Seán Crowe (Dublin South West, Sinn Fein)

Sinn Féin, in proposing this motion, is conscious that until now there has been no real opportunities for Deputies to discuss the cases for and against the privatisation of Aer Lingus and the ramifications it will have for Irish taxpayers, the airline workers and our island economy. It is in this spirit that Sinn Féin proposes to open this debate and give everyone, regardless of the dogma of his or her party leadership, a chance to put his or her position on record as to whether he or she supports the privatisation and sell-off of Aer Lingus.

I want to be clear on the Sinn Féin position. We believe that privatisation will not work for Aer Lingus. We have listened carefully to the arguments of those in favour of the privatisation route but believe they have got it wrong once again. In the long run privatisation costs the taxpayer more money. It results in a loss of jobs throughout the economy not only in the company that ends up being asset-stripped and sold off but in other economic sectors.

It has been amply demonstrated in the cases of Eircom and now the ESB that privatisation leads to higher costs, increased prices and a complete absence of the promised benefits of competition. In the Eircom case, we are witnessing a slow decline towards failure. Today, more than five years after the privatisation hype that accompanied the Eircom share launch, the company is clearly in difficulty. For the customer, privatisation has meant a more costly service, particularly in line charges, hand-sets and being levied for maintenance by Eircom.

The company has been on and off the Stock Exchange as its new owners found innovative ways to cash in on its value. They sold off the Eircell mobile phone licence to Vodafone. This is a company whose profits run to hundreds of thousands of euro daily and whose Irish customers pay more money into Vodafone's coffers than mobile users in any other Vodafone market. Eircom's new management then sold off the Golden Pages and the company's websites. Its members paid themselves a €500 million dividend but were unable to find the money to invest in a nationwide broadband roll-out. When the Government begged the company to run the broadband service, not being a public sector company, it was able to say "no". When the Taoiseach and other Cabinet Ministers offered to subsidise a State broadband roll-out programme, the privatised board of Eircom was again able say "no". Its members also tried to say "no" to their public service obligation to provide fixed line services to all households which was costing them €40 million a year. Last year leaked documents, prepared by Eircom's consultants and senior managers, showed the firm needed to spend at least €1 billion on upgrading its network, which was reporting up to a million line faults annually.

This is the reality of the privatisation of Eircom. A lucky few, like Tony O'Reilly, have been enriched while the original infrastructure is in decay and new investment in broadband is only emerging in a piecemeal way. I give the Government and Eircom credit for one aspect, the advertisements were good but it is a pity about the service.

There is the case of the ESB, not yet privatised but being prepared for sale, and the introduction of new private sector power stations. For the customer, this has meant four years of year-on-year price increases. That represents a 40% increase since the Government decided to privatise the electricity markets. These price increases were needed, according to the ESB regulator, to make the market more attractive for the private sector. That is a remarkable statement. A successful, profitable and efficient State company has to artificially increase its prices, screwing its customers in the process, to facilitate the entry of private profiteers to the market. That is nonsense.

This is the reality of the mad march towards privatisation in Ireland, spearheaded by the Progressive Democrats and their cheerleaders and bank-rollers, resulting in higher profits for the greedy select few and higher prices for customers. Where does that leave Aer Lingus? Will its privatisation be a different story? What safeguards have we that four or five years down the tarmac we will not have a repeat of the Eircom fiasco?

SIPTU tells us that the sale is a "grave strategic error". It highlighted the promise made to it over a year ago that the company needed a full business plan to grow its routes and passenger numbers, then plan the type of aircraft needed and the level of financial investment for the company.

At present, Aer Lingus management does not know what is needed because there is no business plan. The new chief executive will not take up his post until August. If the company does not know what is needed in terms of investment, what hope is there that the Government knows? The answer is none. However, this is not about investment in the airline, securing the future of Aer Lingus or the best interests of the travelling public or the Irish taxpayer, it is about giving in to the insatiable demands of the privatisation lobby.

Government members have a chance tonight to stand up and say whether they are planning a Ryanair mark II or whether they believe there is a future for Aer Lingus as a national carrier, handling cargo and playing a central role in the future of the Irish economy.

IMPACT has raised the issue of Ireland's status internationally in the airline market. It has pointed out that "very few countries of Ireland's size have direct flights to so many important destinations". According to IMPACT, huge strategic interests are at stake, especially in the tourist and investment sectors, if Ireland's ability to have direct flights internationally is not maintained. However, as of yet we have had no details or guarantees from Government, not even a hint that it has given these issues a moment's thought.

Another issue raised by IMPACT is that Aer Lingus could go the way of Manchester United, bought in a hostile take-over and saddled with debt to pay for the take-over.

There is the disclosure by ICTU that €27 million of taxpayers' money has been invested in airlines around the world through the pension reserve fund. Therefore, it is all right to invest in Air France, BA or even Ryanair. I am sure the strategic business plans of these airlines were checked out before any investment was made, or maybe they were not, as €7 million was invested in Ryanair without yet receiving a dividend from this firm. Perhaps it was all spent on the newspaper advertisements attacking the Taoiseach.

These are all cogent arguments as to why Aer Lingus should not be privatised. Aer Lingus is the airline of choice for Irish people, not only for those living in Ireland but throughout the world. For them, it is a symbol of safety, good customer care and value for money, and there is incredible goodwill from the people towards the airline because of this. Given a choice, I believe this is the airline on which most Irish people would choose to travel. That is not to say that an airline can be run on goodwill alone. Aer Lingus is in the successful position it is in today much to the sacrifices made by its workforce. It has adapted to the new challenges that emerged following 11 September and has come through where others failed.

There is the question why Aer Lingus exists in the first place. The answer is that there were no private sector investors willing to take the risk in setting up the company. There was no one with the long-term strategic view of how important the airline industry would become to the Irish economy not only in terms of tourism but of importing and exporting goods. We are, after all, the most globalised economy in the world.

Aer Lingus became a vital part of the economic infrastructure of the State, and it still is today. As was the case in the 1930s, there are still no private sector businesses, domestically or internationally, with the long-term strategic view needed to secure the future of this company. There are the carpet-baggers who will gladly assist in the asset-stripping and dismembering of this company, turning it into a pale imitation of Ryanair. There is even a greater breadth of vision needed for Air Lingus in the time ahead. It needs to be developed in the context of a strategic direction for all the airline industry in Ireland that would include, on an all-Ireland basis, international and regional airports. However, unfortunately, unless Members support this motion none of this will ever come to pass. Instead we will have a quick sell-off and glossy advertisement campaign but no real thinking about the long term and no national strategy for the airline industry. Therefore, Members should get ready for another bumpy ride, lots of turbulence, jobs lost and, ultimately, a crash landing.

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