Ruairi Quinn (Dublin South East, Labour)
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Question 97: To ask the Minister for Transport his views on the proposed major rationalisation programme for Shannon Airport that may result in the loss of up to 200 jobs; if further job losses are anticipated at Cork and Dublin airports under similar rationalisation programmes; and if he will make a statement on the matter. [4791/05]

Jack Wall (Kildare South, Labour)
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Question 108: To ask the Minister for Transport the position with regard to the break-up of Aer Rianta; and if he will make a statement on the matter. [4769/05]

Martin Cullen (Waterford, Fianna Fail)
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I propose to take Questions Nos. 97 and 108 together.

In keeping with the provisions of the State Airports Act 2004, the board of the Dublin Airport Authority has a statutory mandate to do everything necessary to give effect to the restructuring of the State airports.

The Shannon and Cork Airport Authorities were incorporated in October 2004 and in line with the framework provided by the State Airports Act 2004, these two new authorities will, in due course, own and operate their respective airports once sufficient distributable reserves are available to transfer the relevant assets.

Prior to the assets of Shannon and Cork airports being vested in their respective authorities, their boards are charged with preparing to assume full responsibility for the management and development of their airports. They are also empowered to undertake functions delegated to them, on an agreed basis, by the Dublin Airport Authority. Each of the airport authorities is also required to prepare comprehensive business plans for their airports.

In accordance with the 2004 Act, the transfer of assets to Shannon and Cork Airport Authorities cannot take place earlier than 30 April 2005 and, thereafter, a phased approach will allow one of the new airport authorities to be vested first, that is, Shannon Airport, while Cork Airport will be vested once sufficient distributable reserves have been built up within the Dublin Airport Authority.

Both I and the Minister for Finance must be satisfied as to the state of operational and financial readiness of the Shannon and Cork Airport Authorities before the assets of the airports are vested in those authorities. The formulation of comprehensive business plans by the new boards will be a key aspect of achieving operational and financial readiness. The business planning process has been initiated with a view to meeting the requirements of the State Airports Act.

Since its incorporation in September last, the Shannon Airport Authority has been considering, under the overall stewardship of the Dublin Airport Authority, a range of measures for the future successful development of the airport on a sustainable basis. The airport authority has stated that these measures include initiatives to promote traffic growth through Shannon Airport together with measures to address the airport's cost base. It has been recognised for some time that costs in Shannon Airport are high relative to comparable airports and that this is an issue that needs to be addressed to position the airport to be able to continue its valuable contribution to business, tourism and the regional economy generally of the mid-west.

I expect that arrangements for implementing rationalisation can be agreed through consultation between management and union representatives. The authority has made it clear that it is looking to engage with trade union representatives on its proposals and that it is expected that any necessary staff reductions can be achieved by means of voluntary early retirement or voluntary severance schemes. The objective is to develop a long-term sustainable business at Shannon Airport, which is a major feature of the thinking underlying the State Airports Act 2004.

As to Cork and Dublin, it is a matter for the relevant airport authorities to assess on an ongoing basis the measures necessary to ensure that the airports can operate in a financially sustainable way.

I am confident that the new boards of the three airport authorities will successfully meet the challenges ahead. Through more focused commercial operation, all three airports can play a greater role in stimulating and supporting regional and national economic activity to the benefit of their customers, both airlines and passengers, and of Irish tourism, trade and industry.