Semi-State Bodies.

Dáil Éireann Debate, Thursday - 12 May 2005

Thursday, 12 May 2005

Ceisteanna (52, 53, 54)

Liz McManus

Ceist:

34 Ms McManus asked the Minister for Transport if the proceeds of an eventual sale of a portion of the State’s shareholding in Aer Lingus will not be reinvested into the company. [15670/05]

Jack Wall

Ceist:

61 Mr. Wall asked the Minister for Transport when a decision will be made on the future ownership structure and funding requirements of Aer Lingus; if his attention has been drawn to the serious concern within the company regarding the repeated failure to make a decision on this matter; his views on whether the transport and tourism requirements of this country can best be met by retaining public control of Aer Lingus; and if he will make a statement on the matter. [15573/05]

Róisín Shortall

Ceist:

132 Ms Shortall asked the Minister for Transport his plans in respect of the proceeds of any sale of Government shares in Aer Lingus; and if he will make a statement on the matter. [15769/05]

Freagraí scríofa

Minister for Transport (Mr. Cullen)

I propose to take Questions Nos. 34, 61 and 132 together.

Since becoming Minister for Transport, my focus has been to move forward to achieve clarity on the future of Aer Lingus as soon as possible. The key driver for this is to ensure that Aer Lingus continues to make a valuable contribution to the economic and tourism development of the country.

To achieve this, I believe that the airline must be provided with the flexibility to grow and compete on a level playing field. The current situation is restricting the airline, particularly in relation to profitable growth opportunities on long-haul routes. To fund that growth and to provide financial security, the airline must have access to the full range of funding mechanisms and equity capital is a crucial element in that mix.

As the Deputies are aware, the Government will be making a decision shortly on the necessary arrangements to be put in place to facilitate a capital injection in Aer Lingus. Clearly, the funding needs of Aer Lingus will determine the scale, nature and timing of any investment. These matters will be considered further once the Government has made its decision, appropriate advisers are engaged and consultations with stakeholders take place.

As I have already indicated, the key driver for facilitating an equity injection in Aer Lingus is to fund growth and provide financial security. It is clear that any investment transaction involving the issuing of new shares would ensure that the proceeds would go directly to the company. However, the proceeds from the sale of any existing shares held by the State in the company would go to the Exchequer in line with the provisions of the Aer Lingus Act 2004. Decisions in relation to these matters will be made at the appropriate time.