Ms Rose Hynes:

I will deal with Deputy O'Mahony's first question about the catchment area. There are two types of airport in Ireland, the three State airports at Cork, Dublin and Shannon and the regional airports. Shannon Airport is both an international and a transatlantic airport. It is one of the two transatlantic airports in Ireland. This is one area in which we are already working. We have secured an increase in our passenger numbers for the coming year and years. Shannon Airport is different to Knock airport in that it also has connections to the Heathrow hub. When I said that it does not necessarily have to be to the detriment of other airports, of course competition will mean that we will compete with the other airports. We will compete with Dublin Airport. Many people in Shannon and the immediate surrounding area drive to Dublin because they cannot get the flights from Shannon. I want to be able to say to those people that they need to be able to travel from Shannon. Nobody was complaining when Shannon had 3.5 million passengers. Now Shannon Airport figures are at an all-time low and it is trying to grow back up to those figures. Shannon's current position is unsustainable. It must stop the decline because Shannon's own position is under threat.

We are considering a range of options. Shannon Airport is owned by the taxpayer and an intervention was imperative. The reason for the decline in passenger numbers relates to five years ago. Passenger numbers declined by 50% in those five years. The first reason was a change in the economic climate. Second, Ryanair pulled out of Shannon. They were the two factors that caused the decline in the past five years. In the past year there has been a decline of 14% in traffic. This is attributable to two factors. The first factor has been the cloud of uncertainty hanging over Shannon as to whether the airport would separate. The State Airports Act was enacted in 2004. Everybody has been talking for ten years about whether Shannon Airport would separate from the others. The Booz report was published 18 months ago. The cloud of uncertainty exists. I have spoken to various stakeholders over the past five to six months. I have been told that nobody will do business with an airport which has a cloud of uncertainty hanging over it. On that basis we discussed deals with many airlines but none was prepared to do a deal. They fear the unknown. That uncertainty has been eliminated now. It is important for Shannon Airport to get on its own feet. As I see it, this is not about Knock and Shannon; it is about the recovery of Shannon and about stemming the losses there. Shannon Airport was part of the DAA group which had group rules on the basis of one size fits all. That did not work to Shannon's advantage. Shannon needs its own focus. I would say that this situation plus the uncertainty were the primary reasons for the decline in numbers, particularly in the last year.

I will deal with Deputy O'Mahony's question about costs. Because of the situation in which it finds itself, Shannon Airport must look at its costs. There is not a business in Ireland that is not looking at its costs. We are already examining work practices and every area of costs. This is an imperative from our perspective. On the question of a level playing field, I will not comment on Knock because I am not here to talk about Knock, I am here to talk about Shannon. It was necessary that the intervention be made. What has been happening in Shannon has been going on since 2004. The question was asked as to whether Shannon or Cork would separate. There has been uncertainty about Shannon. The downward trend in passenger numbers and in overall revenue meant that something had to happen. There is no package available for Shannon. The State decided to reorder its assets with regard to the three State-owned airports. This is a restructuring and a reordering of State assets. I do not see it as anything other than that.