Hotel group sale faces opposition from unions

THE sale of the Great Southern Hotel group is set to become the first major stumbling block in social partnership talks as unions gear up to oppose any privatisation of the loss-making semi-State.

Yesterday, the board of the Dublin Airport Authority (DAA) informed the Cabinet of its intention to appoint advisers to prepare for the sale of the chain's nine hotels a process expected to be completed within months. Once they report back it will then be up to the Government to make the final call on a sale.

However, SIPTU last night insisted that the issue would have to be addressed in partnership talks as soon as possible. Just 18 months ago SIPTU balloted for strike action as its 800 staff members reacted to rumours of a partial sale.

"Clearly this is a significant issue that will require attention. The Government decision needs to be clarified and it is our intention to seek clarity at the first opportunity within the process we are currently engaged in," said SIPTU general secretary Joe O'Flynn.

Mr O'Flynn said it was the union's understanding, following meetings with Tourism Minister John O'Donoghue, that the hotel group would be transferred to Fáilte Ireland. A further meeting with Transport Minster Martin Cullen is scheduled for next week.

In the meantime, the issue will become an untimely headache for the Government just as already contentious talks get underway.

Taoiseach Bertie Ahern and Mr O'Donoghue in particular are both strong supporters of the Great Southern Hotel Group. Two of the hotels are in Mr O'Donoghue's constituency while Mr Ahern has made a habit of staying regularly in the group's Parknasilla property in Kerry.

However, with losses approaching €6 million last year and €3m the previous year, the company has been warning for some time that a solution will have to be found. The value of the group is thought to be in excess of €100m although operational costs are unusually high for the sector.

In a statement last night the DAA board said it had decided to "engage advisers to assist with the disposal of its hotel assets."

Fine Gael spokeswoman Olivia Mitchell welcomed the decision to sell as "good news for the hotels, their staff and Ireland's State-owned airports."

Labour party president Michael D Higgins said a sale would be "a disaster, not just for the hotel group but for the entire tourism industry".