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
THE creation of a new independent Shannon run by a holding company that’s fully separated from Dublin Airport Authority influence while still under State ownership is the best way forward for Clare’s international airport.
That’s the view of Booz and Company – the consultants hired by the Government to come up with a new roadmap to secure the future of the 75-year-old airport.
The consultants said that this model of governance “provides the best ap- proach to balancing the stakeholder objectives with the viable operation of the airport”.
In backing what’s termed “a concession model”, which would pave the way for the holding company to lease out the airport for up to 35 years, the consultants have warned that “the current state of affairs at Shannon has resulted in demand levels that are not sustainable for the airport”.
Continuing Booz and Company says “Shannon Airport is faced with a significant threat to its viability under current ownership arrangements and further separation from the DAA would offer greater opportunities for setting policies that encourage route development and traffic growth and for the development of niche business opportunities.
“Under this approach, the competition of the local authority holding entity could include Clare and Limerick county councils.
“The holding company could also include Shannon Development, as part of a move to integrate the airport with the nearby industrial land, as well as input from relevant commercial interests and public bodies.
“In addition, the local concession model is the preferred model of local stakeholders since it provides an opportunity for them to take greater involvement in the operation of the airport and in the development of the surrounding land.
Creating a separate entity at Shannon, if well managed, is unlikely to significantly affect the DAA’s relationship with its financiers,” the report adds.
However, Booz and Company have warned that “creating a viable airport business under separate ownership” at Shannon “requires the new airport operate to significantly improve financial performance and to be able to access sufficient funds to maintain and invest in the airport over a longer term”.
To ensure this, Booz and Company say “the Government may need to consider appropriate mechanisms for ongoing support”.
This, the consultants say, could be done by way of “integrating the airport with adjoining industrial developments (Shannon Free Zone, supported by the inclusion of Shannon Development in the new holding company structure) and appointing a concessionaire that is experienced in developing successful aero-industrial airport businesses, could better ensure sustainability of the airport and surrounding areas”.