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Sunday 26 February 2017

State pays €700k extra to keep air service in place

Shane Phelan

Shane Phelan

Aer Arann Islands has had its contract renewed for 12 months
Aer Arann Islands has had its contract renewed for 12 months

The taxpayer will have to pay €700,000 more than expected to subsidise flights to the Aran Islands for the next year after Government officials botched a tender process for the service.

A helicopter company was picked as a preferred tenderer for the public service contract in August - a deal which would have cost the State €900,000-a-year.

However, that tender process had to be abandoned by Gaeltacht Affairs Minister Joe McHugh when it became clear Executive Helicopters would not be able to rely on the availability of Galway Airport as a base on the mainland.

Neither the Department of Arts, Heritage and the Gaeltacht nor the Office of Government Procurement, which evaluated bids for the contract, checked on the availability of the airport with its owners, Galway city and county councils.

A feasibility study commissioned by the councils has recommended the facility be used as a creative campus for the film sector.

The impasse threatened to leave the islands without any air service at all.

However, following negotiations, the minister agreed yesterday to extend the contract of the current operator, Aer Arann Islands, by 12 months, during which time a fresh tender process will be announced.

But the extension will cost €1.62m - some €700,000 more than the Government had wanted to spend on the service in the coming year.

Aer Arann Islands, which flies between the islands and Inverin in Connemara, said the sum was in line with what it had been paid to provide the service in each of the past six years.

Procurement

Its chief executive, Padraig O Ceideigh, said that if it was to be paid less, it would not be able to offer the same level of service.

In a statement, Mr McHugh said the extended contract would last until next September.

"The period of the extension will be used to undertake a new procurement process for a four-year contract," he said.

Mr McHugh said the department had also agreed a €1.86m four-year contract with Galway Aviation Services Ltd, the company which runs Aer Arann Islands, for the provision of aerodrome management services.

This contract covers aerodromes on the Aran Islands and at Cleggan and Inishbofin.

Mr O Ceidigh said Aer Arann Islands was "very happy" with how the negotiations had concluded.

"We have secured the stability of the company for 12 months and the employment of the staff, which is critical," he said. "Also we can continue to provide a service that the islanders want.

"The whole process is going to be re-tendered. The department needs the space of 12 months to put the re-tendering process in place and we're very much going to go for it again."

Documents released under the Freedom of Information Act show there were three separate bids made before the tender process was scrapped.

They also show the Office of Government Procurement consulted with the Commission for Aviation Regulation during the tender assessment process.

Irish Independent

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