I call the Minister of State, Deputy Naughton. She is very welcome.
Air Navigation and Transport Bill 2020: Second Stage
I thank the House for the opportunity today to introduce the Air Navigation and Transport Bill 2020. As Senators will be aware, the Bill was subject to pre-legislative scrutiny by the Joint Committee on Transport, Tourism and Sport in July 2019. The Bill was published on 4 December 2020 and passed all Stages in the Dáil on 7 July this year.
This Bill has been considered by the Oireachtas in the context of the impact of the Covid-19 pandemic on the aviation industry. It is estimated that during the pandemic, the Government has assisted our airlines and airports with general business support measures worth in excess of €300 million. In addition to these measures, the Government has also agreed a revised €80 million funding package specifically for Irish aviation. This funding will be made available primarily to our airports through a number of schemes.
We are now beginning to emerge from the impacts of the pandemic. We have two of the most successful airlines in Europe, an aviation leasing sector that is world leading and modern, high-performing airports. The Irish aviation sector is beginning to recover and will rebuild the global connectivity that is so important for our economy.
It is against this backdrop that I introduce the Air Navigation and Transport Bill 2020. This Bill looks to the future and seeks to put in place a modern regulatory system that will underpin Irish aviation for the next decade and more. An internationally competitive and sustainable aviation industry needs a strong, reputable regulatory regime and that is what this Bill provides for. The current regime was put in place in the early 1990s and while it has served the sector well over that time, the institutional structures no longer reflect international best practices. This Bill addresses that situation.
The Bill has three main objectives. First, it merges the regulatory functions of the Irish Aviation Authority, IAA, with those of the Commission for Aviation Regulation, CAR. In doing so, it establishes a single independent and strengthened aviation regulator. Second, it establishes a new commercial semi-State company, AirNav Ireland, to manage Irish-controlled airspace. Third, it makes changes to how airport charges are set at Dublin Airport by putting a greater emphasis on the needs and expectations of the consumer.
For the most part, the Bill provides for the redesignation of existing regulatory and business functions. Aviation is a highly regulated industry and the Irish system is mostly formed from adherence to international conventions and agreements and EU law. Much of this Bill is concerned with making sure these international obligations are properly assigned and the new institutional structures are robust.
I will take each of the three main objectives of the Bill in turn, the first of which is the merger of the regulatory functions of the IAA and the CAR. At present, between them, these two State bodies are responsible for licensing airlines and individual aircraft; issuing airport operating licences, pilot licences and travel trade licences; inspecting compliance with aviation safety and security standards; setting airport charges at Dublin Airport; consumer rights under EU legislation protecting air passengers; and a range of other related tasks. The industry is required to engage with both entities and there is considerable overlap and interlinkage in the engagement. This Bill will streamline the relationship and create a one-stop regulatory shop, so to speak. The CAR functions will be fully merged into the IAA.
The second objective of the Bill is to establish a new stand-alone commercial State company to provide air navigation services. This service is currently provided by the IAA, which has a dual regulatory and commercial function. This dual model was conceived in the 1990s and regulatory developments in international aviation since then make it something of an outlier. It is simply not good practice to have a commercial and regulatory function within the same organisation, especially when part of the regulatory remit involves oversight of the commercial business. It is a self-regulation arrangement, which is not ideal and nor does it find much support nowadays. Therefore, as we merge the CAR regulatory functions into the IAA, at the same time we are removing the commercial business and setting it up in a wholly separate State company to be called AirNav Ireland.
Both of these steps, namely, merging the regulatory functions of the IAA and CAR while establishing a new commercial State air navigation company, involve the reassignment of staff and the redistribution of assets and liabilities. The Bill provides a clear and fair legal structure for the transfer of functions, land, assets and staff. With regard to staff in particular, employees will move with their current positions on no less favourable terms and conditions. This commitment is set out in the Bill and it means that the existing remuneration and pension entitlements of staff will not be affected by the institutional changes. In fact, the vast majority of staff will not notice any material change in their day-to-day work. There will be only minimal changes in terms of office location in and around Dublin city centre and this will be on an agreed basis. My Department, the IAA and CAR have aimed to maintain an open and constructive dialogue with staff and their representative bodies on the provisions of this Bill. I am advised that there is broad support for the reforms.
The third objective of the Bill is to make changes to how airport charges are set at Dublin Airport. Under the Aviation Regulation Act 2001, the Commission for Aviation Regulation is responsible for setting the maximum price that Dublin Airport can charge airlines for the use of its facilities. It is a complex economic regulatory process but its purpose is to ensure that the price charged by Dublin Airport, which is ultimately paid for by airline customers, is fair and sufficient to cover the development and maintenance of the airport. In setting a maximum price, the regulator effectively frames the medium-term development plan of Dublin Airport.
The proposed changes set out in the Bill are based on recommendations arising from an independent review of the current framework, a review which included extensive industry and public consultation. The changes do not alter the main thrust of the existing price-setting regime but rather make incremental improvements that have the effect of strengthening the role of the regulator for the benefit of consumers. This part of the Bill contains policy changes, whereas the provisions on the institutional changes to the IAA and the CAR are almost exclusively about moving around existing functions. For that reason, I will take time to introduce these proposed policy changes.
First, the Bill provides for a change to the statutory objectives of the airport charges regulatory regime. Throughout the aforementioned independent review process, it became clear that the overarching objective for the regulator should be to protect the interests of consumers while maintaining high standards of safety and security. This idea is reflected in the Bill, which sets out that the primary statutory objective of price setting at Dublin Airport shall be "to protect and promote the reasonable interests of current and prospective users of Dublin Airport". That objective is set above all others.
The Bill also for the first time requires the regulator to take account of Government policy on aviation, climate change and sustainable development when making a decision on the price and the medium-term development of Dublin Airport. There are a number of other noteworthy policy amendments and improvements to which I wish to draw the attention of Senators.
Currently, the Minister for Transport has the power to provide policy directions to the regulator, which must be considered when making a decision on airport charges. This power has been used by previous Ministers, but on reflection, it is difficult to square such a provision with the idea of strong, independent regulation. Therefore, it is proposed to remove it and instead provide that the regulator must have regard to current Government aviation policy. This will ensure that the regulator's periodic review of airport charges will be appropriately framed within the context of current Government policy, but without being subject to specific ministerial instructions which could cut across regulatory independence.
Another change proposed in the Bill is to place a new obligation on the regulator to produce a statement of strategy every three years, setting out details of its performance indicators. This is an additional level of accountability and transparency and is intended to dovetail with greater independence in decision making. The Bill also introduces some additional flexibility into the regulatory process, by allowing the regulator to extend its current decision on the maximum airport charge price for up to two years. Currently, the regulator reviews and resets the maximum airport charge at Dublin Airport every five years. This will continue to be the norm, but the Bill allows for some flexibility to extend a determination, so long as all parties - the regulator, the airport and the airlines - agree that it is in the common interest to apply it.
Changes are also proposed to the regulatory appeals process. Currently, where an appeal of a regulatory decision on airport charges is made, the Minister for Transport is required to appoint a panel of up to three experts to hear the appeal. The panel of experts has the power to revert the regulatory decision back to the regulator for reconsideration. However, during the review of the regime, concern was raised from all sides about this process. It was suggested that any ministerial involvement was inappropriate and that the process had no teeth, with the appeals panel having no ability to direct the regulator to make changes to the determination. Am I out of time?
I might leave it there so.
I wish to share time with Senator McGahon, six minutes and two minutes, if that is okay.
Is that agreed? Agreed.
The Minister of State, Deputy Naughton, is very welcome to the House. Her appearance here today is very important. First, I congratulate her on the appointment of iar-Sheanadóir, Pádraig Ó Céidigh, as the chair of the Shannon Group. He is a person we all admire. He brings huge experience to the role. Second, she comes to us today on foot of Ryanair's announcement of 20 new routes and a €200 million investment in Cork Airport. That is a positive news story. As the Minister of State says in her speech, Covid is the backdrop to today's debate. I will come back to the Government supports of €20 million being given in a funding package to aviation.
This is a progressive piece of legislation at a time when the aviation sector, globally as well as here at home, is seeking to rebuild connectivity following what has been an awful 24 months for everybody involved in hospitality, travel and aviation. I hope that anything I say will not be taken by anybody as being anything other than positive, but we must understand that there is more than one airport in the country, and that there are also more than two. There is Cork Airport, Shannon Airport, Dublin Airport and airports in Galway and Waterford. We could go up north and talk about Derry and Donegal as well. Air connectivity is crucial to the economy. We must continue to ensure that everything we do facilitates its return. Today's legislation and Ryanair's announcement are all important. It is good that we are seeing a new statutory instrument being intertwined in this legislation, which puts an onus on the Commission for Aviation Regulation to take account of the sustainable development of Dublin Airport in all of its determinations.
In her speech, the Minister of State made reference to the prices being charged. It is important that the DAA is able to negotiate, but the customer must be looked after. There is reference in the legislation to protecting the customer. It is important that airports are supported to rebuild in a sustainable manner. Last week Deputy O'Donnell and the Tánaiste had an exchange in the Dáil regarding Shannon. I wish to make a case for Cork Airport. Cork is as important as any other airport, and if we are talking about connectivity then it must be supported in route development, incentivisation and retention. The Minister of State has been very much engaged with all the airports over the summer and she knows that we are in a challenging time for the aviation sector. The loss of revenue experienced in the past two years will only gradually get back to pre-Covid levels in 2023 or 2024. I ask that the significant investment by the Government would continue, because it has underpinned the aviation sector to date. I hope the budget will reflect that in time.
To paraphrase what the Minister of State outlined, the Bill establishes a super regulator that will have a remit for safety, security, economic regulation, licensing and impact every aspect of Irish aviation. It is a clear vision of where we should be going, but from its inception the regulator should be part of that from day one. A clear overarching objective should be set out for it and there should be an internal alignment across its own functions before making decisions that impact on the industry. I refer, for example, to trade-offs between obligations imposed for licensing, safety and security purposes versus the economic impact of those implications.
The new regulator should be conducive to collaboration with all stakeholders. The Minister of State and I have received emails. Senator Dooley and I are on the transport committee and we have received emails from members of staff regarding air traffic control. I hope the engagement will lead to a resolution for them.
This is a very important piece of legislation. It is one we should all support unreservedly. We have seen issues with merchant terminals and travel agents, for example, as part of Covid-19. I hope that the regulator will bring clarity and certainty. We must see route development and incentivisation as part of the budget to underpin the Government's support of the aviation sector.
I wish to touch on a couple of points in my brief contribution. The main point on which I wish to focus most of my remarks is the concept of the national peer support framework that is overseen by a new safety regulator for aviation workers. It is vitally important for three specific reasons. The first is that peer support will enhance flight safety when people have an opportunity to speak to each other about their experiences. The second is national oversight of peer support in Irish airlines. When that occurs, it means we ensure that best practice standards are maintained at all times. Third, is the new safety regulator which Senator Buttimer mentioned. That has the ability to establish an industry-leading approach to the issue as well. That must be considered in the context of the overall aspect of the national peer support framework.
I commend the Minister of State and the Government, to a degree, on the amount of engagement in the past year, in particular with the Irish Air Line Pilots Association.
I know that when I came into this House one year ago, aviation was not something in which I had a particular interest or something about which I had a new huge knowledge either. However, I refer not so much to the lobbying but rather to the detailed briefing notes these people have given us. In particular, Joe May from County Louth, with whom I have become very friendly over the last year and a half and who is a member of that organisation, has been able to provide all Oireachtas Members from County Louth and in this House in general with a detailed overview of the situation over the past year. In my role as an Oireachtas Member, where I am trying to deal with an issue on which I do not have a lot of experience, it has been very helpful. I want to pay tribute to those people for the work they have done in keeping us updated in the Oireachtas over the last year and a half.
I welcome the Minister of State and I welcome the Bill she is bringing before the House, although at this point it does not go far enough, and we will talk about that shortly. As Senator Buttimer has pointed out, the last two years have been a very difficult time for the aviation industry. Indeed, the Oireachtas transport committee has spent an extraordinary amount of time looking at the rebuilding of the air transport communication system for the country. I compliment both Senator Dooley and Senator Buttimer on their input into the committee. They certainly have not let down the side they come from but they have had a global view as well, which I welcome.
I welcome the objective to merge the regulatory functions of the Irish Aviation Authority and the Commission for Aviation Regulation but I do so with some reservations, which I will get to shortly. I hope that in establishing an independent regulator, we are establishing a strengthened regulator, and I look forward to having a new commercial semi-State to manage Irish-controlled airspace.
One of the grave things that has bothered me for some time is the failure to date to have a written report on the crash of Rescue 116. It simply is not good enough and I do not know why that has not happened to date. Certainly, if we have an independent regulator who is strong enough, it will see to it that these things are reported on time. It should have been reported within 12 months. I know the European airline pilots are somewhat concerned about it.
I welcome what the Minister of State has said about the charges at Dublin Airport. That is a good thing and as it is consumer focused, I have no difficulty with it. However, I believe the Bill can be strengthened with some of the things I am going to mention.
A key stakeholder in all of this is the Irish Air Line Pilots Association, IALPA, which seems to be finding it difficult to have its concerns listened to. One of the things we need to talk about is licences. The Minister of State mentioned the licenceholders. It is somewhat ironic in this day and age that a pilot who is licensed to fly an aircraft has to go through his or her employer in order to make a recommendation or to notify the statutory authority of some particular difficulty he or she may have, and that applies not just to pilots, but also to engineers and to cabin crew. It is simply not good enough that they would have to go to their employer if, for example, they are complaining about some practice their employer has implemented which, in their view, calls into question the safety of the airline.
It is a well-justified concern that licenceholders have no mandate to interact directly with the new regulator. They run the risk of being caught between the commercial concerns of their employers and the regulatory or safety concerns they themselves have. Licenceholders need a formal way to engage with the regulator that is statute-based and away from the commercial owner of the fleet they are flying for. To all intents and purposes, we need a charter for licenceholders. In this way, both the licenceholders and the IAA will know precisely what their obligations are, and there will be no room for ambiguous interpretation by a commercial airline operator.
We have plenty of examples which I will not go into because in this country, we only have two main airline providers and they are extremely dominant. I was delighted to hear Senator Buttimer talk about Ryanair adding 22 new routes out of Cork, which is very good news, but it makes these airline companies extremely powerful when it comes to dealing with them, and that is something we need to be aware of.
There are a number of amendments that I want to bring to the attention of the Minister of State. Rather than walking into this House on Committee Stage to put the amendments forward and talk for God knows how long on them, and at the end of the day the amendments get kicked aside and voted down, I would much prefer to work with the Minister of State and her officials on the amendments we will be bringing forward.
Senator McGahon spoke about the crew support programme. We need a standard operating procedure for crew support systems. We need a set of guidelines but we do not need the airline having control over how that is set up. We do not need the airline having control over who will or who will not form the peer support group in an airline. It is too dangerous an industry not to provide the supports that pilots need and pilots need peer support that they can engage with and that they are not afraid to go to with their stories.
As I said on the licenceholders' charter, we cannot have a situation where the licenceholder, that is, the pilot, must go to his or her employer and say, “I have a difficulty with the regulations you are asking me to fly under and I need to go to the regulator with them”, only for the employer to say, “No, you cannot”. In the case of some of the airlines now using contract employees, it makes it very difficult for a licensed pilot to go outside the airline he is working for. I will be bringing forward an amendment on that issue and I know I will be supported by some of my colleagues.
The other amendment relates to investigation and administration penalties, and I know the Minister of State is aware of some of these issues. If there is a situation where there is an administrative problem and a sanction is needed, the sanctions we currently have are punitive. There is this idea that we can close down the airline because it is not doing something right, but we just cannot do that. We need a graduated set of sanctions whereby there might be a fine of €100,000, for the sake of argument, over some breach today. If the breach is still in place tomorrow, it goes to €200,000 and it goes up by €200,000 every day the breach is in place. I think that is a reasonable request from the airline pilots association.
When it comes to it, we should work on the four amendments that we will be bringing forward. This will not disrupt the Bill. The Bill is a great idea and the Minister of State is going to get the Bill through. However, this will strengthen the Bill, it will bring all of the stakeholders onside and it will make for a robust system in the future. There should never be anything left to ambiguity when we are talking about safety and airline practices. I ask the Minister of State to give me a commitment today that she will engage with me, and with other colleagues who have dealt with IALPA and various other agencies that are supporting crews and pilots within the airline industry, to see if we can deliver something that will meet everybody's needs, not just the needs of the commercial suppliers. I will leave it at that as my time is running out.
I welcome the Minister of State to the House to discuss this legislation. At the outset, I want to be associated with the remarks on and recognition of the appointment of Pádraig Ó Céidigh as chairman of the Shannon Group. I recognise he is a man of immense skills and wisdom, somebody who has a vast amount of experience in the aviation sector. In addition he is a west of Ireland man and he understands the importance of regional balance. Together with the experience he has, I believe it signals the dawn of a bright future for the aviation sector on a regional basis. It will be important that he and others who represent or work within the aviation sector outside of the Dublin base are given the support of the Government.
The Minister of State, in setting out her position, said that it is open to the Government to set priorities to develop aviation policy. A very considerable amount of lip service has been paid to regional supports and policies that are there to support the regions.
The reality is that precious little has been done. This Bill presents a real opportunity. The Minister of State spoke of the capacity in this legislation to allow for the setting of maximum tariffs at airports. I contend we need to consider the setting of minimum charges as a method of ensuring a fair share of supports and activity is diverted towards the regions where possible. It will always be the case that an airport like Dublin will be most attractive to airlines. It is legitimate for the Government to establish policies that seek to encourage airlines not just by way of fluffy language but hard measures that make it attractive for them to generate profits outside of the main airport. That may be by way of route support, as my good friend, Senator Buttimer, said. It is important to provide State funds to the airports to attract airlines. We must also examine ways to curtail the unbridled growth of Dublin Airport. When you talk to citizens in and around Dublin they recognise that the airport prior to the Covid pandemic had reached levels of saturation in terms of the impact on traffic both on the ground and in the air, and that this needs to be addressed. It is possible to come up with ways of ensuring airlines see it as an attractive option to offer services to airports outside the capital city.
On the legislation, clearly, it is a straightforward Bill. There is a recognition it provides for the institutional reorganisation of how aviation regulation is provided in Ireland. The Minister of State rightly identified the necessity to separate the two components. We welcome that but, notwithstanding that, like Senator Craughwell and others, I, too, have been contacted by the Irish Air Line Pilots' Association, IAPA. I know it has written to the Minister of State. It has outlined very clearly a need for a number of issues to be addressed in this Bill, particularly the need for graduated sanctions for breaches of regulations, the creation of an inclusive licenceholders forum, clarifying working time provisions, providing legislative underpinning for pilot peer support programmes and the creation of a charter for licenceholders. I have read its documentation and all those issues make sense to me. I noted some of the Minister of State’s comments when the legislation when through the Dáil. She seems to believe, and I presume from her perspective it is well-meaning, that perhaps it is not the place for the Government to intervene in hardwiring this into legislation but the IAPA president, Evan Cullen, and others have certainly made a strong case. I hope we can thrash this out in greater detail on Committee Stage to find some common ground and seek to ratify some amendments.
I know from the Minister of State’s time in this House she will not be taking this House purely in an expected way such that the legislation has to go through this House because it went through the Dáil. There may be aspects of the legislation we can tease out in a non-partisan, careful and considered way that may benefit the long-term future of the sector. I have some further views and ideas on the pricing situation the Minister of State spoke about and some of the issues raised by the IAPA on which I will speak on Committee Stage.
The Minister of State will be familiar with documentation circulated in the media and by way of letter to the Minister for Transport by a certain group of workers in the Irish Aviation Authority. I do not intend to read into the record all the issues outlined in it as some of them are of a personal nature and individuals are named. We certainly do not want to get into that business in this House. Issues have been raised about the closure of State airports. I will read into the record a few paragraphs that relate to that. The letter states:
As you are aware on a number of occasions an air traffic control service was not available at State airports due to the lack of air traffic controllers. Cork Airport closed for a period on July 25 and Shannon Airport on July 26. The closure of Dublin airport on August 6 was narrowly averted thanks to the actions of the ATC Branch committee.
The letter also states: "The closures and non-availability of Air Traffic Controllers ... is as a result of years of sustained and abuse of the air traffic control staff" by certain aspects of management".
These are significant charges made by workers. I did not receive this mail but other members on the committee and in the Houses have received numerous copies of this letter from many members of staff. Air traffic controllers by their nature are highly skilled and highly trained professional people who have been trained to withstand significant pressure associated with the very important job they do. For people of that calibre to sign up to a document as direct and as concerning as this letter leads me to believe there is a significant problem there.
I hope the Minister of State together with the Minister for Transport will engage in a process. Senator Buttimer and I have suggested, through the joint committee, the Department might engage with outside consultants with experience in industrial relations who would bring an approach or process that would hopefully avert a further weakening of the position. These workers raised issues around dignity in the workplace. They also raised safety issues. The letter further states that it is their opinion that the safety of the Irish air traffic control service has never been more compromised than it is now. It also states that they have no doubt that the current conduct of certain sections has greatly impacted safety. That is a very strong statement for so many people to sign up to.
The letter further states there can be no doubt that “pressurising safety critical employees to attend for duty under protest and duress without due regard for fatigue or fatigue caused by inappropriate ... circadian rhythm will result in increased risk of an air traffic incident or accident. This issue is specifically encompassed in the requirements of EU regulation 373/2017". I cannot over-emphasise the importance of addressing this.
On the area of separation, these workers also have issues about pension rights and entitlements and whether that gets resolved prior to the vesting day when the IAA will be split into two companies. Many issues need to be thrashed out. I hope we can address them as apart of the Committee Stage phase of the work in this House. I thank the Minister of State for her attention.
I thank Senator Dooley for keeping to the time and getting his point of view across.
I thank the Acting Chairperson for his direction and respectful smile when it was time for me to conclude.
Is Senator O'Reilly or Senator Boylan due to speak next? According to my list it is Senator O’Reilly and then Senator Boylan. Senator O'Reilly will have eight minutes.
I will not take eight minutes. I am in a part of the country in Galway West in the Minister of State's constituency that does not have an airport. There is no part of the country that is not impacted by what is happening in the airline industry. This Bill is quite technical. Its objective is to address recommendations around regulation and it does that. People are quite rightly raising other concerns and matters they believe could be included in this Bill or will come before us in other legislation, which is correct.
I would like to touch on four issues. First, as a Green Party member, I believe we must take seriously the impact of the aviation sector on climate change. I would like the Minister of State when summing up to address how we can tackle that. Obviously, there are global responsibilities but we also have responsibilities as a nation. Although it is not covered by this Bill, we cannot speak about aviation and not talk about its impact on the environment.
The second issue I wish to touch on is consumers. Much of what the Bill provides is consumer protection. We have all probably been inundated with stories of people who do not have the kind of protection they need. I will not say they are monopolies but certainly there is a small number of operators in the airline industry. This impacts on workers and consumers. I hope that when we have that independent regulation this will all be addressed.
Third, Deputy Dooley raised some points about safety concerns.
People have been receiving some of that correspondence. We are all on notice, including the Department, and, therefore, this has to be addressed. It is not for us to look into the detail of it but, given that we are on notice, it is incumbent on us all to look into that issue for those workers. They must be protected for their own sake as workers but there is also a need to consider the safety of those who are reliant on them in the context of air travel. This could be one of the most dangerous situations if we are not 100% confident in it.
My next point relates to tourism. We often talk about workers in airports and airlines, but there are an awful lot more workers across the country who are reliant on our aviation sector who we do not talk about when we discuss aviation, namely, all of those who are attached to tourism, as well as everyone who goes into their local shop or who works at an airport on which all of the local economy is reliant. The midlands-north west has been downgraded to being a region in transition. We have to recognise that. This means we need to support what is already there, but it also means looking at other kinds of infrastructure if we are not investing in airports. I am fully behind the repurposing of Galway Airport, but we need to look at other kinds of infrastructure, such as the western rail corridor, in the context of the national development plan. That will bring economy from across the island and around the island, from Rosslare right up to the north west. That is a serious proposal. The line is still there and it is not a huge amount of money so we need to look at reopening that portion of the railway.
Those are my thoughts on the Bill. It is fairly technical in nature but it provides an opportunity, quite rightly, to bring up other issues relating to the aviation sector.
My apologies to Senator Boylan. I thank her for giving way.
I welcome the opportunity to speak on this Bill. As others have said, it seeks to reconfigure substantially our aviation and navigation regulation services. Sinn Féin is happy to support it because it is right that the commercial air navigation elements are separated from the regulatory matters of the Irish Aviation Authority.
The workers in this sector, especially those in Aer Lingus, have been systematically and continually let down by successive Governments. Indeed, Fianna Fáil, the Green Party, Fine Gael and the Labour Party were all party to the sale of Aer Lingus. Sinn Féin opposed selling off the remaining share of the company at the time. We remain opposed to it today because we believe the decision was short-sighted. So too are the decisions that are currently being taken by the Government and that are putting Aer Lingus at continuous risk. At the time of the sale of the remaining State share of the company, Deputy Howlin said that he welcomed the commitments offered to the existing workforce in Aer Lingus. He went on to state: "As the chief executive officer has indicated to the Minister, he remains committed to an employer-employee engagement model that has unions and the State's industrial relations apparatus at its heart." This was challenged by Sinn Féin at the time because we could see the dangers ahead for Aer Lingus workers. We all now see the folly of the decision to sell off our national airline. We do not buy the nonsense that there was no choice. There are always choices in politics. There are always decisions to be made and positions to be taken. People cannot simply pick and choose and say later that they are sorry and that somebody else made the decision.
Sinn Féin will be proposing amendments to the Bill before us, which I believe are supported by others in this House. We believe they will improve on the current Bill. They were tabled on Committee Stage in the Lower House but were then withdrawn pending engagement with the trade unions. Assurances were given by the Department that it is not necessary to legislate to achieve what is set out in those amendments and that, instead, a cultural change is under way. We are of the opinion that it is better to underpin and embed cultural change within an organisation with a legislative back-up. It is all well and good to promise culture change but since those assurances were given, a meeting was convened by the Irish Aviation Authority to discuss the post-Covid recovery and neither the workers nor their representatives were invited. It is much better to set out the obligations in black and white in order to facilitate the culture change that is needed. We are all living through the legacy of light-touch regulation when it comes to the construction industry. Let us not make the same mistake with the aviation sector. The personnel and the bodies that are in those regulatory authorities will change so we need to underpin that culture change with legislation.
One of the provisions we think should be included in the Bill relates to the need, which others have noted, for the IAA to have a graduated fines system. The proposed removal of a licence is the only stick it has. It is an extremely drastic measure that has never been used and is unlikely to be used except in the most egregious of circumstances. There must be more proportional sanctions for smaller measures to bring airlines into line with the regulations. One example of this was when Ryanair instructed staff to flaunt the regulations by not allowing people to sit in the emergency exit seats unless they paid a premium. We all know that the regulations indicate that able-bodied persons must be seated at emergency exits for the safe operation of flights. When Ryanair was instructed to bring its practices into line with the regulations, six weeks passed before it did anything about the matter. The regulator was powerless to compel it. The airline would be much more incentivised to act swiftly if it was hit where it hurts with fines that increased the more the problem persisted.
We will also be proposing an amendment in respect of peer supports. It is essential that peer supports are in place for crew. We learned the hard way what happens when crew do not receive the proper mental health supports with the Germanwings flight disaster. There needs to be a more structured approach to peer supports and the choice of peers should not be dictated by the airline. Peer support has to have the confidence of the crew and it has to be reflective of the culture in which the crew are working.
A third proposed amendment relates to a charter to clarify the rights and obligations of all parties involved.
The final amendment mandates a forum for licence holders to discuss air safety regulation in a transparent and efficient manner. This would give them the clarity and assurances they require, as well as the ability to consult with the IAA directly and not through their employer. We have heard of the disparity between the experiences of licence holders when engaging with the Irish regulator and when dealing with the same issue of concern with the British regulator and how quickly they were able to get clear responses from it in comparison with the Irish model. We need to have a system in place where licence holders can go directly to the regulators and get the assurance and clarity that they require. I look forward to submitting these and other amendments in due course and to the later deliberations on the Bill. I thank the Acting Chairman for the opportunity to address these issues.
I thank the Minister of State for coming to the House. The Labour Party is very happy to support this Bill. It is being taken at a time when there are very real question marks about the capacity of the aviation sector to recover. Projections suggest that it will be 2024 before it recovers, if at all. The desirability of that recovery is a very separate but important question about how to have a sustainable aviation sector that sustains thousands of jobs and an even wider tourism sector. We need to ensure that sector gets back up on its feet but also with an eye to climate action and trying to reduce our carbon emissions in this country. I am thinking in particular of the uncertain livelihoods and the very significant pay cuts that are on the table both in Aer Lingus and elsewhere within the aviation sector. There is a lack of hope for many in that sector at this point in time and there have been many calls for a recovery plan or strategy.
There is a great deal more that could be done by the Department of Transport in this area. The Irish Congress of Trade Union's pre-budget submission references the roll-out of a short-term work scheme as being ideal for the aviation sector. We need to see a real commitment from the Department of Transport with regard to the aviation sector and the thousands of livelihoods that depend on it.
With regard to the legislation, any initiative that streamlines how the area of navigation is regulated must be seen as a positive. On the grounds of independence, scrutiny and public confidence in the sector, it is vital that the regulator is separated out from the regulated. I understand the proposed new model will bring Ireland closer to the standard model of regulation across many other EU member states. Ireland is one of only four countries wherein the functions were separate until the introduction of this legislation. However, the Labour Party has a number of concerns, similar to the concerns already articulated across the Chamber today, in regard to the provisions of this Bill. Many of these concerns have been also articulated by IALPA. It has done a good job in communicating those concerns to us. I think all Senators have been circulated with the four amendments IALPA wishes to put forward.
We need to see interaction with the trade union representing pilots and with others in the sector in regard to their concerns about this legislation. We must not miss the opportunity to have as strong a regulator as possible in this country. We need to address the concerns with regard to the engagement and the relationship between the IAA and its stakeholders. The IAA considers the licenceholders to be its stakeholders, yet in terms of engagement up to now the communication has been largely one way. How can a regulator function, in particular in matters of safety, be that in the air or on the runway, if the voices of pilots, engineers and cabin crew are pointedly excluded and can only be heard through their employer? That is perverse because it may be that some of their concerns are related to how the employer is conducting its operations. We need to ensure that licenceholders have a vehicle or mechanism to communicate with the regulator and that there is two-way dialogue. This is important given that licenceholders, in particular pilots, can be held legally responsible if something goes wrong. In that context, IALPA has put forward a number of suggestions around peer support programmes, the gradation of sanctions and the licenceholder forum and licenceholder charter. I ask the Minister of State to engage in that regard.
Another concern relates to the altering of the airport charge criteria to include the reasonable interest of users of Dublin Airport, although I accept that protection of consumer welfare must be a key part of a regulator's pricing strategy. Notwithstanding the assurances provided by the Minister of State in her opening contribution, serious questions remain with regard to the future financing of Dublin Airport. Concerns have been expressed over a significant period of time with regard to the under-provisioning in regard to safety critical infrastructure on taxi-ways, runway lighting, ramp design and other aspects of the airport. We need to hear more detail about getting that balance between ensuring we have safety critical infrastructure that is up to date and of the appropriate standard, while at the same time meeting the needs of workers in all areas of the airport, consumers and all those people not only in Dublin but across the country who are dependent on the airport. I would welcome further clarification around the criteria and in regard to what changes, if any, will ensure Dublin Airport Authority can fund itself into the future.
I thank the Acting Chairperson, Senator Pauline O'Reilly, for accommodating me by taking over the Chair in order that I can make my contribution. I welcome the Minister of State. From the west of Ireland perspective, the Minister of State and I have supported Galway airport in the past and we continue to support the important Knock Airport, also known as Ireland West Airport.
This is a technical Bill. I do not propose to get into the technical detail of it, but like other Senators I will make some points that have probably been made already. It is important to acknowledge the really difficult time the aviation sector has had, but we must also acknowledge the Government supports provided to it. Crucial and difficult decisions had to be made, some of which I have no doubt meant the future of our airports hung in the balance. Without Government support, they would not have survived but they have a long way to go.
I am confident in saying today that our airports and air services can grow in stature. As an island country, we have to ensure greater growth in and use of our regional airports. The Minister of State is very aware of that. It is regrettable that Galway does not have an airport, but Ireland West Airport means so much to the country. Without it, the west would not be in the position it is now. We have many problems but we would be worse off if we did not have Ireland West Airport. In regard to customers, Ireland West Airport is important in terms of the many people who travel weekly to London, Manchester and parts of Scotland for work and return home at weekends. That still happens a lot. The availability of these services is important. I again acknowledge the supports provided by Government for this sector, but I reiterate that it is important we grow our regional airports, which is a point I am sure the Minister of State will make to the Government in her discussions on the sector. We can grow our aviation business considerably.
I take on board Senator Pauline O'Reilly's point in regard to the environment and air travel. One of most favourable comments I heard over the last year was that owing to the lack of aeroplanes there was less pollution. Air travel is important for us as an island nation, but I think we are going to see significant changes in the type of fuel used. Air travel needs to become environmentally-friendly. I am sure there are ways that can be done. As I said, we have to ensure there is growth in our air services.
I want to speak about air cargo. Less than 2% of products leaving this country do so by air. We have a magnificent team promoting Ireland and Irish food abroad, but one wonders why we do not make greater use of air cargo, particularly for food products. That could significantly improve our food exports, which are pretty good at the moment.
Like others, I am concerned about the commentary of air traffic controllers. As a nation, we do not think deeply enough about the important role of air traffic controllers. We talk about our ambulance service and first responders and the responsibility attached to that work, and rightly so, but, as a nation, we should show the same respect and consideration for our air traffic controllers. We do not do that, myself included. Perhaps we take them too much for granted. Air traffic controllers have raised concerns in regard to fatigue and their working conditions. We need to address those concerns. We need to look after them properly and make sure they are never under stress. Air traffic controllers have one of the most responsible jobs worldwide. They take responsibility for the millions of people who travel every day.
I want to use this opportunity to support calls to ensure that those people are sorted out.
As I said, we have reason to be positive after a very negative term during which we all worried seriously about air traffic, the loss of jobs and the possible collapse of the industry. We have got over the hump. There is no doubt that we have a lot to do to address the issue, but generally we can look to the future with positivity. I am prepared to be positive today. I welcome the Bill, even though it is quite technical. I hope it will be part of the progress for aviation going forward.
I welcome the Minister of State to the Chamber and thank her, her officials and all of those in the Department for the work they have put in over the past year or more. It has been a very difficult time for people who work in the aviation industry, but the Government has been very supportive and has worked with them to try to get them through the most difficult period they have ever experienced. It is a challenge to come out of that, there is no two ways about that, but the Government is very supportive of the aviation industry and understands the impact it has on Ireland as an island country.
I read today that the CEO of British Airways, Mr. Sean Doyle, announced that there will be a restoration of full pay for British Airways pilots. As the Minister of State knows, Mr. Doyle is a former CEO of Aer Lingus. Pay restoration is happening in the UK, while here in Ireland Aer Lingus is talking about pay cuts and redundancies. It is interesting that pay is being restored in one jurisdiction while there are pay cuts in another. There is an onus on us as a Government to support the industry, but there is also an onus on companies. Full restoration for pilots is something that needs to be achieved as quickly as possible.
Pilots will say that pay is important, but routes are also important because routes mean connectivity. If one has connectivity one has security of employment. The big difference between the two airlines in this country, namely, Ryanair and Aer Lingus, over the past year has been connectivity and the speed at which Ryanair has reinstated routes and flights. It needs to be commended for that. Ryanair gets an awful lot of flak, but it has been very quick in terms of its Covid recovery plan to get routes up and going. Today 20 routes for Cork were announced, two of which, Edinburgh and Birmingham, are new, along with an investment of €200 million, which is really significant.
In fairness to Ryanair, it ramped up its schedule extremely quickly. However, the same cannot be said about Aer Lingus. It has not increased its American flight schedule. It is important for businesses that we have connectivity to America. Flights to the east coast have restarted, but not to the west coast, including Los Angeles and San Francisco. Silicon Valley is important to a lot of businesses in Ireland and it is crucial that Aer Lingus is as eager as Ryanair to make sure that its routes are recovered because if they are not someone else will take them.
I wish to emphasise the point made by Senator Buttimer that if we as a Government and Ryanair and Aer Lingus are going to have an aviation recovery plan, it needs to be country wide. It cannot just be Dublin-based. Shannon and Cork are key routes for people in Tipperary. I spoke to a number of people two weeks ago about priorities in Tipperary and what we need to focus on coming out of Covid. For north Tipperary, in particular Newport and the regions around it, Shannon Airport is critical for the region. It is the same in Cahir and Clonmel, where the Cork route is crucial. If the routes were available people in south Tipperary would fly from Cork whereas people in north Tipperary predominantly go to Shannon if the option is there. Aer Lingus needs to get its American routes up and running.
There are no Aer Lingus routes between Shannon and America. At the moment, people can book a flight with United Airways to Philadelphia for next March, or April from Shannon. One cannot do the same with Aer Lingus. The longer things stay like that, the more chance there is that Aer Lingus will lose opportunities and space. It is very focused on setting up a base in Manchester, whereas its focus should be on connectivity and routes within Ireland because for regions like Cork and Shannon that is crucial.
A lot of people say that we need to get back to the levels we had pre-Covid and talk about 2019. If we are talking about trying to get back to levels that are realistic, 2019 is probably not the best gauge from which to work. It was an exceptionally good year. If we want to get back to levels that are realistic we should probably take a look at 2018, which was about 10% less than 2019.
I thank the Minister of State for her contribution today. Senator Buttimer is correct. Aviation is very important country wide, not just in Dublin
I welcome the Minister of State to the House and thank her for her comprehensive statement. It is an understatement to say that Covid has had a devastating effect on a number of sectors, in particular the aviation sector which has been largely shut for 18 months. That has had a knock-on effect for the tourism industry. Tens of thousands of people have lost their jobs and others have seen their income drop by up to 90%. However, the Minister of State, Fine Gael and the Government are conscious of the impact on workers and the industry, and have worked with the unions to ensure airlines will fulfil their obligations to workers during this difficult time.
I wanted to speak about the effect Covid has had on the tourism industry across the country. In January 2020, as people were getting sick in Wuhan in China, we were celebrating 11.3 million visitors to Ireland who spent a total of €6 billion and supported over 250,000 jobs. Then Covid hit, and we know everything hit the floor. In 2019 there were 24 gateways for flights operating out of our largest market, the USA. Today, there are just 14. International travel opened in mid-July, but we have not seen our numbers improve dramatically. We did not plan ahead sufficiently, unlike some other European countries. A lot of inbound visitors to the EU made their plans and visited other countries, such as Scotland, Italy and Northern Ireland. I say this as someone who has family members working in an industry that brings in tours from abroad. That is the main reason a lot of tourists did not come to Ireland. Despite the strong domestic summer staycation market in the absence of the international visitor, that will never be able to fill the hole that is missing. International tourists spend, consume and purchase more, be it car rental, coach transport, accommodation, pubs or shows. They have higher spending power. Opening extra routes has to be a priority.
We need to extend the VAT reduction for a significant number of years. It rebuilt our economy after the recession and I believe it can do so again. As was alluded to, Ryanair is back to 100% of its pre-Covid flight schedule from Cork and Shannon, but not Dublin. We need to extend the DAA funding beyond June so that agreements can be put in place. People are booking their holidays for next year already and we need to have routes in place or we will be down significantly for the 2022 season. Dublin Airport is already predicting that it will be down 35% on pre-Covid numbers. Senators Buttimer and McGahon highlighted a lot of these issues with regard to the routes. Connectivity is key to the rebuilding of our tourism industry.
As I do not see any other Senators offering, I call on the Minister of State to conclude.
I thank Senators for the contributions they have made to this Second Stage debate. I am going to endeavour to respond to as many of the issues raised as possible.
Senators Buttimer, Murphy and Ahearn raised the regions and supporting our regional airports. As Members will know, policy on regional airports has been influenced by the need to optimise conditions for regional development and connectivity. It absolutely is a key priority for the Government. We are acutely aware of balanced regional development and how all our airports, including our regional airports have suffered a huge drop in inbound tourism. Ensuring our airports and infrastructure were in a position to rebound coming out of this crisis has been the focus since the start of this pandemic. For that reason, out of a budget of almost €80 million in 2021, approximately 78% has been targeted at regional airports with Cork and Shannon receiving about 43% of the overall budget. Balanced regional development is a the heart of the programme for Government and we recognise all parts of Ireland must be able to prosper if we are to build a sustainable and resilient future and that global connectivity is absolutely critical, as is regional connectivity.
On climate issues, which were raised by Senators Murphy and Pauline O'Reilly, the Bill will for the first time require the IAA, as regulator, to take account of Government policy on aviation, climate change and sustainable development when making a decision on the price and the medium-term development of Dublin Airport.
Senators Dooley, Murphy and others raised IAA industrial relations issues. I am aware a significant proportion of air traffic controllers have made representation to the Minister, Deputy Eamon Ryan, over recent weeks. The Senators have also received correspondence outlining their concerns regarding workplace issues with the IAA. As with any commercial semi-State body, workplace issues are matters to be addressed, in the first instance, by the board and executive of that body. Nevertheless, briefings have been sought and received from the IAA on this issues raised in the correspondence. On the specific matter of the operation of the IAA's call-in scheme and any safety implications, the IAA executive has affirmed safety is its overriding priority and that at no point has safety been compromised in the operation of this scheme, nor has it posed any risk to the safety of air traffic control, ATC, services. It is important that all sides recognise the need to engage in dialogue in a constructive way to bring a resolution to the differences that have arisen. I hope that can be achieved. I understand that in an effort to ensure continued dialogue, and in an attempt to resolve the current issues, the IAA executive met Fórsa last week and the chairman of the IAA's internal dispute resolution board with a focus on addressing any outstanding concerns through dialogue. I again ask all sides to engage constructively in those engagements.
In relation to points made by Senators McGahon, Sherlock, Craughwell, Dooley and Boylan and engagement with IALPA, they will be aware that on Committee Stage in the Dáil, several Deputies raised a number of similar amendments. My reservations lay with with the question of whether such concerns would be more appropriately addressed on a more flexible, non-statutory basis, rather than hard-coding this into primary legislation. Department officials recently met both IALPA and the IAA on these issues. There was a full discussion and exchange of views on the amendments proposed and on the importance of addressing concerns using the most suitable instruments. IALPA is understandably passionate about its concerns and points to the long history of its engagement with the IAA. Indeed the report of the 2019 examination of the IAA noted that the working relationship between the IAA and the unions is poor. These are complex issues of trust and relationship-building. However, I am confident the new regulator intends to address the concerns of IALPA in a proactive and satisfactory manner on a non-statutory and consultative basis. I note that in his letter to all stakeholders on 21 September, the aviation regulator's chief executive designate is inviting observations on the preparation of a draft statement of strategy for the new IAA regulator for the period 2022 to 2024 and has proposed the following as deliverables, namely, to review and improve its regulatory processes, as necessary, to provide clear information on processes, including compliance requirements, to establish stakeholder forums to inform decision-making, to set out a charter for licenceholders and to establish forums for sharing best practice, for example, peer support. I stress also that the whole basis for this Bill is to reform the regulatory structure and to create a new independent regulator. Part and parcel of that reform will be stakeholder engagement under a new board, chairperson and CEO. IALPA will not be engaging with the IAA in its original form.
Senators Dooley and Pauline O'Reilly also mentioned issues around pensions. As Senators will be aware, the central objective of this Bill is to merge the regulatory functions of the IAA and the Commission for Aviation Regulation while establishing the new commercial State-regulated air traffic control service provider. As is established practice in State agency restructurings, the Bill contains robust provisions safeguarding employees' existing terms and conditions, including pension rights and entitlements. Employees of the IAA who move to AirNav Ireland will enjoy no less favourable terms and conditions under the new arrangements than those they do currently. The final scheme of the pensions transfer arrangement between organisations will require the approval of both the Minister for Transport and the Minister for Public Expenditure and Reform and will be examined to ensure they comply fully with the terms of the Bill. It is important to distinguish between the measures relating to superannuation that are necessary to give effect to the establishment of new structural arrangements and other pension issues under discussion through the company's industrial relation procedures. It is not necessary or appropriate for the purposes of giving effect to this Government policy on structural reform to seek to impose a precondition that all pension issues be resolved.
On other amendments, it is proposed to introduce a small number of Government amendments on Committee Stage to confirm the role of the Comptroller and Auditor General as auditor of the new regulator and to update the schedules to the EU legislation contained in Schedules 1 and 2 to the Bill.
I might leave it there. I outlined most of the Bill in my opening statement. I welcome the support received for this Bill and will reflect on all the points raised. I believe the Bill has cross-party support and thank Senators for that. I look forward to engaging with them on Committee Stage.
I thank the Minister of State. We used the opportunity to ask very important questions which were probably a little outside the technicality of what this Bill is about but as a politician, she understands we had to do that on the occasion. I appreciate she came back individually to try to give us all the answers she could. I thank the Minister of State and her officials, Senators and all the staff for their co-operation.
When is it proposed to take Committee Stage?
Is that agreed? Agreed.