This article is from page 12 of the 2012-03-06 edition of The Clare People. OCR mistakes are to be expected so download the original SWF or the rendered page 12 JPG
IF implemented, one of the options for the future operation and management structure to govern Shannon that has been put forward by the team of international consultants hired by the Government would mean little change for the airport.
That’s according to Booz and Company themselves, after the final report, which has been part-published by the Minister for Transport, Leo Varadkar, outlines that one of the two options favour by the consultants would not give Shannon its independence and instead place control of the airport’s destiny in the hands of a new holding company.
“State control of Shannon would be maintained, but would be given the status of an independent subsidiary within overall airport group,” says the Booz and Company blueprint.
“The independent airport board would set the strategic direction for the airport and appoint individual management teams with responsibility for developing tailored business plans and marketing strategies,” it adds.
Booz and Company also say that “if properly structured, the primary benefit of this approach is that it would provide the airport with enhanced autonomy at local level”, enabling Shannon “to develop policies and processes that will enhance airport competitiveness with their specific market”.
However, the downside to this option is that it amounts to a watered down version of the current status quo where Shannon is concerned. In theory, Shannon would be given equal status to Dublin and Cork, with all three airports being subsidiaries of a new Ireland Airports Corporation (IAC), but could still be the junior partner of the IAC because of having the smallest number of passengers.
That these pit-falls exist have been confirmed by Booz and Company’s admission that “a risk of this approach is that increased competitiveness of one airport could have a detrimental effect on another airport within the group by diverting traffic away from one or both of the other airports.
“The holding company may therefore choose to impose restrictions on the subsidiary boards to ensure a group-focused approach to financial risk management.
“This would undermine the key benefit of separation and lead to outcomes that are similar in reality to the current situation, but it would create a structure more suitable for future separation.
“Under this approach, there would also be some additional costs associated with creating extra governane at the national level, and through duplicating some management roles at the airport currently performed by the DAA,” Booz and Company add.