State Airports.

Wednesday, 15 October 2008

Seanad Éireann Debate
Vol. 191 No. 8

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Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer I thank the Leas-Cathaoirleach for allowing me to raise this matter on the Adjournment.

The Minister of State will be aware that Cork Airport Authority has a vacancy for the position of the cathaoirleach or chairperson of that authority. This vacancy arises from the resignation of Mr. Joe Gantly. Associated with it is a milieu of issues surrounding Cork Airport, namely, its debt, the fact that it has not had a chairperson since the middle of the summer, that a business plan for it has not been published and that the separation of the three State airports, Dublin, Shannon and Cork, has not taken place.

Cork Airport is central to the growth of not only of Cork but the Munster region. The economic vibrancy and vitality of the region is very much dependent on it. Tourism in Cork needs not only a strong airport but one that is marketed well, driven by its board and that has leadership. The attraction of business to the region requires that Cork Airport is sustainable into the future and that it has a competitive executive that manages it. However, what have we got? The airport has no chairperson, no business plan has been published, there has not been a separation of Cork Airport from the Dublin Airport Authority and Cork Airport has been laden with a debt.

When the Minister, Deputy Dempsey, was in Cork in September he said he could not appoint a new chairperson to the authority because he had not received the business plan for it from Dublin Airport Authority. Surely the Minister who presides over aviation policy for the country can demand or request from Dublin Airport Authority a business plan for Cork Airport. A number of questions arise. Are we serious about securing the future of Cork Airport, protecting the jobs of the staff there, attracting the opening up of new routes out of it, making it viable [553]and sustaining the growth of the passenger numbers about which we hear so much? Is there anybody in government prepared to show leadership on this matter?

I contend the Government has neglected the board of Cork Airport Authority. It has refused to appoint a chairperson to the authority. It has forced the board to accept a debt that it did not want to accept. Dublin Airport Authority is setting out the plans for the aviation sector, with a business plan for Cork Airport, and it is setting the tone of what happens with the result that Cork and Shannon airports are suffering.

A proactive approach by the Minister, Deputy Dempsey, is needed, not excuses. The Dublin Airport Authority comes under his remit. I hope I am not pre-empting the Minister of State’s reply but it is important that the business plan for Cork Airport is released. The Minister said that a chairperson for the airport cannot be appointed until he has sight of the business plan for it. How long must we wait for a chairperson to be appointed? It is ridiculous that no chairperson of Cork Airport Authority has been appointed at a time of economic crisis and recession in this country when the board needs a leader to bring it forward and give it direction and impetus.

This is not a time for inaction but for being proactive. It is time to show support and solidarity with the people of Cork, the board of Cork Airport and the workers who have made a major contribution to the development of that airport. I was in Cork Airport last Sunday and one could drive a bus through the terminal it was so quiet. Is that what we want?

Senator Cecilia Keaveney: Information on Cecilia Keaveney Zoom on Cecilia Keaveney We could cycle.

Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer After the budget we will be cycling everywhere.

The Minister of State’s Government has already told us that Cork Airport will have no debt, but it has been laden with a debt. We need action and answers from the Minister of State tonight. It may not come under his direct area of responsibility, but I hope he will have positive news for the workers of Cork Airport and the people of Cork tonight.

Minister of State at the Department of Transport (Deputy Noel Ahern): Information on Noel Ahern Zoom on Noel Ahern As Senator Buttimer will be aware, Joe Gantly recently stepped down from his position as the chairman of Cork Airport. He held the position since 2004 and I would like to record in this House my appreciation for the work he did in that post and to wish him well in the future.

Under the stewardship of Joe Gantly, Cork Airport greatly expanded its passenger base. Last year was the 15th consecutive year for aviation growth at Cork Airport and between 2003 and 2007 passenger numbers increased from 2.2 million to 3.2 million. That makes a lie of some of the accusations the Senator made. It is obvious that Cork Airport has been a vibrant airport and has done great work to boost tourism in the area.

Such growth and expansion requires a dynamic and experienced chairman. I can assure the House that the person to be appointed will bring these qualities to the job, and the position is to be filled very shortly. Under the State Airports Act 2004 the boards of Cork and Shannon airports are required to prepare business plans for eventual separation.

All three airport business plans have to be co-ordinated by the Dublin Airport Authority for eventual approval by the Minister for Transport and the Minister for Finance. Among the requirements to be satisfied in advance of separation is the need to ensure the financial sustainability of the three State airports. It has always been the Government’s position that the resolution of the debt issue at Cork Airport would have to ensure that the debt burden to be undertaken by Cork would be manageable and that it would form a reasonable basis for Cork Airport’s autonomy, without in any way putting at risk its commercial future.

[554]However, it is also the Government’s position that the sharing of the Cork debt — much of which was incurred in financing the new terminal and other infrastructural works at Cork Airport — between the Cork and Dublin airport authorities will have to take account not only of what is commercially and financially feasible for Cork Airport, but also what is commercially and financially feasible for the Dublin Airport Authority. Most of that debt was spent in putting the infrastructure into Cork.

In order to break the logjam between the DAA and the Cork Airport Authority on the equity of the debt, Mr Peter Cassells was appointed earlier this year to mediate between the two parties with a view to reaching agreement on a level of debt that was acceptable to both sides. Mr. Cassells’s conclusions and recommendations were the outcome of that dialogue with both parties. The recommendation is that the CAA takes responsibility for debt of €113 million in return for the transfer of net assets of €220 million on separation. The board of the CAA has accepted this recommendation.

I have already received the Cork and Shannon business plans and I expect shortly to receive a finalised commentary on those plans by the DAA when it submits its business plan. I would expect the DAA’s commentary to address recent trends in the aviation market, the challenges facing the State airports and the financial and operational aspects of restructuring.

As to the question of publication of business plans, I do not foresee publication because the content is commercially sensitive. In any case, I will need to consider the DAA’s commentary and the implications of the individual business plans for the future operation of our State airports before deciding on the best way forward.

Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer The Minister of State’s reply is disappointing. In saying that it is hoped a person will be appointed shortly, is he talking of weeks or months? In his reply, he is factually incorrect. A clear commitment was given by his predecessors to the effect that there would be no debt on Cork Airport, and that the Government would honour that, yet it has not.

Deputy Noel Ahern: Information on Noel Ahern Zoom on Noel Ahern I do not know, but I believe “shortly” means weeks rather than months. However, the key point, regardless of what was said a couple of years ago, is that the board of Cork Airport is taking on a debt of €113 million and getting assets of €220 million. Most of the debt was accrued or built up from building infrastructure at Cork.

Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer The promise was that it would be debt-free.

Deputy Noel Ahern: Information on Noel Ahern Zoom on Noel Ahern While we are very generous in Dublin——

Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer You are not.

Deputy Noel Ahern: Information on Noel Ahern Zoom on Noel Ahern We are not Santa Claus, either. It would be unusual for the DAA to build infrastructure in Cork while accepting all the debt.

Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer The promise was made.

Deputy Noel Ahern: Information on Noel Ahern Zoom on Noel Ahern The Dublin Airport Authority is accepting half of it. Cork is doing well.

Senator Jerry Buttimer: Information on Jerry Buttimer Zoom on Jerry Buttimer However, as the Minister of State is aware, the promise was made.


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