Derek McDowell (Labour)

It will be hard to follow that. I am in complete disagreement with almost everything Senator Morrissey said, which I suppose is a considerable relief to both of us. We will have time to tease that out over the next day and a half or so.

I want to address much of the wishful thinking we have heard about competition and its nastiness, the monopoly and so on. However, it is appropriate to focus for a few moments on the additional detail the Minister brought to the debate in commenting on recent press reports dealing specifically with financial issues, which are important. I do not share the reaction of others, including Senator Browne, in condemning those who leaked this information. The information is extremely important and it is a great pity it was not in the public domain long before now. It isolates a particular difficulty which may in time be resolved but it is one of which we should be fully apprised. It should have been sorted out before now. We should not be going down the route being extolled by the Minister without having resolved these important issues. While the Minister has been firm and resolute and has repeated his assurances on the matter, he has not added anything to the debate. He has not contradicted anything that has been said or the information that has been put into the public domain in recent days.

Let us recapitulate briefly on what we know. We have known for a long time that Aer Rianta has debts in excess of €480 million which are split between eurobonds that are traded on the Dublin and London Stock Exchanges and bilateral debts which are organised directly between Aer Rianta finance and the banks. Regarding the bilateral loans, it is accepted that they contain a number of default clauses. Certain circumstances may trigger a default mechanism whereby creditors can call in the loans early. Such clauses include reference to Aer Rianta taking any steps towards a substantial reduction in capital; Aer Rianta ceasing or threatening to cease to carry out any part, or in some cases any substantial part of its business; any disposal by Aer Rianta above a certain value; and Aer Rianta ceasing to retain ownership or conduct operations from Cork and Shannon. The Bill, to a greater or lesser extent appears to do all four of those things. It is clear that there is a potential, which I do not wish to overstate, for a default mechanism to be triggered. It is open to any of the bilateral creditors to say that because the circumstances have changed it intends to invoke certain clauses to call in the loans early. In those circumstances, there is a severe risk that Aer Rianta, at least in the first instance, would not be able to afford to make the early repayments, which could in turn lead to an amount of indebtedness that would cross-accelerate and also lead to a calling in of the bonds. In those circumstances, refinancing would be expensive. There is a danger that if the company were unable to do so quickly enough, it could become insolvent. One would have to be pessimistic to think that all of those things would happen, but it is not unusual or unpredictable that one would get a few nervy creditors who do not like the look of this, do not believe the political backing exists or that things will work out as the Minister has envisaged. If they want their money back they could trigger the default mechanism. If one creditor does this, it is by no means inconceivable that others would do the same.

There is nothing terribly staggering in what we have found out in recent days, or at least nothing that would surprise most people. What is surprising is that this has not been resolved before now and that we have not been clear about the facts before now. What I also find surprising is that the Minister has given us no indication of how he sees the matter being resolved. The expectation is that the company or the Government, or the company acting through the Government or vice versa, will organise a waiver and that creditors will essentially waive their rights to call in loans in default in the circumstances which are set out in the default clause. That is what we expect but we know from the advice that has been given to the company that that could be expensive. I have no expertise in that matter and I do not suppose anyone else in the Houses has either, but if it is going to cause additional expense and if there are serious potential downsides we should have known about it before now and we should receive more detail from the Minister either today or tomorrow as to how he envisages we would get out of it. It is inadequate to say this is and always has been dealt with professionally and well between officials in the Department, the company and the creditors.

The potential serious negative in this regard should be cleared at the earliest opportunity. The company and its creditors deserve better. The Minister said in his statement today that there has not been an adverse reaction from the creditors. We know that Deutsche Bank, acting on behalf of the bondholders, indicated its concern about the uncertainty that existed approximately a year ago. I am not aware of uncertainty in the interim. If the Minister has such information, I invite him to put it on the record today or tomorrow.

I wish to examine some of the bigger issues in this regard. It is fair to say that most Members of the Oireachtas do not have a problem with the notion of three independent boards, one for each of the three airports, acting in a more aggressive fashion to market their particular airport or their particular part of the country. Over the last 18 months or two years, most parties have said they have no difficulty in providing for independent management and a measure of independent financial control in the airports.

I speak for myself rather than my party when I say that some of us examined seriously the Minister's proposal to establish two regional airports at Cork and Shannon as independent entities with clean slates. The problem with the suggestion is that it does not stack up and does not bear examination. It is not necessary to do any of the four or five things cited by the Minister today as reasons for adopting this proposal. Its risks and downsides outweigh any potential benefits which might derive from it. That is where the difficulty arises. Senator Ross put it well when he said he thinks this is a good idea in principle, but he is not quite sure why the Minister is pursuing it. The Minister has not set out his reasons.

We have had an extensive debate about the business plan. Senator Morrissey asked what the business plan will be. He wondered why the State monopoly should be retained and why a certain amount of business should continue to be brought through Dublin. I suppose such systems should be retained because they work and have worked well in recent times, from a national perspective. No evidence has been produced by the Minister today or during the debate on the Bill in this House and elsewhere to suggest that an alternative structure would work. There is no evidence that it would be better. A great deal of nonsense has been spoken about competition. Irish airports do not compete with each other. There is no prospect of Dublin competing with Cork or Cork competing with Shannon in a serious way. People will go to the most convenient airport. They rarely have a choice when an identical or similar service is provided by different airports.