Aer Lingus and other commercial semi-state companies should be transferred into the ownership of a new State holding company that could take in private capital, the Labour Party has proposed.
The holding company should be given a mandate to develop each company, subject to taking in no more than 49 per cent in private funds, the party leader, Mr Pat Rabbitte, said at the weekend.
His comments came as the Cabinet sub-committee established to consider the future of Aer Lingus prepared to meet today to discuss the Goldman Sachs report on the funding options for the airline.
The Minister for Education and Science, Ms Hanafin, confirmed to RTÉ's Week in Politics programme last night that a decision on the future of Aer Lingus would be made before Christmas.
Aer Lingus chief executive, Mr Willie Walsh, said yesterday that he had detected "growing unease" at the direction in which he and his management had brought the airline.
He said on RTE Radio's This Week programme that his decision of last week to resign was "final" and would not be changed.
Mr Rabbitte told a SIPTU regional conference in Waterford that privatising Aer Lingus could result in a repeat of what had happened to Eircom.
He said Eircom had been been a strong semi-state company, providing an essential utility to the Irish economy.
Following an "extraordinary sequence of changes in ownership", it was now a much depleted company, with no presence in the mobile phone market, considerably higher debts and obligations to pay dividends, he said.
"Who can say the same will not happen to the next semi-state [ company] to be privatised? Who can say that Aer Lingus will not be asset-stripped in the same way, with slots at Heathrow being put up for sale?"
The way forward, in Labour's view, was to create a holding company into which ownership of all commercial semi-state companies should be transferred, Mr Rabbitte said.
"In this way, each of the semi-states could enter into strategic alliances or joint ventures, as approved by the Public Management Enterprise Company, or by raising equity finance or issuing debt in the financial markets."
The board of the holding company, Mr Rabbitte said, would be appointed by the Government and the company would be answerable to the Oireachtas. The entire structure would be underpinned by primary legislation. Mr Rabbitte criticised the Government's handling of Aer Lingus, claiming the "provoked resignations" of its senior management had "shot to shreds" the company's value.
The result of last week's events was that one of the most strategically important companies in the Irish economy had no executive leadership and no direction from its shareholder as to what its future should be. "It is, quite simply, paralysed."
