Michael Ahern (Cork East, Fianna Fail)

On the announcement yesterday of Mr. Joe Gantly's decision to step down from the board at the end of July next, the Minister paid tribute to his achievements during his time as chairman. In responding to the Deputy, I propose to set out the initiatives that the Minister has taken to facilitate the separation of Cork airport from the DAA, a key objective that he shares with Mr. Gantly. The Minister has co-operated with Mr. Gantly in the endeavour to resolve outstanding issues relating to separation.

The State Airports Act, 2004 provides the framework for the establishment of Shannon and Cork as independent airports. As part of the airport restructuring process the boards of Cork and Shannon airport are required to prepare business plans for eventual separation.

The Cork business plan was submitted to the DAA at the end of last year and subsequently forwarded to me with DAA's commentary. There were clear divergences between both authorities on the business plan and particularly on the level of debt that the CAA would absorb in its business plan.

To break the impasse between the two bodies the Minister decided to appoint Mr. Peter Cassells to engage in a constructive dialogue with the CAA and DAA boards in order to establish whether there was a basis for a speedy resolution of the disagreement between the two parties. Mr. Cassells reported to the Minister on the matter and the Minister published his report on 2 April.

His conclusions and recommendations were the outcome of that dialogue with the DAA and CAA. They provided an opportunity for a final decision to be made on the financial consideration to be paid by the CAA in respect of the transfer of net assets of €220 million on separation. In essence, they provided the Cork Airport Authority with a funding solution post separation of €20 million to €40 million, in return for the transfer of net assets of €220 million, while reducing DAA's indebtedness by €113 million.

The Minister believed Mr. Cassells's recommendations represented a sensible solution to this impasse, which he urged both parties to accept as soon as possible. He then asked Mr. Cassells to assist the two boards as regards bringing the issue to a speedy, mutually acceptable conclusion. Mr. Cassells' subsequent efforts lead to the acceptance of his report by the CAA Board on 10 April last.

The Minister would point out, as previously stated, that he gave no assurances to the CAA about financial support from the State.

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