Dáil Éireann Debate, Thursday - 7 October 2004
8 Ms Shortall asked the Minister for Enterprise, Trade and Employment the rental income the Shannon Development Company currently earns from the property in the Shannon free zone that is proposed to be transferred to Shannon Airport Authority and if he will make a statement on the matter. [20401/04]
Amharc ar fhreagra11 Ms Burton asked the Minister for Enterprise, Trade and Employment if he has received proposals from the board of Shannon Development on the role the company can play in the future development of the region; if he will report on such proposals; the position with regard to the proposal to transfer the company’s rental income from the Shannon free zone to the Shannon Airport Authority; and if he will make a statement on the matter. [23649/04]
Amharc ar fhreagraI propose to take Questions Nos. 8 and 11 together.
There have been a number of developments that will impact on the mid-west region and the roles of the respective State agencies operating there. I draw attention, in particular, to the proposed relocation of the headquarters of Enterprise Ireland, involving 300 of the agency's Dublin based staff to Shannon, as part of the Government decentralisation programme. Shannon Development provides support for indigenous businesses in the Shannon region on behalf of Enterprise Ireland, there is the decision to establish an independent Shannon Airport Authority and the enterprise strategy group, which reported in July, has recommended that Shannon Development should disengage from industrial development functions which should be left to the national agencies, that is, Enterprise Ireland and IDA Ireland.
A number of meetings took place between my predecessor and Shannon Development in recent months to discuss these developments and their implications for the future of the company. I emphasise that Shannon Development fully supports the decision to establish an independent airport authority which it sees as vital to the economic development of the region. Furthermore, it has agreed that the company should refocus its activities on the airport with a view to generating business for the airport and the company's assets should be used to support the airport authority particularly in its early, vulnerable years. A working group representative of my Department, the Department of Transport and the Department of Arts, Sport and Tourism, Shannon Development and the Shannon Airport Authority was also set up to examine the specific issue of how Shannon Development could best contribute to the development of the new independent airport in this regard.
A number of options have been under consideration by the working group, including a possible transfer of responsibility for managing the Shannon free zone industrial estate to the new airport authority. I stress that no decisions have been taken. I am in the process of reviewing the deliberations of the working group in the context of the overall developments I have outlined.
In terms of the specifics of the question, I understand the Shannon free zone yielded a gross rental income of approximately €10.4 million in 2003. The costs associated with the management and operation of the zone have not been taken into account in the calculation of this figure.
I tabled two questions to the Minister to give him an opportunity to review a very important strategic decision his predecessor had made, I believe, for ideological reasons in co-operation and consort with the former Minister for Transport, who, again for ideological reasons, was in the process of breaking up a very successful public company, Aer Rianta, into three component companies. I believe the only reason the assets of Shannon Development were being transferred to the stand-alone Shannon Airport was to give a veneer of economic viability to Shannon Airport because it would not be economically viable without some additional asset transfers.
I had hoped this Minister might not have regurgitated the old script. Unfortunately, we got the old script but I do not give up hope yet. Careful consideration should be given to this matter. Does the Minister acknowledge that Shannon Development has been the most successful stand-alone regional development company in the State with the specific result that the Shannon region is the most industrially developed region outside Dublin? Had we such a company in the south east and another in the north west, those regions might have thrived in the same way yet the approach is to dismantle a success story, so to speak. What does the Minister see as Shannon Development's role if it is not to have its traditional industrial development role? Since the gross generated income of €10.4 million was a significant part of the €25 million operating costs of Shannon Development, what resource base will be available to it to perform whatever function is now agreed or is it simply to be left as a token sinecure under the umbrella of Enterprise Ireland until people forget about it and it can wither away? Does the Minister see a role for Shannon Development into the future?
Let us be clear. I have read the file on this matter and I have examined the options. Further consultation will have to take place but a number of events have happened that changed matters, and I am not reading from the script. That is a fact. The independent airport authority, whether the Deputy agrees or disagrees, has been established.
Is being established.
It is a key issue which highlights the future——
The Minister has to see the economic development potential.
The airport has always been a centrepiece in terms of economic development in the mid-west. An airport is a central infrastructural issue in terms of the development of any region and it would be foolish not to utilise a transatlantic airport like Shannon. The relationship between that and surrounding industrial development is clear, they are inextricably bound through the evolution of the industrialisation of that region over the past 30 or 40 years. It is interesting that Shannon Development believes the establishment of the independent authority will have a beneficial economic impact on the region. As the Deputy is aware, north Kerry came in under Cork-Kerry Tourism. That has changed that side of the equation. Shannon town, which was set up by Shannon Development, has come in under Clare County Council. There has been a number of developments which, by definition, are changing the role of Shannon Development as we move forward. It promotes investment in the Shannon free zone. Even the taxation changes changed the attraction in that respect. Life has moved on.
The key issue for the future is the role it will play. Clearly, there is a role in the context of the airport. That was the perspective of the working party but it had a particular structure in mind as to how it would continue to support the airport. Others might have had a different structure in mind as to how it should support the airport, whether it should be within the airport structure overall, continue to invest or invest its assets and have a separate independent role. It manages a significant property portfolio, not just in the Shannon free zone but in Thurles, Tralee, Ennis and Limerick. That is a continuing function. It promotes the development of indigenous industry in the Shannon region. What we are saying is that there is an opportunity now to bed down the future role, given the changes that have occurred.
What is the role?
We will not unilaterally impose that on Shannon Development or the region. There are further consultations to be held and I am keeping an open mind.
I am tired of old words being repeated from the script the Tánaiste delivered the last time we discussed this. I still do not know what the new Minister has in mind for the future of Shannon Development. If it will not have industrial development, or an international or domestic role, and its assets in the upward zone are to be transferred to the airport authority depriving it of an annual income of €10.4 million, what will be its role and what resources will it have to implement that? Last month, Shannon Development signalled its total opposition to the Government's proposals to transfer the Shannon free zone to the airport authority. It is the driver of a successful strategy. Allowing for inevitable changes, what role does the Minister see for Shannon Development in the future?
The role for the future is centred on the airport. Shannon Development will continue to have a significant role in terms of supporting the airport.
There is an airport company and an airport authority.
The airport is critical to the economic underpinning of the region.
What role does the Minister see for Shannon Development?
That has yet to be determined. It has a view on how it could continue to support the airport and others have a different view. It is not straightforward. The Department of Transport is involved and has its own perspective on it. The working group was formed to get all the parties together to see if they could hammer out an agreed position which has not emanated from the working group. There is work to be done.
When will there be a conclusion?
I will consult the parties first and make a decision in due course. I have been in office for a week.
I thought the Minister had all the answers.
Has the Minister met Shannon Development?
Not yet.
Does he intend to?
Yes.
