Kerry route row hots up

RYANAIR boss Michael O’Leary yesterday called on Transport Minister Noel Dempsey to explain his decision to reject the airline’s offer of binding arbitration to resolve the row concerning the Kerry-Dublin route.

Ryanair plans to reduce the number of return daily flights on the subsidised route from three to one at the end of this month.

Meanwhile, efforts are continuing to get Aer Arann, which previously serviced the route, to fill the vacant slots.

Ryanair has operated the Public Service Obligation (PSO) route since July 2008, receiving an annual subsidy of €1.7 million.

However, Ryanair claims its costs have jumped by €660,000, due to the tourist tax and increased Dublin Airport fees, and is seeking reimbursement from the Department of Transport, which the department is refusing.

Both sides are accusing each other of breach of contract.

Mr O’Leary, in a statement yesterday, said if Ryanair was in breach of contract, then clearly Mr Dempsey should be happy to go to binding arbitration.

Ryanair has also warned Mr Dempsey that if he attempts to offer the PSO service to Aer Arann at a bigger subsidy than that being requested by Ryanair, it will take legal proceedings against him for breach of contract.

Meanwhile, Kerry North Fine Gael TD Jimmy Deenihan said it was highly regrettable that the department had rejected an offer by Ryanair to enter into arbitration.

“The refusal by the Department of Transport to enter into arbitration with Michael O’Leary is extremely disappointing, as the offer by the airline to sit down with department officials was expected to be the first step on the road to sorting out the problems with Kerry Airport,” he said.

Mr Deenihan, also FG’s tourism spokesperson, said a reduction in flights would have a serious impact on the people of Kerry and the possibility of future growth for the region.

“Businesses that rely on multiple flights being available to them on a daily basis are set to suffer hugely if this situation is not worked out,” he added.

“The cost that will be incurred by the tourism sector in the region, which already faces myriad challenges, also cannot and must not be underestimated.

“This stand-off between Michael O’Leary and Minister Dempsey cannot be allowed to persist.

“We are in the grip of the worst recession in our history and this disagreement, if not resolved, will only cost more jobs in the Kerry area,” he went on.

Mr Deenihan called on Mr Dempsey to intervene and to set in place a binding arbitration process that can resolve the matter before it was too late.