Tougher rules on access to Dublin Airport and a 90 per cent rise in charges over five years are needed, writes Liam Meade.
In the aftermath of the Aer Rianta break-up it is tempting to write about the intrigue, political antics, personality clashes, duplicitous behaviour, wastage and the other less decorous elements that went into making up this two-year cocktail.
However, that will have to wait for another time (and a larger canvas) as it is more urgent to examine the battlefield landscape, as we find it today, to see what impact these changes are likely to have on the national airports involved going forward, and more particularly on Dublin and Shannon.
No matter how this all pans out, Cork is on a winner. It will have a spanking new terminal in one year that will take it through to 2015 at least. It is proposed that the Dublin Airport Authority (DAA) will cede the Cork assets to the Cork company at some future date and, in the meantime, Cork will have use of them for a minor financial consideration.
Dublin, however, is a different story. The two-year period of inertia brought about by the restructuring, allied to some truly bizarre pricing rulings by the aviation regulator, has left the "rump" of Aer Rianta, now the DAA, with a seriously weakened financial profile and an airport that has not been receiving the capital expenditure inputs it requires to cope with traffic growth.
During this period no capacity improvements were made at Dublin Airport despite the fact that many key traffic processing areas are unable to cope with demand. The terminal extension and its associated facilities completed in 2002 have contributed nothing to resolving capacity deficits in kerbside access, baggage reclaim and the departures concourse areas.
During this summer the congestion in these areas raised serious health and safety issues. Given that the changeover to the new company is in train only now, it will take it some time to develop and implement a programme to alleviate the situation. Any construction initiatives will not have an impact before the summer of 2006, at best, and more likely 2007.
Projections for Dublin Airport compiled in 2002 envisaged passenger numbers reaching the 20 million mark by 2007-2008 and 30 million by 2018. These have been overtaken by events and it is now likely that the 20 million figure will have been reached by 2006 and 30 million by 2013-2014. Aer Rianta's airport master plan, approved by the board in April 2003, was based on the lower numbers and proposed immediate action on capacity improvement to meet the higher demand.
The plan was based on exhaustive analysis and consultation with stakeholders. It represented a cohesive and measured response to growth demand. So far so good, but the plan had the major misfortune of seeing the light of day in the middle of former transport minister Séamus Brennan's search for an "independent terminal" at Dublin Airport. The only difficulty with this Government initiative was that it froze all consideration of the other elements, other than terminal space, that go into making up a workable airport environment. Until the timing, ownership and location of the independent terminal was resolved, no one knew where to put anything else.
This dilemma is best illustrated by the handling of the so-called Pier D. This project was designed to provide additional contact stands, mainly for low-cost airlines, and its construction had been urged on Aer Rianta by the Government in the wake of 9/11.
Aer Rianta proceeded apace with planning for a temporary facility to be available in 2003 and the permanent structure in 2004. The temporary solution was discarded as impractical, but over €8 million was expended on detailed planning for the permanent structure. The minister indicated, however, that while these preliminary steps (high-cost "preliminary", it must be said) could go ahead, construction was not to begin until the independent terminal race had been won.
In spring 2004 he was pressed very hard by Aer Rianta to proceed but eventually issued an order preventing it from going ahead. One of the early decisions by the DAA board will probably be to write off this €8 million in its 2004 accounts.
It is worth noting that the independent terminal has now become the "second terminal" in the lexicon of the Department of Transport. The DAA has now been asked to study this matter. If the question being asked was about an independent terminal, it should not be asked of the DAA. That would be akin to asking the turkey for his views on Christmas. Ryanair should note this subtle change in emphasis and may want to mount the bully pulpit (again) before it is too late.
There is some consolation to be taken from this, however, since the hope is that the DAA will undertake this work in a fully contextual way and develop accelerated plans for total airport development, which is what was always required.
These plans will have to be funded and they won't be unless Dublin Airport charges are permitted to rise by a significant amount over the next several years. To recover the financial deficits created by depressed airport charges imposed by the regulator over the past three years, the cost of carrying Shannon and Cork assets and the accelerated capital expenditure requirement brought about by the delays of the past two to three years, Dublin Airport charges will have to increase by up to 90 per cent over the next five years. This may sound enormous but charges of this level five years hence will only be the same as the average charges today at Dublin's European peer airports.
In the near-term it is likely that Dublin airport will have to impose draconian conditions on access.
Among the measures that may be required are aircraft movement limitation (turning away business); flow control in baggage reclaim (holding people on aircraft); departure hall access control (passengers only); and even vehicle control at the key access congestion points. All of this is a far cry from "up, up and away" visions of an airport metro, independent terminal operators knocking the socks off each other in a grab for business and happy, happy people having a nice day at the airport.
Liam Meade is a former director of Aer Rianta