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Shannon Airport: Motion (Continued)

Tuesday, 11 December 2012

Dáil Éireann Debate
Vol. 786 No. 1

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(Speaker Continuing)

[Deputy Leo Varadkar: Information on Leo Varadkar Zoom on Leo Varadkar] In this regard, it has been suggested the passenger projections for Shannon Airport seem fanciful. While the business plan is confidential, in the next five years the Shannon plan projects passenger numbers to grow from approximately 1.5 million this year to 2.3 million in 2017 and 2.5 million in 2021. Shannon traffic peaked at 3.6 million passengers five years ago. I do not deny that it will be a challenge to meet these targets, but they are achievable. Moreover, the alternative of accepting that passenger numbers at Shannon cannot be improved is much worse because that would spell the continued decline of the airport. In that eventuality we would soon be seeking to downgrade or even wind down the structures at Shannon. That is not the future I want for the Shannon area. As I announced last week, the Government has confirmed its decision on Shannon Airport and we are working on implementing it. I am delighted with the news that commitments for the creation of 850 jobs have been secured by the task force from two companies as part of plans for an international aviation services centre to be located at Shannon. The longer term potential of this centre is projected to create and maintain up to 3,500 new direct jobs within five years, not including construction jobs.

While on the most important subject of jobs, I understand the concern that may be felt by the staff in both Shannon Airport and Shannon Development at this time of significant change. I acknowledge that, as with any new initiative, there are challenges ahead for the airport and the new Shannon entity being formed from the merger of the airport and the restructured Shannon Development which we will call NewCo for the time being. However, it also offers a great opportunity for Shannon and the region. The terms and conditions of the DAA employees working in Shannon Airport will not be diminished in any way when they become staff of the Shannon Airport Authority. This was agreed following intense negotiations with ICTU in 2004 while the State Airports Act was being enacted and their protections are enshrined in that legislation. The terms of the Croke Park agreement apply to the staff in Shannon Development and, when the State-owned NewCo is established in due course, they will transfer to that company with their current terms and conditions. The workers in both Shannon Airport and Shannon Development are vital to the success of the airport and the vision for NewCo. Together with management, I am convinced that they can and will work together to ensure not just the survival but also the renewed growth and success of the airport. I am aware that some in the unions are unhappy with how these policy initiatives have been progressed to date and feel excluded from that process, notwithstanding the arrangements for consultation in place. I have invited ICTU to nominate a representative to join a steering group of key Departments which the Minister for Jobs, Enterprise and Innovation and I will establish to oversee implementation of the Government decisions on NewCo. I also want to ensure the workforce in the Shannon Airport Authority can have representation at board level as soon as separation is effected on 31 December. In this regard, I have also invited ICTU to nominate an employee representative for appointment to the board of the SAA on a temporary basis pending agreement on the arrangements for NewCo.

The Government's decision represents an historic new beginning for the Shannon region, with Shannon Airport playing a central role in the drive to develop a world-class aviation industry. In addition, the decision grants Shannon Airport the long awaited freedom to determine its own future in the best interests of the airport and the region. The decision will give the board, management and staff of Shannon Airport the scope to bring a fresh approach to its future development. Its merger with a restructured Shannon Development provides an opportunity to open up access to the extensive land bank at Shannon to facilitate the development of the international aviation centre of excellence.

Some in the Shannon region maintain that Aer Rianta International should be transferred to Shannon Airport from the DAA. From the time separation of the State airports was mooted in 2004, it has been the intention of successive Governments that while the debts associated with the business of Shannon Airport would remain with the DAA,Aer Rianta International would also remain with it. Aer Rianta International is an integral part of the DAA group and the DAA's balance sheet, funding and credit rating are reflective of the group's business, including Aer Rianta International. Being part of a larger group allows Aer Rianta International to access funding necessary for its ongoing expansion by borrowing against the assets in Dublin. I would prefer the Shannon Airport Authority to use borrowing to develop Shannon Airport rather than overseas businesses. Even if it was desirable to transfer Aer Rianta International out of the DAA, it would damage the latter's viability if it was done as part of the Shannon Airport separation process. In short, if the DAA's financial viability was compromised as a result of separating Shannon Airport, separation could not happen. Both Shannon Airport and the DAA post-separation must be viable. That is the law.

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