10-May-2012 11:36 AM

Shannon Airport to be separated from Dublin Airport Authority, Cork Airport to be maintained

Irish Government announced (09-May-2012) it intends to position Shannon Airport within a new entity together with parts of Shannon Development while maintaining Cork Airport within the Dublin Airport Authority (DAA). Details include:

  • Shannon Airport: Will be separated from DAA and brought together with Shannon Development to form a new entity with a commercial mandate in public ownership. In addition, the Government has decided Shannon Development’s functions in relation to indigenous enterprise and foreign direct investment will transfer to Enterprise Ireland and Invest in Ireland, respectively. Its tourism functions, including Regional Tourism offices, will transfer to Fáilte Ireland. A steering group will be set up in coming weeks to to decide the organisational structure of the new entity, including its financing, with recommendations expected before the end of this year. "In accordance with its legislative mandate, DAA will work actively with the steering group that has been announced today so that the Government’s decision in relation to the separation of Shannon can be implemented," it said. Minister for Transport Leo Varadkar said the decision is a a significant step in developing the aviation sector in Ireland and securing the future of Shannon Airport. He said the airport will begin its new era “debt free”; [more - original PR - DAA] [more - original PR - Transport Ministry] [more - original PR - Ireland West Airport Knock]
  • Cork Airport: The Government has decided the existing ownership of the airport by the DAA will be maintained for the time being. To take account of this decision, the DAA will be renamed to reflect the fact that there are now two airports and international businesses in the group structure. The Minister for Transport, Tourism and Sport will be making an announcement in the near future on this issue;
  • Reactions:
    • Ryanair: Ryanair criticised the Government for "missing an opportunity" to sell off Shannon Airport to the private sector. The carrier said, "Transferring Shannon from one failed semi-state, the DAA, to another, SFADCO, means that there will be no real change or reform nor radical cost reduction or efficiencies, but rather lots of continuing political interference and bureaucratic mismanagement". It continued: “The Govt’s failure to sell Shannon Airport is also a missed opportunity to generate real proceeds with which to pay down either the DAA’s or the Irish Govt’s huge debts"; [more - original PR - Ryanair]
    • Irish Hotels Federation: Voiced strong support for the plan, stating it marks a new era of opportunity for the region which will enable Shannon Airport to fulfil its potential to act as a significant tourism hub for the West coast of Ireland; [more - original PR - Irish Hotels Federation]
    • Fianna Fáil: Fianna Fáil Transport spokesperson Timmy Dooley has raised a number of concerns about the decision. He stated, "There is no clear funding stream for the airport outlined by the Government after it is cut loose from the DAA. I want the Government come clean on the debt issue and ensure that Shannon will not be saddled with historical debt. It must also ensure that Shannon retains control of Aer Rianta International and it valuable revenue generating potential. Aer Rianta International was born, nurtured and grown out of the Mid-West to become a major success story and it must remain local.What’s happening with Shannon Development is very worrying. The Government has decided to tear up a very successful organisation. The tourism functions are going to Fáilte Ireland, the business support and investment functions are going to Enterprise Ireland and the IDA and what’s left will be folded into the new Airport body";
    • Shannon Development: Shannon Development welcomed the certainty regarding the future of Shannon Airport and the confirmation of its separation from the Dublin Airport Authority. It noted, "there is still a lot of detail to be worked out around the new structure and operation of the new entity, but today’s announcement is undoubtedly a major step towards creating a new entity which will act as a catalyst for growth for the wider Region in the years to come"; [more - original PR - Shannon Development]
  • Sinn Féin Transport spokesperson Dessie Ellis TD has given what he called "cautious welcome" to the news. "This is certainly what local campaigners wanted to see happen and Shannon can now go forward and attempt to grow without being saddled with the €100 million debt that had hung over it under DAA control. I also welcome the fact that the airport remains in state control," he said; [more - original PR - Sinn Fein]  

Irish Government: "This is a significant step in developing the aviation sector in Ireland and securing the future of Shannon Airport. It heralds a new era for the Shannon region. I firmly believe that this is the best way forward for both Shannon Airport, Shannon Development and the Mid-West region. We want to recapture the pioneering spirit of the people who gave us the airport and the Shannon Free Zone concept, so that we can provide exciting and innovative opportunities which benefit business, tourism, and job creation in the region, and across the country. Our task now to develop these proposals in more detail," Leo Varadkar, Transport Minister. Source: Company statement, 09-May-2012.

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