Thursday, 18 October 2007
Private Notice Questions
Aer Lingus Proposal.
Question : To ask the Minister for Transport if he will make a full statement on the disclosure that his Department was aware of plans by Aer Lingus to scrap its Shannon to Heathrow routes and transfer the service to Belfast six weeks before he claims to have been made aware of the proposals; the reason he took no action in regard to such a major threat to job creation and economic investment in the west and the mid-west regions; and if he will appoint an independent figure from outside the Civil Service to carry out an investigation to establish exactly who in his Department was aware of the Aer Lingus plans and the reason no action was taken.
Question : To ask the Minister for Transport the reason he was unaware of what was happening in his Department between the 13 June 2007 and 27 July 2007 in relation to the Aer Lingus Shannon to Heathrow slots; and if he will make a statement on the matter.
Question : To ask the Minister for Transport the circumstances surrounding the fact that while officials within his Department were aware on 13 June 2007 of implications for the Shannon to Heathrow route of proposals from Aer Lingus management to establish a new base in Belfast, he maintains that he was not made aware of these matters until 27 July 2007; and if he will provide full details regarding briefings which he received on developments in Aer Lingus upon taking office.
Question : To ask the Minister for Transport if he will provide a detailed and credible explanation for the way a senior official in his Department was fully aware of the Aer Lingus decision to transfer a Heathrow service from Shannon to Belfast on 13 June 2007 and yet he was not informed of this decision until 3 August 2007, six weeks later.
Question : To ask the Minister for Transport the position regarding Aer Lingus's decision to remove the Shannon to Heathrow route in view of the fact his Department had knowledge of the proposal to remove the Shannon to Heathrow service on 13 June 2007.
Question : To ask the Minister for Transport when he, his Department or other Departments or office holders first became aware of the Aer Lingus proposal to discontinue flights from Shannon to Heathrow; the person or persons to whom he or his office corresponded on receipt of such information; if the Taoiseach's office was informed; if the management of Aer Lingus was contacted; if an interdepartmental memo was circulated on the issue, then or thereafter; and if he will make a statement on the matter.
I thank Members for their questions. Hopefully I will be able to clarify this matter as there appears to be some confusion among them.
A media article on 13 June 2007 reported the possibility of Aer Lingus opening a new base at Belfast. Aer Lingus confirmed that a number of possible locations were being considered. Following a query to the company by my Department on foot of that article, the company, on 13 June, indicated it was considering the opening of a new base at Belfast and that, were the proposal to proceed, there would be implications for Shannon. An official conveyed the Department's concerns from the perspective of aviation and regional policy regarding the implications for Shannon and asked the chief executive to give full consideration to the ways in which a new base might be accommodated before arriving at a decision, which he agreed to do. The matter was not brought to my attention.
Subsequently, an official of the Department contacted Aer Lingus on 27 July arising from a query to the company on industrial relations matters. Again, it should be noted that contact was initiated by my Department. In the course of that conversation, it was confirmed that the company's plans for a new base had solidified and that a formal announcement was to be made on 8 August. It was also confirmed that opening the new Belfast base would entail the reallocation of Shannon to Heathrow slots to Belfast from early 2008. The official expressed concern regarding the impact of the loss of a Shannon to Heathrow service from an aviation and regional policy perspective, emphasised the importance of Aer Lingus's commitment to Shannon and indicated that these matters would be raised with the chief executive of the company.
In an e-mail to my private office on 27 July, the official stated the company intended to announce the new Belfast base on 8 August, which would entail the reallocation of Shannon to Heathrow slots to Belfast from early 2008, and referred to the concerns he had raised. A meeting with the chairman and the chief executive was arranged for the earliest opportunity, that is 3 August, to enable me to discuss these matters with the company. At the meeting on 3 August with the chairman and chief executive of Aer Lingus, I was informed of the decision to open a hub in Belfast and the reallocation of all the Shannon to Heathrow slots to a new Belfast to Heathrow service.
A number of Deputies have asked questions regarding the period between 13 June and 27 July. It is important to make clear that officials were keenly aware that the company was in an offer period until the end of June, which meant that information obtained from the company had to be treated with absolute confidentiality. Even outside an offer period, the rules related to quoted companies impose tight confidentiality requirements relating to price-sensitive information. Aer Lingus did not indicate until late July that it had made a final decision. When contact was made in June, no decision had been taken and the company had agreed to reflect on the concerns raised by the Department.
As has been pointed out repeatedly in recent weeks, Aer Lingus is free to make such commercial decisions. It was clear from early August that the company was steadfast in its decision although the implications for Shannon had been brought to its attention and, as it stated, had been considered fully by it. Although the deeply-felt concerns of business and tourism interests in Shannon are well understood, it remains the case that Aer Lingus has not been convinced that there is a commercial case to reverse its decision.
Will the Minister acknowledge that a document existed within his Department on 13 June that was marked for the attention of the Minister and that indicated specifically this concern? Can the Minister comment on, or explain, how the document did not reach him? This is the crux of the matter.
Does the Minister seriously expect Members to believe that during the one and a half months in question, no one informed him, the Government, the Taoiseach or the Minister for Defence, Deputy Willie O'Dea? This is despite the fact that the issue had been brought to the attention of his officials, who considered it sufficiently serious to warrant contacting the chief executive of Aer Lingus. Does the Minister seriously expect Members or the people to believe this to be the case? I find it to be incredible.
Will the Minister hold an independent investigation into this matter rather than an internal departmental investigation? Clearly, both departmental officials and the Minister are directly implicated in this business. It is essential to have an independent investigation into this matter.
Given the issue regarding corporate governance raised earlier today by my colleague, Deputy Broughan, in Priority Question No. 2, will the Minister ask his two board members to raise as a matter of urgency at board level the need to re-investigate the entire issue pertaining to the withdrawal of the Shannon to Heathrow slots? The company's corporate governance documents state that the board is responsible for overall group strategy, including new activities and withdrawal from existing activities.
The Minister should respond to these four direct, clear questions. The people of the mid-west are horrified that this information was available, the decision could have been pre-empted and an alternative decision could have been agreed with the Government, had the Minister and his Department done their jobs. I agree with my colleague, Deputy Broughan. The buck stops with the Minister and he should consider seriously his position as Minister for Transport.
The Deputy asked whether there was a document in the Department on 13 June. There was, and the document in question was released under freedom of information legislation. As the Deputy noted, it was headed, "For the information of the Minister". Neither I nor my predecessor ever received that document. While everyone within the Department accepts I should have been informed of the document's contents and should have received it, I was not so informed and did not receive it.
—— within the Department. This is now the subject of a report.
The Deputy asked whether I seriously expect her or anyone else in the Opposition to believe what I am saying. No, I do not expect Opposition Members to believe anything that does not suit them from a political point of view.
As for the review of Aer Lingus's decision and the appointment of directors, I have already indicated the Government will appoint two additional directors to the board of Aer Lingus. As the Deputy may not have been present in the Chamber during my reply to previous questions, I will repeat it.
The decision of the board in this regard was that the specific issue of the transfer of the slots was not brought before the board. The board gave a general mandate to the company and its executive to make decisions in the best commercial interests of the company. Consequently, the executive made that decision on foot of that mandate.
It is incredible that the Minister has given such a response. I find it completely unbelievable that he can state he did not see anything, hear anything or know anything. Neither his press office, his advisers nor his programme managers told him anything. I wish to ask the Minister a question in respect of the Taoiseach.
Is it not a fact that there is a media watch unit in the Department of the Taoiseach and that the Taoiseach, as he said on the record of the House, circulates media reports to the relevant Departments? Did the Minister receive such a report from the Taoiseach? The reports are here and the Minister could have seen them himself if he had done a Google search. They are on the Irish Independent and Irish Examiner websites.
My second question is about the credibility of the Minister. He seems to be saying that members of the Dublin Airport Authority, the Aer Lingus board, the Belfast groups, and the Department of Transport — at the level of assistant secretary — all knew about this issue and were talking about it, yet none of them spoke to the Minister about it. Nobody told the Minister anything. It is as though he were in an isolated cell where nobody could communicate with him. I would have expected the Minister to meet with people such as these, including the aviation experts and the assistant secretaries, on his first day in office to find out about any big issues that would have to be faced. Were they not there? I would have expected him to find out about the matters that would affect him, the Minister, Deputy O'Dea, and the other members of the Cabinet. It is not credible for the Minister to say that he did not know. I do not accept that, nor will anyone on this side of the House. Deputy Dempsey has been a Minister for ten years in at least four different Departments. He has no credibility on this issue. I ask him again. Did the Taoiseach's media unit contact him or his Department about this issue?
It was well known — perhaps it escaped Deputy O'Dowd's attention during the course of debates on the privatisation of Aer Lingus, the production of IPO literature and so on — that Aer Lingus intended to set up hubs in other parts of Ireland or in the UK. I am not sure how many people here knew, but it was public knowledge that at least five different centres were being considered, including Belfast, Birmingham and Glasgow. In the story that appeared on 13 June, it was stated that Belfast was a likely choice. It was not stated that all the slots would be removed from Shannon Airport——
How can I answer when the Deputies will not let me finish?
Deputy O'Dowd should take note of what I said. It was a media report spotted by officials from my own Department that gave rise to the contact with Aer Lingus.
No, the official in the Department told me. There is no mystery about the media report. I was not in the Department at the time the media report appeared. It was spotted by the official, who had the conversation as a result of that.
It defies belief that a Minister of Deputy Dempsey's experience would not have realised when he took over the Department that the key issue was the privatisation of Aer Lingus. Surely he would have asked whether there were any issues regarding the privatisation of Aer Lingus that needed to be brought to his attention. The memo he received was dated 13 June. He took over as Minister on 14 June. I expect the memorandum was prepared before he went in as Minister, and he would have been given a separate briefing on this issue. Did the former Minister, Deputy Cullen, brief the Minister on Aer Lingus and the Heathrow slots?
The Minister received information on 27 July to the effect that his Department had known since 13 June that Aer Lingus was considering pulling the Shannon to Heathrow slots. At that stage did the Minister not consider appointing two directors to the board with a mandate to protect the Heathrow slots? Does he agree that if he had appointed the directors back on 14 June when he took over as Minister we would not be in this situation now? The Heathrow slots in Shannon would have been protected.
When did the Taoiseach become aware of the proposed decision of Aer Lingus? When did the Minister first discuss it with the Taoiseach? These are critical matters. What the Minister is presenting here today does not stand up to scrutiny. Clearly, the Government knew as far back as 13 June that the decision was to be made, and it could have made certain it would not happen.
I will go through this one more time. The official who saw the information in the newspaper on 13 June tried himself to make contact with Aer Lingus to establish the truth of the matter. He was unable to make contact directly. Another official was asked to do it because the first official had a number of meetings that morning. The second official made contact with a person in Aer Lingus and had a conversation, which he recorded and placed in the memo of 13 June. In case people are becoming confused, I will mention that this was the principal officer. In the meantime the other official, the assistant secretary, made contact with or was contacted by — I cannot say which — somebody in the company, who told him——
On a point of information, when the Minister first gave an explanation he said quite clearly that his Department made contact with Aer Lingus, not vice versa. Now he is saying he is not sure who made contact with whom. Could he clarify this, please?
——but did not succeed in making contact. He told the principal officer to make contact, which was initiated. There was a conversation. I do not want to be accused of misleading the House, because I am not sure of this, but there was a conversation in the afternoon between the assistant secretary and the chief executive of Aer Lingus in which the information about the Belfast hub was conveyed. He was told that Belfast was one of a number of places being considered but that no final decision had been made, and that there could be implications for Shannon if it was chosen. The assistant secretary indicated what he knew to be Government policy——
He knew that this would have implications and that anything to do with Shannon Airport was sensitive. Any issue such as this would come under the remit of Government policy in the areas of aviation, regional development and so on.
——which the chief executive agreed to do. As I said, the next contact was initiated by the Department on 27 July. To answer the specific question again, neither that conversation nor the memo was brought to my attention.
Will the Minister accept that it is normal practice for a Minister moving to a new Department to be given a briefing by the Civil Service on important matters within that Department? I assume the answer to that is "Yes" or "No". Was the Minister offered such a briefing? Did he ask for one, and if not, why? Did he discuss any matter related to Aer Lingus with officials in his Department prior to 27 July, and if so, with whom did he discuss them?
Why will he not ask an independent body rather than an internal departmental inquiry to investigate these matters? Who is running the Department of Transport? Is it the Minister with responsibility or is it the Civil Service? The Government at the time blamed Aer Lingus management for removing the Shannon-Heathrow slots, describing it as regrettable. It now seems that the Minister is blaming the Civil Service for that.
Would the Minister accept that, had he acted properly with management in a timely fashion from early June, such an intervention could have led to a much better solution, salvaging the Shannon-Heathrow slots and thereby offering significant infrastructure to that part of this island?
I will try to be brief. On 14 June Deputy Dempsey became Minister for this, his fourth Department. He is an extremely experienced politician at this stage. He got a written briefing from his Department, which we have seen, containing a section on the Shannon tourism and economic development and another section on the development of Shannon Airport. Is he seriously expecting us to believe that he got that written briefing but that he got no verbal briefing relating to those two sections——
——of the briefing we have seen, and that a Minister of his experience did not ask his senior officials the basic question, whether there was likely to be a political timebomb that is about to explode over the summer——
——or whether he could go on holidays safe in the knowledge that the biggest political story of the summer was not about to break? Is it reasonable to be sceptical when, the day before he got this briefing, the second in command in his Department was so concerned about a political story that was about to break that he rang Mr. Dermot Mannion, chief executive of Aer Lingus, yet the following day, despite the fact that the Minister would have been required to ask questions about his written briefing, nobody chose to mention this?
This is not the Opposition looking for a political opportunity. Pure and simple, it is that we do not believe what the Minister is saying. That is why these questions have been tabled. It is not credible.
I do not believe the Minister either. I want to establish when the Taoiseach was informed of all this. Was he informed, like the Minister, on 13 June? The Minister was informed on that date, he was briefed by his official and he washed his hands of it. He did not act and he turned his back on Shannon.
I want to know when the Government found out about this and when all the officials knew about it. The Minister has turned his back on us. He has sold out the people of Shannon and he must be held accountable for that.
When the Minister or his Department discovered the emerging situation, what was his first reaction and what was the reaction of the official who had the information?
The Minister states he was not contacted, that he was not informed. Were other Departments informed? Was the Taoiseach's office informed and did the Minister himself ring that office?
What action did the Minister or anybody else take, to his knowledge, to ascertain whether Aer Lingus had an alternative plan to reschedule some of its other services with a view to retaining services at Shannon?
It is normal procedure to brief a Minister. I got a brief and the Deputies opposite have a copy of that brief. On 19 June I had a divisional briefing, which was verbal and around a table. I was not told at that stage——
Deputy Coveney asked if there was a briefing and stated that I am an experienced Minister. There was a briefing. There was a briefing document and there was a briefing session. I can tell the Deputy that I was not told of the contents of that information.