In the clearest admission yet of the government's failure on Shannon, the minister indicated that a situation like this would not be allowed to happen again.

He told the Sunday Tribune that it was too late to prevent the airline's controversial plan to end its Shannon-Heathrow service, but said lessons had been learned and the government would now use its power to appoint new directors to protect services.

The government, which owns 25.3% of Aer Lingus, has the power to appoint three directors to its board but has only appointed one, solicitor Francis Hackett, to date.

"What we are going to do is appoint the two members to the board and we will look at the mandate that we give them to make it [the requirement to protect the slots] very, very clear, " he said.

He said that he believed there was no commercial case for Aer Lingus to withdraw those services, but that the new government-appointed directors would take action if the airline's management attempted to do so.

"We would have directors on the board who, with the benefit of the experience we now have, would be taking a different attitude to any decision like that, " he said. "They wouldn't be giving management carte blanche in relation to what they do with the slots."

Fine Gael transport spokesman Fergus O'Dowd said yesterday that the move had come too late for Shannon and the new directors should have been appointed on Dempsey's first day in the job.

Claiming that Shannon had now been "thrown to the wolves", O' Dowd said: "At long last the minister is getting a spine."

The Atlantic Connectivity Alliance, which is campaigning for the retention of the Shannon-Heathrow route, slammed Dempsey's comments, saying he was making "a completely discriminatory decision".

"The government is now accepting that it can intervene, that it should intervene and is ready to intervene but on behalf of Dublin and Cork, which we welcome, but not Shannon, " said the group's vice-chairperson Ken Sullivan. "The minister's commitment to these airports' future is hypocritical in the context of inaction on Shannon and an admission of failure in relation to Shannon at the same time."

Dempsey's comments will also alarm the airline's investors, who are concerned about the prospect of government interference.

"Any type of government interference in a quoted company is not favourably looked upon by the market, " said Stephen Furlong of Davy Stockbrokers. "You only have to look at the financial problems at Italian state airline Alitalia to see the problems the government can cause."

The minister said he has no intention of intervening in the ongoing pay freeze dispute at the airline. "Shareholders do not get involved in the day-today running of a company, " he said.

However, Michael Halpenny of Siptu, one of the airline's main unions, said that Dempsey should intervene as the company was breaking commitments on industrial relations given by the government at the time of its flotation.

Meanwhile, Dempsey also indicated that he may challenge Minister for Finance Brian Cowen for the Fianna Fail leadership once the Taoiseach steps down.

"We'll wait and we'll see, " he said when asked about the prospect.