlines and the airports but also those working in production areas. At the moment, those workers are also experiencing significant lay-offs and redundancies and an inability, particularly among younger workers, to obtain mortgages, etc., because of reduced circumstances. We have seen situations where workers have had agreements for pay, etc., deferred. There are deep concerns about health and safety, particularly the roll-out of vaccines for workers in airports. If people are to be ready for the upsurge, they must be protected for when that comes. We all know about the downturn in figures and the impact of that on numbers. We echo what has been said about increased Government support for the industry similar to what we have seen across Europe. We are calling for some very precise issues that we feel have been missed to be addressed.

No worker should be subject to compulsory redundancy while his or her employer is benefiting from any Government subsidy during the pandemic. The legislation on redundancy means that workers who are currently laid off or on reduced hours cannot avail of voluntary redundancy, yet that time is not counted as service. If we are denying workers the right to voluntary redundancy, that time should be counted as service. This is a serious issue for our members. We would support a system similar to the German kurzarbeitergeld system or even that of Sweden, where workers who continue to work during the pandemic are supported through better terms. In that context, we are concerned about a future skills shortage in maintenance and specialist roles because people are leaving the sector. When the upturn comes, there will be a skills shortage. Our members have particular and precise specialist skills in certain areas and we are concerned that when the upturn comes, which it will, there will be a shortage of skills. In that context, we are asking the State to see this as an opportunity to subsidise the industry for specialist upgrading or maintenance works that could be done to get the airports and airlines ready for the upsurge when it comes. Basically, we support everything else that has been said here.

Approximately one third of our union members are in construction. While construction has been badly hit, we understand that the sector will resume much more rapidly than aviation. Aviation will not be where it was pre-pandemic until 2024 or 2025 according to the latest estimates. Workers in the aviation sector will suffer the longest hit and they must be taken care of with some sort of scheme to ensure that while they remain in the industry, their earnings are protected.

Chairman

I thank Mr. Kavanagh and now invite Mr. McGowan from SIPTU to make a four-minute presentation.

Mr. Neil McGowan

I thank the Chairman and members of the committee for the opportunity to make a presentation. The Covid pandemic has had a devastating impact on the aviation industry, which continues to worsen by the day. All workers in aviation have suffered a significant drop in income due to the pandemic. Those that have remained in work have suffered drops in working hours and pay, thousands have faced lay off and many more have lost their jobs on a permanent basis. Flights and passenger numbers have collapsed and the industry has been brought to its knees. The outlook for aviation in the short- to medium-term is bleak and workers face into 2021 with real uncertainty and fear for their jobs.

Despite a dramatic drop in earnings, workers in aviation continued to work throughout the pandemic. This has allowed essential medical supplies, PPE and most recently, vaccines, to continue to arrive in the country. While State supports through wage subsidies and financial support for the regional airports are welcome, they simply do not go far enough given the depth and breadth of the crisis.

To ensure that we have an aviation industry post-Covid, a number of actions need to be taken immediately by the Government. SIPTU recommends the extension and amendment of the employment wage subsidy scheme, EWSS, for the aviation sector to ensure that employment is maintained in the industry. The scheme should be tailored for the aviation industry so it becomes a genuine short-time working scheme based on the German model that pays 85% of pre-Covid earnings. It must be made conditional on several binding commitments from employers, including that no worker be made redundant on a compulsory basis and that no worker suffers a permanent reduction in any terms and conditions of employment, unless by collective agreement, while the employer is benefiting from the EWSS. SIPTU recommends that Shannon Airport be returned to the same management group as Dublin and Cork airports. The separation of Shannon Airport has not been a success and the Covid crisis has brought into question the airport's long-term viability. Given the airport's absolute importance to the region's economy, SIPTU believes it must be brought back into the same management group as the other State airports. SIPTU recommends the introduction of free and rapid testing for all airport workers and that aviation workers be given the vaccine at the appropriate time. Any financial support by the State directly to airports or airlines must be accompanied by conditionality that prohibits compulsory redundancies or a reduction in terms and conditions. We believe that such support is required at levels well above what we have seen to date.

In the absence of the Government taking meaningful action, we simply will not have a functioning aviation sector in this country. Given we are an open island economy, the country will not recover to the full extent without a functioning aviation sector. The thousands of people who depend on aviation directly and the hundreds of thousands in the wider economy who need a functioning aviation industry need the Government to act now through the tailored supports for which our union is calling.

Mr. Paul Hackett

Things were bad when we spoke to the committee in October and they have got much worse. There was no reopening date for travel back then and we assumed it would resume in the second quarter of 2021. This has now been pushed out to the first quarter of 2022 with no prospect of international travel in 2021. Last Thursday on "Prime Time", the Taoiseach said that travel had totally collapsed and that some of the measures are a deterrent to travel and will have an impact. On 1 February at the daily NPHET briefing, the Chief Medical Officer said it is not realistic to expect people can fly to Europe or other destinations for summer holidays and the only beach they are likely to travel to is their local one. We now have the €500 fine for anyone travelling for nonessential reasons. There is clearly no doubt that travel agents cannot trade.

We, as an industry, are responsible and customer focused. We have always and will continue to follow public health guidelines. However, if NPHET and the Government want to close down international travel for a year, they need to put in place the appropriate level of support if they want an Irish travel industry when international travel can safely resume. We are a unique sector in that we have had to remain open to clients to facilitate refunds with practically zero income for almost two years. The travel sector needs a bespoke response with a specific support as a consequence of being closed on public health grounds linked to international travel.

Let me summarise the supports in place. The travel industry is accessing the EWSS similar to other sectors. The scheme is available when turnover is down at least 30%. We are more than 90% down and for 2021 we could be 100% down. We also have no visibility on wage supports after 31 March. Most of the travel industry is accessing the Covid restriction support scheme, CRSS. This is designed to assist with nonpayroll costs. To qualify, a business must be 75% down on turnover compared to 2019 and it applies from level 3 and above. The travel industry has been told the scheme only applies to it at levels 4 and 5. This is an advanced tax credit; it is not a grant. The maximum threshold of €5,000 per week seems reasonable provided turnover is €4 million per year or less but for any travel company above this level the support simply does not cover non-payroll costs to any material extent. This is a retail-focused assistance and does not cover all Irish licensed travel companies. The CRSS does not support a downturn in business and is directly linked to the levels in the Covid framework but, clearly, travel agents are prevented from trading irrespective of the levels, and have been since March 2020.

The Government introduced the refund credit note scheme in summer 2020. This is a cash flow mechanism to assist with delayed supplier refunds. We need to be clear that the refund credit note is not a grant, a subsidy or a support. It is a pure cash flow mechanism introduced with a nine-month delay on the assumption that the industry would be back trading. Clearly this is not the case and we need a solution to this issue similar to the approaches adopted with EU approval in Denmark, the Netherlands, Portugal, Bulgaria and others.

This brings us to the issue of airlines refunds or the lack thereof. When we spoke to the committee last October, we outlined the potential reason for the delay on the part of one particular airline being down to a conflict over two EU directives that impact the travel industry. This has turned out to be the case and we can go into more detail in the question-and-answer session. The fact is that a significant number of refunds to customers for cancelled flights are outstanding. Given the current talk of no international travel for 2021, we need to discuss the issue of consumer protection and refunds when flights operate contrary to Government advice on travel. These are known as "ghost flights" and the ultimate loser is the consumer.

Committee members may also recall that the ITAA called for pre-departure airport testing when we addressed the committee back in October 2020. The aviation recovery task force, the airports and airlines also called for predeparture airport testing. What ensued was a debate with the medics over which test should be used and none was introduced. Subsequently, we have been dealing with the issue of variants of Covid that arrived into Ireland in late 2020. Was predeparture airport testing a missed opportunity?

When we addressed the committee in October, there was no talk of vaccines. The State is spending €1 billion a week in supports and related costs and we are being told there is a vaccine supply issue. There does not appear to be a supply issue for some countries and given this is a life-saving opportunity, it appears that we are lagging well behind in getting the vaccine into the arms of our citizens.

Chairman

I thank Mr. Hackett.

We have about 21 minutes remaining and eight members can have 2.5 minutes each. It is important that we hear from the witnesses about the overall issues. I ask members and witnesses to be cognisant of the fact that there is 2.5 minutes for each question and response. I will have to be strict on time because I want all members to be able to get in.

Deputy Joe Carey

I thank all of the witnesses for their presentations. I refer to Mr. Cullen's presentation. What type of engagement has happened between airlines and Government to get the funding injection needed? It is welcome that Aer Lingus has been provided with a loan. To what extent do the witnesses believe that indigenous airlines need funding to keep them going so that we have an airline industry after this?

There is broad consensus from the witnesses on the German model. I ask Ms Connelly to expand on what that means in real terms. What is Germany doing that we could do?

Mr. Evan Cullen

Ryanair has just emerged with its results. It was in a closed period until a couple of weeks ago. Aer Lingus is part of IAG and is in a closed period. It will announce its results at the end of February or in early March. During these periods, the airlines cannot talk to anybody about their financial state. Other airlines have indicated to us that they asked for assistance from the Government. If we are to believe those executives, they said none was forthcoming. We understand however that there has been some discussion with the Government. That is all confidential, based on market sensitive rules on share prices and so on.

There are aviation economists in IALPA whom we use for various negotiations. The airlines need assistance in the form of direct State aid. They cannot take on any more loans on their balance sheets. It is important to note that when we last spoke, there was a reference in the committee's report to green shoots for 2021. It came as an enormous surprise to us in January when the Government effectively closed international travel for the summer of 2021. Every assumption we built into our plans was that we would get to a space of at least 70% of the 2019 production in 2021.

That has now been scuppered. We will be lucky if in 2021 we get to 10% of the 2019 level of production. Therein lies the problem. We will also go into 2021 without the cash we had in 2020. A lot of bookings were made in early 2020 for the summer of 2020. That booking cash is no longer available and we are going into a zero revenue 2021. Problem after problem is being heaped on us. All the assumptions for getting out of this crisis have now proved to be false. It looks like there will be a recovery in quarter 1 or 2 of 2022, if there are any airlines to take on that recovery. That problem is massive and cannot be dealt with through loans from ISIF. It has to be dealt with through direct financial State aid. That is now the only way out of this.

Chairman

I apologise for the time constraints but we have no choice.

Ms Ashley Connelly

In regard to the scheme are making reference to, it is the short-time work benefit scheme, kurzarbeit. Germany has put in place an extension to the terms of the scheme and the rates at which it is paid.

For the first three months, a person would get 60% of basic salary for days not worked. They have looked at increasing that to 70% from the fourth to the sixth month and up to 80% or 85% from the seventh month. Our members have now seen 11 months of pay reductions and reduced working hours, or in some cases lay-offs. This would help shore up incomes and ensure these people do not have problems with mortgage or rent arrears in future. We are very concerned that the debt burden being carried by our members is not sustainable.

A scheme like this will give a level of certainty for the next 21 or 24 months so people can plan their livelihood. Many members I have engaged with found when their children went back to school last year that getting the benefits from the State could be quite complicated when in receipt of the employment wage subsidy scheme. Many members, for example, found themselves appealing to get the third level grants. Much more flexibility could be adopted if we engaged together on this. We could find the solutions that would give certainty to all members working in the aviation industry, including our colleagues here today from the travel agent sector. I hope this is helpful and I am happy to share any further information if required.

Deputy Darren O'Rourke

I thank all the witnesses. Will Mr. Dawson and Mr. Hackett outline the long-term threat to the Irish travel industry? I will pick up on the point about the scale of the response from the Government being an outlier in international comparisons. What sort of scaled response do the representatives of the aviation industry want to see? I am conscious that the junior Minister in the Department stated last week that if more needs to be done, it will be done.

Mr. Pat Dawson

The long-term position with travel agents is that we will have two years without any income whatever. As my colleague, Mr. Hackett, has said, we got some help but that will certainly not keep us afloat. We have 200 small companies dotted around Ireland and to date the support has not been tailor-made. We will meet the Minister for Transport for the first time next week and perhaps that will bring something. Currently we are bleeding money and new licences must be issued on 1 April. It is a bleak front for all of us. We have not got enough support. We are fighting through refunds and trying to support our customers. We have certainly got little or no meaningful help from the Government.

We were at level 4 or level 5 restrictions for 15 weeks of last year's 52 weeks. The Covid restrictions support scheme has proven useless because we have seen level 5 restrictions so much over the past 12 months. It looks like this could last for two years. We are in dire straits. Many Ministers have promised to help us in a meaningful way but that has not happened.

Senator Timmy Dooley

I thank everybody for their presentation. I and others have been really anxious to highlight this very serious matter and the witnesses have done that exceptionally well for all facets of the aviation sector. They have rightly identified that the expectation for some recovery was this year and, quite frankly, with the current status of the virus, that will not happen.

Will the witnesses provide some further documentation? I am interested to hear what a number of witnesses have mentioned with respect to Germany. It certainly sounds like a model we could look at. I am hopeful that when the committee receives those documents, we might put together a short presentation or report for the Department of Transport and the Government as a whole to follow up.

Mr. McGowan mentioned other matters close to my heart of trying to get Shannon Airport back into the cluster of airports with Dublin and Cork. It is something I will certainly support as time goes on. The crisis is immediate.

The witnesses rightly identified the fact that we cannot have one picking off the other. There cannot be an opportunity now to shed employees at this time, particularly when one considers the efforts that aviation workers have made throughout the crisis. If possible, can the witnesses provide further information on the schemes that have worked and that are working well throughout Europe?

Chairman

I call on each of the witnesses to come back with a one-pager fleshing out specific supports and schemes. Maybe we could have a little more flesh in a more condensed way. It is a big ask but we want to do something productive on behalf of the organisations and their members. Can we flesh out the position relating to the German model? Mr. Cullen made reference to direct state aid being required rather than loans. Can we hear a little more detail so that we can come back on that?

I have two questions for Mr. Cullen and Mr. McGowan. They have been involved in the aviation sector over many years. Where does the crisis rank in the context of others that have occurred in their lifetimes? My next question is for the travel agents. Michael O'Leary appeared on "Morning Ireland" recently. He said that all refunds had been completed. Is that the case? We will hear from Mr. Cullen first and then Mr. McGowan and Mr. Hackett.

Mr. Evan Cullen

I was involved in the restructuring negotiations following the tragic events of 11 September 2001. I was also involved in restructuring negotiations following the economic crisis in 2008 and 2009. This is, by a multiplier of ten, far more serious. All those crises had certainty about their ending and about what needed to be done to fix the problems. The uncertainty created by this crisis is extraordinary. In the context of having an entire summer cancelled after the previous one being cancelled, no airline in the world structured its finances around being able to go for two years without revenue and still pay its obligations to the aircraft lessors. That is where the big cash drain lies. Aircraft are extraordinarily expensive. When they are not in operation and making money, they are very expensive indeed. Paying those leases is what will pull us down.

Mr. Neil McGowan

I agree with Mr. Cullen's assessment. Aviation is an industry that has been through many crises in recent decades. Yet, the depth and breadth of this crisis is almost impossible to articulate in terms of the impact it has had on the industry. I do not believe any of us could ever have imagined that we would be looking at a situation where almost two years' worth of activity is likely to be lost. It is almost impossible to articulate the depth and breadth of the crisis. It makes the issues we had to deal with in previous crises look relatively simple by comparison with what is facing aviation workers now and what has faced them during the past 12 months.

Chairman

Have all refunds been paid by Ryanair to customers as Michael O’Leary said?

Mr. Paul Hackett

No, I am afraid not. Ryanair has acknowledged that it has an obligation under EU Regulation 261/2004 to refund customers. Ryanair has told us that it wants to do so directly to customers and the travel agents accept that. We are absolutely behind the airline in getting those refunds to the customers, including families, retirees and everyone else who is due that money from last year. That is the primary concern.

We have a shared objective in processing the refunds. As part of that, we engaged in Ryanair's customer verification process. We submitted a raft of documentation. At some point in October or November, the Ryanair systems seemed to stall. Some cheques issued from a German bank. Nothing has come out since then. Ryanair is now looking for bank details to do bank transfers. The end customer is the person suffering here, not the travel agents. We all accept that the refund can go directly to the customer. We really need Ryanair to do that. I hope that we can come back before the committee at the end of February and give an update on where that matter stands. We will do whatever we can to work with Ryanair. Our customers have done it and we want to do it. Let us get the refunds processed.

Chairman

We will follow up with Ryanair on that.

Deputy Cathal Crowe

Can the Chairman look at the chat contribution?

Chairman

The next slot up is Deputy Ó Murchú. I will come back to Deputy Crowe on that.

Deputy Ruairí Ó Murchú

This is either to Mr. McGowan or Ms Connelly. We need that piece of paper the Chair spoke about. We need a half page on what is necessary. On the wage subsidy scheme and the need for a bespoke solution with protections for workers, I ask the witnesses if they can give an update. We need an update on travel agents as well as soon as possible, on where they are regarding refunds. If we had that information, we could put it on the governmental agenda with a view to getting a result.

Chairman

I thank the Deputy. I call Deputy Cathal Crowe, who has two minutes.

Deputy Ruairí Ó Murchú

Will I be able to get that update on the bespoke solutions?

Chairman

Does the Deputy want a response? The witnesses have covered what they are looking for and they will write to us in that regard. I am conscious of time and I have two members looking to come in.

Deputy Ruairí Ó Murchú

All right. Go on ahead. If they have time at the end, they can build it into other answers.

Deputy Cathal Crowe

The best country we can look at in terms of what is happening is perhaps Israel, where they have had an advanced roll-out of Covid vaccines. We will have to see how they get their aviation sector up and running because things in their wider population seem to be improving at a faster rate than other countries.

I will ask the representatives from IALPA something and maybe they will come back afterwards on it. Many IALPA pilots have contacted me about the difficulties they are having getting out of Ireland to, maybe, Heathrow to fly a service from Heathrow to China, the Far East, Australia or wherever it may be. The supply chain pilots or pilots still working for British or continental-based airlines that need to get out on a Wednesday morning to an airport hub to take up work for the week were having difficulties. I have written an awful lot and corresponded with the Department of Transport on their behalf. Is that still a problem?

The last query I have is for Mr. Dawson and the travel agents. I dealt a lot over the past three days with an issue in County Clare. There is still an issue with people who booked with Ryanair through third-party travel agents and that needs to be looked at.

Mr. Evan Cullen

My latest information is two weeks old with regard to supply chain pilots. I will contact those pilots now and get an update on transiting Heathrow to Australia and also to the-----

Chairman

Mr. Cullen might come back to us on that. Mr. Dawson or Mr. Hackett, very quickly.

Mr. Pat Dawson

There are third-party travel agents who have dealt with Ryanair for the last 20 years and this only happened with the start of the pandemic. As my colleague, Mr. Hackett said, we are working through verification and onerous paperwork to send back to Ryanair. There is a logjam and it is being slowed down, but not by the travel agents or the consumer. The payments are being slowed down by Ryanair. We figure that in Ireland alone approximately €20 million is due back to the customers of Ireland.

Chairman

I suggest the ITAA sends us a briefing note on that after this meeting so we can do some constructive work on that.

Mr. Pat Dawson

Certainly.

Deputy Michael Lowry

Most of what I wished to ask has been answered. Our witnesses have set out a bleak analysis of the sector. The magnitude of the problem is daunting and it is an appalling vista for the sector. I go back to previous discussions we had and the failure of our authorities to bring in proper pre-departure tests and rapid testing and tracing. Now the Government is talking about an international travel ban.

In my view, one has to ask whether zero Covid is practical or feasible. There would be enormous consequences and a devastating impact on the aviation sector. The loss of connectivity would have significant implications for business, enterprise and the economy in general. I would like to see a submission to the committee outlining the feasibility of this notion of zero Covid that is flying around at the moment and gathering credence.

Deputy Duncan Smith

I am interested in hearing from SIPTU based on its submission any details on conditionality for protection of workers for any supports received from the State. I would like to hear from the ITAA any details on the specific supports that are required for the travel agency industry.

Mr. Neil McGowan

It is clear that both the employers and the employees will need additional supports from the State to get through the crisis. Conditionality must be attached because if the State is to hand over large sums to employers, a social dividend has to arise from that. That social dividend will keep people in employment and that is why conditionality in respect of compulsory redundancies is so important. We will not tolerate employers receiving large sums from the State on the one hand, while making people redundant on a compulsory basis on the other hand.

Mr. Paul Hackett

The travel industry made submissions to every Deputy, Senator and Minister last year and, unfortunately, we were ignored. We will have further meetings next week with representatives of the Department of Transport and follow-up meetings with the Minister, Deputy Eamon Ryan, and the Minister of State, Deputy Naughton, the following week. We really need bespoke supports at this stage. We are facing 22 of 24 months with zero income. If we do not support this industry, there will not be an industry. It will be managed out of the UK, which is out of the EU. The consumer will have less protection due to Brexit and we will destroy an entire sector of industry that pays close attention to consumer needs and protection.

Chairman

All the witnesses, including Mr. Hackett, are invited to make one-page, precise submissions to the committee developing some of the themes so that we can put something constructive to the Department and the Government.

Senator Jerry Buttimer

A copy of the final sentence stated by Mr. Hackett should be sent to every Oireachtas Member and taken note of. As a committee, we should come back to it and I ask that we revisit this section of the meeting. I thank Fórsa and its members for their work.

Turning to Mr. Dawson, what can we as a committee do to help travel agents with respect to refunds from Ryanair? From a Cork perspective, could he make a comment on the behaviour of Ryanair towards Cork Airport?

Mr. Paul Hackett

We are making progress on Ryanair, although it is very slow. I would like to revert to the committee by the end of the month in regard to what we can do. We have to get Ryanair to get the refunds to consumers. We accept that precedent and it accepts the issue of EU261. Everybody around every table in this country just wants the refunds to go back to those retirees, families and couples who booked last year. Let us continue to work on behalf of consumers to do that and to deliver it as best we can, and we will report back to the committee.

Mr. Pat Dawson

We support helping airlines because without them, we will have nobody to take us abroad. Nevertheless, I would highlight one proviso for the Government. If customers in Ireland are refunded, the company will get state aid. In the US, airlines were told they would get state aid if they refunded customers. All the American airlines, therefore, refunded their customers and were given state aid. We fully support the airlines but they should pay back the money that is owed to customers and they will be entitled to state aid.

Chairman

I thank Mr. Dawson and apologise for the time constraints. We would very much welcome summary submissions from our guests addressing direct supports from the Government that are needed. We will return to this issue as a matter of urgency and will hold further hearings on it. The aviation sector is vital for the economy in terms of employment, the economy and connectivity.

The meeting is now adjourned. The next meeting of the joint committee will be a private virtual meeting at 4 p.m. today.

The joint committee adjourned at 12.05 p.m. sine die.