Dáil debates

Tuesday, 17 May 2011

Adjournment Debate

Air Services

6:00 pm

Photo of Tony McLoughlinTony McLoughlin (Sligo-North Leitrim, Fine Gael)
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I wish to share time with Deputy Paudie Coffey.

Photo of Joanna TuffyJoanna Tuffy (Dublin Mid West, Labour)
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The Deputies will have two and a half minutes each. Is that agreed? Agreed.

Photo of Tony McLoughlinTony McLoughlin (Sligo-North Leitrim, Fine Gael)
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Is there a Minister available to respond?

Photo of Joanna TuffyJoanna Tuffy (Dublin Mid West, Labour)
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The Deputy should say what he has to say in two and a half minutes.

Photo of Paudie CoffeyPaudie Coffey (Waterford, Fine Gael)
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There is no Minister available to provide a response.

Photo of Ciarán CannonCiarán Cannon (Galway East, Fine Gael)
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I am not responsible for transport issues, only health and education.

Photo of Joanna TuffyJoanna Tuffy (Dublin Mid West, Labour)
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Deputy Tony McLoughlin should say his piece and we will see whether there is a Minister available to reply.

Photo of Tony McLoughlinTony McLoughlin (Sligo-North Leitrim, Fine Gael)
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Dáil Éireann calls on the Minister for Transport, Tourism and Sport to ensure his Department will provide €400,000 in aid for Sligo Airport to ensure this vital piece of infrastructure remains viable. I thank him for addressing this important issue for the people of the north west.

Since its foundation in 1974, Sligo Airport has been developed from an airstrip, effectively, to a commercial airport catering for up to 700,000 passengers. The recent decision to withdraw PSO funding is a dramatic blow that threatens the viability of the airport. As a key resource for Sligo, a gateway city in the national spatial strategy, the airport is an attraction when the IDA Ireland promotes Sligo as a location for foreign direct investment. Tourism growth is targeted by the Government, especially in the north-west region which lags behind others. Tourism potential will diminish if Sligo Airport ceases to operate.

Sligo Airport hosts the Coast Guard search and rescue service, medical organ transplant emergency flights, private commercial flights, Air Corps training and Government flights for a variety of Departments. The decision to withdraw from July the PSO subsidy will result in the ending of the daily Dublin to Sligo flights. It will have an immediate effect on staff and the finances of the operating company. I compliment the board and staff on their work. They have given value for money. A recent submission to the Department recommended that the decision be reviewed and that more cost effective ways of maintaining the route be examined. In recent contracts the cost of subvention has escalated and the board of Sligo Airport would welcome a review, as it would a more in-depth look at the overall programme.

Funding of €400,000 is required by Sligo Airport to ensure its continued operation. I urge the Minister to consider this level of subvention based purely on the cost-benefit analysis based on tourism growth, industrial investment and the use of the airport by emergency services. At the least, I urge the Minister to ask his officials to examine in detail the submission sent by Sligo airport before he closes the door on this issue.

Photo of Paudie CoffeyPaudie Coffey (Waterford, Fine Gael)
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I thank Deputy McLoughlin for sharing time with me on this important issue.

As a result of the recession, funding for regional airports was cut drastically in budget 2010 by the previous Government. I am concerned that recent media reports indicate that Waterford Regional Airport may be an airport the Minister is considering closing. I would like to present some facts to the Minister. Waterford Regional Airport passenger numbers increased exponentially, from approximately 15,500 in 2002 to almost 112,000 in 2009. The Buchanan report states that 85% of businesses in the south east view direct air access to the region as being very important. Millions of euro have been spent on infrastructural investment to date at the airport and the local authorities have invested in additional servicing infrastructure, such as a better roads network.

I note from the value for money report prepared by the Department that Knock and Kerry airports are successful because they have the facility to land jet aircraft. Waterford Regional Airport was expected to receive additional investment, via the Transport 21 project, to extend the airport, but that funding was never forthcoming. This has put the airport at a serious disadvantage. Waterford Regional Airport is the only airport in the south east region and there is a strong economic argument for its retention. With Waterford City as the gateway city to the region, for balanced regional development and strategic infrastructure there is a strong economic argument for the retention of the airport for access to the region. It is the only regional airport in the country not in receipt of the PSO subvention.

I acknowledge the Minister faces huge challenges to balance the budget in his Department. However, the continuation of the regional airport will help to deliver economic development and growth in the region. I note from the recommendations of the value for money report that the operational expenditure for Waterford Regional Airport would continue, subject to an annual assessment of subvention. I hope the Minister can put to bed the concerns I, my constituents and people in the wider south east region have and that he will confirm that support will continue for Waterford Regional Airport for the reasons I have outlined.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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I thank Deputies McLoughlin and Coffey for raising this matter.

The Deputies will be aware that I am faced with dealing with the lack of funding available for the regional airports programme for 2011 and for future years, following the reductions made by the previous Government. At the same time, some of the regional airports are becoming more dependent on Exchequer support as the cost of operating and providing necessary security facilities rises and the number of people flying domestically continues to decline. Essentially, the regional airports are asking for more money to do less. This is not a sustainable position and I expect it to worsen in the coming years, with an improved road network, cheaper train fares and rising security costs.

There is a total allocation of €13.4 million available for the programme for 2011, some €11.4 million for current expenditure on the PSO air services and operational losses of the airports and €2 million for capital projects at the airports. This compares to expenditure of €21.2 million on the programme in 2010 and €200 million in the past ten years. After existing commitments for PSO air services to July 2011 and for new PSO air services from Kerry and Donegal to Dublin are accounted for, only €0.6 million is available for operational subvention for airports in 2011, whereas €4.8 million was paid out in 2010. The €2 million for capital expenditure is also considered to be inadequate for essential safety and security work at all the airports. Obviously, an increase in funding would have to come from cuts to road maintenance, bus services, railways or the coast guard. That might be possible this year, but not next year in the context of the €2 billion or more of spending cuts sought by the Government.

Last January, the previous Government announced that it would continue to support PSO air services for Donegal-Dublin and Kerry-Dublin. Only the Donegal-Dublin PSO operates currently. It was subsequently decided that a scheme would be introduced to allow the six regional airports to apply for whatever funding was available for operational expenditure, but the Government at the time did not identify what funding was available, because there was none.

I understand these decisions were based on the value for money review published last January, which recommended that funding for PSO air services between Dublin and the regional airports be discontinued when current contracts end in July 2011, with the exception of the Donegal-Dublin service. It also recommended that OPEX and CAPEX funding be discontinued for Sligo and Galway airports for a number of reasons, including the fact the catchment areas of these airports overlap with other airports with jet capability nearby at Knock and Shannon. The review took account of recent improvements in alternative transport modes, changes in EU legislation and the requirement to make best use of ever scarcer Exchequer resources.

I fully appreciate the implications for Sligo arising from these recommendations. However, in the context of addressing the lack of funding issue, I must focus on ensuring the sustainability of a strong network of regional airports serving the public, both in terms of business and tourism. I am conscious that once the PSO expires in July, Sligo will not have any regular scheduled air services.

While no decision has yet been made by the current Government on regional airport subsidies, I will bring proposals to Government within weeks with regard to funding of the airports for 2011 and future years. It would be inappropriate at this stage to comment on the possible outcome of the Government's deliberations of those proposals. However, it is clear that in the current financial crisis, any decisions will have to take account of available Exchequer funds. It is not business as usual and unpopular decisions must be made on matters like this today or we will be unable to pay for even the most basic or essential services in the future.

The Dáil adjourned at 9.10 p.m. until 1.30 p.m. on Wednesday, 18 May 2011.