THE EUROPEAN Commission has authorised a maximum of pounds 7m in aid to help convert Swan Hunter on Tyneside back into a merchant shipyard.

AER LINGUS, the Irish airline, has reached agreement with union leaders on proposals to cut payroll costs by Ir pounds 21m ( pounds 20m) as part of an overall rationalisation plan to return the company to health. The deal, struck after all- night talks, includes changes to working practices, writes Mary Fagan.

LOSSES at Aer Lingus, the crisis-hit Irish state airline, rose to Ir pounds 188m ( pounds 182.5) after exceptional costs in the year to March, from pounds Ir11.7m the previous year.

USAIR, which launched a TV advertising blitz this week heralding its new alliance with British Airways, was yesterday forced to warn investors that it is likely to lose money again this year.

IN THE END it was the only deal in town. Faced with a stark choice between losing control of the business he founded or witnessing its complete demise, Tony Ryan decided to salvage at least something from the wreckage.

JOHN MACGREGOR, Secretary of State for Transport, yesterday ruled out an investigation of British Airways by UK aviation authorities in the wake of the Virgin dirty tricks affair.

GPA GROUP, the financially stretched aircraft leasing company, needs backing from investors for only half its planned dollars 200m equity issue to trigger its long-delayed refinancing.

THE IRISH government has come to the rescue of GPA, the debt-burdened aircraft leasing group, with a pounds 15m capital injection.

DUBLIN - Further high-level departures at Aer Lingus, the Irish state airline, may follow the resignation of the chief executive, Cathal Mullan, writes Alan Murdoch.

CATHAL MULLAN, the chief executive of Ireland's troubled Aer Lingus national airline, resigned last night.

AER Lingus, the Irish state airline buffeted by the international recession and weighed down by debt, has turned to the government with an urgent call for cash.

An injured climber was rescued from the slopes of Mount Snowdon in north Wales yesterday after his radio distress call was picked up by an Aer Lingus jet flying from London to Dublin.

IT wouldn't cross your mind, talking to him, that Norman Rush has just written a masterpiece. He hasn't worked up the personality tie-in; he hasn't transformed himself into a literary type. You'll never see him in a Vanity Fair photo-gallery next to Susan Sontag, Harold Brodkey and Jay McInerny. So while his novel, Mating (Jonathan Cape pounds 14.99), is thrustingly experimental, with an insistent and dazzling style, Norman Rush is a quiet and uncharismatic man with a neatly clipped beard, who displays very old-fashioned manners with respect to car doors and the outside edges of pavements.

Patrick McCabe won the pounds 10,800 Irish Times-Aer Lingus Irish literature prize for fiction for his novel The Butcher Boy, which is on the Booker Prize shortlist.