Malcolm Noonan (Carlow-Kilkenny, Green Party) | Oireachtas source

I am taking this question on behalf of the Minister of State at the Department of Transport, Deputy Hildegarde Naughton. I thank the Senator for the opportunity to address the ongoing crisis in the aviation sector, particularly the recent announcement made by Aer Lingus concerning certain cost-cutting measures in light of the cumulative impact of Covid-19 over the past 15 months. First, I acknowledge the unprecedented challenges faced by Aer Lingus and its staff during this difficult time. The entire aviation sector is experiencing its most challenging crisis in its history. Analysis undertaken last week by EUROCONTROL, the European organisation for the safety of air navigation, suggests air traffic across Europe is not expected to return to 2019 levels before 2025. Here in Ireland, the sector has been particularly impacted by Covid-19 and Irish airlines continue to face major financial challenges. As a consequence, all airlines have previously issued capital, raised further borrowings, drawn on Government supports and undertaken measures to reduce their cost base.

In that context and in light of the continuing pandemic, it is acknowledged that Aer Lingus has little option but to take unpalatable measures to reduce its cost base. It has also noted that many other European airlines are also implementing significant cost-saving measures in light of the circumstances currently facing the industry. Nevertheless, it is regrettable that Aer Lingus has decided to close its cabin crew base at Shannon Airport and to temporarily close its base at Cork Airport, as well as embark on a review of grounding-handling arrangements at those airports. The Minister for Transport, Deputy Eamon Ryan, and the Minister of State, Deputy Hildegarde Naughton, met the CEO of Aer Lingus to discuss details of the announcement made by the company last week. They reiterated the Government's commitment to supporting the industry and acknowledged the importance of providing clarity on the extent and duration of employment supports beyond the end of June.The Minister and the Minister of State also reassured the airline that there will be no cliff edge in supports for the airline or for the wider aviation sector. Their meeting with the CEO also focused on future operations of the company in Ireland and they outlined their hopes for a resumption of travel from Cork and Shannon when the situation allows. In that regard, the Minister welcomed confirmation by the CEO that there is no strategic attempt to reduce connectivity at either Cork or Shannon, while acknowledging that restoration of services depends on market circumstances.

The Minister and Minister of State also met with the CEO of Shannon Group and the Minister of State, Deputy Naughton, met with the CEO of Cork Airport last week to discuss the situation. The Minister and Minister of State reiterated their support for the airports and their important role in regional development. Similar engagements took place last week when the Minister of State, Deputy Naughton, met with unions and employer representative groups in her capacity as chair of the aviation subgroup of the Labour Employer Economic Forum. This subgroup has been investigating the option of a specially extended wage subsidy scheme for the aviation sector and this work will continue.

I assure the House that Government is committed to supporting the aviation sector. We recognise the importance of providing clarity on the extent and duration of supports beyond the end of June. Throughout this pandemic, Government has provided a significant level of general support to the economy, with at least €300 million provided to the aviation sector alone. The bulk of this support is in the form of wage subsidies which were designed to maintain the link between employers and their workers.

Approximately €32 million is also being provided in supports to Cork and Shannon Airports this year. Additionally, the Department of Transport is assessing applications for funding to State Airports under the €20 million Covid-19 supplementary support scheme and expects to be able to provide funding to Cork and Shannon Airports under this scheme soon. This support will allow the airports flexibility to provide route incentives and airport charge rebates to stimulate recovery of lost connectivity this year.

While acknowledging the primacy of the protection of public health, there is clearly an increasing need for a strategy for international travel that can serve as a basis to both protect existing jobs insofar as is possible and to plan for recommencement of operations as soon as is practically possible. I confirm the Government will set out a pathway for the reopening of international travel following its meeting next Friday.