Fresh doubts over the future of Shannon Development emerged yesterday after the Tánaiste and Minister for Enterprise, Trade and Employment, Ms Harney, announced that half of the regional development company's permanent workforce would be transferred to Enterprise Ireland.
Already facing uncertainty over a Government proposal to transfer its control of the Shannon Free Zone to the new Shannon Airport Authority, the regional development company's delegated functions from Enterprise Ireland will now revert back to that agency.
This arises from the Government's decision to decentralise Enterprise Ireland's headquarters to Shannon.
In a letter to TDs in the mid-west region yesterday, Ms Harney said: "It would make no sense to have two agencies in the same location performing the same functions."
She added: "This is fully supported by the board of Shannon Development."
As a result, Ms Harney said that up to 100 staff at Shannon Development would be transferred to Enterprise Ireland.
In the letter, Ms Harney said nothing to allay fears expressed by Shannon Development chairman Mr Liam McElligott, and business and union interests in the mid-west, over the proposed transfer of assets of the Shannon Free Zone to the airport authority.
Currently, Shannon Development receives €6 million in rental income per annum from the Shannon Free Zone and the income stream is seen as vital in keeping the new airport authority afloat.
Ms Harney wrote that: "while no decision has been made on the issue, I can assure you that the transfer of the assets would mean no change to either the status of the zone or to its attractiveness as an investment location.
Fianna Fáil deputy Mr Tony Killeen said yesterday that the future role of Shannon Development now needed to be clarified.
"It is hard to argue against the logic of the transfer of the staff, but my concern would be for the staff left over," according to Mr Killeen,
Fine Gael TD Mr Pat Breen said the transfer of Shannon Development staff "is a tremendous blow to the region".
A spokesman for Shannon Development declined to comment yesterday on the Minister's announcement.
