Kieran O'Donnell (Limerick East, Fine Gael)
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Question 116: To ask the Minister for Transport when his attention was drawn to Aer Lingus's decision to remove its winter schedule between Shannon and New York and Chicago; the direction he gave his three nominees on the Aer Lingus board in this regard; the measures he is taking to safeguard the summer schedule; and if he will make a statement on the matter. [24189/09]

Noel Dempsey (Meath West, Fianna Fail)
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Officials in my Department informed me on 5 June 2009 that they had received information that Aer Lingus was finalising its winter 2009/10 schedule and that suspension of some transatlantic routes from both Dublin and Shannon were being considered by the company in that context. Aer Lingus had previously indicated in an interim management statement issued on 28 April that it was reviewing the sustainable shape and size of both the long haul and short haul businesses and that decisions on the capacity deployed for winter 2009/10 would be made to reflect that process.

Aer Lingus Group plc issued a statement to the Stock Exchange on 12 June 2009, in which it outlined changes to its winter schedule for 2009/10. The transatlantic schedule from Shannon will see the suspension of the Chicago service and a reduction in frequency on the Boston route. The New York route will continue, subject to ongoing review by the company.

On 11 June 2009, the Chairman of Aer Lingus briefed me on proposals for transatlantic services for the winter season 2009/10 and for the enhancement of the Shannon-Heathrow service. The Chairman wished to brief me in view of my role in relation to aviation policy generally and in particular in view of my concerns about connectivity to and from Ireland and especially the catchment area served by Shannon Airport.

The State's three nominated directors on the board were issued with a mandate on the date of their respective appointments requesting them to seek to ensure that all future decisions of the company that have significant implications for wider Government, aviation or regional development policies are considered at board level. In any such decisions they are directed to seek to reconcile commercial and public policy objectives.

Following the meeting with the Chairman on 11 June, I immediately wrote to the three directors to remind them of this mandate and requested that they take account of Government policy on connectivity, regional development and industrial development in the board's consideration of this matter. It is acknowledged that the duties of the State nominated directors on the board of Aer Lingus derive from the Companies Acts and that they are obliged to pursue the best interests of the company.

It is understood that the proposed changes to transatlantic services were necessitated by the continuing losses on these routes. Aer Lingus, in common with other carriers, are experiencing a significant drop in yields especially on long haul business and they have had to cut fares aggressively. Given the impact of the recession on demand, other carriers are also cutting capacity on long haul. Decisions on the summer 2010 schedules will not arise until later this year but the mandate outlined above will continue to apply, in respect of the State's three directors on the board.