Shannon Airport to decouple from DAA

Transport and Tourism Minister Leo Varadkar has confirmed that Shannon Airport is to be separated from the Dublin Airport Authority (DAA).

However Cork Airport will remain under Dublin management and the DAA is set to be renamed to reflect this.

The Government has unveiled plans to develop what they claim will be a "world-class aviation industry" in Shannon, and a restructuring of tourism and enterprise agencies in the region.

Under the plans, Shannon Development, the body charged with creating investment into the region, will be abolished and many of its responsibilities will pass to State agencies the IDA, Enterprise Ireland and Failte Ireland.

"The Government has decided to separate Shannon Airport from the Dublin Airport Authority and bring it together with Shannon Development to form a new entity with a commercial mandate in public ownership," a statement from the Department of Jobs, Enterprise and Employment said.

"This decision represents a new beginning for the Shannon region, involving a drive to develop a world-class aviation industry in Shannon, and a restructuring of tourism and enterprise support agencies in the region to support this goal.

"The new entity will have a clear mandate, working closely with the IDA and Enterprise Ireland to develop the potential of the aviation sector, and will explore other opportunities with those agencies for further prospective investments in the region."

Many traders in the region believe the stand-alone organisation, which will be debt-free and expected to fund itself, can help reverse declining passenger numbers.

The new semi-state company set up to run the airport will also take over lands owned by Shannon Development, which will be used to redevelop the area.

There will be opportunities for private investors and operators, with possible tax opportunities yet to be decided.

One of the proposals to be explored in a feasibility study is an international aviation centre of excellence.

A steering committee is to be set up in the coming weeks to start drawing up the new masterplan.

Transport minister Leo Varadkar said the decision would help secure the future of Shannon Airport, where passenger numbers have more than halved from over 3.6 million to 1.6 million over the past five years.

Mr Varadkar said Shannon would not get any State funding but its debts would remain with the Dublin Airport Authority (DAA), which currently runs all three State airports.

But airline Ryanair said the decision not to sell off Shannon to private investors was a missed opportunity to create real competition between the country’s airports.

Minister Varadkar said he "firmly believed" that this is the best way forward for Shannon Airport, Shannon Development and the mid-west region.

"We want to recapture the pioneering spirit of the people who gave us the airport and the Shannon Free Zone concept, so that we can provide exciting and innovative opportunities which benefit business, tourism, and job creation in the region, and across the country," the Minister said.

"Our task now is to develop these proposals in more detail.''

Commenting on the announcement a spokesperson for Shannon Development said:”Shannon Development welcomes the certainty regarding the future of Shannon Airport and the confirmation of its separation from the Dublin Airport Authority.

"There is still a lot of detail to be worked out around the new structure and operation of the new entity, but today’s announcement is undoubtedly a major step towards creating a new entity which will act as a catalyst for growth for the wider region in the years to come."

Micheal Vaughan, president of the Irish Hotels Federation, said an independent Shannon Airport would have enormous benefits for tourism in the west of Ireland.

“We have continually called for a new approach and structure to promote the Shannon region – the existing tourism marketing approach for Shannon was simply ineffective with visitor numbers collapsing by over 50% over the past decade,” he said.

But Stephen McNamara, spokesman for Ryanair, said passing the airport from one semi-state quango to another was a missed opportunity to introduce real change and reform through a private sell-off.

The DAA said it would work actively with the steering group on the separation of Shannon Airport.

In relation to Cork Airport, the Government said it had decided "that the existing ownership of the Airport by the DAA will be maintained for the present".

"To take account of this decision, the DAA will be renamed to reflect the fact that there are now two airports and international businesses in the group structure," the statement continued.

"The Minister for Transport, Tourism and Sport will be making an announcement in the near future on this issue."

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