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No Privatisation of Aer Lingus

Privatisation of Aer Lingus would be a major strategic error.  The sale of a majority shareholding would result relinquishing control over a strategic company that - as the Taoiseach says is vital to an open, island economy.

In time, Aer Lingus and its shamrock will disappear, and do Irish Ferries, formerly the state B&I Continental Line, and the Eircom fiasco come to mind?

Aer Lingus’ growth and development is necessary.  The opportunities are there with the committed workforce who have turned the airline around with great sacrifice, with their embracing of change on a scale never seen before.

No ‘golden share’ will protect all the strategic benefits the national airline secures for our island nation and citizens in the areas of transatlantic routes, freight services, tourism and quality jobs.

Investment Capital for Aer Lingus

While EU competition rules allows for our Government to invest in Aer Lingus on the same basis as any other investor, our Government has decided not to do so.

The alternative can be the ICTU proposal that the Government’s stake in each of the thirteen commercial state companies, valued at around €7 billion, should be transferred from the Department of Finance to a new ‘State Holding Company’, and the State Holding Company would access the equity investment proposals of individual semi state companies such as Aer Lingus.

On March 16 2005, the Minister for Transport, Martin Cullen TD, committed to the unions in Aer Lingus and the General Secretary of ICTU that a full assessment of the Share Holding Company concept - in consultation with the Aer Lingus Unions and Congress - would be undertaken, and as is provided for under the Sustaining Progress National Agreement.

In May, the Government broke rank with their obligations and commitment and announced a decision ‘in principle’ to sell a majority shareholding in Aer Lingus of at least 51%.

This breach with the spirit and intent of Clause 7.1 of Sustaining Progress (see back page), must be rectified, particularly as the possibility of talks on a possible new National Agreement are being explored.

Imagine a privatised Aer Lingus in the event of the present EU Services Directive becoming a reality!

 Part Two of Sustaining Progress - Pay and the Workplace

Clause 7.1 – Public Enterprise

The Government is committed to active engagement with the social partners on the future of the commercial semi-State sector on the basis of the Government’s commitment to its role in providing services of world-class quality at a competitive price to the consumer with a viable long-term future for individual companies based on the most appropriate form of ownership or structure for its particular needs.  The Government’s approach will be grounded on a number of principles:

• We should have a strategy for sharing information and analysis about issues and options facing each major State company and the sector in which it operates;
• This should include systematic learning from the experience of other countries as a guide to dealing with issues that may arise;
• The engagement should be such that the Government’s thinking is shared at the earliest appropriate time;
• Our policy will, in all cases, be based on serving the public interest, in particular that of meeting the needs of people to best effect without any ideological assumption as to what corporate structure or strategy best meets that objective; and
• All of this engagement should be based on a recognition that the public interest is best served by a culture of innovation, flexibility and cost effectiveness in the operations of our State companies.