Michael McNamara (Clare, Labour)
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As the Minister is no doubt aware, earlier this week Aer Lingus management announced its intention to close the cabin crew base at Shannon Airport from the end of March 2014. That follows the company’s unilateral announcement in September that it would outsource cabin crew services on a new transatlantic service from January 2014. The announcement was directly contrary to an agreement which Aer Lingus had reached with the pilots in negotiations on the outsourcing the 757 service in the first place.

In response to that unilateral action IMPACT members in Aer Lingus across the country were balloted and they determined that they would go on strike.

I am relieved at today's events whereby the LRC has invited both parties to talks. I hope Aer Lingus will formally announce it will be accepting that invitation, if it has not already done so.

The limitations on what the Government can do with regard to Aer Lingus have been very well rehearsed in this House. As we all know, it not a State-owned company any more; there is merely a minority shareholding. When Aer Lingus pulled the flights from Shannon Airport to Heathrow Airport, with disastrous consequences, these arguments were debated at great length. At the time Members were told the Government could not use its shareholding to force Aer Lingus to take a particular action. However, the Government's advice from the Attorney General on the issue, as with the advice from the Attorney General on many other issues, was not published. During the last general election campaign I campaigned for the Attorney General's advice to be published. I do not really understand why the Attorney General's advice on a wide range of issues cannot be published. I understand there are issues of commercial sensitivity, but when it comes to issues of constitutional change, it is another matter. Today there was an announcement or a decision made by the Cabinet. In this regard, I just do not know why Attorney General's advice cannot be published. I do not wish to digress on this issue.

The Government, as a significant shareholder in Aer Lingus, has an interest in maintaining the value of the company. This is determined by and very reliant on loyalty, including customer loyalty. Unlike companies with which Aer Lingus competes, in respect of short-haul flights to Europe and even transatlantic flights, the airline is very reliant on customer loyalty. It is very difficult to see how that customer loyalty can be maintained, while at the same time abusing the loyalty of long-term staff.

There is a notion among the new management that Aer Lingus having been a company for which people worked for their entire working lives does not fit with some of the practices of its competitors. People work for a year or two as cabin crew with the latter and then burn out and move on to other jobs. In Aer Lingus this has not been the practice. Its customers value this and it is part of the reason the company was able to survive. It survived because of the loyalty of its staff and customer base.

We have been told by the Irish Aviation Authority that it is safe to have four-person crews on transatlantic flights. However, there is the difference between what is safe and what is comfortable or what provides a reasonable level of customer service. Aer Lingus prides itself on and markets itself on the basis of providing that customer service. It has competitors which until very recently marketed themselves on not providing customer service, but that model does not seem to be working and the competitors are changing. It seems bizarre at this time that Aer Lingus is seeking to reduce the level of its customer service. I look forward to the Minister's reply.

Leo Varadkar (Dublin West, Fine Gael)
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I thank the Deputy for raising this issue.

Aer Lingus is a publicly quoted company and decisions regarding its employees and bases are commercial matters for the board and management. As Minister for Transport, Tourism and Sport, I have no role in such decisions. For that reason what I can say is somewhat limited. While the State retains a 25% shareholding in Aer Lingus, this does not allow it to become involved in the day-to-day commercial operations of the company. However, the Government is committed to the new independent Shannon Airport company being a success and sustaining employment opportunities in the mid-west. The closure of Aer Lingus's Shannon Airport cabin crew base would be very regrettable and the Government urges the relevant parties to make every effort to reach agreement in order that the base can remain open.

Last July Aer Lingus announced a significant expansion of its transatlantic routes and capacity for 2014. This included very positive developments for Shannon Airport, since one element is that Aer Lingus's Shannon-Boston and Shannon-New York services will resume during the winter months in 2014. The company had ceased operating these services for part of the winter season in recent years as they had proved loss-making for it when operated with large A330 aircraft, as opposed to the narrow-body aircraft that it will now use. The resumption of year-round services will, according to Shannon Airport, result in a 25% increase, or 50,000 additional passengers, on Aer Lingus transatlantic flights in 2014. With other new Aer Lingus European routes out of Shannon Airport, this was welcomed as an indication of the airline's continued commitment to the airport.

In addition to increased services at Shannon Airport, Aer Lingus announced new year-round direct services to San Francisco and Toronto from Dublin Airport in April 2014. These new services were welcomed by all concerned when first announced last summer, in particular by the inbound tourism industry and the many IT employers in the country with close links with the Silicon Valley area. Providing a year-round direct service to Shannon Airport for tourists inbound from the USA will provide a major boost for the local tourism industry and the wider western and mid-western regions. These new services have been made possible because Aer Lingus is leasing three smaller Boeing 757 aircraft from another Irish airline, Air Contractors. It was originally announced that Air Contractors would supply the aircraft and that the crew would be Aer Lingus employees. The company began the recruitment process for additional cabin crew for this purpose.

Agreement for these new arrangements had been reached with the company's pilots and cabin crew represented by SIPTU. However, on 24 October it was announced that the company had failed to reach agreement with IMPACT cabin crew. As I understand it, the dispute focuses, in particular, on cabin crew numbers on the smaller Boeing 757 aircraft. Aer Lingus is proposing to crew the aircraft with four cabin crew and has received regulatory and safety approval for doing so. Other issues such as the cabin manager grade and rostering have also been raised by IMPACT. It is reported that Aer Lingus believes IMPACT's objections to the new arrangements would make the Shannon Airport cabin crew base commercially unsustainable for the company and that it would have little choice but to close the Shannon Airport base and request Air Contractors to provide cabin crew for the Shannon-US services. In response to this, on 4 November it was announced that the IMPACT cabin crew had balloted overwhelmingly in favour of industrial action in the order of 91%. The ballot was of all IMPACT cabin crew in the State. The company has not yet been served with notice of industrial action.

The LRC has had contacts with both sides and it was announced earlier today that they had been invited to meet it this Friday in an attempt to find agreement in the dispute. The Government strongly urges both sides to use the available industrial relations machinery of the State to reach agreement on the matter as soon as possible in the interests of the travelling public, staff and the company. Industrial action in the company could be very disruptive for passengers in the run-up to Christmas and very damaging for the company. It would be very regrettable if the boost the Shannon region would get from the increased Aer Lingus services at the airport were to be marred by a reduction in the numbers employed at the airport owing to an industrial relations dispute.

Michael McNamara (Clare, Labour)
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I accepted at the very outset the commercial nature of the Government's interest in Aer Lingus, but my question was on whether the commercial developments in Aer Lingus were in the commercial best interests of the company, particularly in an increasingly competitive market. I am thankful there is a more competitive market, including at Shannon Airport, at which there is increased competition on both short-haul and transatlantic routes. The company was a flag carrier and still markets itself very much as the flag carrier. We still remember the slogan, "Look up, it's Aer Lingus!" There are differences in the marketing strategies of European airline companies, from former flag carriers to newer, more dynamic companies that may engage in sharper practices in regard to their workforces. However, the companies with which Aer Lingus competes, including the former flag carrier British Airways, certainly have a higher number of staff on their long-haul flights than some of their competitors. People pay for this. Generally, Aer Lingus flights are more expensive than those of some of its competitors, but people pay more in the hope they will receive a better service. Thanks to Aer Lingus's loyal workers at its bases at Shannon, Cork and Dublin airports, customers receive the desired level of service. However, it is hard for a company to expect to be able to provide that level of service while at the same time treating workers in the way Shannon Airport based cabin crew have been treated. The Minister mentioned the 30 cabin crew trainees who were taken on only three weeks ago to be trained for the transatlantic flights. They have since been summarily fired. That is not the way to treat workers one had hoped would manage the new service and build a loyal customer base.

I am glad of the Government's support and hope it will not be called into question when fixing the huge pension deficit. The staffing dispute is against the backdrop of the pensions deficit. The deficit at the Dublin Airport Authority affects Shannon Airport employees and all former Aer Lingus employees. I hope this issue can also be sorted out. I realise it is an entirely separate dispute, but it forms a backdrop to it nevertheless.

Leo Varadkar (Dublin West, Fine Gael)
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It is really good news for the Shannon region and Ireland that it has been possible to restore services, including winter transatlantic services, to San Francisco.

Part of the reason they failed before is that they were not commercial - the aircraft were too big and the costs were too high. If we want those services to work, they must be commercial and Aer Lingus must make decisions on the appropriate staffing costs. The Deputy should bear in mind that the difference between five staff members and four is 25% in costs, while six staff over four represents 50% in costs. Staff numbers make a significant difference.

It is my preference that the base would remain open and that the staff should be normal Aer Lingus employees and that the additional jobs would go to normal Aer Lingus employees. That preference will be communicated to the Government-appointed members of the Aer Lingus board. The only way to achieve that, however, is for Impact and Aer Lingus to come to an agreement at the LRC and I hope they will be able to do that.

Olivia Mitchell (Dublin South, Fine Gael)
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That brings us to the end of today's Topical Issues debate. I understand a change is being proposed to today's schedule and I call on Deputy Joe Carey to inform the House.