Airport faces €160m bill when it flies solo

CORK Airport is facing potentially crippling debts of €160 million when it opens for business as a separate company, it emerged last night.

Local TDs accused the Government of breaking its promise that Cork would be debt-free once granted full autonomy after it emerged the airport would have to shoulder the construction costs of its new terminal.

“Seamus Brennan had said the airport would begin debt-free, which it needs to be in order to give it a fighting chance against Shannon and Dublin,” said Labour TD Kathleen Lynch. “Now, it’s going to have a millstone around its neck instead.”

In July 2003, when announcing plans to abolish Aer Rianta and replace it with independent authorities at the three airports, Mr Brennan, then Transport Minister, said the Dublin Airport Authority (DAA) would bear the cost of Cork’s new terminal.

“The existing debts associated with Shannon and Cork, including the debt associated with the major new investment programme at Cork, will not be assigned to the new companies but will remain with Dublin Airport,” he said at the time.

However, on Wednesday, Cork Airport Authority chairman Joe Gantly told an Oireachtas transport committee that Cork was factoring the massive debt into the business plan it is preparing for life as an independent operation.

“A significant financial challenge facing the Cork Airport Authority is the management of the debt associated with the construction of the new terminal,” Mr Gantly said.

The Cork Airport Authority business plan, together with those of Shannon and Dublin, must be approved by Government before full separation takes place. Until then, Cork and Shannon remain under the ownership of the DAA.

The DAA is likely to assume responsibility for substantial existing debts at Shannon and Cork when the three become autonomous. However, the bill for the construction of the terminal at Cork is a separate debt, and it now seems certain the DAA will not cover this.

At the committee hearing, Government deputy chief whip Billy Kelleher said it was “always the consensus” that the DAA would finance the construction of the terminal, and demanded to know when that policy had changed.

In response, DAA chairman Gary McGann said while it was currently the effective “paymaster” for the three airports, and would have to have regard to the viability of Cork’s business plan, “there isn’t a bottomless pit in Dublin, either”.

Mr Kelleher last night said he would raise the issue with Transport Minister Martin Cullen and press for the original promise to be honoured. “It defies logic to expect Cork to operate with a debt of €160 million from the start,” he said.