Minister Ahern announces decision in principle by the two Governments to provide €15 million for City of Derry Airport

Minister for Foreign Affairs, Dermot Ahern TD, and NIO Regional Development Minister, John Spellar MP, today announced the two Governments' decision in principle to provide over €15m financial assistance for City of Derry Airport.  The support is in response to requests from Derry City Council for funding, including for the long term development of the airport.

Minister Ahern emphasised the Irish Government's support for the current proposals:

“City of Derry Airport is a prime example of transportation infrastructure which serves communities on both sides of the border.  It is this crucial North/South dimension which is the distinguishing feature of the airport, and which persuades the Irish Government that further investment in the airport will deliver significant benefits to the entire North West region.

Communities on both sides of the border recognise the importance of cross-border infrastructural development. We believe that this investment package will make a very real contribution to the economic development of the entire North West region. Projects like this show the practical mutual benefits of working together.”

Minister Spellar said: “City of Derry Airport is highly valued by the people and businesses of the North West.  Its importance was recognised in the Regional Development Strategy.  That is why the Secretary of State agreed to Government's active participation in the Steering Group which revisited Derry City Council's original development proposals for the airport.  The revised proposals which have emerged from the Steering Group are, in Government's view, more soundly based and worthy of support.  I am extremely pleased to join with Minister Ahern to announce a positive response to those proposals. This is an excellent example of practical, effective, North/South co-operation as well as a further concrete demonstration of Government's ongoing commitment to the North West.

Minister Spellar added: “We must all recognise that the revised proposals require the acquisition and removal of a number of buildings in the vicinity of the airport. Inevitably this will involve a degree of disruption and upset, and I have received representations about this. I sympathise with the concerns of those whose homes and property would be affected, and assure them that due process will be applied and that their interests will be taken fully into account.”

Concluding, both Ministers commended all involved in devising the Steering Group's revised proposals and looked forward to continuing the constructive engagement with Derry City Council and with the stakeholders in the North West.

NOTES FOR EDITORS:

City of Derry Airport is owned and operated by Derry City Council.

In late 2003, Derry City Council presented an economic appraisal relating to a proposed development of the airport, including an extension of the runway, at a total capital cost of some £18.4 m. Earlier in 2003, the Council had bid for £4.6 m, relating to a cost overrun on the 1998/99 runway upgrade and to other mainly safety-related capital developments that had been undertaken by the airport.

Following dialogue with the Governments, Derry City Council set up a Steering Group in May 2004 to review the original proposals.  The Steering Group was chaired by the Chief Executive of Derry City Council and involved a range of North West interests with input from officials from Northern Ireland departments and the Irish Government.

The Steering Group submitted its report to the Secretary of State on 2 November 2004.  The report contained revised proposals, not requiring a runway extension, with a capital cost of £10m

The decision in principle is, subject to State Aid clearance and other conditions, to provide 75% grant support, split equally between the two
Governments, for:

• cost overruns on the previous runway projects plus capital expenditure required to comply with safety requirements – grant support from each Government of  approximately €2.15m.

• the Steering Group's revised proposals, involving clearing obstacles at the western end of the runway and other safety related work – grant support from each government of approximately €5.4m.

The decision in principle is subject to a number of important conditions:

• It will be necessary to seek and obtain State Aid clearances from the European Commission;

• Derry City Council will need to obtain all statutory consents, including planning consent, for its revised proposals;

• The two Governments strongly endorse the Steering Group's conclusion that changes in the governance arrangements for the airport are essential to a more successful future.