Noel Dempsey (Meath West, Fianna Fail)

I thank the Ceann Comhairle and the Deputies opposite for the opportunity to outline the background to the current industrial relations dispute at the Irish Aviation Authority, IAA, at Dublin, Cork and Shannon airports and to bring Deputies up to date with the air traffic control problems at the three State airports.

I am very disappointed that air traffic controllers are disrupting the travel plans of thousands of air passengers from 2 p.m. to 6 p.m. this afternoon. The action arises in the context of an industrial relations dispute between the company and the air traffic controllers' trade union, IMPACT. The immediate cause of the dispute is a withdrawal by IMPACT of co-operation with new technology since 1 January and the consequent suspension of a number of air traffic controllers.

However, I am advised that the issues at the core of this dispute are the non-payment of increases under Towards 2016 and the issue of an employee contribution towards the IAA superannuation scheme. The dispute was referred to the Labour Relations Commission and a hearing on 14 January last failed to resolve the matter. A Labour Court hearing on the pay and technology issues was scheduled for 26 January and the IAA requested IMPACT to desist from industrial action and maintain normal co-operation with the introduction of new technology pending the outcome of the hearing.

The IAA has advised me that it is ready to co-operate fully with the industrial relations machinery of the State with a view to addressing these issues quickly and in full. To that end the authority would be willing to lift suspensions immediately if air traffic controllers return to the co-operation with the technology projects as applied up to 31 December last. I would urge both parties to avail of the services of the Labour Court and to make every possible effort to resolve this dispute as quickly as possible.

The dispute must be considered in the context of the impact of the downturn in the aviation sector on the lAA's customers, namely, the airlines. The IAA has pointed out that this country has witnessed the biggest decline in aviation traffic in Europe and the continuing downturn means that the IAA is under very strong pressure from airlines to minimise cost increases. The world's commercial airlines are set to lose $5.6 billion this year, following an estimated loss of $11 billion dollars last year. European carriers, many of which are IAA customers, are on track to generate the largest losses of any region in 2010 of $2.5 billion. Of the lAA's top ten customers, only one is currently making a profit.

Deputies will be aware that Aer Lingus is currently implementing a major transformation plan with the agreement of staff. Similarly, the Dublin Airport Authority has negotiated a cost reduction package. Employees in both companies have also taken cuts in pay and allowances, improved roster flexibility, and additional productivity measures. That is the real aviation environment in which the IAA must operate.

Air traffic controllers are very highly paid, have suffered no pay cuts and are not subject to the public service pension levy, as the IAA is a commercial State body. The majority of air traffic controllers are former civil servants who transferred to the IAA on 1 January 1994. They make no contribution to their pension fund while the IAA pays 30.5% of gross pay towards the fund, which in 2009 had an actuarial deficit of €234 million. The IAA introduced a new defined benefit scheme with employee contributions for all those recruited on or after 1 April 2008.

My Department is closely monitoring developments in the air traffic controller dispute. I hope that both sides in this dispute can recognise the imperative of reaching agreement. I urge them to work constructively with the Labour Court with a view to resolving this matter.

See this speech in context