Terminal two approved at Dublin airport
Terminal Two agreed at last
Government to sell majority stake in Aer Lingus
The Government has at last made the decision to proceed with the second terminal at Dublin Airport and at the same time agreed in principle to partially privatise Aer Lingus. Details were announced following a Cabinet meeting on Wednesday afternoon although earlier in the day, when questioned in the DÃ¡il, Taoiseach Bertie Ahern would commit to nothing more than that an announcement would be made "shortly".
Dublin Airport Authority will build and own the new terminal but the DAA and other companies will be invited to submit tenders to decide who will operate it. Those who were hoping for competition were disappointed, particularly when Minister for Transport Martin Cullen said that whoever won the tender would have to operate it in accordance with the terms of an agreement between the Government and the trade unions. In an apparent move to avert criticism Taoiseach Bertie Ahern warned that work practices at the airport would have to change radically and claimed that this was understood by the unions. He added, however, that the trade unions will be involved in the entire process of bringing the new terminal on stream. Concerned at these comments, the Chambers of Commerce of Ireland called for the immediate publication of last year's agreement between the Government and the Irish Congress of Trade Unions.
While the DAA will be responsible for the construction of the new terminal it must first consult with the airlines planning to use it. It has also been told that it must create a functional building meeting basic needs and able to operate as efficiently as possible. Work is also to proceed on a new pier at the existing terminal. Pier D should be in operation in 2007 and the completion date of the new terminal is 2009. By that stage the planning process for a third terminal should be at an advanced stage and ready for implementation before the first two terminals reach their capacity of 30 million passengers per year. No decisions were made on who should build, own or operate the third terminal.
Tourism and industry groups welcomed the decision but there is a widespread belief that, having waited so long, they were ready to welcome any decision that hastened the completion of Terminal 2. Aer Lingus also welcomed the news but Ryanair's CEO Michael O'Leary was scathing in his criticism. He described the existing terminal as "not just a slum" but "a testament to the failure of Bertie Ahern to keep his own promises". Mr O'Leary has long advocated that the terminal should be built and operated by the private sector, given the record of state involvement to date. Another critic was Ulick McEvaddy who owns 150 acres of land adjacent to the airport and fronting the N2. He is anxious to build the terminal and points to the problem of all airport traffic trying to reach both terminals from the M1. Mr McEvaddy plans to lodge a complaint under national and EU competition law.
Minister Cullen justified the partial privatisation of the national airline on the basis that it required substantial capital to expand. He gave an assurance that, while a majority stake would be sold, the Government would retain at least a 25% stake in the airline to ensure that it is not the subject of a trade sale to another airline. He also believes that this will prevent the sale of valuable landing slots at Heathrow. On this occasion his critics either attacked the decision to privatise the airline or attacked the minister for failing to specify the percentage of the airline he planned to sell, how much he hoped to raise and whether it would be by sale to a private investor or via a stock market flotation. Opposing the sale of a stake in the airline were the trade unions, the Labour Party, the Greens and Sinn FÃ©in.
The Minister hailed the decisions as momentous for the aviation sector. PD leader TÃ¡naiste Mary Harney was more subdued. Political observers saw the Terminal Two decision as a victory for Fianna FÃ¡il but, while acknowledging that concessions had been made, Ms Harney insisted that both the PDs and Fianna FÃ¡il had made concessions in the interests of coalition Government.