Cullen to brief Cabinet on aviation package

A PROPOSAL on partial privatisation of Aer Lingus, a second terminal at Dublin Airport and the end of the Shannon stopover will be brought to Cabinet by Transport Minister Martin Cullen today.

The minister will brief Government colleagues on an integrated aviation policy package ahead of a final decision, expected early next month.

The minister is expected to propose that the State dispose a majority stake in the national airline to private shareholders. This will help fund the replacement of its transatlantic fleet, which will cost €1 billion.

The Government may agree with this three-pronged strategy on the basis that anticipated union opposition may be partly assuaged by a decision to allow the Dublin Airport Authority (DAA) to build the second terminal.

The third highly controversial issue facing Irish aviation - the proposed scrapping of the compulsory Shannon stopover - would form part of the package.

The Cabinet decision on the status of Aer Lingus has been delayed since December, largely because of the sensitivities of Taoiseach Bertie Ahern to the objections of the unions.

Mr Cullen’s proposals come after extensive negotiations with unions over the past two months.

The decision to allow the State-owned DAA (which already runs the existing terminal) to built the second terminal was being portrayed last night as a barter in return for the disposal of a majority stake by the State in Aer Lingus.

However, the proposal could face some flak within Cabinet, especially from the PDs.

The programme for Government between Fianna Fáil and the PDs included a commitment for an independent second terminal at Dublin Airport.

Yesterday, PD Senator Tom Morrissey said that the second terminal should be independently-owned and competing, and not part of the State apparatus.

If the Government decides on awarding the contract to DAA, it will face opposition from Ryanair boss Michael O’Leary.

Mr O’Leary yesterday vowed to take any action - including legal challenges in Ireland and Europe - to block the move.

Mr Cullen was guarded about the scope of his intentions yesterday. He said the plans were almost ready to put to Government.

“I think the outcome will be very, very positive for Irish aviation,” he said.

“I’ve only been driven by one issue on this - what is best for Irish aviation, what’s best for the customers and best for the employees. It’s clear that there are good options there to achieve all of that,” he said.