The Tánaiste said that discussions are ongoing for further financial support if required.
TÁNAISTE LEO VARADKAR has said that Aer Lingus “will not be allowed to fail” as he outlined that confidential discussions were underway to provide additional financial support to the airline if required.
Aer Lingus is owned by parent company IAG, which posted a €1.76 billion loss for the third quarter of last year. IAG also owns British Airways, which late last year secured a €2.2 billion recovery loan that was partly backed by the UK government.
Speaking in the Dáil today, Varadkar said that the government was already assisting Aer Lingus through the company’s use of Covid-19 supports.
“I say very clearly that Aer Lingus will not be allowed to fail. It is already receiving substantial financial support from the government both through the employment wage subsidy scheme and funding through the Ireland Strategic Investment Fund.
Confidential discussions are underway involving the Minister for Finance and the Minister for Transport, Deputy Eamon Ryan, on further support for the company so it can be there when we need it again.
Later, the Business Minister clarified that he was not making the comment because the airline was in any imminent danger of collapse.
“When I say we will not let Aer Lingus fail, I do not want to create the impression that it is in any way about to fail or anything like that, just in case I am misunderstood,” Varadkar said.
What I am saying is that we are providing a lot of financial support already through the Ireland Strategic Investment Fund and the EWSS. As I said earlier, we are in discussions with Aer Lingus to see what we can do to make sure the airline survives the pandemic and is there to enable connectivity whenever we can get flying again.
Varadkar was responding to queries from a number of deputies including Sinn Féin’s Louise O’Reilly and Fine Gael’s Alan Farrell, who both represent the Dublin North constituency that is home to Dublin Airport.
O ‘Reilly said she received an email from an Aer Lingus worker who “had some savings that she hoped to use to buy a home but she is now regarded by the bank as an ‘uncertain’ customer”.
The deputy asked the Tánaiste whether steps were being taken to protect the airline because “it is a significant employer for those of us who live and work around the airport”.
Catherine Murphy TD of the Social Democrats said she welcomed the Tánaiste’s pledge that the government “will not be allowing Aer Lingus to fail”.
She inquired about the discussions underway with the airline and whether the supports being discussed are on the premise that Ireland’s connectivity is protected and the country does not become “a regional airport for Manchester in terms of the flights to the US”.
In response, Varadkar said that the government is ready to provide more support to Aer Lingus “to retain essential connectivity like Heathrow, the United States and those key hubs in Europe”.
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“The sad truth is that the way things are going now it could be a long time before we see aviation recover. Some people are even saying we may have passed peak aviation,” he said.
“I am not saying that, but some people are. Saving all jobs and all routes may not be possible but we want to protect the company and make sure it is there for essential connectivity in the future.”