Aer Arann defends PSO concept

Aer Arann has called on the Irish Government to reject the recommendation by An Bord Snip (the body tasked by the Irish government with identifying areas where public spending cuts can be made) that Public Service Obligation (PSO) routes be discontinued.

The airline believes PSO routes support a vital part of Ireland’s infrastructure and sustain hundreds of jobs directly and indirectly in the regions. "They are also a key part of the socio-economic fabric of life in the regions and the removal of accessible air transport will disadvantage many thousands of people from the North West and all along the western seaboard to the South West," the company states.

The carrier points out that the cost of the PSO routes is less than €15million per year, with all the money going to support infrastructure that in turn promotes business, industrial development and economic growth.

"The recommendation to discontinue the PSOs can only be seen as a flawed financial assessment driven by an absolute desire to cut spending with no economic impact study of the full financial cost in terms of job losses and the removal of infrastructure necessary to assist economic growth," declares Aer Arann. "While some road and rail services have improved there are still North South and East West routes where air transport is required to support business and economic development. Industry and business in the regions should not be discriminated against, and they need and deserve the same access to international air services from a hub airport like Dublin as that enjoyed by Dublin business people.

"Similarly, the people living in the regions have the same entitlement to do a day’s work in Dublin or to connect to international services from Dublin for business and family reasons without the inconvenience and high cost of several hours of ground transport.

"At this time domestic air fares are cost effective for both business and family air passengers and are competitive with ground transport costs. The discontinuation of regional air routes will significantly decrease competition and further negatively impact the people and business of the regions.

At present, 16% of Aer Arann’s revenue comes from PSO routes but the discontinuation of the scheme will mean that some regional air routes will close and this will have an immediate impact on regional airports with associated job losses.

The PSO scheme is a European scheme that is used effectively in many EU countries to promote the economy of the regions. Ireland has six PSO routes while France, for example, has more than 160.

Similar to the US Essential Air Services (EAS) programme, the PSO scheme subsidises regional airports through the airlines and allows them to maintain infrastructure that is vital for the safe operation of air transport services. These air services in turn support the economy of the regions and open global business links, thereby increasing the market available to manufacturing and industry in the regions.

"In simple terms," the airline concludes, "the discontinuation of the PSO scheme in Ireland will cost more than it will save and Aer Arann calls on the Government to consider this key point as it evaluates the proposal from An Bord Snip."