Ryanair to challenge Knock contract

RYANAIR has won the right to challenge the awarding of the Government-subsidised Knock- Dublin route to Aer Arann.

Aer Arann was awarded the Knock-Dublin PSO (public service obligation) route last week.

Ryanair however said it is seeking an explanation as to why its offer of a smaller subsidy, lower fares and triple the passenger numbers for the Knock route was rejected in favour of Aer Arann’s proposal.

The High Court yesterday granted Ryanair’s application for a judicial review of the decision. Davy analyst Stephen Furlong said that this decision could prove significant if Ryanair’schallenge is successful.

Ryanair’s director of legal and regulatory affairs, Jim Callaghan said: “Ryanair has been a vocal critic of the Department for Transport’s waste of taxpayer funds in the area of PSOs and this is the latest example. We’re delighted the High Court has granted our request to challenge this unlawful decision.

“At a time of economic downturn, it is high time the Department for Transport stopped wasting taxes on grossly inflated PSOs by supporting the subsidy junkie Aer Arann, which does not publish accounts yet continues to receive massive state subsidies.”

Aer Arann is due to provide a daily early morning service and an evening return service on the route beginning on October 1.

Aer Arann had operated the Knock–Dublin route until July this year and had bid for the contract as part of the public tender process covering all PSO routes.

However, it was awarded to CityJet in May but no flights have operated between Knock and Dublin since July 21 last after CityJet announced it would be unable to go ahead with its plans to operate a daily service between the airports.

Yesterday, counsel for Ryanair Martin Hayden SC told the court his client could have no complaint if Aer Arann was subject to the same conditions and compensation as CityJet.

Ryanair has only ever tendered for one PSO route and did so successfully with an application to operate the Dublin–Kerry route.