HC Deb 02 April 1992 vol 222 cc438-9W
Sir Keith Speed

To ask the Secretary of State for Transport what representations he has received about proposals for state aid to Aer Lingus; and what has been his response.

Mr. Norris

Concern has been expressed to me from a number of sources about reports of an injection of state aid to Aer Lingus, and the serious distortion of competition which might result from this on many routes, including London-Dublin. The Minister for Aviation and Shipping has written to Commissioner Matutes, seeking assurance that any formal application for state aid by the Irish authorities will be very fully scrutinised in the light of the market economy investor principle and the need to avoid distortion of competition, and that member states will be given the opportunity to comment.

Sir Keith Speed

To ask the Secretary of State for Transport what representations he has made to the European Commission about recent state assistance to Air France.

Mr. Norris

We are aware of reports of further state assistance to Air France, following the support allowed by the European Commission in 1992. Since there has been no formal notification of further support by the French authorities, we have made no formal representations to the European Commission: but on many occasions we have made clear to the Commission that all applications for state aid should be very fully scrutinised in the light of the market economy investor principle and the need to avoid distortion of competition, and that member states should be given the opportunity to comment.

Sir Keith Speed

To ask the Secretary of State for Transport what assessment he has made of the extent to which state aid to airlines of the European Community has continued after 31 December 1992.

Mr. Norris

The responsibility for approving state aids under the treaty of Rome rests with the European Commission. The Government have consistently urged the Commission to take a tough line to combat aids which distort free fair and open competition in the air transport market. So far this year, the only state aid which has been approved by the Commission is the settling by the Portuguese Government of the deficit accumulated by the carrier TAP in operating service between the Portuguese mainland and the Atlantic islands over the 13 years to 1991. We are generally aware of other forthcoming cases and will continue to monitor the situation.