Pat Breen (Clare, Fine Gael)
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Question 6: To ask the Tánaiste and Minister for Enterprise, Trade and Employment her plans for Shannon Development following her decision to move 100 jobs to Enterprise Ireland; and if she will make a statement on the matter. [17939/04]

Dan Boyle (Cork South Central, Green Party)
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Question 54: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the Government's strategy for the Shannon Development in view of the proposed transfer of 100 staff from the agency to Enterprise Ireland. [18121/04]

Mary Harney (Dublin Mid West, Progressive Democrats)
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I propose to take QuestionsNos. 6 and 54 together.

As I have indicated in response to previous similar parliamentary questions and the earlier question from Deputy Howlin, Shannon Development at present performs a range of functions on a delegated authority basis for Enterprise Ireland. Under the decentralisation proposals, the headquarters of Enterprise Ireland, involving 300 of its Dublin based staff, will move to Shannon. In these circumstances it has been decided that these functions should revert to Enterprise Ireland. This is an entirely practical development as it would make little sense to have two agencies in the same town performing the same functions. The decision, which is fully supported by the board of Shannon Development, will result in the transfer of between 50 and 100 Shannon Development staff engaged in these functions to Enterprise Ireland.

There have been other developments impacting on the mid-west region which necessitate a review of the role of Shannon Development. First, it has been agreed that the management of Shannon town should be transferred from Shannon Development and vested in Clare County Council. This is a decision that has been made for practical reasons and both Shannon Development and Clare County Council are in agreement.

The Minister for Transport proposes to establish an independent Shannon Airport authority and this proposal also has the support of the board of Shannon Development. Without an independent and viable Shannon Airport, the task of guaranteeing the entire region's future as a tourism destination and as a location for investment would be made considerably more difficult. In that regard, one of the options under consideration is to transfer the assets of the Shannon free zone to the new airport authority. No decision has been taken on this issue. The transfer of the assets would mean no change to either the status of the zone or its attractiveness as an investment location.

In light of these changed circumstances, I met with the chairman, some members of the board of Shannon Development and the chief executive of the company on several occasions to explain and expand on matters under consideration. At all of these meetings, I also asked the board to bring forward detailed proposals in regard to the role Shannon Development can play in the future in the context of the changes under way.

Brendan Howlin (Wexford, Labour)
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I have already asked a similar priority question. I am intrigued by the Tánaiste's response to this question in which she said her proposal, "is fully supported by the board of Shannon Development". I was looking for a public comment by the board. The only one I could see was from Mr. Liam McElligott in The Irish Times of 21 May 2004 in which he described the Government's proposals as flawed.

Rory O'Hanlon (Cavan-Monaghan, Ceann Comhairle)
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It is not appropriate to quote on Question Time.

Brendan Howlin (Wexford, Labour)
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I refer to his comments where he said it would seriously undermine Shannon Airport's capability to play a meaningful role in regional development. That was the attitude of the chairman of Shannon Development to the Tánaiste's proposals at the end of May. I understand that reflected the view of the board. Has the Tánaiste managed to persuade the chairman of a different view? Are there any public utterances to support her contention that the board is fully supportive of what it described as "flawed" a few weeks ago?

Mary Harney (Dublin Mid West, Progressive Democrats)
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In case there is any misunderstanding, what the board fully supports is both the transfer of the town to Clare County Council and the transfer of the staff working in Shannon Development on an agency basis to Enterprise Ireland. I will send the Deputy a letter to that effect. The board does not support the asset issue in relation to the zone. As I said earlier, the Department of Transport is the owner of the property and the zone and leases them to Shannon Development. What is important is that we use the assets in the region to make the region dynamic and vibrant.

Every fair-minded person who has looked at the Shannon region from a business perspective believes the airport must be supported as an independent autonomous airport so that it is in a position to be able to do deals with airlines and others. If the Shannon Development asset base can make a contribution to that, we should be open-minded about it. In case I misled the Deputy, I do not want any misunderstanding that the chairman is in favour of that, because he is not.

Brendan Howlin (Wexford, Labour)
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Is it not a fact that the only reason for the asset transfer is simply to give a veneer of economic credibility to the plan to break up Aer Rianta? Does the Minister agree that a proposal was never put to the Dáil to destroy one of the most successful companies under her control?

Mary Harney (Dublin Mid West, Progressive Democrats)
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In the early 1990s when the Culliton proposals were being implemented the foreign direct investment, FDI, role was taken from Shannon Development, for the very good reason that it was very hard to explain to companies in north America that one agency in Ireland called Shannon Development was knocking on their door and another agency called IDA Ireland was also knocking on the door from a small island with fewer than 4 million people. The only FDI piece that was left was the zone. The role for supporting indigenous companies was also taken from it and given to Enterprise Ireland or, as it was then known, Forbairt, but it was allowed to continue to do the work on an agency basis. The reality is that supporting indigenous companies will be entirely a matter for Enterprise Ireland and it will not be a matter for Shannon Development. Supporting foreign direct investment is a matter for IDA Ireland with the exception of the zone and with all those changes.

In the context of 2004, we must look at a new role for Shannon Development. The agency has described itself to me as the glue that makes things happen in the region. I agree that it has done so. There are fantastic people on the board and fantastic, committed executives and staff in the organisation. My Department and the board of Shannon Development are seeking to agree a remit for Shannon Development as we go forward so that it is clear what it will be doing. Shannon Development has a major role in tourism, as the Deputy is aware, but it will no longer have a role in supporting indigenous companies, and that is a fundamental change. We were in discussions with Shannon Development on its new role long before the issue of the airport. Shannon Development has been undergoing a process of internal review in the organisation and that is continuing. I hope it will come to a conclusion before the recess, which is only three weeks away, if not sooner.