Phil Hogan (Carlow-Kilkenny, Fine Gael)
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Question 163: To ask the Minister for Enterprise, Trade and Employment when his policy in respect of the abolition of Shannon Development and its merger with Enterprise Ireland will be clarified; and if he will make a statement on the matter. [25386/05]

Micheál Martin (Cork South Central, Fianna Fail)
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On 28 July last, following detailed consultations with the board of the company, other stakeholders and regional interests, I announced a decision on a future mandate for Shannon Development. The terms of that decision are quite clear and involve neither the abolition of Shannon Development nor its merger with Enterprise Ireland.

As I have indicated in response to previous similar parliamentary questions, there have been a number of recent developments that impact on the future role of Shannon Development, the most significant of which are: the proposed relocation of the headquarters of Enterprise Ireland to Shannon as part of the decentralisation programme; the Enterprise Strategy Group recommendation that Shannon Development should disengage from industrial development functions; and the establishment of an independent Shannon Airport Authority.

Discussions commenced with Shannon Development early last year and, in March 2005, the company submitted proposals for a revised strategy for the company. These proposals provided that the company would exit certain tourism and enterprise support activities and would focus on strategic value added activities that would contribute to the economic development of the region. Following an examination of these proposals and after consultation with the company and other stakeholders, I decided on the revised mandate for the company. The main features of the new mandate are: the company will place an increased focus on the regional development aspects of its mandate and special emphasis will be placed on addressing the needs of the less-developed parts of the mid-west region; the company will retain ownership of industrial property in the Shannon region and responsibility for managing the Shannon Free Zone and will have responsibility for providing appropriate property solutions for both indigenous and overseas enterprises; the support functions in relation to indigenous enterprises in the Shannon region, that are carried out by Shannon Development on behalf of Enterprise Ireland, will revert to Enterprise Ireland; the IDA will assume responsibility for promoting investment in, and supporting, FDI companies in the Shannon Free Zone; and the company will produce a new three year corporate plan to reflect the new mandate and this will be reviewed annually.

All the interested parties in the region agree that Shannon Airport is vital to its economic well-being and that Shannon Development is ideally placed to support the new airport authority and to complement its activities. How this should be done will, however, have to await consideration by the Minister for Transport of the authority's business plan. Similarly, any changes to Shannon Development's tourism remit will be decided by the Minister for Arts, Sport and Tourism in consultation with the company.

The Shannon Development board and executive raised issues of concern during the consultation process. I believe that my decision addressed these concerns. I recently met members of the board and I believe that there is both support for the new mandate and energy present to implement it. Discussions between departmental officials and the executive have already commenced in this regard. I am also facilitating clarification of specific elements of the new mandate between my departmental officials and the main trade union, SIPTU.