08.10.07
Shannon
Ah the FF spin aided and abetted by RTE begins. We had 11 mins and 14 seconds of Morning Ireland this morning in which FF backbencher Peter Power was unchallenged by his assertion that he was not a member of the government, Jackie Healy Rae made a laughable if passionate plea for the reversal of the decision and never challenged on why he supported the FF policy of privatisation in the first place and finally, Noel Dempsey didn’t have to make an appearance himself but Eugene Phelan news editor of the Limerick Leader kindly assured us that he had spoken to him and Dempsey is very concerned and is phoning his cabinet colleagues to see what can be done!
Well then, nothing to worry about I suppose. I wonder will the IBEC members in Shannon be questioning their leaders since IBEC were so supportive of privatisation?
Perhaps now, after the Eircom debacle and the dangers of a non-state national airline have been exposed, someone will actually put up some serious opposition to the proposed meddling in the ESB. Privatisation sucks. When will they learn?
I did a quick tot of the FF vote in the election for Clare and Limerick/East and West. They got 67,963 first preferences. All by fools who believed the cast-iron reassurances that privatisation of Aer Lingus would not result in any reduction of services to Heathrow. I wonder how many of those voters will be present at today’s protest meetings? They should be made wear dummies hats.
EJP said,
August 10, 2007 at 2:27 pm
It’s a curious situation. If, as numerous indignant letter writers contend, the flights that AL currently run out of Shannon are consistently booked out, then surely a competitor with some precious Heathrow landing slots will fill the gap post haste.
I’m not fully au fait with all the details of the situation, but it does seem like a curious commercial decision, given how well the Belfast-London route is served by existing operators.
One thing is for certain, the government can’t have it both ways; you don’t get to cash the asset in and retain control of the company’s decision making process. I forget what size of a stake it has retained in the airline, but as far as I know commercial decisions such as this are fully within the remit of the board (though possibly subject to direction from the AGM in certain situations).
EJP said,
August 10, 2007 at 2:29 pm
And was it an FF policy, or one ideologically driven by the former party known as the PD’s?
I suppose that question is, for all intensive purposes, academic.
Gerry said,
August 10, 2007 at 2:42 pm
it is odd – i don’t quite get show Belfast would be more lucrative than shannon. Is it some North-Southery symbolism? In which case of course it is not a commercial decision at all which is then more confusing.
BMI might move in but it will be some price a ticket from Shannon to heathrow you can bet. I am normally against political interference in commercial =decisions as yu are normally simply delaying the inevitable but there is something odd about this one particularly as FF can’t get any votes in Belfast.
Sarah said,
August 10, 2007 at 2:52 pm
Well Michael Noonan (FG) did a great interview the other day (where’s he BEEN for the last 5 years?). He said
a) the Belfast-Heathrow route was a Peace Process dividend and there is no way it would have happened without government approval
b) that BA should come into Shannon now.He’s written to Willie Walsh suggesting it.
The sister-in-law in Belfast whose husband works in London is thrilled. BMI have been creaming them for £400 red-eye Monday flights. They reckon the prices should tumble now.
I’m against political inteference too. Either the company is private or its not. It was just ludricous of people to expect that AL would go private and not mess with the Heathrow slots. They are the no. 1 asset of the company. They said they wouldn’t SELL the slots, they are happily leasing at least two.
joseph said,
August 10, 2007 at 3:26 pm
maybe it would have been good if Ryanair had taken over AL. I dont particularly like RA but at least you know what your dealing with?
P O'Neill said,
August 10, 2007 at 3:41 pm
I’ll never understood why RTE still allows FF TDs to, as Cian said over at Irish Election, act as their own opposition. They voted Yes in the Dail on everything the government did. They are part of the government. It’s their decision. In one respect it’s a shame that the Dail is in recess for so long because it would be interesting to get a motion about the Aer Lingus pullout and see how many of O’Dea etc would actually vote against the government on it. On the other hand I suspect that a Dail vote would be a token gesture anyway — just allowing O’Dea etc to say they voted against it and nothing else could be done. Now they have to sweat it out for 3 months while Bertie and Noel leisurely work their home from their holliers — not via Shannon.
andrew said,
August 10, 2007 at 3:43 pm
To the ESB I’d add Dublin Bus. The service is better than it’s ever been, but how long before the stonefaced chief exec of some PLC is explaining that certain routes just weren’t profitable, and his primary responsibility is to his shareholders, not his passengers?
tom said,
August 10, 2007 at 3:55 pm
I heard the same Morning Ireland interviews and, like you Sarah, I could not believe what I was hearing. Are we supposed to believe that none of these people realised that privatising the airline means that the Government has no say in these decisions? You can’t have your cake and eat it.
Having said that, is it really so significant that there is no longer a link from Shannon to Heathrow? Presumably you can still fly from Shannon to other London airports. Is it really such a big difference? 50,000 jobs worth of a difference? Come off it.
P O'Neill said,
August 10, 2007 at 4:25 pm
I think it’s a big difference. Think about Element 6, the former De Beers. That’s 600 jobs in the Shannon Free Zone. A lot of their long haul traffic is presumably from Johannesburg. So they expect someone on business to do 11 hours Jo’burg-Heathrow, then fly to Dublin and drive 4-5 hours to Shannon to get something done? Or an airport transfer within London to get a flight to Shannon? That’s a huge disadvantage relative to somewhere else that can promise direct access to Heathrow (or at least better transport to the nearest big airport). All Shannon has now in terms of long-haul access is a few US flights that are basically seasonal. I suspect that if you talk to each of the firms, they can provide a similar rationale for why Heathrow was so important to their business.
Sarah said,
August 10, 2007 at 5:06 pm
Don’t forget the massive inbound tourism dividend. How much easier to get people to the west when they fly there direct from a Heathrow international connection. It makes a mockery of 50 years of government industrial and tourism investment in Shannon.
Sarah said,
August 10, 2007 at 6:06 pm
The government stake is 25 % btw and Ryanair’s another 25% and they’ve offered to co-operate with the government on a board vote. What stake do the unions have and will someone remind me what their position re privatisation was? Presumably like their mates in Eircom their members got a tasty windfall…(or rather, like their mates in Eircom about 6 tasty windfalls and still counting…)
The Limerick Blogger » Blog Archive » Aer Lingus screws the west: Day 5 said,
August 11, 2007 at 1:18 am
[...] Shannon – GUBU [...]
Betty said,
August 11, 2007 at 10:17 am
We can predict the problems of privitising ESB but retaining it as a semi state company without having to confront a few commercial realities also has very serious problems for consumers and manufacturing.The cost of electricity is a major factor in our high cost base and one of the reasons for losing jobs to lower cost countries.
andrew said,
August 11, 2007 at 4:38 pm
Interesting to hear Olivia Mitchell saying that FG would intervene, while Dempsey says FF can’t. Is this ideological blue water at last: Fg to put people before profit?
Billy Waters said,
August 11, 2007 at 5:11 pm
Ryanair fly to three London airports from Shannon. Aer Lingus flew to one. Get over it.
Sarah said,
August 12, 2007 at 12:31 pm
The Unions are running the ESB but the price of electricity is regulated at an artificially high price in order to encourage competition. It is deliberately set higher by a regulator in order to make it wortwhile for newcomers to the market. Competition now for its own sake rather than for the benefits it can bring to most markets, but not all.
leon said,
August 13, 2007 at 8:48 am
Ten years ago Ireland had one of the lowest eletricity prices in the EU, as Sarah says when the EU required a competitive market the CER was created and raised privces to encourage new entrabnts and obliged ESB to buy electrcity at higher price from these new generators rather than there oen cheaper stations. Prices have been increased several times by the cER to increase new entrant share, and oblige ESB to buy this production above their own.
At the same time the government prevemted the ESB expanding overseas, notably into Poland, and insisted that ESB take massive loans to upgrade the distribution network. The network which the governmnet is proposing be removed from ESB.
Without government interference, and propabably as a monopoly, ESB electricity prices would be atleast 15% lower and perhaps 25% or more. The false premise that deregulation of airlines works in other industries is utter bollocks, look at bus services in regional towns and cities in the UK since deregulation, look at the brillinat public owned transport systems in France.
If the networks is removed from ESB, it is likely that within 10 years the ESB would no longer exist, with electricity in Ireland controlled by EON, Southern & Scottish, or similar, who will extra maximum dividends from this small difficult market.
irishpancake said,
August 13, 2007 at 9:23 am
see FG document supporting Aer Lingus privatisation here:
http://www.finegael.ie//PubUploads/ACF1AC.htm
now Sarah, you should check with Olivia Mitchell regarding your new slogan:
“Privatisation sucks”
I agree with you, but does FG
John said,
August 13, 2007 at 8:08 pm
FF is in power. FF/PDs privatised Aer Lingus. Once Aer Lingus was privatised
the Shannon to Heathrow route was at risk. There is no point in talking about the opposition. FF/PDs made made the decision to privatise.The problems at Shannon stem from that FF/PD decision. The people of the west and mid west want a solution. Otherwise FF face a wipe out in the long term. Blaming the opposition is a red herring.
I forecast that government plans to break up the ESB will end in disaster. And I am no socialist.