O'Rourke begs EU to allow aid for Aer Lingus

Public Enterprise Minister Mary O’Rourke has pleaded with the European Union’s Transport Council to allow the Government to give state aid to Aer Lingus.

Ms O’Rourke is believed to have told her counterparts from the 14 other EU member states that Aer Lingus depends heavily on transatlantic business and that the aid granted to US airlines has given them an advantage.

Under current EU competition law, member states are barred from giving aid to airlines.

The Government has been trying to convince the EU to change the law to make an exception for Aer Lingus.

However, Minister O’Rourke’s pleas are expected to be futile. The European Commission has already granted permission for governments to help airlines overcome the increased security and insurance costs incurred since the September 11 atrocities in the United States.

They have also allowed governments to compensate airlines for any loss of business during the four days last month when US airspace was closed.

Aer Lingus was in financial trouble before September 11 and, despite the fact that the crisis has been exacerbated by the US attacks, the EU Transport Council is unlikely to give Ireland the go-ahead to bail out its struggling national airline.

Michael O’Leary, the chief executive of Ryanair, Aer Lingus’ main rival, has threatened to mount a legal challenge if Aer Lingus receives a cash boost from the Government.

A firm believer in ‘perfect competition’, he has offered to take over any transatlantic routes that Aer Lingus abandons in its fight to remain afloat.