Seanad debates

Tuesday, 23 February 2010

6:00 pm

Photo of Denis O'DonovanDenis O'Donovan (Fianna Fail)
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I thank the Cathaoirleach for allowing me to raise this matter on the Adjournment as it is extremely important. The ferry in question is due to have its inaugural sailing on 1 March, which is next Monday. There has been a ferry link for over 60 years from Cork to different parts of Wales, including Pembroke, Swansea and, before my time, Tenby. The service is worth approximately 1,100 jobs to the Cork and Kerry region and we have had two very poor tourism seasons in that area.

This is the third year in which the ferry has not operated and the people of west Cork and Kerry formed a co-operative some months ago with the target of raising €13.5 million to put the ferry service back in operation. I acknowledge that a fund-raising drive by way of selling shares was undertaken in Cork, Kerry and further afield bringing about €4 million from amounts of €10,000 or less. Some 500 people and local businesses were involved in this drive as it is a community-based project. Some €6.3 million was obtained from a Finnish bank and an equity business in Wales contributed €1.7 million, so €12 million has already been committed to the project.

Unfortunately, an outstanding balance is required to ensure the ship is in a sailing condition and the season can get under way. I appeal to the Minister to see that the balance is put up in some form. I am aware that competition rules prohibit the money being given directly. The company is expecting more than 30,000 passengers in 2010 and its initial advertising and bookings process has been substantial.

This service to the region would be a ray of light in some difficult times and it is a must-win case, so funding must be found through the likes of Enterprise Ireland or some other source. Investment is critical and I am appealing to the Minister because we have only days left in which to act. The Welsh Government has apparently put its cards on the table and I ask the responsible Minister to act. The issue may cross several Departments, including the Department of Finance and the Department of the Minister for Transport, Deputy Noel Dempsey. It may also involve the Department of Arts, Sport and Tourism. I know the Minister for Foreign Affairs, who lives in the region, has put tremendous work into this. We are at a critical juncture where time is of the essence, and hours rather than days are left to ensure this ship sails. If it does not sail, the catastrophic consequences to the region will minimise the unfortunate loss of jobs in Dublin and the hangar 6 debacle last week. We are talking about 1,100 jobs here. Tourism is now the third largest industry in Cork and Kerry, and in some areas it is probably the second largest. Towns like Kinsale, Bantry, Schull, Baltimore, Clonakilty, the peninsulas in west Cork, and towns like Killarney, Dingle and Kenmare are very dependant on tourism. That is why I raise this matter and I hope the Minister of State can give a positive response to ensure tourism in the region will get a boost.

The directors, shareholders and people in the area put their best foot forward and went out to collect about €4 million. It is a significant contribution and they did not sit back and expect that money would come down from heaven. There is a financial contribution of slightly more than 10% required to ensure the ferry sails. If we can get up and running this year, the ferry will eventually be cost effective. The previous ferry made money in its last year, but the owner, who was a non-national, sold the ferry with a view to replacing it. He probably got a very good price, but the new ferry, the MV Julia is a much bigger ferry. Not every ferry can operate on the sometimes rough seas between south Wales and Cork.

I keep my fingers crossed that the Minister of State will convey positive news tonight.

Photo of Áine BradyÁine Brady (Minister of State with special responsibility for Older People and Health Promotion, Department of Health and Children; Minister of State, Department of Environment, Heritage and Local Government; Minister of State, Department of Social and Family Affairs; Kildare North, Fianna Fail)
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As stated in the Adjournment debate on the same topic in the Dáil last Wednesday, the Minster for Transport has no function in, or finance for, the provision of ferries on this or any other route, other than being as supportive as possible. The Minister certainly hopes the Cork-Swansea service can be re-launched successfully and that it is commercially sustainable.

Safety is paramount for any new passenger ferry service and the Department of Transport has important functions in that respect. This includes a mandatory initial safety verification of a roll on-roll off passenger ferry prior to the start of the operation of the ferry on a regular service. This is required under EU Directive 1999/35/EC. The directive applies to all ro-ro passenger ferries and high-speed passenger craft operating to or from a port of a member state, regardless of where the vessel is registered. The directive requires that the host states, in this case Ireland and the United Kingdom, must carry out an initial verification on a ro-ro passenger ferry prior to the start of the operation of the ferry on a regular service. The ship must also carry valid certificates issued by the administration of its flag state, in this case Bermuda. The marine survey office of the Department of Transport will co-operate closely with the UK authorities in carrying out these verifications. The marine survey office has been advised by Fastnet Line that the ship should be ready for inspection later this week and surveyors will travel to Swansea to carry out the inspections.

The Minister for Transport appreciates that the suspension of the service since 2007 has had an impact on the local region, in particular on tourism, and that there is a strong desire for the service to be re-launched. However, current market conditions are very challenging in the shipping sector. The sector has been hit harder than most by the global recession. Like all businesses, securing investment and bank financing is very difficult for shipping companies at the moment. Ferry services to the UK also face the additional challenges of fluctuating fuel prices and of operating all year, including when tourist numbers are low, in order to offer a service to the freight industry.

Since the previous operator withdrew the service, the Port of Cork Company has worked very hard to try to have it reinstated. In early 2009, the West Cork Tourism co-operative was formed with the objective of re-launching the service. Despite the efforts of the port company and the co-operative, no existing shipping company could be found to operate the service. The co-operative then took the courageous decision to try to re-launch the service itself. The Minister recognises that great efforts have been made by all concerned to make this a success. This has been a community based initiative and the Minister acknowledges that it has considerable and broad spread regional support.

Over the course of 2009, the co-operative raised €2.5 million from the sale of shares to local investors. Since the purchase of the vessel in September 2009, Fastnet Line has been trying to raise further funding to finance the pre-launch and operating costs of the business. The Minister for Transport has recently given approval, with the consent of the Minister for Finance, to allow the Port of Cork Company make a commercial investment by purchasing €200,000 of bonds from Fastnet Line. The final decision was entirely a matter for the board of the Port of Cork Company.

The Minister understands that some of the local authorities have also made similar investments. It is not open to the Government, under State aid rules, to provide direct financial support to the venture, but it is advised that commercial investments by State agencies are permissible. A range of supports is available from various State agencies for any new venture. Fáilte Ireland is available to support any new service through active promotion and marketing. The Irish Maritime Development Office has also offered its services to Fastnet Line. In summary, a broad range of support has been provided to Fastnet Line to help make it a success.

The Government has taken a number of other initiatives in recent years to support the development of the Irish shipping industry generally. The Irish Maritime Development Office is the shipping sector's statutory, dedicated development and promotional agency. The Government has introduced a number of fiscal and strategic policy measures to promote Irish maritime sector activity, both at sea and on shore. Such promotion concentrates on fiscal areas, marketing and the education of seafarers.