Dáil assent for Aer Lingus sale to pose difficulty for Labour

Mounting concern for Labour TDs about the likely impact of airline’s takeover

Minister for Transport Paschal Donohoe will brief Cabinet colleagues on Tuesday in respect of the takeover bid. Photograph: The Irish Times

Minister for Transport Paschal Donohoe will brief Cabinet colleagues on Tuesday in respect of the takeover bid. Photograph: The Irish Times

 

Any proposal by the Government to sell the state’s 25 per cent share in Aer Lingus will have to be approved by the Dáil. Labour sources have indicated that the requirement will make it very difficult for the party to agree to a sale.

The Aer Lingus Act, 2004 section 3 (5) states: “The Minister for Finance may not dispose of any shares in the Company without the general principles of the disposal being laid before and approved by Dáil Éireann.”

Labour TDs have serious concerns about the likely impact of a takeover of the former national airline and the prospect of a Dáil vote has heightened those concerns. The principal concern relates to the likely impact of a takeover on the frequency of flights between Ireland and London Heathrow. Party TDs are also worried about the likelihood of job cuts at the company which employs more than 3,500 people if there is a takeover by International Airlines Group (IAG).

Minister for Transport Paschal Donohoe will brief his Cabinet colleagues on Tuesday in respect of the takeover bid. He said on Monday that he intends to put in place a process to “very, very, carefully” evaluate all of the consequences for the country of a sale of the state shareholding or a takeover of the company.

National interest

Mr Donohoe said that the priorities were not just what it meant for the taxpayer in terms of share process but also access in and out of the country and the ability of the airline to sustain and increase employment in the future.

Fianna Fáil spokesman on transport Timmy Dooley has called on the Minister to rule out any sale of the Government’s stake in the company. He said that he was arguing not just on the basis of the likely impact on Shannon Airport, which is in his constituency, but on the negative national impact the sale would have.

“There would be serious implications for Dublin both in terms of job losses and a reduction in connectivity between Dublin and London following a takeover,” said Mr Dooley.

Sinn Féin transport spokesman Dessie Ellis also called on the government to block the sale. “We have major concerns for the future of Aer Lingus’s Heathrow slots if IAG were to control them,” he said. “IAG are likely to want these slots for routes more lucrative to their business which would see less flights from Ireland to Heathrow in the long run,” said Mr Ellis.