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State Airports.

Dáil Éireann Debate, Tuesday - 15 February 2005

Tuesday, 15 February 2005

Ceisteanna (35, 36)

Olivia Mitchell

Ceist:

90 Ms O. Mitchell asked the Minister for Transport the reason a second deadline on the future of Aer Lingus has been passed without a decision on the future strategic development of the State airline having been taken; the further reason a decision on a proposal for a second terminal at Dublin Airport has not yet been taken; the obstacles which are preventing these critical decisions from being taken; when these decisions will be made and announced; and if he will make a statement on the matter. [5046/05]

Amharc ar fhreagra

Paudge Connolly

Ceist:

92 Mr. Connolly asked the Minister for Transport his view on the provision of a second air terminal to provide for increased traffic at Dublin Airport; and if he will make a statement on the matter. [4897/05]

Amharc ar fhreagra

Freagraí ó Béal (33 píosaí cainte)

I propose to take Questions Nos. 90 and 92 together.

As regards the future of Aer Lingus, I reject any claims that there has been a delay on the part of Government to progress the matter. It is important that any decisions we reach about the company's future are correct and take account of the nature of the sector, the company business model, the needs of the economy and the views of stakeholders. In that context, as the House is aware, the Cabinet sub-committee and the Government considered the future of Aer Lingus in December last. Arising from that consideration, it was decided, in line with the terms of Sustaining Progress, to initiate a process of consultation with ICTU to assist in reaching an understanding on the airline's future funding requirements. In that regard, I met representatives of ICTU on 16 December 2004. Since then there has been intensive engagement between Aer Lingus and ICTU's financial advisers on the issue and I expect the process to conclude very shortly. When the process with ICTU is completed, I will reflect on its outcome in consultation with ICTU prior to making a further submission to Government on the future of Aer Lingus.

On the second terminal issue, it is the policy of the Government to encourage as wide a range as possible of reliable, regular and competitive air services to and from Ireland. The central tenet of this policy is the belief that a strong, competitive and efficient network of air links is vitally important for developing our trade and tourism sectors, particularly having regard to our island status and peripheral location.

Passenger traffic through Dublin Airport is forecast to grow from last year's level of more than 17 million passengers to 30 million by approximately 2018. New infrastructure capacity and facilities, both airside and landside and including further terminal capacity, will clearly be needed to cater for this growth. The issue at this point is how best to provide that additional capacity to meet passenger growth.

The programme for Government includes a commitment to examine proposals for a new independent terminal at the airport and to progress such proposals if the evidence suggests that such a terminal will deliver significant benefits. A report in 2003 by a panel of experts chaired by Mr. Paddy Mullarkey assessed the independent terminal concept taking account of 13 "expressions of interest" submitted to my Department on the development of an independent, competing terminal at Dublin Airport.

I recognise that an early decision is desirable in respect of this matter so that, regardless of how it is provided, adequate terminal capacity will be in place at Dublin Airport when required to meet the growth in passenger traffic. I am in the process of finalising proposals which I will bring to Government shortly. My objective in putting proposals to Government will be to ensure the provision and operation of terminal capacity on an efficient and cost-effective basis.

Does the Minister accept the Government's treatment of Aer Lingus is inexcusable at this stage? It was the injudicious remarks of the Minister for State at the Department of Transport, Deputy Callely, when he said there was no urgency for a decision, which precipitated the loss of the senior management at Aer Lingus and which now means that effectively very few options remain open for the restructuring and refinancing of the company. The Minister for Transport, Deputy Cullen, promised a decision before Christmas. At Christmas he promised there would definitely be one before January, and still there is no decision.

Is the Minister aware that recently at a meeting of the Joint Committee on Transport, the lame duck chairman of Aer Lingus said the company must have a decision on financing early in the first half of this year. Is that decision going to be made by the Government and when is it going to be made? Negotiations with Airbus and Boeing have dragged on. The critical moment approaches when an order must be placed. Where is the money to come from? Aer Lingus is being greatly disadvantaged as a result of the way it is being treated by Government and decisions must be made. I believe the Minister accepts that, but why are they not being made? What are the barriers in the way of making a decision? Is there tension within Cabinet or what is going on? Is the Taoiseach afraid to upset someone? Why has no decision been made?

I thank the Deputy for her questions, but I disagree with the basis of what she has said. The reason for the three executives leaving the company is a matter for themselves. As I have said before, they did——

They were told no decision was going to be made, particularly by the Minister of State.

I had met them shortly before they decided to leave the company. I was quite surprised, as was everyone else, that they did, particularly on the basis of what I had to say to them. However, that is history and it is over and done with. By the way, I certainly do not accept that the current acting executive chairman of Aer Lingus is a lame duck. I want to emphasise my——

Perhaps the Minister does not understand the meaning of the term "lame duck". It means somebody whose term is over and who is due to leave.

The Minister is entitled to answer questions, without interruption.

I want my thanks to the current acting chairman, who is doing a tremendous job, to be recorded. He has certainly garnered the respect of all involved in Dublin Airport for his efforts on this matter.

I am not disputing that, but he is on his way out the door.

That has not been decided.

His term is up. He is there on a temporary basis.

That has not been decided. There is a long way from someone who is in a position of acting chairman——

Why is he arguing with the reality?

No, I am not arguing with the Deputy.

The Deputy must allow the Minister to answer.

When will the Minister make a decision on the funding of Aer Lingus?

Deputy Shortall has also submitted questions on this issue and she is entitled to ask a supplementary. I would prefer if the Minister did not answer questions submitted by way of interruptions.

The Deputy is asking me straight questions based on her assertions in the three points she has made. I disagree with her; that is all. My role here is to answer questions. I do not accept for a minute that the current acting chairman is a lame duck. That is a nonsensical statement.

It is a statement of fact that the acting chairman is a lame duck.

He is doing a tremendous job——

Does the Minister understand the meaning of the term?

Deputy Olivia Mitchell should obey the Chair. We want an orderly Question Time and it is not appropriate to interrupt the Minister constantly.

I have met him on numerous occasions. I know from my engagement with many different stakeholders involved in Aer Lingus, that they are equally confident of his ability and grateful to have someone of his stature, knowledge and standing-——

I have confidence in his ability, but he is not going to be there for long.

Will Deputy Olivia Mitchell please desist from interrupting?

——-driving this agenda forward. I said I would bring the matter to Government before Christmas. I did and told the Deputy and others afterwards that because of the Sustaining Progress arrangements, I would immediately engage with the stakeholders involved in the national wage agreement and with the ICTU in particular. I have done that. There has been considerable engagement, both at my level and between officials. The ICTU has its own experts reviewing the financial situation. I have told the Deputy that I expect that process to be completed shortly. I want to go to Government on the issue of Aer Lingus and to conclude it quickly. However, I want to do it by way of partnership involving the sharing of information and knowledge so that no stakeholder involved in the process feels excluded from knowing the basis on which a decision is being made.

As regards the terminal, I am happy to inform the Deputy and the House that there has been excellent engagement on this issue both at my level and through officials over recent weeks and months. I fully accept, as does the Government, that clarity and decision needs to be made immediately on the terminal issue. The numbers clearly indicate we must have a second terminal at Dublin Airport. I want to see that decision and I expect to go to Government shortly with my proposals. We are coming to a conclusion on the matter with all the stakeholders.

To some extent the Minister has answered my question, but not quite all of it. Does he agree that numbers are growing at an alarming rate at Dublin Airport? In 2004, 17.4 million passengers went through the airport, an increase of 8% on the previous year and 350% on 1990 when the figure was approximately five million. Dublin has one of the fastest growing airports in Europe. There are two solutions. I am glad that the Minister agrees a second terminal is needed while indicating it may be coming on stream shortly.

Has the Government considered opening the airport at Baldonnel to commercial or passenger traffic. That would take much of the pressure off the north side of County Dublin. It is adjacent to the M50 motorway and it would make sense. Rather than channelling 17.5 million passengers through north County Dublin every year, it would make much sense to consider opening Baldonnel to commercial traffic.

If a second terminal is opened at Dublin Airport, will it be an independently owned airport or a mixture of State and private ownership?

As the Deputy has said, the numbers are growing massively. That is a mark of the economy's success in terms of trade and tourism. I have not considered the issue of Baldonnel at this stage. My focus has exclusively been on expanding capacity at Dublin Airport by providing a second terminal. I believe, as does the Government, that it is vital for future economic development. Whatever happens with other airports will be a matter for consideration later. I am not considering that issue at the moment, rather I am specifically considering——

Is the Minister ruling out Baldonnel?

The Minister must not be interrupted.

I have not considered it at this stage. I am focused entirely on the issue of providing the second terminal. I hope to be in a position to go to Government shortly to sign off on that issue.

On the question of the terminal, the Minister of State at the Department of Transport, Deputy Callely, announced that a decision would be made on the second terminal. The Minister mentioned the possibility of a competing terminal. Is it possible, given the present structure of the Dublin Airport Authority which provides not only a terminal but also other services, to have real competition where another terminal competes with the existing one which also provides these shared services? Is it not leaving one of them in a dominant position? Is it possible to have that type of competition arrangement and has the hiving off of the terminal from the Dublin Airport Authority been considered?

The Deputy raises an important question. Clearly, it is an important issue to be considered in the context of the infrastructure at Dublin Airport and how an airport functions. From the point of view of the passengers and the 90 airlines using the airport, we want the most competitive and cost-efficient terminals, including the existing one. That forms part of the consideration on how we ensure that.

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