DAA CEO Declan Collier addressed a meeting of the Oireachtas Joint Committee on Transport

Chairman and Members of the Joint Oireachtas Committee on Transport

Thank you for your invitation to address the Committee this afternoon.

The reason we are here today is to discuss the DAA’s proposals for Dublin Airport, relations with Cork and Shannon Airports and arrangements for the independence of the airports.

In this context I believe it is important to restate the policy background underpinning the DAA’s key business objectives.

These objectives are:

• To deliver the required capacity at Dublin Airport to service over 30m passengers by 2015. In this context, the Government’s 2005 Aviation Action Plan specifically provided for the delivery of Pier D in 2007 and of Terminal 2 in 2009.
• To fundamentally transform the passenger experience at our airports.

and

• To strive to effect the separation of Dublin, Cork & Shannon as commercially self-sustaining, independent airports, as stipulated by the State Airport’s Act, 2004.

I am pleased to report that significant progress has been made towards each policy objective over the past year and that 2008 will see further significant developments.

I will focus firstly on the DAA’s Transformation Programme at Dublin Airport.

Dublin Airport has been one of the fastest-growing major European Airports for some years and with just over 23m passengers last year, is now Europe’s eighth busiest airport in terms of international traffic.

But, as is clear to the vast majority of its stakeholders, the Airport’s passenger processing and airfield capacity had not kept pace with traffic growth thereby leading to a less than satisfactory travel experience for many customers, particularly at busy travel periods.

The Government’s Aviation Action Plan of May 2005 addressed this capacity deficit and directed the DAA to deliver the facilities required as swiftly as possible.

In the two and a half years since the Government’s decision, the DAA has, in my view, responded effectively and efficiently to the requirements of both its shareholder and its airline and passenger customers.

In that period, the DAA has:

• Developed a Masterplan for the progressive development of infrastructure at Dublin Airport
• Consulted intensively with airlines and other key customers about their business plans and capacity requirements
• Secured planning permission, following a full planning appeals process, for a new 75,000 sq m passenger terminal, an adjoining major boarding gate facility, and a new parallel runway.
• Secured indications from the Commission for Aviation Regulation that more than 95% of the company’s first-stage, €1.2bn investment plan for Dublin Airport, will be remunerated.
• Delivered a spacious new boarding gate facility, Pier D, on time and budget.
• And delivered a host of projects and measures to mitigate the impact of congestion in the existing passenger terminal. These measures included the doubling of passenger security and customer care staff to over 600; the creation of a new check-in facility, Area 14, beneath the Arrivals Floor; and the construction of a new centralised immigration facility to cater for more than 50% of the Airport’s inbound passengers.

Looking forward, construction work has commenced on the second terminal, T2, and the DAA will invest €450m or more than €1m per day  this year as the Airport’s Transformation Programme gathers momentum and scale.

It is perhaps worth reminding the committee at this stage that the investment programme is funded through a combination of regulated passenger charges, borrowings and commercial income generated by DAA. Dublin Airport, which receives no direct state funding, has the lowest level of passenger charges of any major European airport.

As a consequence of the protracted planning appeals process, construction of T2 will now be completed in the fourth quarter of 2009. Following a rigorous commissioning and testing phase, the new terminal will open to the public in April 2010. T2, which will handle up to 15 million passengers per year, has been designed around passengers’ needs and will provide them with a pleasant and efficient travel experience.

While T2 is the largest single element of the Transforming Dublin Airport Programme, close to 70 additional construction projects will also be progressed during 2008.  Work will begin shortly on a €55 million extension to the existing terminal, which will provide more circulation space for passengers, an enlarged and reconfigured check-in area at the northern end of the terminal and additional retail space.

The Investment Programme includes many areas of unseen infrastructure such as the upgrading of services and utilities and the provision of new aircraft parking stands and taxiways, which will make the operation of the airport more efficient.

The DAA is determined to deliver at Dublin Airport the 21st century aviation gateway that Ireland and its economy requires; a gateway that will, in the next ten to 15 years, manage in excess of 30m passengers per year comfortably and cost effectively, connect Ireland directly to each of its key trading blocs and contribute significant additional employment and national wealth. The company is also committed to ensuring the highest standards of environmental sustainability throughout its development programme.

While Dublin Airport is being transformed, the DAA acknowledges that the travel experience for many of its customers is still far from satisfactory.  We believe that the congested nature of the existing facilities at the Airport is the principal reason for this situation. But we are also very mindful that we must bring continued focus to the quality of service provided by our own staff and those of our concessionaires.

I would like to turn now to the issue of airport separation. The State Airports’ Act 2004 provides the legislative basis for the restructuring of DAA and the establishment of Cork and Shannon Airports as self-sustaining, independent business entities.

The Act stipulated that separation of the airports would only take place following completion of separate business plans for each airport that would satisfy the Ministers for Finance and Transport as to the state of each airport’s operational and financial readiness. .

This business planning process has proved a complex and protracted process, principally because key issues affecting one airport had implications for the other airports’ business plans and needed to be addressed before all three plans could be completed and submitted.

I am pleased to confirm to the members of the Committee that in December 2007, the DAA forwarded business plans in respect of Dublin, Shannon and Cork Airports to the Department of Transport. These business plans provide the basis for the initiation of discussions with the Department on the critical issues affecting the separation of Cork and Shannon Airports.

While I appreciate that confirmation of the completion of these plans may generate many questions on the part of Committee members, as to their content, the DAA believes it would not be appropriate to elaborate on the plans, pending their consideration by the Department and its advisors.

Finally, I would like to remind the Committee that until separation of Cork and Shannon takes place, the DAA has ultimate responsibility for all Shannon and Cork Airports’ employees, assets and business contracts.

All three airports continue to perform well. I have already referred to Dublin Airport’s continued strong growth.  Last year witnessed the first full year of operations at the new Cork Airport terminal with a record 3.2 million passengers availing of an increased number of flight options from the southern gateway. Shannon had a record year for international business growth in 2007 with almost 3.1 million passengers. When domestic traffic is added, Shannon achieved a total passenger throughput last year of 3.6 million. Furthermore, in securing the CityJet/Air France service to the Paris CDG hub, global connectivity from Shannon has been retained.

I wish to thank you Chairman and the other members of the Committee for your time and courteous attention. We are happy to help you with any questions you might have.