Dessie Ellis (Dublin North West, Sinn Fein)
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124. To ask the Minister for Transport, Tourism and Sport his plans for the State's stake in Aer Lingus; and the maintenance of its Heathrow slots which are vital to the Irish economy. [4666/15]

Dessie Ellis (Dublin North West, Sinn Fein)
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There are huge concerns not just among the public but in various representative groups about any potential sale of Aer Lingus. Those concerns were expressed at the recent meeting of the Oireachtas Joint Committee on Transport and Communications by unions, employers' bodies, Enterprise Ireland, representatives of tourism and other groups. Within our economy tourism numbers have been greatly increasing. From what we can gather, €300 million is what the State would benefit as a result of a sale to IAG. Does the Minister think selling off our Heathrow slots, which are vital to the Irish economy, is worth €300 million?

Paschal Donohoe (Dublin Central, Fine Gael)
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I touched on some parts of the Deputy's question when I was responding to Deputy Dooley. His question contains particular reference to the Heathrow slots. I will devote my time to responding to that issue.

At the time of the flotation of Aer Lingus in 2006, a procedure for any proposed disposal of the Heathrow slots was built into the company’s articles of association. That procedure was outlined in detail at the time and on many occasions since in this House. The threshold to prevent a disposal of Heathrow slots is such that the vote against disposal cast at an EGM of Aer Lingus shareholders must be at least 25%, or greater than the percentage of the company's shares held by the Minister for Finance plus 5%. With the present State shareholding that threshold is 30.1%. Therefore, the ability of the State's shareholding to block a disposal of slots is not guaranteed under this mechanism. Furthermore, it relates only to a proposed disposal of slots. Aer Lingus does not require any shareholder approval to change the routes for which it uses slots.

IAG's latest announcement yesterday indicated that it is proposed to offer legally binding commitments to Government on Aer Lingus's Heathrow slots. These are still only proposals and it should be noted that IAG has stated that any such commitments would be subject to Irish takeover rules and EU competition review. The Government's steering group is considering this proposal and intends to engage with IAG to explore these potential commitments. However, it should be noted that these discussions are at an early stage. This is a complex area which will require detailed and careful consideration before any recommendations can be made to the Government.

Dessie Ellis (Dublin North West, Sinn Fein)
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It is widely reported that IAG has offered to secure these slots for five years. That is not worth the paper on which it is written. In the past we have seen how companies come and go and how they change over time. In a previous takeover in England it was agreed that a position regarding slots would last for three to five years.

Then, the regulator moved in and said a certain number of slots had to be shed as a result. That is the problem facing us.

We have an airline that is profitable and is making money for the State. It is making money for the tourism industry and across-the-board we are seeing huge increases in tourist numbers. The airline has a modern fleet and it is working well. There are major grounds for expansion. The takeover bid seems to be about the Heathrow slots and their use. We need to protect them to protect our industry and tourism. There are 23 slots in question and the loss of any of them will have major repercussions for connectivity across the country. This applies not just to Dublin but to connectivity in Cork and Shannon. The regional balance we try to keep will not be kept by the likes of IAG.

Paschal Donohoe (Dublin Central, Fine Gael)
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I have always been acutely aware that national connectivity has a vital regional dimension. I have visited Shannon and Cork airports and met representatives of the two airports on matters of concern and interest. I understand that access to our country is fundamental to the way our economy has grown. Maintaining and increasing access in the future is vital not only from the point of view of tourism but also from the point of view of investment and allowing Irish companies to sell their goods and services abroad. That is why I have been clear that what is at stake is far more than the price of a share. The considerations that must be taken into account to guide our decision will have connectivity as an essential elements of how this will be examined.

Dessie Ellis (Dublin North West, Sinn Fein)
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Pensions must also be considered. There was a debacle with the pensions of the Irish airlines superannuation scheme, IASS. Other areas must be examined beyond connectivity and tourism. It is important we examine this carefully.

When senior executives stand to make €30 million, it is in their interests to sell off our airline. That seems to be how things have moved. The drive to privatisation has been a disaster for the country and is one this party was opposed to in respect of the sale of Aer Lingus, with the State ending up with 25% of the company. It is a shambles. Vital connectivity for this island nation, on which our regional airports depend, and continuity must be kept. We are building our tourism industry and the Minister has taken initiatives on this. Why would we sell something that is profitable and is delivering? Has the Minister sought support from other shareholders? We know the pilots hold a 7% stake while Ryanair holds 29%. Has Minister sought support from them?

Paschal Donohoe (Dublin Central, Fine Gael)
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The first step in allowing the Government to determine its decision is for us to gain the right level of information and understanding about what IAG is proposing. We are in the process of doing so and preliminary contact has been made. I expect further contact to take place soon, which will allow us to understand the exact nature of what is being proposed. When I am in a position to report back to the Cabinet and the Dáil with a comprehensive understanding of what is proposed by the group, I will be in a position to make a recommendation to the Government. Extreme care and caution must be taken on this decision. The Government has shown in many initiatives that it is absolutely clear on the importance of tourism, foreign direct investment and access to those to deliver the best outcome for our country and its communities in the years to come.