New legislation confirms break up of Aer Rianta

Aer Rianta will be split up into three separate companies, under legislation published today by Transport Minister Seamus Brennan.

However, the State Airport Bill 2004 only gives full independence to Dublin Airport, which will be controlled by the new Dublin Airport Authority.

Due to union pressure, the new boards for Cork and Shannon Airports will not be given full powers until at least April 30, 2005.

Cork and Shannon airports will have to present business plans to Finance Minister Charlie McCreevy before they get the go-ahead. The more profitable Dublin Airport Authority will pay their debts, according to the bill.

The legislation is due to pass through the Dail and the Seanad before the summer break.

SIPTU, which represents workers in all three airports, said the legislation had been rushed for ideological and ill-conceived reasons.

President Jack O’Connor said: “The only obvious effect will be to benefit the shareholders of the major airline in the country (Ryanair) and to strengthen the position of that airline against the airports. As a result the legislation will be to the detriment of competition and ultimately to the detriment of the consumer.”

However, Mr O’Connor said the requirement for Cork and Shannon Airport to present business plans offered a way out.

“A rational, well thought out approach can still be be adopted in the light of good, objective analysis before the aviation infrastructure in this island economy of ours is irreparably damaged,” he said.

The break up of Aer Rianta was the most contentious issue in last week’s national pay talks and delayed the final agreement for days.

Strong job guarantees for the workers in the three airports have been provided in the bill. All employees will be transferred to one of the new companies with the same pay and working conditions they previously held.

The bill also restricts the Commission for Aviation Regulation to controlling prices in Dublin Airport only, and increases the fine for disruptive behaviour on board an aircraft in flight from €1,900 to €3,000.

The 12 member board of the Dublin Airport Authority will be headed by Gary McGann, the chief executive of the Jefferson Smurfit Group. The chief executive of the new Shannon Aiport Authority will be Pat Shanahan while the Cork Airport Authority will be headed by Joe Gantly, the managing director of Apple Computers in Europe.

Aer Rianta released the following statement this afternoon: "Aer Rianta has received a copy of the State Airports Bill, 2004 and is currently examining its provisions. The Company intends to communicate with its various stakeholders, including bondholders, banks, business partners, customers and staff, about the contents of the Bill.

"While it is not in a position to offer further detailed comment at this stage, Aer Rianta welcomes the provisions of the Bill relating to aviation regulation.

"In particular it welcomes the requirement by the Commission for Aviation Regulation to take into account the needs of passengers, amongst other users, when determining maximum airport charges at Dublin Airport and that one of the objectives of the Commission's determination should be to enable the operation and development of Dublin Airport in a sustainable and financially viable manner."