Shannon Airport connectivity and governance
Michael Harty and others raised concern about Shannon Airport’s long-term viability, route development, and governance. The Taoiseach defended the airport’s independence and recent progress, acknowledged traffic declines, and said Government and the airport should work together on incentives and marketing to secure a European hub route.
There is great concern in the midwest region about the long-term viability of Shannon Airport in County Clare. The airport is an iconic institution in the midwest and an essential driver of regional development. Air access is critical to regional development.
Shannon is an essential piece of infrastructure for the west and midwest, both from a tourist and economic point of view. In addition, it is the first port of call for emergency transatlantic landings and is, therefore, an essential part of aviation infrastructure. Shannon Airport, having gained its independence, has not been supported to perform as well as was envisaged. This is having a knock-on effect on the long-term economic stability and sustainability of the midwest region.
There has been a decline in passenger numbers this year, after modest growth over the past few years. Unforeseen events such as the grounding of the Boeing 737 MAX have ended Norwegian transatlantic services. There is, of course, uncertainty around Brexit which is having a disproportionately negative effect on the midwest region as Shannon has connectivity to London but not to a European hub such as Frankfurt or Paris.
Shannon lacks strong Government support in promoting it as a gateway to the west and the wild Atlantic way, but also as a counterbalance to the unhealthy dominance of Dublin Airport. The greatest challenge facing the midwest is that Dublin Airport now commands, or will soon command, a 90% monopoly of aviation traffic in an already congested airport and city. As Shannon loses its connectivity, this damages the economic development of the west which is contrary to project 2040 which sets out a target of 75% growth in regions outside of Dublin.
The Government needs to step in to promote and protect Shannon Airport. If that involves changing its status or putting in place other mechanisms to allow it to develop and attract investment, that should be considered. A mechanism needs to be found to support new routes into the region. Tourism Ireland needs to dramatically improve its focus on marketing and supporting the development of new routes into Shannon which would benefit tourism, foreign direct investment and indigenous exporting industries in the area. Has the concern for the future of Shannon Airport and, by extension, the mid-west region filtered through to the Government? If so, what actions is it taking to ensure balanced regional development in the west by supporting the airport?
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As the Deputy is aware, I am a very strong supporter of Shannon Airport, which has a special place in my heart because I was Minister for Transport, Tourism and Sport when we decided-----
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I thought he was going to say he started it.
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We established Shannon Airport as a debt-free independent airport with its own board and governance. I am very proud of being part of that. As the Deputy is aware, the industrial zone around the airport is doing very well, with a significant number of jobs having been created there in recent years. Indeed, the first aircraft maintenance hangar to be built for many years is under construction there. The zone around the airport is doing quite well.
Passenger numbers rose by approximately 6% last year, to 1.9% but, for reasons outlined by the Deputy, they are down this year, which is of concern. At the time of the airport being made independent, I set a target of reaching 3 million passengers. We are currently very far off that level. We need to examine how we can support the airport to develop new routes.
We must be mindful that there are other airports of which we must take account, such as Cork Airport, which is having a good year but had bad years in the past, Ireland West Airport Knock, which is doing well, and Waterford Airport, which is keen to get flights again. Dublin Airport receives no Government or State support.
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It is given money by Tourism Ireland.
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On the contrary, the Government takes one third of its profits in dividends to pay for services across the country.
We need to see if there is something we can do, particularly for Shannon Airport. Although it has very strong routes to the UK, including Heathrow in particular, and North America, it lacks a route to a significant continental hub such as Frankfurt, Paris, Amsterdam or Copenhagen. If that could be achieved through marketing supports, it would be of real benefit to the airport. In so doing, we need to ensure we get it right. More flights to Malaga, Faro or Mallorca would be of little economic benefit to the region. If one provides route supports to an airport, one must ensure it does not cannibalise another. It is of no benefit to the country as a whole for a route to be moved from Cork Airport to Shannon Airport.
I am interested in this issue. I have been in touch with the chairman of the airport and recently met her in Limerick. We are examining proposals in regard to how we could, in a meaningful way, assist the airport to get more routes.
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The Taoiseach could start by getting rid of the chairman.
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I acknowledge that many positive things are happening within the Shannon Group but, unfortunately, the airport is not thriving. What can the Government do to establish a route to a European hub? That is essential for Shannon's connectivity. I do not agree that the board is doing a poor job. It needs to be strengthened rather than abolished or replaced. There have been several calls in the mid-west to replace the board. It is doing significant work but needs to be strengthened, particularly in regard to aviation policy.
I take the point that the Government is not promoting Dublin Airport, but the current economic environment is such that Dublin has a dominant position within the Irish aviation industry. That needs to be countered by a change in Government policy. I ask the Taoiseach and the Minister for Transport, Tourism and Sport, Deputy Ross, to examine how a change in Government policy could support Shannon Airport. The existing policy is not doing so.
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The existing policy is to not support Dublin Airport. It receives no Government support. In contrast, the Government takes one third of its profits to invest in services all over the country.
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Tourism Ireland give its routes support funding.
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However, we support regional airports like in Knock, Waterford and Kerry. Cork and Shannon airports operate as semi-State companies on a commercial basis. In terms of getting to a solution, which is what we both want, to try to secure a mainland European hub route for Shannon, what can be done? The Government and the airport acting together can eliminate airport charges. Airports can do that to incentivise an airline to establish a new route. They can waive charges for up to five years. The Government can come in with marketing supports to make it more attractive for an airline to open that route. These things have been done in the past and I believe they can be done again. However, there are two crucial things to bear in mind. Ultimately, a new route only succeeds if there is sufficient demand. Many routes fail because there just is not sufficient demand and the Government cannot create demand where it does not exist. We also need to make sure that we do not use taxpayers’ money for displacement, subsidising a new route that is just a route move from Cork to Shannon or from Knock to Shannon. That does not make any sense.
Local authorities can get involved. I visited Knock Airport recently and I was enthused at the fact that not just Mayo County Council but seven local authorities in the region got behind that airport, not just with words but with money. I saw that in Waterford also with three local authorities, not just in Waterford, getting behind that airport with money. I encourage the local authorities in the mid-west to consider what has been done in the south east and at Knock and do the same.