THE DEPARTMENT of Transport yesterday rejected an offer by Ryanair to enter into binding independent arbitration on the issue of its operation of the Kerry to Dublin subsidised regional route.
The airline is due to pull out of the route, which offers three subsidised return flights a day, and replace it with just one commercial flight.
The arbitration offer emerged after Ryanair chief executive Michael O’Leary met public representatives in Kerry on Thursday to discuss Ryanair’s withdrawal of the public service order route. Ryanair says the €1.7 million annual subsidy it receives is not enough, due to a rise in costs it could not have foreseen when it signed the three-year contract in 2008.
Those increased costs include a tourist tax in 2009 and an increase in Dublin Airport Authority fees by as much as 40 per cent in 2010.
The airline is to pull out of the service at the end of October.
At a press conference in Tralee on Thursday, Mr O’Leary also said he would be willing to accept €440,000 in additional fees to cover his costs for the remaining eight months of the contract, which is due to expire in July 2011.
Mr O’Leary also reiterated his commitment to “grow” Kerry airport saying, it was “rubbish” to suggest it would close if the subsidised route was withdrawn.
