Cork airport may have to share debt

Concern was growing last night that the Cork Airport Authority (CAA) will have to carry approximately half the cost of the new €160 million terminal despite a pledge by the Government in 2003 that the authority would not be saddled with the debt.

Minister for Transport Martin Cullen has proposed the idea that the debt would be shared equally between Cork and Dublin Airport Authorities, leaving CAA with an €80 million debt, according to sources.

Mr Cullen's predecessor, Seamus Brennan, pledged in July 2003 that all contractual arrangements involving Aer Rianta would be transferred to the Dublin Airport Authority when the three airports were split up and made independent entities.

Yesterday, Progressive Democrat Senator John Minihan raised the issue of the Cork Airport debt in the Seanad and asked Mr Cullen if he intended to honour the pledge made by Mr Brennan or if he had some alternative proposal to alleviate the debt.

Mr Minihan asked if Mr Cullen had instructed the board of CAA to accept an amount of the debt and, if this was the case, he wanted what percentage of the cost was to be carried by CAA and what percentage by DAA.

Mr Minihan also queried what action Mr Cullen proposed to take if the boards of CAA and DAA could not agree on a repayment deal and he pointed out that lumbering CAA with the debt to some extent defeated the purpose of the break-up of Aer Rianta.

Minister of State Tony Killeen - answering on behalf of the Minister for Transport - told Mr Minihan that the promise made by Mr Brennan was always going to be subject to company law.

"Dublin Airport Authority will only be able to make the transfers when it has available sufficient distributable reserves to match the value of the assets being transferred," Mr Killeen said.