Oireachtas Joint and Select Committees

Wednesday, 23 June 2021

Joint Oireachtas Committee on Transport, Tourism and Sport

Merchant Service Providers in the Travel Trade in Ireland: Discussion

Photo of Cathal CroweCathal Crowe (Clare, Fianna Fail) | Oireachtas source

I understand that in her heart of hearts, Ms Mannion would probably agree with much of what we have to say, but that given her role, she has to be above politics and above committing to positions insofar as travel agents are concerned. I accept that she will not able to agree with what I have to say but I want to use a little of my time to make a brief statement. As a sector, travel agents have been ravaged. They pay a bond fee to the Commission for the Aviation Regulation, at 4% of their annual turnover, as a safety net to ensure that if somebody goes totally insolvent, or if there are issues with air fare refunds, there will be some clawback and something there to protect them.

What I have been alarmed by over recent months is that these merchant service providers are on the wings. Depending on how one views them, they are either an asset to protect the consumer, which they are, given that a person can book by card and there is an additional safety net there, or a vulture to many in the sector because, in some instances, they demand cash security deposits as high as 30% of projected turnover. In one case in Ireland, they demanded a cash security deposit of €1.5 million, which was absolutely ludicrous and would be crippling for businesses that are trying to function to some degree of normality and have fallen well short of that over the past 15 months. They are striving to recover, but that will be impossible when they are being charged more than seven times what the commission requires them to hold as a bond. The merchant service providers are hanging around asking for seven times that. I accept that Ms Mannion cannot comment on this and I have heard what she said in response to other members, but I just wanted to make that point.

Ms Mannion sat on the aviation recovery task force last year. One aspect of its report related specifically to the commission's role and I want to home in on it. Recommendation No. 5, on Dublin Airport, states:

The regulatory regime as overseen by the Commission for Aviation Regulation (CAR) should continue to apply to Dublin Airport, with a planned Interim Review of the current price-cap determination to be held in the coming months. Airlines should continue to pay all airport and air navigation charges relating to Dublin. The Government should provide a rebate directly to the airlines of all Dublin Airport charges and air navigation charges as paid by the airlines. This would represent State Aid, and it would have to be notified to the European Commission for approval in accordance with State Aid Rules.

People have bemoaned the fact that recommendations from the aviation task force have not been implemented. Again, I do not expect Ms Mannion to comment on that, given that the task force met as a broad entity and we are not individualising this. Nevertheless, one issue I have seen in the report is that it was intended for the continuance of the commission's regulatory functions at Dublin Airport, so it still has all of this scope.

As we approach the end of June and look to 19 July as a date from which international air travel will resume, and as we look to the sector bouncing back, is there anything Ms Mannion can say to people who are tuned in and who work in the aviation sector, such as travel agents and others who are concerned about where the sector in general is going, in regard to how pricing charges and the regulatory framework that is in place can be used in a positive discriminatory way to ensure that air travel into and out of Ireland will be shared better with the regions, rather than funnelling everything through our national airport? Dublin Airport is important - do not get me wrong - but it is equally important to have economic recovery in the regions and air travel to them. Is there anything in the current regulatory framework that could be used as a positive discrimination tool?

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