The European Commission is exploiting the September 11th crisis to force mergers among European Union airlines, senior officials at the Department of Public Enterprise have alleged. The Department's Secretary General, Mr Brendan Tuohy, said there was "tremendous concerns" about the policies being followed by senior figures within the Commission. The Government, he said, did not "object" to orderly change in the industry: "But we made an impassioned plea that September 11th should not be used to expedite this."

Assistant Secretary, Mr John Lumsden insisted that top Commission officials had bluntly made it clear that any Government investment would be regarded as a State aid.

He said Irish officials were "deeply unhappy" that the Commission had given "a very different message" to opposition politicians and others since September 11th.

"It seems that there is a different message being given to the one that we encountered," Mr Lumsden told the Joint Committee on Public Enterprise and Transport. He said he had last Friday attended a meeting with a top official in the Directorate General of EU Transport Commissioner, Ms Loyola De Palacio, who again voiced support for airline consolidation.

However, the Irish officials said the Government was still arguing that airlines should get help to cover losses for more than the four days immediately after the attacks. Opinion was moving on the issue, Mr Tuohy indicated, particularly among the EU's major states, which now find that their own, better protected airlines were suffering from the crisis.

The Aer Lingus survival plan, which will be voted upon in early December, is vital for the company: "Without it, the company will not be there," he went on.

If a share in the company is sold, the money raised will be invested to develop the airline, though the State will not be able to match this investment unless it gets EU State aid approval.