Maurice Cummins (Fine Gael)
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The motion for the sale of the 25.1% share in Aer Lingus is being debated in the other House. It is a financial matter and a financial decision. As Members will be aware, this House does not have a say in financial matters. However, I have agreed that the House would debate the issue, as requested on the Order of Business.

This is a good deal for the taxpayer and a good deal for Aer Lingus and there is no question that this is a good deal for the country. It has been agreed that up to 635 jobs will be created by 2020, with 150 new jobs next year. There are plans for four new transatlantic services. As has been stated, the guarantees hold as they are written into the articles of association. A seven-year guarantee has been given regarding the use of the Heathrow slots as part of the deal and will begin once the transaction is completed. The use of the slots will be defined by the summer and winter schedules. The current frequency of use will be maintained across a seven-year period. This is a significant guarantee. As I mentioned on the Order of Business yesterday, the Government has been in contact with the European Commission regarding the legal mechanisms and the Government has indications that the Commission will not oppose the guarantees.

The fact that all the airports involved in the operation of these slots have welcomed this deal is an indication of the confidence which the airports have in the operation of the guarantee which currently does not exist.

The question of outsourcing and redundancies is a matter for the unions and management. However, I draw the attention of the House to a letter received by Mr. Kavanagh which stated that they will look at the scope of the registered employment agreements and will look to extend the number of employees covered by the REAs.

The Nyras report was mentioned on the Order of Business. This report was commissioned by the chief executive officer of Aer Lingus and it has nothing to do with IAG, no matter what way Fianna Fáil or other parties might paint the picture that the Nyras report is connected to the sale. There is no question of this being part of the sale because this report was commissioned by the CEO of Aer Lingus and this type of exercise is part of the normal course of business in the highly competitive and international airline sector and it would have been commissioned before any talks on a sale. Any airline would commission such a report on a regular basis and Aer Lingus is no different in that regard.

It beggars belief that the party which privatised Aer Lingus and bankrupted the State is now trying to play politics with such a great company as Aer Lingus. Over the course of the past few days Fianna Fáil members have, on one hand, praised Aer Lingus management for turning the company around and making it a success while, on the other, claiming that they are determined to sell out the interest and that of workers and customers. They cannot have it both ways but that is the way they operate on the other side of the House; it is a case of on one hand and on the other. They do not know whether they are coming or going with regard to Aer Lingus.

I look forward to listening to measured comments and contributions from all sides of the House. I will relay the contributions to the Minister before any decision is made in the other House. However, it is ultimately the decision of that House and we will have no say on the sale. I will relay the measured comments of Members of the House to the Minister.

Darragh O'Brien (Fianna Fail)
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I thank the Leader for amending the Order of Business. However, I wish to put on the record of the House that we are debating without any Minister or Minister of State in attendance.

The Leader and other Members will be aware that I live and I have grown up beside Dublin Airport. I have spent my whole life there and I know families, friends, members of my own family and work colleagues who work there. Whole families have been employed at Dublin Airport and in Aer Lingus. It is a very important company for this country and from a selfish Dublin and north Dublin perspective. I know the airport and Aer Lingus very well. I have grown up with the airline.

It is a fact that Dáil Members will be making a decision this evening. My constituency colleague, Deputy Alan Farrell, admitted that he had not read any of the reports before he spoke in the other House. With the exception of Deputy Michael McNamara, they are making their decision on trust, without doing any research. The State will get about €340 million out of this deal. As I said on the Order of Business, this has been choreographed for the past two to three years. The Fine Gael Party, the Labour Party, the Tánaiste, Deputy Joan Burton, the Minister, Deputy Donohoe, and the Taoiseach all know this. That is why they butchered the pension scheme. That is why the Fine Gael and Labour parties enabled legislation for the first time in the history of the State to allow a company's private pension scheme to be changed by legislation to reduce people's pension benefits by up to 60%, to take six weeks' money from retired people in their 70s, 80s and 90s, so that there would not be a deficit in the pension scheme when they flogged off the State's interest. Those are the facts. That is what the people think and what the people know. The Fine Gael Party has done it and the Labour Party has facilitated it.

It does not surprise me with regard to the Fine Gael Party because the selling of State assets has always been its strategy; it would sell them all if it could and that is why NewERA was set up.

Pat O'Neill (Fine Gael)
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Fianna Fáil stripped Aer Lingus first.

Darragh O'Brien (Fianna Fail)
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I will deal with that point in a moment. The Senator may not have been here earlier or yesterday. The reality is that the Fine Gael Party would sell. However, from the perspective of the Labour Party, the number of U-turns its members have done over the past four years means their heads must be spinning. The founders of the Labour Party must be spinning in their graves because of what the party is allowing to be done to the strategic interests of this State. I will explain again for those who are a little bit slow on the uptake that the reason the 25.1% stake was kept was to protect the State's interest in the airline. The 75% that was sold was invested in the airline for new airplanes, new staff, to improve the company and to make the company profitable and viable.This company is profitable and has nearly €1 billion in cash reserves. It carried more than 11 million passengers last year. Based on the record of British Airways, in terms of what it does with airlines it takes over, the whole move towards consolidation is bad for consumers and is certainly bad for an island nation. While the Minister can spin it whatever way he wants, the reality is the Government has been sold a pup and is selling the State short.

I am disgusted with Deputy Joe Costello and others who made a big play at the Labour Party conference of getting a motion passed to stand up for Aer Lingus and its workers. They were going to stand up for the pensioners but they sold the pension scheme members down the river. I would say to those reading the transcript or watching this debate that if Fine Gael is re-elected, this will be the first of many. All it is about is cash. It is not good for Ireland or for jobs.

The Minister mentioned the Nyras report and yet the Taoiseach has admitted he did not even read it. It is not just a stand-alone report. Does the Minister think for one moment that Willie Walsh and IAG are not going to look at that report and identify where they can cut staff in Aer Lingus? It is outlined and given to them on a plate. That is what is going to happen.

Brian Ó Domhnaill (Fianna Fail)
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Hear, hear.

Darragh O'Brien (Fianna Fail)
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If the Minister thinks any of these allegedly cast-iron guarantees are going to stand up in the commercial operation of a future Aer Lingus, that is complete nonsense. No one has even explained how the B share will work in reality. The Minister for Finance says there is no veto and the Taoiseach says there is. It is an absolute farce and a mess, brought to us by the Government that created Irish Water. Why should I trust this Government in anything it does?

I know Aer Lingus and the people who work there who have given their life's work to turn the airline around. I know why the 25.1% stake was kept; it was to make sure Ireland's interests are protected. Fine Gael and the Labour Party are selling our interests cheaply and they will regret it. I have debated with the Minister, Deputy Donohoe, on numerous occasions what he has done to the company and the pension scheme. He, his predecessor, Deputy Varadkar, and the Tánaiste, Deputy Burton, will be remembered for doing this, and not favourably.

We have talked about Dublin but what about Shannon and Cork? There are no guarantees there. There is practically nothing. They have been left swinging in the wind as they do not matter. It is an awful shame that the Minister is not here to listen to the views of the Seanad. I endeavour to represent the views of those who have been in contact with me, namely, the employees of the company who I know and people in many different roles in the company. Those who have been suffering the brunt of this since 1 January are the 15,000 people in the IAAS scheme. The Government's decision today will have an impact on the company, the airport and all the other companies and people who work in that airport. This is a cheap sale. After its acquiescence in this decision, the Labour Party has proven it has no role in the Government, certainly not in economics. It has rolled over again and it is shameful.

Pat O'Neill (Fine Gael)
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I thank the Leader for allowing the debate. It would have been nice if the Minister was here but the Opposition was not agreeable to accepting a 5 p.m. time for him to be here and we have to discuss this.

Darragh O'Brien (Fianna Fail)
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The decision will have been taken.

Pat O'Neill (Fine Gael)
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No. The decision has to be taken in the other House yet. We do not know what way the vote is going to go.

This is a correct decision for Aer Lingus and for the country. We are a small island nation and connectivity to mainland Europe, the UK and the US is one of the most important things we have. The Government's decision to sell its share in Aer Lingus and the takeover by IAG of the Aer Lingus group will secure the future for air transport. It is about jobs. Senator Darragh O'Brien said jobs are under threat but he is totally wrong on that. The plan is that 150 extra people will be employed by 2016 and we hope to have 635 new jobs by 2020. Those are not just new jobs in Aer Lingus but around Dublin Airport, the services, airport police, customs, etc. The Senator said this will be detrimental to the country and that the Government is failing the people. This is the Government that supported the tourism industry. He said the highest number of passengers, 11 million, came through Dublin Airport last year-----

Darragh O'Brien (Fianna Fail)
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I said Aer Lingus carried 11 million. More came through Dublin Airport.

Pat O'Neill (Fine Gael)
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That was part of a tourism package the Government put together, bringing in the 9% VAT rate and dropping the travel tax which Fianna Fáil imposed-----

Darragh O'Brien (Fianna Fail)
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Was that by taking €2 billion out of private pension schemes?

Pat O'Neill (Fine Gael)
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We have been given commitments on connectivity and the Heathrow slots from IAG. Those slots are the most important part of the Aer Lingus package, as Heathrow is the busiest airport in Europe. They give us connectivity to the rest of the world. The vision is that rather than Heathrow being used as a hub for the north Atlantic, Dublin and Shannon Airports will be part of the overall view of IAG's transatlantic travel. The Aer Lingus brand is one of the most recognisable in Ireland and worldwide. Ireland does not have many brands. There is Kerrygold in the food industry, and Aer Lingus is similar type of brand.

IAG has given a commitment that it will continue to grow our transatlantic routes. By 2016, we will have two new routes and, by 2020, four more. That will bring 2.4 million extra passengers through the Aer Lingus brand, the IAG brand or British Airways brand, whichever it uses. Senator Darragh O'Brien and Fianna Fáil seem to have a crystal ball. The Senator told us this will have a detrimental effect on jobs in Dublin, Shannon, Cork and Knock Airports and yet the Fianna Fáil crystal ball could not see the economic crash coming. I do not believe the Senator on this matter. The Fianna Fáil tactic most of the time is to scaremonger.

This is the correct decision for the future of the airline industry in this country. The Minister is not here but I ask the Leader to pass on one concern. The Heathrow slots are the most important slots. The only two airlines flying into Heathrow from Dublin are Aer Lingus and British Airways. It is important that we do not allow a monopoly situation whereby people could be exploited in terms of prices. We have Ryanair but it does not fly into Heathrow. The Competition and Consumer Protection Commission should look into this to ensure people are not exploited.

I thank the Leader for the debate. This is an important decision for the country which will secure the future of an Irish brand, Aer Lingus, the tourism industry and connectivity with the rest of the world. The investment IAG will make in the Aer Lingus brand will further enhance it and make it a success. Aer Lingus has been successful over the past few years after its restructuring. I hope by 2020, we will have 650 new jobs, 2.4 million extra passengers and four new transatlantic routes and that if Senator Darragh O'Brien is in either House of the Oireachtas, he will acknowledge that the right decision.

Paschal Mooney (Fianna Fail)
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I call Senator Quinn.

Feargal Quinn (Independent)
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May I share one minute of my time with Senator Norris?

Paschal Mooney (Fianna Fail)
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Is Senator Quinn aware he has five minutes?

Feargal Quinn (Independent)
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Yes. I will make do with four minutes.

Paschal Mooney (Fianna Fail)
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Is that agreed? Agreed.

David Norris (Independent)
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I am sure the Acting Chairman will be flexible.

Feargal Quinn (Independent)
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Part of the reason for doing this is that I hope Senator Sean Barrett will be able to take the other slot from us.

David Norris (Independent)
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Yes.

Feargal Quinn (Independent)
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I am grateful we are having this debate. It is not ideal not having a Minister here but it is better than what was going to happen at 5 p.m. and I congratulate the Leader on that.

We all have a great affection for Aer Lingus. It is one of those brands that has been around for some time. If I am not mistaken, I think Aer Lingus and I were born in the same year and, therefore, I feel particularly proud of it over those years. I feel a particular pride as I arrive on another country and see that Aer Lingus shamrock logo on an aeroplane on the runway. The danger of losing that is something none of us wants. The people of the Netherlands were quite concerned when Air France took over KLM. They felt they did not have ownership of KLM anymore and that it was their own national airline. On that basis, we will all be sorry if this happens I believe the steps that have been taken have enabled the Aer Lingus brand to stay alive but it will depend, to a large extent, on its ability to run it in a manner which will keep it alive and healthy.

I have a little concern when governments run businesses. Governments very often run businesses not with the objective of running them as good businesses for their customers and for their success, but for other purposes, such as political purposes or, perhaps, as Senator O'Neill stated, for jobs, and that is wrong. I was chairman of a hospital in the 1980s when we were having difficulty with unemployment. The Government would write to us every month asking how many jobs we had created in the hospital. Even though we did not need them, the aim was to see if we could create jobs, and that is wrong.

Look what happened in the airline industry when Ryanair suddenly turned up. Ryanair is not a government-owned company but it came along and stated it did not need cleaners because it would get its own staff to do the cleaning as aeroplanes landed. As one arrives anywhere on a Ryanair flight, an Aer Lingus flight and on other flights, one does one's own cleaning - in other words, the staff come along with a plastic bag and one puts all the rubbish in it. In recent years, I have travelled a lot to Brussels and Ryanair flights flying into the airport close to Brussels unload and load up in seconds. The turnaround is so efficient. That would not have happened with a government-owned airline but, because Ryanair led the way, others had to follow, and that is what will happen here too. Aer Lingus has certainly become healthy because of competition. I am a great believer in competition which is much more likely to happen if the airline is not solely owned by a Government which perhaps has other objectives.

Having weighed up all the pros and cons, I am inclined to say I support the objective of this deal. It seems to be the best deal we can get. I am happy to see that Aer Lingus will continue - I hope with seven years guaranteed. I hope it succeeds as well as it can on that basis and continues for a lot longer than that.

David Norris (Independent)
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I am grateful to Senator Quinn for allowing me participate in this debate. We have consolidated so that if Senator Sean Barrett, who is our acknowledged expert in this area, comes in, he will be able to speak. I think he is at the banking inquiry, but I telephoned his office to alert it.

We should have an independent, stand-alone and State-owned airline. When the Fianna Fáil Government denationalised Aer Lingus, I spoke and voted against that. Like Senator Quinn said, I feel pride flying into London and elsewhere when I see a stack of Aer Lingus aeroplanes in their bright green colours.

It is peculiar that an English court would make a judgment on competition grounds against Ryanair's holding and then would seem to allow the amalgamation of two airlines without a squeak. I note there are also concerns about competition on the Government side, and I welcome that. This really needs to be looked into. It would be a very great irony if the release of Aer Lingus, or at least 25.1% of it, from national control led to a lack of competition.

I stated yesterday, and I believe strongly, that part of the €335 million or so gained from this sale should be set aside to resolve the disgraceful situation where Aer Lingus deferred pensioners have been squeezed out of their rightful entitlements, with a cut, in some cases, of 60%. I would ask every Member of this House how they would feel if their income was cut by 60%.

Darragh O'Brien (Fianna Fail)
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Hear, hear.

David Norris (Independent)
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It is an absolute disgrace.

Darragh O'Brien (Fianna Fail)
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It is disgraceful.

David Norris (Independent)
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This Government eventually resolved the Waterford Glass situation and it has an absolute moral obligation in this area as well. Whatever is needed from that money must go to the deferred pensioners.

Gerard Craughwell (Independent)
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Hear, hear.

David Norris (Independent)
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It is inhuman to expect pensioners who have worked for 40 years to experience a cut of 60%. I would very much like to hear the Labour Party on this point.

With regard to the pensions, will the Government carry out an investigation into the administration of the IASS fund? It is disgraceful. I was provided with a comparison sheet, between IASS, AVIVA, Davy Assets, Friends First, Kleinwort B., Merrion, New Ireland, Setanta, Standard Life and Zurich Life. They all are well-up over what they were in 2007 but the IASS is still down, at 67%. This represents a disastrous investment policy on behalf of the administrators of the fund. There was legislative interference from the Government in this area to deprive people of their pensions. This is what set up Aer Lingus for sale in the first place. It could not have been sold with this pension issue hanging around its neck.

Darragh O'Brien (Fianna Fail)
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Exactly.

David Norris (Independent)
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The people who paid unwillingly, through the sacrificing of their pensions, for a situation where Aer Lingus could be set up to be sold are getting nothing out of it. Let us hear from the Government on what it will do about this. There is an imperative and a moral case for the Government to give at least a substantial part of these funds, not into education, hospitals and all the usual stuff, but to the people who were defrauded of their pensions. What will the Government do? Will the Leader refer this question as a matter of urgency, because the Minister is not here? The Leader is a thoroughly decent man who was gratified when the Waterford Glass pensioners were dealt with and I ask him to ensure the same level playing field for Aer Lingus pensioners.

Ivana Bacik (Independent)
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I thank the Leader for arranging the debate at the request of the House. Indeed, I was one of the Senators who looked for the debate. Will all of those who shouted so loudly on the Order of Business now turn up to participate in this debate? My own position, as leader of the Labour Party group, is that I opposed the effective privatisation of Aer Lingus and the sale of the controlling share by Fianna Fáil in 2006 - the 74.9%. It is difficult to listen to the hand-wringing by Fianna Fáil now. I would remind colleagues that the 2004 Aer Lingus Act which set up the privatisation was enacted by Fianna Fáil and the PDs in 2004. In July 2006, the Fianna Fáil Government introduced its motion to the Oireachtas to privatise Aer Lingus and the privatisation plan, which was introduced by the then Minister, Mr. Martin Cullen, allowed for a 25.1% shareholding to be retained. I have listened to Fianna Fáil Members speak of this as if it were some sort of virtue but it is instructive to remind colleagues that the report from the Government steering group shows clearly the limited nature of that 25.1% interest. According to the report, the 25.1% minority shareholder enables the State to have a degree of influence, comprising mainly a range of negative or blocking rights.There is no express right or power to direct Aer Lingus in the conduct of business, there is no control over employment levels in Aer Lingus by the State and the State cannot prevent a reallocation, reassignment or cessation of use of Heathrow slots by Aer Lingus in accordance with the current shareholding. I remind colleagues of the very limited nature of that shareholding.

While I would have preferred, and I said this before, that we had retained the 25.1% share, the key reason for retaining it - Fianna Fáil Members have addressed this - was to try to secure connectivity. Yet, when one considers to what the 25.1% share entitles the State, it does not have a guarantee on connectivity. What we have seen with the significantly improved bid from IAG is a greatly enhanced guarantee of connectivity. It is important to look at the details. Stronger protection will be granted to the State in terms of the ownership of Aer Lingus's current Heathrow slots than the protection that exists today. We know that the Minister for Finance will retain a B share. For the information of Senator Darragh O'Brien, that will be enshrined in the Aer Lingus articles.

Darragh O'Brien (Fianna Fail)
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Nonsense.

Ivana Bacik (Independent)
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Again, the nature of the share is set out in the steering group report. That share will enable the Minister to block any proposed disposal by Aer Lingus of any of its Heathrow slots indefinitely. Therefore, it is a much strong stronger protection than currently exists. I think this addresses the connectivity issue. I note that my colleague, Deputy Ciarán Lynch, pointed out the protections also for regional airports because connectivity is crucial, in particular, for regional airports. Deputy Lynch noted the assurance about retaining existing winter and summer frequencies to Heathrow. There are very specific details for seven years for the Cork and Shannon airports, in particular.

The connectivity issue is one issue. Many others have mentioned such as the branding issue. Like others, I share the emotional attachment to the Aer Lingus brand and that is quite right. I am glad we have got a legal commitment in terms of maintaining the brand, the company name, the head office location and the place of incorporation for an unlimited period, a protection the State currently does not have. Jobs were a key concern for Labour Party colleagues. Others mentioned the group of eight Labour Party Deputies who put a motion to the party conference. That motion had four issues in it which, if acquired, any taker of a bid would have to address in order to be supported. One of those issues was connectivity, which I spoke about, and another was about guarantees for regional airports. I spoke about that also. Another issue was the independent valuation of the assets of the company and ensuring the bid reflected the true value of Aer Lingus. As we know, the current bid is significantly above the original share value. The fourth issue in that motion concerned the protection of Aer Lingus workers' terms and conditions of employment. With the improved deal, IAG has agreed that a registered employment agreement will be introduced which will protect the terms and conditions of Aer Lingus employees.

Members may be aware that we have also received a copy of a letter from Mr. Stephen Kavanagh, CEO of Aer Lingus, to the Minister of State, Deputy Gerald Nash. I was one of the Labour Party members who met Mr. Stephen Kavanagh yesterday morning. In his letter, Mr. Kavanagh emphasises again the commitment to ensuring that the limited number of job losses will be met through voluntary redundancies. He has informed us that a much greater number of applications have been made for voluntary severance than would be required. The plan refers to 50 redundancies through to 2016 but to a net increase of 150 jobs by the end of 2016 and more than 600 jobs by the end of 2020. Other colleagues on this side of the House have referred to that aspect. Mr. Kavanagh's letter also gives significant assurances in terms of engagement with the representatives of the workers in Aer Lingus and also on the registered employment agreements. That is very welcome. In terms of the IASS fund, we have spoken on this issue previously and I agree with colleagues on the plight of the deferred pensioners. That is a separate issue. Clearly, that issue has been ongoing prior to the issue of the sale.

Darragh O'Brien (Fianna Fail)
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No.

Ivana Bacik (Independent)
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I agree with colleagues that we should be able to see whether money can be put aside from the sale of Aer Lingus for this fund. I am certainly happy to take that up with the Government as I am sure my colleagues will also. In regard to the connectivity fund of €335 million, the Labour Party has secured agreement that the proceeds of this sale will be ring-fenced into a fund operated by the Strategic Investment Fund for investment in transport and other connectivity projects. Again, there should be a way of ensuring that money is available for the IASS pensioners, although that issue has been ongoing.

I ask colleagues to look fairly at the report of the Government's steering group. Despite my own view against further privatisation in principle, I accept the strong commercial and strategic rationale that the report makes clearly and succinctly in terms of moving forward with Aer Lingus. Somebody on the Fianna Fáil side said earlier that privatisation in 2006 was done to ensure capital investment in the company. Why do they think IAG is making this bid? IAG has indicated that two new transatlantic services will be added as early as 2016 and is talking about eight additional aircraft by 2020 and up to 2.4 million more passengers. As a small airline, significantly smaller than Ryanair, if it does not change, can Aer Lingus grow or will it be faced, as so many other domestic State-owned airlines have been, with falling back into the unprofitability witnessed in 2008 and 2009? We all welcome the current positive financial performance of Aer Lingus which is a tribute to all who worked on it. There have been periods of unprofitability in the past. The airline industry is cyclical. There have been severe impacts from different shocks and Aer Lingus is not immune from future shocks.

Paschal Mooney (Fianna Fail)
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I have allowed the Senator much latitude.

Ivana Bacik (Independent)
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I will finish on that point. I ask colleagues to reflect on the issue of growth as I am doing. I am making a journey on this issue myself.

Brian Ó Domhnaill (Fianna Fail)
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I wish to start on the last point made by Senator Ivana Bacik. The world is now a smaller place and more people are travelling by aircraft. Aer Lingus profits in the company were up by €71 million in 2014, some 9% on the previous year. In its own right, Aer Lingus is growing exponentially year on year. Much has been said on this issue.

I am amazed that the Labour Party, a party that is supposed to represent the views and interests of workers, is allowing 15,000 people with pension entitlements to be effectively rail-roaded given that the Government is allowing individuals involved in the take-over bid to receive pension entitlements of almost €0.75 million. There are vested interests at play here. The workers in Aer Lingus and the taxpayer will be the fall guys. In the 1980s, people had to pay up to £400 for a flight to and from London. The arrival of competition, in the form of Ryanair which played a major role, reduced costs. The State had to allow autonomy in terms of Aer Lingus. The 2006 decision to dispose of 75% of the shareholding in Aer Lingus allowed that autonomy to take place and allowed the company to become more effective and efficient, but critically allowed the State to have a 25.1% shareholding in Aer Lingus.

Senator Ivana Bacik appeared to water down the significance of that shareholding. Anyone who plays the role of director in any company will know that a 21% or a 25% holding in any company is a significant and strategic underpinning of that company's decision-making power. The State has that role at the moment, a role in financing the company but also in developing the future direction of the company and the decision making process whether through routes, employment, efficiencies or the effectiveness of the company. That shareholding is being sold off to private investors, IAG. Some of its shareholding is owned by Qatar Airlines. Who can say whether it will have an influence over a future decision of British Airways in the years to come? We are not just dealing with a CEO, Mr. Willie Walsh, who appears before a committee of the House and provides assurances. We are dealing with shareholders living in the Middle East, controlling other airlines. We are diluting competition in an area where the State has tried in the past, under Fianna Fáil, to improve competition by allowing the company to become more efficient. British Airways must be laughing all the way to the bank because, effectively, its record is very poor when it comes to transatlantic routes in other regions. For example, when British Airways bought British Midland Airways, it brought about efficiencies by reducing the number of staff and the number of routes. It has almost driven British Midland Airways to the ground.

British Airways does not operate any transatlantic routes from Scotland, an issue which was a bone of contention during the recent referendum debate. It offers no transatlantic routes from the North of Ireland.Now it is telling us it will provide a commitment in the British Isles, if one wants to call it that, which is how it views it. This is a commitment to provide transatlantic routes out of Dublin. I simply do not buy it, because the record of British Airways does not stand up to scrutiny. In the future, what is to stop British Airways from breaking the seven-year commitment? The State or other interested parties may take it to court, but the very worst it could face would be a fine. No court can direct that it reinstate the routes. There is a lot of smoke and a lot of hot air. Ultimately, in my view, the Government is bowing down to the vested interests, including those who are involved in this decision-making process, riding roughshod over future pensioners in the company and ensuring that the individuals who are making the decisions will gain financially in a personal capacity. It is disgraceful. Ireland is a small country on the edge of the world. There is an economic argument that governments should not become involved in airline companies, and this was the basis of the 2006 decision to take a step back. However, given our geographical location, there is a need for the State to at least have an involvement in keeping prices and costs down for our punters, our consumers and all our constituents who want to travel to the USA or Europe. According to Pádraig Ó Céidigh, by selling the shares in Aer Lingus at a reduced price of at least 25% below what they are worth, we are selling a strategic State asset but we are also diluting competition within the airline industry, which will ultimately result in prices rising and routes being diluted. Eventually, if we want to travel to the States, we will have to travel through London, unless Ryanair, which is a private company, intervenes.

The decision does not stand up to scrutiny. The report was a joint report and not just an Aer Lingus report. It was a report commissioned in February by Aer Lingus and IAG. It showed that jobs in ground handling would be slashed by 20%, jobs in catering by 40%, maintenance jobs by 15%, and heavy maintenance and eastern European staff by 25%. We talk of 635 additional jobs, but those jobs would have been created anyway due to the growth of air traffic through Dublin Airport and the regional airports. Those jobs were in the pipeline anyway. However, what will happen is that jobs will be cut. The company and the shareholders, including Qatar Airways, will strive to reduce the bottom line, to increase efficiencies within the company, to reduce employment numbers and to increase profits. The State will have no input. Shame on those involved in selling off this asset.

Kathryn Reilly (Sinn Fein)
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Plain and simple, this is the wrong deal for Ireland. Aer Lingus is worth infinitely more to Ireland than the €335 million the Government will get for cashing in on the 25% stake that Fianna Fáil left the State with. We should retain our Aer Lingus shares, recognising that it serves the island. It would be a productive investment by the State, rather than a divestment at a time when investment in the economy is quite low. We need to think about a long-term industrial and enterprise policy and the role of indigenous firms. Enterprise policy is not confined to one company and a cashing in of these shares; we need to think about how our share in this airline serves our enterprise policy as part of a bigger picture. We no longer own Aer Lingus, but the retention of our share is very important. State ownership and the holding of stakes should not simply be to rescue a company; rather, it should be a method for ensuring long-term growth, particularly as this is an open island economy. Aer Lingus is a valuable asset, not just for the quick buck it could return but in terms of delivering long-term sustainable benefits to the island economy.

I refer to a think-piece published by TASC earlier this year in which Paul Sweeney argued that instead of selling our shares, Ireland should invest more in Aer Lingus by increasing its shareholding in the company from 25.1% to 50.1%. He argued that the current push to sell Aer Lingus was not motivated by the best interests of Ireland or Aer Lingus, and that Aer Lingus has many strengths, such that consolidation into a major airline group is not necessary to ensure its survival. Aer Lingus is one of the most profitable airlines on the transatlantic route, and this would not have happened if it had been under the control of IAG. Between 2018 and 2020, Aer Lingus will take delivery of €2.5 billion worth of assets in the form of nine Airbus A350-900 aircraft. This means that, if bought new, the current fleet held would cost €5.3 billion. Of course, it is not a brand new fleet, so depreciation must be allowed for. However, the IAG offer of €1.35 billion for the whole company is ridiculous.

Aer Lingus brings secure and consistent connectivity to Ireland, which is vital for any island but particularly for a country that has attracted major multinational companies in recent years. Aer Lingus has made Ireland an attractive destination, and its reputation for quality promotes a positive image of Ireland across the world, as we saw during The Gathering, for example. Irish people have taken pride in Aer Lingus and continue to do so. However, if this deal goes ahead, Aer Lingus is facing an uncertain seven years, which could possibly be its last seven years as we know it. It will also be a very uncertain time for the thousands of workers who make their living as part of Aer Lingus or peripherally to Aer Lingus operations in Ireland.

We have heard about commitments and assurances, but these are perhaps just a stay of execution which should never have been entered into. Behind that lies the major question about whether these assurances can be enforced or fulfilled. Do we really believe it is possible for this State, in selling 25% of a company, to hold a major multinational conglomerate to agreements in our interest for seven years and onwards? We must remember that IAG is a private, for-profit organisation with only two interests - its bottom line and its shareholders, of which Ireland is not one. IAG has no interest in the best interests of Ireland, its people or the 4,000 employees of Aer Lingus.

IAG's track record shows that its interest is not in providing jobs or supporting the countries from which its airlines come. For example, when Iberia became part of IAG in 2011, 4,500 jobs were cut, more than the entire staff of Aer Lingus. Other Senators have referred to the Nyras report and said that the targets for efficiencies could result in cuts of €60 million. We need only look at the example of Iberia when it became part of IAG. No one on the IAG board will be arguing on behalf of Ireland's interests.

It has been made clear on many occasions that the Heathrow slots are crucial for Aer Lingus and for Ireland, as they provide connectivity with one of our main sources of trade. However, what we are getting for our stake in Aer Lingus is less than the value of Aer Lingus's Heathrow slots alone. If IAG decides to sell Aer Lingus and wrap up the company, who knows what would happen to the assurances we have been hearing so much about? As mentioned by other speakers, under this deal, Ireland will, in time, become like Scotland, which was ignored by IAG through British Airways, which was purely interested in increasing its business out of Heathrow. What hope, then, for Cork, Shannon and other regional airports? Chambers of commerce and other bodies in these areas voiced grave concerns about the bid when they attended the joint committee.

Like other Senators, I wish to raise concerns about the workers who have deferred pensions. They will be forced to take a 40% cut in their pension entitlements. What hope do they have of a fair resolution after this sale?

We are facing another seven years of uncertainty and a struggle for the State to maintain its connectivity. There will be seven years of industrial strife and hardship for workers and, for this island, seven years of being dependent on the crumbs from a major multinational in order to provide the much-needed connectivity on which we have come to depend. Sinn Féin opposes this decision.

Thomas Byrne (Fianna Fail)
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I do not see a rush to the Government benches to support this debate.

Maurice Cummins (Fine Gael)
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The Senator's party asked for the debate.

Thomas Byrne (Fianna Fail)
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Because the Government is proposing to flog the last remaining share of Aer Lingus. We would like to see some justification-----

Ivana Bacik (Independent)
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The Senator's party flogged most of it.

A Senator:

The important bits.

Maurice Cummins (Fine Gael)
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Most appropriately said.

Thomas Byrne (Fianna Fail)
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Let us start with that, because that is why we kept 25%.

Maurice Cummins (Fine Gael)
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That is why his party sold 75%.

Thomas Byrne (Fianna Fail)
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If we had been ideologically committed to selling off State assets in the way Fine Gael is, we would have sold the whole lot.

Maurice Cummins (Fine Gael)
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Fianna Fáil sold 75%, which is as good as doing that.

Thomas Byrne (Fianna Fail)
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We did that for a reason.

Darragh O'Brien (Fianna Fail)
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It was to get some protection for it.

Thomas Byrne (Fianna Fail)
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We did that to protect Aer Lingus for the State.

Maurice Cummins (Fine Gael)
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To get rid of it.

Darragh O'Brien (Fianna Fail)
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Senator Cummins needs to check what he is hearing.

Maurice Cummins (Fine Gael)
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To privatise it.

Thomas Byrne (Fianna Fail)
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We kept the 25%. We could have sold 100% back then but we did not we kept the 25% for a reason.

Maurice Cummins (Fine Gael)
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I am beginning to interrupt like Senator O’Brien, my apologies.

Thomas Byrne (Fianna Fail)
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I have just come across the general principles of the proposed disposal for the purposes of the Dáil motion. It is an absolutely shocking document. How anybody could vote for this piece-----

Ivana Bacik (Independent)
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Is that for the July 2006 Dáil motion, to sell 75%?

Thomas Byrne (Fianna Fail)
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How could anybody propose to vote for such a wishy-washy, vague piece of paper? That is what is being done. The Minister is selling the shares and that is it. The Members of the Dáil are voting on waffle about Aer Lingus’ preference for a registered employment agreement. It can change a preference tomorrow. My favourite colour today is blue and tomorrow it might be red. It has a preference to utilise direct labour, wherever efficient. That is not a commitment, it is a preference. I thought collective agreements, registered employment agreements, were unconstitutional and had not been re-enacted. Maybe somebody could correct me on that. If they are going to come in, that is good but there is no commitment by Aer Lingus to do that.

There is no question but that the Labour Party gang of seven was a front for the Government, to give it cover. They were getting top coverage from all the top political journalists who get their feeds from the Government. It was a sham and a fraud on their constituents. They were opposing it but they knew some extra items would be gathered from the negotiations and then they could row in behind the Government saying they had gained a victory, that it was all because of them. Nobody believes that. People are very cynical and they do not believe that type of nonsense. No one in that group has shown him or herself to be principled, with the possible exception of Deputy McNamara, who has a strong constituency interest in the issue.

We have kept this share as a strategic commitment to the airline, to make sure it has a strategic commitment to us. The way this sale has happened seems to be in complete breach of what the Minister for Public Expenditure and Reform, Deputy Howlin, talked about when he described the hands-off nature of the sale of State assets. When he was talking about the sale of the national lottery he talked about appointing certain officials in his Department who would work on it and no Minister would be involved, etc. We have found out, however, that in the past few months the Minister for Transport, Tourism and Sport, Deputy Donohoe, has been entertaining Willie Walsh and others from IAG in his office, on a private basis. Presumably, if we made freedom of information requests about these meetings they would be found to be commercially sensitive, although we certainly should attempt to get the minutes of all those meetings. Then there is a debate for a day and a half in the Dáil to rush this through. It brings us back to Siteserv and the sale of the mobile telephone licence. This is a common theme when Fine Gael is in government. If we decide to sell assets we should look for full market value and sell them in the interests of the State and we should not decide to flog something because someone comes along and says he or she would like to buy it. What if someone wanted to turn the Government offices into a hotel? That would be completely ludicrous but someone comes along to buy a 25% stake in an airline that he or she is so desperate to get and is entertained, there are official meetings and an agreement to do business, and there is great excitement that it is protecting the airline. Government backbenchers, with the exception of Deputy McNamara, are reading off the notes they have been given because they do not know what went on. They have no access to the information passed between the Minister, the Government and the executives of IAG.

The ironic point is that this deal is not through yet, which could make a laughing stock of Parliament because it has to get the competition consent at the European Commission. Virgin Atlantic has complained and expressed its concerns and presumably will object to this. If that complaint were to succeed and this deal were to fail, as the proposed Ryanair takeover of Aer Lingus failed, it would make a mockery of the Parliament. It also depends on Ryanair’s consent, which has not been announced. It will need to take all of the shares in the company. In their excitement Parliament and the Government are rushing in to get a few quid. As someone, Senator Barrett I think, told me yesterday, it is two hours’ public spending. For the length of this debate the amount of money generated by the Aer Lingus sale would be spent by the public service around the country. It is completely ludicrous, valueless and unacceptable. The process is wrong that the Government can negotiate behind closed doors and then tell the Dáil.

Trevor Ó Clochartaigh (Sinn Fein)
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Tá mé buíoch go bhfuil an t-ábhar fíorthábhachtach seo á phlé againn. Is trua é nach bhfuil Aire againn, áfach. Ní thuigim an práinne ná an deifir atá ag an Rialtas leis an gcinneadh seo, a bhí á phlé sna meáin le seachtainí agus míonna anuas. Cén fáth an gcaithfear é a bhrú tríd an bParlaimint ar bhealach chomh sciobtha seo?

I got a phone call two evenings ago from a former Eircom worker who said “Don’t do it!” He said we should remember what happened when Telecom Éireann was sold off and the disaster we have with regard to broadband in rural areas which is brought up here week after week.

Michael Mullins (Fine Gael)
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Who sold that?

Trevor Ó Clochartaigh (Sinn Fein)
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That is a good question. It certainly was not Sinn Féin. We have heard many assurances, which could have been photocopied from those we were given about the National Asset Management Agency, NAMA, and Irish Water when they were being set up. This quite patently is the wrong deal for Ireland and we know that the Labour Party knows it but it does not have the courage to act on that knowledge. My colleague, Louise O’Reilly, who will be the Sinn Féin general election candidate for Dublin Fingal, has resurrected a statement by Deputy Stagg in 2006. When addressing the Fianna Fáil Minister for Transport at the time, he asked if the Minister was aware that the Labour Party had taken a very firm decision on the matter of privatisation, particularly in regard to Aer Lingus, and that it would not involve itself in any future Government which would advance such a policy. That is one of those statements one makes before elections.

Aer Lingus is certainly worth infinitely more to Ireland than the €335 million this Government will get for cashing in the 25% that Fianna Fáil left the State with after its calamitous reign. Thanks to Fine Gael’s desire to sell off State assets at all costs Aer Lingus is facing into an uncertain seven years, which very possibly will be its last seven years, certainly as we know it. It will also be a very uncertain time for the thousands of workers who make their living as part of Aer Lingus or peripheral to Aer Lingus’ operations in Ireland. The Government says it has assurances from IAG that it will not sell the slots, which was a major concern due to their strategic importance to the company. It claims to have got a commitment that the Aer Lingus slots will remain under the company’s control for seven years. Do we really believe it is possible for this State to hold a major multinational conglomerate to agreements for seven years? IAG is a private profit operation with only two interests, its bottom line and shareholders, of which Ireland is not one. It does not care about the interests of Ireland, its people or the workers who make up the almost 4,000 employees of Aer Lingus. What hope have Cork, Shannon or other regional airports in that environment?

The deferred members of the IASS, who worked for Aer Lingus, are being forced to take a 40% cut in their pension entitlements, facilitated by legislation. What hope do they now have of a fair resolution? This is a bad deal for Ireland, Aer Lingus and its workers. It will usher in seven years of uncertainty and struggle. It would be seven years of industrial strife and hardship for workers who will be left on the scrap heap. In seven years’ time we will be left an island dependent on the crumbs of a major multinational to provide the crucial connectivity we have come to depend on. The day will come when the Labour Party will see the cost of its cowardice just as Fianna Fáil must surely see the end result of its own rush to privatisation. The message is very clear: Fine Gael, the Labour Party and Fianna Fáil cannot be trusted in government with decisions such as these. We call on the Government, even at this stage, to reverse this decision, to pull back, take stock, listen and take on board all the different reports that are available to make an educated decision and to listen to that man in the west of Ireland who used to work for Eircom who said “Don’t do it again because it was a disaster when ye did it with Eircom”.

Gerard Craughwell (Independent)
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I understand the Leader’s position but it is regrettable that Senator Barrett cannot be here. He is tied up in the banking inquiry and he simply cannot leave it. It is deeply regrettable that we will not hear his voice today.I speak today on behalf of those who cannot speak in this House, namely, the Aer Lingus staff who suffered severe cuts to their pensions as a result of the actions of this Government.

I am not interested in political point-scoring but it is shocking that there are so few Members on the Government side present in the House to defend the sale of Aer Lingus. I appreciate their having remained in the House throughout the entire debate. It is outrageous that there are many Senators wandering around Leinster House today hailing this as a great deal for Ireland, yet they have not presented in the House for this debate. In fairness, Senators Cummins, O'Neill, Mullins and Bacik have contributed to this debate.

If there were a free vote in Dáil Éireann today, how many Government backbenchers would actually support the sale of Aer Lingus? As in the case of Irish Shipping, Aer Lingus will slip off into the memories of people, and within seven years, in the context of the much talked about guarantees, most people will have forgotten all about Aer Lingus. The Government speaks of the sale of this organisation being about jobs. Following completion of the sale, 50 jobs are to be cut from Aer Lingus. That is not saving jobs. The remainder of the deal is platitudes and promises.

On Aer Lingus the brand, I recently met some soldiers who have served in the Lebanon. They told me that as they finished their tour of duty and reached a hill overlooking Tel Aviv, where they would see the Aer Lingus jets on the tarmac waiting to take them home, they knew they were safe and would soon be home. Most of us in this House and most of our families and relations have travelled all over the world. There is nothing like arriving at an airport and seeing the shamrock. I do not believe for one minute that IAG will retain the brand for any longer than it has to.

I recently heard that one of the members of the board of Aer Lingus will walk away with a €4.5 million payment. How many pensions would that have topped up? Other members will walk away with up to €750,000 each. It is outrageous that people will be allowed to walk away with that amount of money. Will the Government publish the data on the amount, to the penny, each member of the board or management will be paid following completion of this deal? How much of the sale price will be diverted to the pensioners, those who built up the brand that is being sold at a giveaway, knock-down price? Senator Bacik said - I am sure that, as a member of the Labour Party, it was the right thing to say - that she will fight to ensure some of that money is diverted back to the pensioners. I would like a report to the House on precisely how much of that money will be diverted to the pensioners.

We never learn in this country. All one sees when one drives around this country is broken railway lines that once served places such as west Clare, Connemara and so on. All these lines were ripped up because it was the economic thing to do at the time. The tram system in Dublin because ripped up because it was the economic thing to do at the time. We are now spending billions to replace it.

If Senator Barrett were here, he would speak about the irony of the British courts ruling on competition between two Irish-based companies. There is something terribly wrong about that. He would also speak about the way IAG serviced the regional airports in the UK and how terrible that was. Unfortunately, I do not have the expertise of Senator Barrett in the area of transport economics. He is the only voice I have heard in all this that is truly independent and has no axe to grind with anyone. We are told that the Government's influence, in terms of the 25.1% shareholding, was limited. I am sure that someone advised the Government of suppression in any relationship of the minor shareholder. It had influence. From what I hear, the golden share is not worth the paper its written on. Where does that leave us?

On the Heathrow Airport slots, as pointed out by one of my colleagues, the sale price does not even cover the value of the Heathrow slots. Let us not for one minute think the Heathrow slots will remain in Ireland's ownership; they will not. As far as I am concerned, today is a bad day for Ireland and the workers of Aer Lingus and a terrible day for the Aer Lingus pensioners. I hope and pray that the one person with the backbone to stop this, Michael O'Leary, refuses point blank to divest himself of his shareholding and the Ryanair shareholding in Aer Lingus, thus leaving us with what we have.

I thank Senators Cummins and Bacik for representing the Government in this debate.

Maurice Cummins (Fine Gael)
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I will relay Members' comments to the Minister.