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Dáil Éireann debate -
Thursday, 29 May 1958

Vol. 168 No. 7

Transport Bill, 1958—Committee Stage (Resumed).

Question again proposed: "That Section 11 stand part of the Bill."

Following the discussion last night, I want to make a suggestion to the Minister in regard to Sections 10 and 11 both of which deal with capital. I have the uncomfortable feeling that the capital structure of C.I.E. is becoming like the income-tax law. It has been so frequently changed that it becomes almost impossible to find out what it truly is. The Minister said yesterday that the aim was to get rid of capital liabilities prior to 1950 and that the capital of the new board should be regarded as capital invested since 1950. In that regard Deputy Norton directed the attention of the House to the burdens taken over by C.I.E. It may be no harm to refer to paragraph 23 of the Beddy Report where it was pointed out that railway rolling stock consisted of 405 locomotives with an average age of 51 years, 680 passenger coaches with an average age of 48 years and 11,700 wagons with an average age of 35 years. There was, of course, also the permanent way, the stations and hotels and so on.

Do I take it now that it is the Minister's intention to wipe out substantially all the rolling stock to which I have referred, the permanent way, the hotels and other properties which C.I.E. took over in 1950 and to leave as their capital, which we shall expect to have remunerated under their current operations, only the expenditure of a capital character undertaken since 1950? If that is the purpose is it not desirable from the point of view of the public, of the Board of C.I.E. and of other interested parties, the trade unions catering for the employees and the customers of the transport system who ask for special rates, that there should be set out in plain and simple language the amount of capital which now constitutes the capital of the company and which ought to be remunerated inasmuch as it was spent on modern up-to-date equipment which should be able to earn a fair return?

If that course commends itself to the Minister is there not something to be said for greatly simplifying the form of the balance sheet of C.I.E.? I understood the Minister to say yesterday that as the total write-off amounted to something like £15,000,000——

£16,500,000.

——it is for the board of the company to deal with its balance sheet for the purpose of allocating what assets are to be cancelled as against that reduction in the total liability of the company thus leaving the balance sheet as set out on page 77 of the Beddy report still containing figures like 3 per cent. transport stock, 2½ per cent. transport stock, 5 per cent. transport stock and 4¼ per cent. transport stock, totalling in all £23,000,000. Would it not be a simpler thing to determine that the total stock of the company was £8,000,000 or whatever it is and show that in the balance sheet so that in successive years we might relate the earnings of the company to the capital which we knew was invested, not in engines 51 years old but in the most modern equipment any railway company in the world is in the position to acquire?

I am always afraid that we shall be drifting into a long period in which everybody accepts it as normal that, no matter what the railway company has, it is expected to lose money and at the end of the year present its bill and says: "We have lost that much" and that any reduction or any refusal to meet the loss is met by saying: "We have no alternative but to do so." That is a very dangerous frame of mind for everybody to get into. If we have spent the capital now appearing in the balance sheet on the best equipment that money can buy we ought to be able to earn a reasonable return. Unless that is set out on the face of the balance sheet I am afraid that essential fact will be lost sight of by more people than the board of C.I.E.

It is quite obvious that the balance sheet of the company will require to be reconstituted on the enactment of this measure. The precise method by which its capital liabilities and assets should be displayed on the balance sheet is a matter on which, no doubt, the board will be advised by its auditors. I do not know if there is any need to put on them a statutory obligation to make the changes which will obviously be necessary in the new circumstances.

However, let us be clear on the realities of the situation. The board has not, in fact, been remunerating its capital. The position up to the present has been that when interest became payable on any of these stocks the board, being unable to pay the interest, applied under the provisions of the 1950 Act to the Minister for Finance and got the money wherewith to pay it. The money was subsequently voted by the Dáil and became a liability of C.I.E. When Deputy Norton uses the phrase "£16,500,000" he will understand that of that £16,500,000 something like £4,500,000 represented a liability of C.I.E. in respect of interest on stock paid from the Exchequer, a liability which was not reflected in any assets of the company. Therefore, when I talk about wiping out capital liability I am thinking of a smaller sum which does represent an actual capital liability, money spent at some stage upon the acquisition of capital assets.

It is true that C.I.E. emerged from the war with decrepit rolling stock in their railway system and indeed in their road transport system. It was not until 1953 that it was put in a position to undertake the systematic replacement of that out-of-date rolling stock by new equipment. There is no point in going back over past events. I had hoped that the re-equipment of the C.I.E. system would follow immediately after the war. Indeed, it was with that aim in view that the Transport Act of 1944 was passed while the war was on. But as it happened when the time came in 1948 the then Minister for Industry and Commerce felt he had to have a committee of inquiry before any proposals of the board could be approved. The board were in fact instructed not to spend any money on capital account and even to cancel certain orders that had been placed for new equipment. Consequently there was a delay which was only partially corrected when the Transport Act of 1950 was passed.

Deputies can go back over the debates on the 1950 Act. Some of them will recollect that the general criticism at that time was that the particular job which seemed to be necessary in relation to the railway system of C.I.E. was not in fact made possible by that Act, that is to say, the re-equipment of the system with new engines, new carriages and new wagons of a modern type and capable of efficient operation. It was not until I brought the 1953 Transport Act to the Dáil and got it passed that the systematic re-equipment of the system began.

It was hoped then that the new equipment to be procured by C.I.E. would so reduce its operating costs that not merely would it go a long way towards wiping out its existing revenue deficiency but would also enable it to meet the interest charges on the new capital invested in the re-equipment programme. That has not proved to be so. The cost of operation of C.I.E. keeps on mounting and even though the actual savings on fuel and maintenance contemplated in 1953 have been achieved, the mounting cost in other sections of the board's accounts has nullified the effect of these economies and left the overall financial position of C.I.E. more or less unchanged.

At that stage C.I.E. had to carry the responsibility for remunerating the new capital raised by the re-equipment programme in addition to the capital liability which had been given to it under the 1950 Act. The Beddy Committee recommended that its liability in respect of capital investment undertaken prior to the 1950 Act should be wiped out and that only capital invested since that date should now appear as a liability of the board. In effect, that is what is being done. The reduction of its capital liability by £11,500,000 achieves that result.

Since then the board has spent on capital account approximately £10,000,000—£9,750,000. I must perhaps correct that to some extent. The board spent more on capital account but the additional capital liability which it incurred was £9,750,000. Some of the additional capital expenditure was financed out of their depreciation provision. The capital expenditure on head of that reorganisation programme is not yet completed. It is still proceeding. There are some liabilities accruing on capital account which will have to be met in this year. But it is contemplated that by the 1st April, 1959, the board's liability on capital account will be approximately £13,500,000, all of which will represent expenditure incurred in the re-equipment of the undertaking since 1950. It will have no liability of any sort whatever on capital account in respect of any expenditure incurred prior to 1950. We are wiping out £11,500,000 of its capital liability by transferring the 3 per cent. 1955-60 stock to the Exchequer and releasing it from any obligation of repaying advances to the board from the Exchequer for capital purposes.

In addition, there is the wiping out of its interest liability, which the board was unable to meet in the past. Therefore, the board will start off on 1st April, 1959, in the position that it will have that reduced capital liability and a subvention fixed at £1,000,000 per year from the Exchequer which will enable it to meet the interest in respect of its existing stocks, which, for the information of Deputy Norton, amounts to about £450,000, and the balance will meet the revenue deficiency which, it is anticipated, will still be experienced for some two or three years to come.

Do I understand that the annual expenditure to remunerate the outstanding capital liability is about £450,000 per year?

In round figures, it is about £450,000.

That will be met by the Exchequer?

No, it will be met out of the £1,000,000. They get this £1,000,000 and the Bill says that the board will utilise that £1,000,000 so far as may be necessary to defray the interest on its transport stock and apply the balance to the operation of the undertaking.

Am I right in believing, when the Minister speaks of writing off approximately £11,500,000, the balance sheet of C.I.E. will then be roughly as set out——

There will be additional capital liability. I estimate that by 1st April next its capital liability will be £13,500,000.

——as set out in the Beddy Report pro forma balance sheet as at 31st March, 1956. It is proposed that transport stock amounting to £11,602,721 will be substantially written off, leaving the total capital at £11,800,782.

That is what it would be to-day, but by 1st April next it will be £13,500,000.

And when it arrives at £13,500,000, that thenceforward will be capital to be remunerated by C.I.E.

They may of course incur additional capital liability in the future. They are authorised to do so. If they have occasion to incur new capital expenditure, they will put out a new stock issue and will, of course, be responsible for that. I assume, however, that the board will not incur any new capital expenditure, unless they can see the effect of that expenditure in the form of economies or of revenue by which it may be remunerated.

We may assume in respect of the £13,000,000, most of which is being made available by the Government or with a Government guarantee, that C.I.E. will be expected to produce an annual return sufficient to remunerate that capital and convert it from deadweight into gross debt.

Into active capital. It will have no difficulty in doing that for the five years because the £1,000,000 grant-in-aid will be more than sufficient to meet liabilities.

The Minister mentioned that C.I.E. liabilities by April next will be about £13,500,000. How much of that is outstanding stock?

About £11,500,000 at the moment.

In stock?

No. I think it is less than that. I can get the figure.

I gather £7,000,000 in stock was issued since 1950. What makes up the rest of the £13,500,000? How much of the outstanding liability is represented by stock and how much is represented by debts accumulated since 1950?

There are certain liabilities in respect of pension funds and other things of that kind. I would not like to attempt to analyse that too closely. They have other funds which represent liabilities in the balance sheet.

I want to find out how much is stock, how much other liabilities and how much debt.

I will get that information.

Is it not the position that you are wiping out all loans prior to 1950 which, in effect, is wiping out £9,900,000?

In effect, that is the situation into which we are getting, but the Deputy must not relate it item to item.

I am taking the Bill and the White Paper which accompanies it. The Exchequer is taking over liability for the 3 per cent. transport stock 1955-60. That is £9,900,000. In addition, they are wiping out liability to repay capital advances, which represents £1,800,000. That makes a total of roughly £11,500,000. That leaves C.I.E. with a liability for all transport stock issued after that date, amounting to roughly £13,500,000. That will be the capital on which it will have to continue to pay interest; the accepting of liability for the 3 per cent. 1955-60 stock and cancelling liability to repay advances of £1,800,000 means, in effect, that you are relieving C.I.E. of the liability for depreciation charges.

Depreciation charges on the old rolling stock.

A large part of the old rolling stock will have been scrapped. Some part of the capital expenditure incurred was financed by the sale of the old stock.

I understand that, but at the end of March, 1957, according to the balance sheet, there were accumulated losses of £7,500,000. I presume there is another £2,000,000 on to that now for 1958.

That is £9,500,000. The Minister is writing off £16,500,000, which leaves £7,000,000 over and above, which, I presume, the board will apply to writing off the old railway lines and the rolling stock to which reference has been made here. That, in turn, will relieve them of depreciation charges, which were quite substantial, on that old stock. For the 12 months to 1957, they paid almost £1,000,000 in depreciation charges and, according to the Beddy Report, their suggestion of writing off rolling stock and railway lines would relieve C.I.E. of a further £350,000 per year. It seems therefore—I may be wrong in this— that, in effect, the reorganisation scheme suggested will relieve them of interest charges of £631,000, which are referred to here in the White Paper, and depreciation charges of something over £300,000.

I take it the Deputy is using the term "depreciation" to mean sinking fund obligation?

£974,000 depreciation for 1957—that, presumably, is taken into account when assessing their losses. It represents an accumulation year after year in the appropriation account. Is that not correct? By this reconstruction, not alone are we relieving them of interest charges of £631,000, but we are also relieving them of depreciation charges of £308,000. Therefore, they are saving nearly £1,000,000 per year and, on top of that, it is proposed to give them £1,000,000 per year and, unless something very unforeseen occurs, that should put matters straight for them.

I do not expect it will in 1958.

I agree, but they are getting a very good break. It is a pity we did not have a pro forma invoice as at the end of March, 1958, to give us some idea of what the new capital structure will look like.

There would be no question of preparing a new balance sheet as at 31st March, 1958. It would be 31st March, 1959, which will be the effective date from which this scheme will come into operation. For this year, their deficiencies on revenue and their cash needs generally are being met out of a Vote. There is an item in the Estimate for the Department of Industry and Commerce for that purpose. It is only from 1st April next year that this new financial arrangement comes into operation.

Deputy Russell may be misled about the depreciation aspect when referring to C.I.E. The method of ascertaining depreciation so far as C.I.E. assets are concerned is the most involved science in the world. Only one or two people know the secret of it. It is most complicated. It is not as if you are in a private company where you buy a machine and say: "There are ten years of life in the machine and therefore we will write it down as 10 per cent. for each year and then it is gone." That is too simple for C.I.E. It is a most involved scheme. You do not merely write down the depreciation value of what is installed but the figure is arrived at by some notional reference to the orthobox way of writing down depreciated assets and then the cost of maintenance and the whole system on which that plant operates. If you were trying to get down to the basis of this, you would want a long period of study in solitude to be able to understand the techniques of writing down C.I.E. depreciation assets.

When Deputy Russell talks of writing down £10,000,000 or £11,000,000 in fixed assets because their liabilities on the other side have been wiped out, it does not necessarily mean it is saving C.I.E. a proportion of a sum of money represented by not having to write down the depreciated assets which are now being wiped out. It is perfectly illusory. While you go through the whole exercise with C.I.E. about writing down assets, the fact remains that you get nothing out of it in this respect because of the complex formula they operate.

They probably apply a different system of depreciation to different assets. I am sure they write off a bus on the basis that the normal life of a bus is, say, from ten to 15 years and try to ensure, adding in depreciation as a working cost, that the net earnings of the bus will be sufficient. I do not know how you apply that to a permanent way. In that case, what matters is the maintenance expenditure.

I quite appreciate what Deputy Norton says. It is a very complicated procedure. A railway line is not like buying a machine or a lorry.

I am sorry to hear Deputy Russell back-pedalling.

Perhaps Deputy Dillon would give me a chance to finish what I have to say?

This will be good for Deputy Russell's soul. Every group of technical persons tries to build up a mystery. It is as old as the Middle Ages. I remember a time when, if you asked any question about credit, the answer was: "Ah, you do not understand banking. It is a most complex procedure." The truth is that it is the customary moneylenders' racket. If you ask the doctors: "What is wrong with me?" They will tell you: "It is not good for you to know. We will fix you up." Railway directors belong to the same coterie. They build up a vast mystery and then they present their bill to the Oireachtas and say: "You would not understand. We write this off in a way that no human creature can understand." My reply to that is: "Why the hell do you do that? Is it not time you got somebody to put the matter in a form which any rational person can understand?"

What is the need for mystery? Why must a railway company or a transport company handle its depreciation in a way which no rational creature can understand except two or three individuals? My reaction is: "To hell with it. If that is their way of doing business, let them send for proper accountants to put their accounts in such a manner as to make it possible for us, who are charged with the care of the money of the taxpayers of this country, to understand this business, provided we are prepared to give it attention and care."

All I am troubled about is this. I have seen this happen in Dáil Éireann many times. Somebody says: "Nobody could understand it" and everybody shakes his head and says: "That is that." I say that is all cod. It is a common device practised by people who want to become a charge upon the public purse to say that their affairs are so complex that they are quite unable to explain them to anybody, but the net result is that they want £7,000,000. I think that is wrong.

At the beginning of the discussion, I put this simple request to the Minister: "When all this is through, what will the balance sheet, which is set out on page 96 of the Beddy Report, look like? What will the capital issues liability be?" I do not propose to press that question further now. I think point and force have been lent to my request by the subsequent discussion which I think reached its climax when Deputy Norton told us —I think, truly—that under the existing system only two or three people in these two islands understand what goes on in the processes of accounting which are considered appropriate for the transport company.

I should like the Minister to reassure us by telling us that the Government, on our behalf, will say to the transport company: "Cod. That will not wash any more. Accounts ought to be prepared in a form which is comprehensible to rational people who are prepared to take the trouble to study them. It will not do to tell us that your accounting procedures are incomprehensible except to two or three specialists and that these are always in your own employment." I think general public malaise will grow if we are faced with the fact that we are to receive annual bills for deficiencies in transport revenue and no adequate explanation of how these deficiencies are arrived at.

I suspect, as I believe Deputy Russell suspects, that, in the transport company, as in many other companies, depreciation is a figure that can be used either to pad or to bleed a balance sheet. However, I do not agree with Deputy Russell that you may expect depreciation materially to fall after you have re-equipped a railway company. I think depreciation on run-down assets is liable to be much less than depreciation in the early years of a completely newly-equipped transport company because the cost, in capital value, of new diesel engines is far greater than the capital value of 50-year-old steam locomotives. I assume that somebody in the Revenue Commissioner's office understands how transport accounts are kept and how depreciation is calculated and that they will have to justify to somebody the rate at which they are depreciating assets.

I can well conceive that the depreciation appropriation in the annual accounts of C.I.E. could be a good deal higher after the re-equipment programme that took place in 1950 than it was in respect of the antediluvian equipment they had prior to that date.

I do not know whether it is that Deputy Dillon misunderstands me or that he has not looked at the balance sheet of C.I.E.

I am quoting it.

Allowing for the suggestion, as Deputy Norton said, that this is a very complicated procedure, which I appreciate, I refuse to believe you can write down assets of any undertaking, whether a railway or anything else—taking last year's figure of £24,000,000 down by some £8,000,000 or £9,000,000—without its making some appreciable difference to the depreciation difference to the depreciation figure. It is a very complex calculation, but nevertheless C.I.E. have been paying £1,000,000 a year depreciation charges on assets estimated to be valued for £24,000,000. If you write off £8,000,000 or £9,000,000 of those assets, or wipe them out, you must affect the depreciation charge. Of course as Deputy Dillon said, if you spend more money on new diesel engines and equipment, obviously this charge will go up again. I am merely taking it as on 31st March, 1957; and I still think there should be a saving in depreciation charges due to the capital reconstruction which the Minister proposes to carry out in order to help C.I.E. Anything which Deputy Dillon says on that will not change my viewpoint one iota.

With regard to the auditing of C.I.E. accounts, the firm of auditors which looks after those accounts is a well-known and prominent one, which should be able to arrive at figures understandable when presented to the public who take an interest in these things. It is a responsible firm and I do not think we need look any further than the accounts presented. I shall not labour that point any further.

Question put and agreed to.
Section 12 agreed to.
SECTION 13.

I move amendment No. 4:—

In sub-section (1), page 6, to delete lines 8, 9 and 10 and substitute:

Whenever the board ceases to provide or permanently reduces any transport service by rail or inland waterway or substitutes.

One of the questions raised here during the previous debate was whether the wording of the Bill was adequate to provide for compensation for railway employees rendered redundant on the closing of a railway station on a line which remained open. It was certainly intended that the Bill should provide for compensation in such cases, but on examining the section there appeared to be some doubt as to whether the wording was adequate to secure that aim. The purpose of this amendment is to put that beyond doubt. The suggestion was that compensation was payable only where a line was closed down. This amendment makes sure that compensation will be payable if any service is closed down, such as a railway station.

We appreciate the intention of the Minister in bringing in this amendment to cover the closing down of stations, as mentioned on a previous stage of the Bill. Since the Minister has that intention, one wonders why he was not more specific in his amendment. I do not know if it is at all clear in the wording of the amendment, which says:—

"Whenever the board ceases to provide or permanently reduces any transport service by rail or inland waterway or substitutes."

It does not mention the closing of stations.

Nevertheless, I give the Deputy my assurance that I have been advised by the parliamentary draftsman that the wording he proposed for insertion in the Bill is quite adequate to ensure that compensation will be payable on the closing of a station or a halt, that that represents a withdrawal of a service.

May we take it therefore that amendment No. 6 which is designed to provide compensation where a station, depot or halt will be closed, is covered by the amendment now proposed?

Amendment No. 4 covers the aim of amendments Nos. 5 and 6 completely.

Amendment agreed to.
Amendments Nos. 5 and 6 not moved.

Amendment No. 7 may not be moved. It is out of order.

Amendment No. 7 not moved.

I move amendment No. 8:—

To add to the section a new sub-section as follows:—

(6) The Minister may by Order extend the provisions of this section to any case in which, within five years after the passing of this Act, the services of an officer or servant are dispensed with or he is transferred to another position because of redundancy arising from any comprehensive scheme for the reorganisation and more economical operation of any department of the undertaking agreed between the board and the trade unions representative of the employees affected by the scheme, and may by Order amend any such Order.

I want to make a statement on this amendment. The effect of it is to ensure that where redundancy occurs otherwise than on the closing of a line or the withdrawal of service, because of a general scheme of reorganisation of any section of the board's undertaking, which produces a permanent lowering in the number of people required for the operation of that section of the undertaking, compensation will also be payable provided there was a scheme of reorganisation agreed to by the trade unions and accepted by the Minister as adequate to justify his making the Order bringing this provision into effect.

I discussed this matter on Tuesday last with the trade union committee which has been dealing with this Bill and they suggested a verbal change in the amendment, to make it clear that the term "any department of the undertaking" would include any category of workers or any sort of subdivision of a department. I am prepared to accept that amendment, as it is in accord with the idea I have in mind.

I raised with them, however, another aspect of the amendment. Since I drafted it, I have had some doubts as to whether it is reasonable to insist that prior trade union agreement should be given to a scheme of reorganisation. It is clear that, irrespective of what appears in this Bill, the C.I.E. management will be entitled, and expected, to examine and act on every possibility of reorganisation which will help to reduce losses. It is undesirable from my point of view— which I think would be the viewpoint of the Dáil—that compensation should be payable only to workers made redundant by such a scheme on condition that the trade unions agreed to it. We all know there are many trade unions catering for C.I.E. employees and in respect of some categories of C.I.E. workers there may be two or three unions involved. One can see circumstances in which one union might agree and another might not and, as the amendment now stands, that may preclude my making an Order to apply the compensation provisions —assuming that the C.I.E. Board decided to go ahead with them even though unable to get complete unanimity amongst the unions.

The trade unions tell me they would welcome the deletion from the section of the requirements of prior trade union agreement and I will move to amend the section further to that extent on the Report Stage.

Am I to understand the Minister as saying that the trade union representatives agree to the deletion of the prior requirements?

They welcomed the deletion. My view is that effective reorganisation, which brings about a reduction of working costs, the carrying on of the railway end of the undertaking upon the basis of employing in it only that number of workers which is the minimum essential for its proper operation, requires not merely a decision of the management that that should be the aim of their efforts but also the assent of the trade union that that is to be the objective of transport policy.

We are in the situation that we are trying to put the railway organisation of this country on a basis which will ensure its permanency, in so far as any human activity can be described as permanent. We are trying to give to the workers who will be employed in that organisation the feeling of security in their occupation which they cannot have at the present time. I have been trying to ensure that that approach to the problems of railway maintenance would be common to both unions and management. Therefore, I was thinking in terms of a joint examination of the possibilities of these economies, and a joint approach to all the problems involved with that objective in mind of bringing the labour costs of operating our railway services to the minimum which efficient operation would permit. I think that is essential.

I have recognised since I started to prepared this amendment, following on discussion with trade unions concerned, the difficulty which would be experienced in any trade union executive where they had formally to agree to an arrangement which would involve redundancy for some of their members. Therefore, I shall not insist on formal agreement, but I think agreement should be the aim, that this joint approach should be made, and the two parties to the industry should get together with a view to working out arrangements which will bring about that lowering of costs.

The trade union representatives said to me that that, of course, implied there should be consultation between the management of C.I.E. and the unions in relation to these matters. I accept at once that implication of emphasis upon the desirability of a common approach. Agreed action does imply consultation and I do not see any difficulty in ensuring that that consultation will take place, and that the effort will be made to get whatever reorganisation measures are possible brought into effect with the goodwill of all concerned, provided, of course, there is that common recognition of the need to reduce losses on railway working, if railways are to be preserved as an integral part of our transport system, and if those who are employed on railways are to be given that security of occupation which at present they do not have. I, therefore, move this amendment in its present form but will move its further amendment in two respects on Report Stage —the reference to departments of the undertaking to include categories of workers as well as departments, and to delete that requirement of prior trade union agreement to reorganisation schemes.

There is a difficulty which will emerge in that regard and which perhaps I should mention now. I am thinking of reorganisation schemes prepared in advance, schemes which will reduce the operating costs of C.I.E. by more than the costs of compensation to the workers who may be made redundant. There must be a gain by reason of the reorganisation scheme, and it may be necessary for me as custodian of public funds in this regard to make sure that the casual type of redundancy which inevitably arises in a major organisation employing 20,000 workers will not be passed off as a reorganisation scheme, and that purely temporary reductions in the volume of work will not be so regarded either —reductions in the volume of work which in a railway undertaking may mean redundancy now and re-employment of workers at a later stage. The type of reorganisation I have in mind is one that will have permanent consequences on the board's finances, and where the saving in costs will be such as to justify the putting on the taxpayers of this country the obligation to pay the generous compensation which is provided in this Bill to workers who may be made redundant.

It would be unreasonable to provide compensation for the closing of lines and not to provide it for methods for working the lines as economically as possible. I do not claim to be a transport expert. Supposing there was a branch line railway which was losing money and which was employing 40 workers. Supposing C.I.E. said: "We cannot make that line pay, we think it can never be made pay"—that would mean 40 workers would be redundant. They would be entitled to compensation under this Bill as it stands, but if C.I.E. said they can keep that line open by employing only 30 or 25 workers, as the Bill stood the ten or 15 workers rendered redundant would not be entitled to compensation, but under this amendment they would be entitled to compensation.

It seems to me there are three prerequisites for the prospect of a successful railway undertaking in this country. The first is competent management, the second co-operation between that competent management and responsible trade unions, and the third the need for public support to maintain railways as part of our transport system. It was my experience in the Department of Industry and Commerce that trade unions catering for railway workers constantly complained about the frustration which they experienced in trying to get consultation with C.I.E. That situation reached a stage in which I felt it necessary to assemble the directors of C.I.E. and put to them the need for close consultation with trade unions in order to bring about a better spirit and better climate of understanding than appeared to be then present.

I found the trade unions suspicious of C.I.E. management and I felt and said that as long as an atmosphere of that kind continued it was not possible to get the best out of management, on the one side, and the best out of trade unions on the other. Standing back and looking at things objectively I always felt there were good grounds for the trade unions' feelings that they were not able to get frequent consultation, the open-hearted consultation, which they desired with C.I.E. management. This is not the time to apportion responsibility for that.

What we ought to do is make up our minds that in future that kind of atmosphere will be eradicated and that the management of C.I.E., under this Bill, must be encouraged to carry the trade unions with them in their activities to present a better, more efficient and more economic transport system to the country. Anything the Minister can do in that respect or anything the House can do in that regard to bring about the utmost co-operation between unions and management, which is so essential to provide more economic transport services than we have had in the past, will be welcomed. It is absolutely essential in any reorganisation such as C.I.E. contemplate that the maximum measure of co-operation should exist at top levels.

I concede at once, however, that there are big difficulties in regard to such consultation in C.I.E. There are very large numbers of trade unions catering for a whole variety of workers, and when they all attend a conference it can become quite formidable. Formidable conferences of that kind comprising people with different sectional interests do not make agreement easy. It is because you have that hybrid character of organisation on the trade union side that need for consultation and carrying them with the management is more necessary than if you have got to deal with a single organisation in a single industry.

I do not think C.I.E. have shown very great talents for managing the peculiar difficulties inseparable from that type of trade union organisation, experienced in the railway system, which takes the form of a very large number of unions. In Britain and other countries they have resorted to the idea of the working party as a kind of management-trade union combination which studies proposals affecting the industry and services. These have been responsible for very valuable reports and have been responsible also for injecting a new understanding and a new sense of responsibility into management on the one hand and the trade unions on the other. It might be well worth while getting that position examined so that some kind of committee could be established, representative of management and the trade unions in the railways, to try to give the community a better service, to try to make the undertaking more economic than it is and, at the same time, to try to make railway employment more stable and wages and conditions better than they are at present.

Railway wages and conditions are by no means ideal and it could be very well argued that C.I.E., apart from getting subsidies in the form of cheques from the public purse, is also getting a subsidy in the form of low wages and unsatisfactory conditions so far as the workers are concerned. The trade unions have a natural interest in building up an efficient transport service because it ought in the long run mean better conditions and wages, a better service for the community and taking off the backs of the public the constant liability of providing substantial subsidies for the maintenance of the undertaking.

I do not think a railway system can live in a healthy climate when it has to have these frequent financial injections to the tune of £1,000,000 or £2,000,000 a year, not do I think it conducive to the growth of harmony and efficiency that there should be these frequent financial, surgical operations on C.I.E., when capital is written down and large slices of assets written off. Anything which gives C.I.E. some form of freedom from these constant financial convulsions would bring about a better atmosphere for the operation of the undertaking.

I am at one with the Minister when he accepts the principle that there should be full co-operation between the trade unions and the management. That should be put strongly to both sides. It is essential that the management should carry conviction to the unions that what is being done is done with a view to promoting a better transport service in which the interests of those who operate the service will be a matter of considerable importance to those responsible for those operations. With co-operation between the management and the trade unions, I could see a much better future for C.I.E. than if the feeling of discontent, distrust, and frustration continued on the scale which I experienced in my relations with C.I.E. and the unions catering for these workers. I hope the Minister will emphasise that the community expects that consultation to take place and that be will be able to create a climate of co-operation and understanding which, as I said before, must in the long run pay dividends to the workers of C.I.E. and to the community at large.

I spoke a moment ago of the abracadabra which transport companies try to build up in order to puzzle everybody and make their whole system of accounts a mystery. I agree with what the Minister and Deputy Norton said but I think there is another side to the story in regard to labour relations. I agree with the Minister and Deputy Norton that in this day and age in which we live no substantial enterprise can be successfully carried on without full understanding between the management and the trade unions representatives of the men. I think the trade unions are an indispensable asset to a well managed firm provided all parties are prepared to act reasonably. When Deputy Norton came to analyse the difficulties of conducting labour relations with the employees of C.I.E. he adverted to a fact to which I think the Trade Union Congress ought to address their minds. It is extremely difficult to maintain satisfactory trade relations if, at every conference you call to discuss them, there are 15 or 16 trade unions all appearing to represent the employees of one enterprise.

People are human and if you have 15 or 16 trade unions it is quite likely that one trade union will bargain with another trade union to this effect: "If you will help me to get the concession I want, I will stand with you to help you to get the concession you want." You have practically no firm basis on which to conduct intelligent and genuine negotiations with the trade unions representing the men. I think that situation developed in the engineering industry in England to a point in which a step had to be taken to try to get some joint body to represent all the multifarious sections and negotiate for them. Unfortunately, in England the Communists have got control of that particular body but the fact that the Communists have got control of that body does not invalidate the principle that if you have a group of decent unions, which being craft unions are small and numerous, amongst the personnel of the staff of a body like C.I.E., they could make a great contribution to the kind of improved labour relations to which Deputy Norton referred.

They could combine all the trade unions into one plenipotentiary negotiating committee. If the unions would take that step then I think this House and the Government could say with much stronger conviction to the management of C.I.E.: "We will hear with dismay and strongly disapprove of any failure on the part of the management of C.I.E. to establish satisfactory labour relations with the employees of C.I.E." Until there is such a plenipotentiary body representing the multifarious body of craft unions that cater for the employees of C.I.E. I think it is not fair to throw all the blame for misunderstandings that may have arisen and distrust that may exist between the trade union members on the management of C.I.E. I am quite certain that distrust and misunderstanding are not desired by the management of C.I.E. I cannot conceive of any manager wanting to function on a basis of distrust of his own employees. It is a matter of the utmost possible satisfaction for anybody administering a business large or small to arrive at a stage when there is an atmosphere of mutual trust not only between the individual employees and management but especially between the trade union representatives of the employees and the management.

I could expatiate on that at some length but I emphasise that it is of peculiar satisfaction to a management to feel that they are on terms of mutual confidence with the trade union representatives of their employees. I do not think it possible for C.I.E. or anybody else to arrive at that happy stage so long as they are required to negotiate with 16 or 17 trade unions all of whom claim the right to be represented at any general conference to discuss conditions for the whole body of employees of C.I.E.

I should be interested to hear from Deputy Norton, if he felt free to say so, whether there is any hope that the Trade Unions Congress or the Congress of Irish Unions would be able to promote some plenipotentiary body which would represent the unions catering for the workers of C.I.E. so that responsibility might be squarely fixed on the right quarters for good trade relations in the future. That is the first point.

The second point which arises on this amendment is the whole question of redundancy. I want to submit to the House that compensation for displacement of a worker from what he has regarded as permanent employment after the worker has passed the age of 35 or 40 years is impossible. There is no use giving a man of 43 or 44 years of age, who has spent 25 years of his life in the railway company, a lump sum and telling him to go out and do the best he can. Some of them may scramble into alternative employment but a considerable number will get no employment.

Suppose you were approached tomorrow by a man who has been 25 years a railway porter, a worker in a machine shop or something of that kind; that he was 43 or 44 years of age and was looking for a job and for the same job you had applicants who were 22 years of age, malleable fellows who could fit into the organisation and take their place in the ordinary hierarchy of seniority, who is going to choose a man of 43 or 44 years of age and give the job to him?

I think people do not appreciate the immense hardship it is to disrupt a man's life, particularly when he has arranged his whole family affairs on the assumption that he has permanent employment of a specialised type and to come to that man in middle age and say: "Look, there is a lump sum; go out and start life over again." I do not believe any man can do it. I do not believe you would ask a doctor at 42 years of age to look for work as an engineer or a lawyer or turn his hand to something completely new at that age and believe he would have any prospects of doing it. It would be easier in a learned profession to do it that it is in a trade or craft such as the employees of C.I.E. fill.

I want to impress upon the Minister that far from encouraging anybody to deal in terms of redundancy and compensation, all the pressure ought to be on the railway company and on the trade unions to avoid redundancy altogether. By that I do not mean sitting down and saying that the existing number of men must continue to be employed no matter what the services are. What I mean is that there retires from the service of C.I.E. a certain number of men. That ordinary annual retirement would very quickly effect a reduction in the total staff employed by C.I.E. if recruitment were suspended.

I know that means a good deal of adjustment and a good deal of co-operation, between the unions on the one hand and the management on the other, in order to fit redundant men into alternative jobs in the railway set-up but it can be done. I would not hesitate in endorsing an arrangement whereby, if redundancy arose, and you had a man declared redundant who is entitled to £8 per week and the only vacancy available was in a post which ordinarily carried a remuneration of £6 5s. I do not think it ought to be impossible to say to that redundant man: "You will work at the £6 5s. job but we will continue to meet your present scale of pay until you graduate out of the railway service" rather than say to him: "There is a lump sum. Now you are 47 years of age, go and find another job."

That is fully provided for.

That is provided for in the Bill.

As far back as 1950 I understood in any case that recruitment by C.I.E. was virtually suspended and that this device to which I refer was to operate. I remember Deputy McGilligan, who was then Minister for Finance, speaking very strongly on the unspeakable hardship it was on a man in middle age to have his whole normal career disrupted and an illusory compensation handed to him. But although that understanding was arrived at, I never saw since the slightest evidence of that scheme being put into operation. As far as I could see, C.I.E. was daily recruiting staff every year on much the same scale as they recruited it in the past. Has the Minister himself seen any evidence of an attempt to absorb staff in the way outlined by me or has he not been struck by the fact that the recruiting of staff seems to go on cheerfully? Far from suspending and manning vacancies by redundant staff we are building up a staff all the time.

One of the most striking things in the Beddy Report is that it takes almost exactly the same number of clerical employees in the service of C.I.E. to-day to look after the operations of the railway company, the total employment in which has dropped by 4,000 since 1928. The clerical staff seems to be rising steadily or certainly to be maintained. However, the operation of that scheme to avoid redundancy is quite impossible without the active co-operation of the trade unions, and if trade unions do not agree with the view I express—and I suspect they do —there is no prospect of getting it to function satisfactorily.

If we could get the co-operation of all the trade unions I believe we could avoid men being thrown out with compensation and secure for them enduring employment up to the normal end of their term. At the same time, we might get from the Trade Union Congress some method of avoiding the difficult situation mentioned by Deputy Norton in which you have 16 or 17 unions all represented in the conference room, with one board of directors or management trying to arrive at a basis of mutual confidence with them all, which as far as I know in my industrial experience is a virtual impossibility. If you are dealing with one body of plenipotentiary trade union delegates who are reasonable men, it is possible to achieve that basis of confidence which is the principal desire of the management of any enterprise, large or small.

I cannot claim to put the trade union point of view, but I should like, from some experience in negotiations at particular times, to put an aspect of the points raised by Deputy Dillon which should be taken into consideration. The first point is that we have a big number of trade unions. We must work from the existing scheme of things and take that aspect into account. It is a case of safety in numbers because if there are various craft or trade union organisations working in a system like C.I.E. and they have the prospect of direct negotiation or consultation so that they can report the exact result of conferences to their members, who are the people affected, and each craft can put its own viewpoint to the management, there is a better chance of retaining the confidence of the members and, in many cases, of avoiding disastrous fightning strikes which occur very often because the people affected feel that they have not available to them direct negotiation for the remedying of grievances. From that point of view, the fact that each craft is represented is a safety valve in negotiations. That has been my experience. It is a desirable thing.

It would take some time to achieve what Deputy Dillon has suggested. It might be ideal, if it could be achieved, but it is practically impossible at the moment. We must, then, take the units that are there and deal with them and with their grievances and try to give them an opportunity of negotiating through their own representatives. That is the first point raised by Deputy Dillon. His suggestion is ideal but is unattainable at the present time, with the existing scheme of organisation.

Redundancy is always a very difficult problem. It must be dealt with. It is through the goodwill of the trade union leaders and their various representatives, the confidence that their members repose in them and the attitude in which representations are met by the management that will bring about the desirable results which the amendment proposed by the Minister is designed to achieve.

There is a first prerequisite to negotiation, that is, to put the undertaking in a sound and healthy condition. Up to the present time, C.I.E. has been dragging on year after year, as Deputy Norton says, with doses of financial assistance. That created an atmosphere in which there could not possibly be useful and healthy co-operation between management and workers. The first thing this House, through the Minister for Industry and Commerce, must do is to show the trade unions and their representatives that C.I.E., through efficient management and the co-operation of its employees, is in a position to run the national transport undertaking efficiently and economically.

I am quite certain that if the workers see that the undertaking has a reasonable chance of success, that their employment is secure and the opportunity of earning a decent living assured, they will co-operate with the management. It is quite impossible to expect more than a limited degree of co-operation between management and labour where the undertaking cannot be run efficiently and economically. It does not matter what business it may be, if labour and management get the impression that they can carry on only as a result of charitable donations and a low standard of wages for the workers, there can be no co-operation between the two arms of the undertaking.

Putting first things first, the first task of this House is to see that C.I.E. is given a chance to pull its weight and to be efficient. Thereafter, there is a good deal to be said for Deputy Norton's suggestion. A working party or joint industrial council or, perhaps, a series of industrial councils, if it is not possible to have one group catering for all trade unions, would seem to be a very feasible way of ensuring co-operation between management and workers. The first prerequisite is to show the workers that the management, first, are in a position to run the undertaking and, secondly, are competent to run it efficiently. That is why I suggest, putting first things first, that the House should apply itself to ensuring that this scheme, either in its present form or in an amended form, will go through.

The question of compensation is always a difficult matter to assess. There is a good deal to be said for Deputy Dillon's point of view. It is very difficult, particularly in the circumstances of our country, to take a man in middle life out of a position he has occupied for perhaps 20 years and expect him to get alternative employment. The only possibility I see is that, in the general reorganisation, assuming that C.I.E. will engage more actively in road transport as opposed to rail transport, men who are redundant on the railway will be given an opportunity of equal employment in the new developments. We must face the fact that there is bound to be some redundancy. In all justice, those who are declared to be redundant are entitled to fair compensation based on two things—length of service with the company and the age at which they are obliged to leave the company's employment.

It is unfortunate that C.I.E. have successfully created the impression that, because of the multiplicity of unions within the organisation, any form of joint consultation or co-operation is well-nigh impossible. They appear to have successfully sold that idea to very many people. We know, of course, that even in this country there are industries in which there are almost as many unions catering for the various workers as there are in C.I.E. and where there appears to be no such frustration in the minds of the employers or employees regarding labour relations as exists in C.I.E.

Does it not strike people that the unions catering for workers in C.I.E. are continually complaining about lack of co-operation and the need for joint consultation when the same unions have no such complaints about transport undertakings such as the Ulster Transport Authority and the G.N.R.? The same problems arise, the same types of workers are employed, the same grades of workers are employed and there is exactly the same number of unions catering for workers in each of these transport undertakings as in C.I.E. Yet, the trade unions have not at all the same complaints to make regarding co-operation and joint consultation with the G.N.R. and the Ulster Transport Authority as they have in regard to C.I.E. Is it not rather significant that, down through the years, the trade unions have had to say that they were not being treated as they should be treated by the management of C.I.E.?

In the Beddy Report, it is stated that there was a regrettable absence of friendly co-operation between the management and the trade unions. Quite obviously, they appreciated that it was essential in the running of a successful transport concern to have that co-operation. Apparently, C.I.E. in their submission, had stated that the unions connected with C.I.E. were interested only in rates of pay and conditions of service and that in no way were they anxious to co-operate in the management and the good running of the concern.

It would be no harm to keep the record straight in this regard. The impression has been created, that perhaps it is the trade unions' fault that we have not had this co-operation and that we have not had successful joint consultation in the railway industry. As far back as 27th August, 1956, the Provisional United Trade Union Organisation wrote to the then Minister for Industry and Commerce and pointed out to him a long series of complaints and grievances which they felt had militated against the efficient running of C.I.E. and against the harmonious relations that should exist between them and the management. The Minister at that time called a meeting, presided over by the Secretary of the Department of Industry and Commerce. At that meeting, both sides freely accepted the principle of joint consultation, and all that had to be done was to set up the necessary machinery to implement that principle. That was in August, 1956. It has not yet been set up.

Who failed to set it up?

Perhaps it would summarise the matter for the Deputy if I quote a letter which the Provisional Trade Union Organisation wrote to the Minister subsequent to the issuing of the Transport Committee's findings, and which I already quoted at column 1496, Volume 164, of the Official Debates of 5th December, 1957:

"On the 22nd August, 1956, the secretary of the Provisional United Trade Union Organisation wrote to the then Minister for Industry and Commerce drawing his attention to the series of complaints and grievances which had been brought to its attention and which militated seriously against achieving improved efficiency in C.I.E. and harmonious relations between the board and its employees. At a meeting convened by the Minister and presided over by the Secretary of the Department of Industry and Commerce, held on the 2nd October, both sides agreed to accept the principle of joint consultation between C.I.E. and the staff through the provision of regular means of consultation between the management and the staff and affording opportunities for co-operation ... The official statement issued after the meeting stated that the management would take all possible steps to implement this principle of joint consultation and that both sides undertook to approach the concept of consultation in a spirit of harmony and co-operation.

It was not until the 24th November, that the chairman of C.I.E. requested the Provisional United Trade Union Organisation to appoint representatives to discuss with the board the way in which the question of joint consultation should be approached. A meeting for this purpose was held on the 11th December at which the chairman of C.I.E. outlined the board's view as to how joint consultation should operate and the machinery necessary to this end. On the 12th February, 1957, the Provisional United Trade Union Organisation wrote to the chairman of C.I.E. requesting that discussions with the unions concerned with the setting up of joint consultation machinery for rail operative and rail shop grades should commence as soon as possible, but it was not until the 10th April, that a meeting for this purpose was convened by C.I.E. At the meeting the trade union representatives set out at some length the unions' proposals on joint consultation and a document incorporating these proposals was submitted to the chairman at that meeting."

That was 10th April, 1957. The joint consultative machinery has not been set up since, despite the fact that on all occasions the unions have displayed their desire to set up that machinery. It was through their initiative that the Minister at that time called the meeting between the trade unions and the management for the purpose of setting it up. Right down through the years, the present Minister and the previous Minister will agree, there has been a series of complaints from the trade unions regarding this notorious lack of co-operation and consultation between the management and the trade unions.

Perhaps I can illustrate my point in this way. We are in this House to-day discussing a Transport Bill which provides, amongst other things, for compensation for workers who become redundant because of reorganisation. On last Saturday, Whit Saturday, a group of C.I.E. workers were called before the boss and told that because of the reorganisation, as and from 1st June next, they were being reduced in grade and their pay was being reduced accordingly. I understand that a similar group in Limerick received the same message, on Whit Saturday, when it was impossible for them to contact their trade unions over the week-end, at a time when this House was discussing what compensation might be payable to them in such a case and without consulting the unions in any way. They were only a small group of nine or ten people, but it illustrates the manner in which labour relations have been handled from day to day right down through the years by the management of C.I.E.

I am glad to know that the Minister and everybody in this House are unanimous that there should be joint consultation and better co-operation towards harmonious working between the two sides of the industry, but from past experience I have my doubts whether it is sufficient for us all to express these sentiments and whether it will even suffice for the Minister to urge this joint consultation. It is not much use accepting a principle, if the principle is not implemented. I do not think it is possible to write into the Bill an obligation on the management of C.I.E. to set up some definite joint consultative machinery between the management and the staff, but if it were possible to write it into the Bill, I would certainly wish it to be written into it. As I say principles are accepted, but not implemented and labour relations with C.I.E. down through the years have been notoriously bad, and it is significant that the unions have no such complaints to make regarding other transport concerns where they cater for the workers.

I wish to support the views expressed by Deputy Casey and Deputy Dillon regarding the joint consultative council and also in relation to redundancy. I shall take the joint consultative council first. Such a council is long overdue. I have had the personal experience of acting as chairman of a body charged with the solution of disputes between C.I.E. and at least 12 trade unions. I must admit that the delegates from the trade unions gave me, as chairman, every co-operation in my endeavours to hammer out a reasonably good solution. I am sorry to have to state that I did not get the same co-operation from a member of the C.I.E. management. Most of the members of that management are all right, but the particular individual to whom I refer did not co-operate.

The present Minister, his predecessor and other Ministers for Industry and Commerce spent much time trying to bring about harmonious relation in an endeavour to make C.I.E. a paying proposition. The livelihood of the employees of C.I.E. depends upon their employment in C.I.E. I do not know any employee of C.I.E. who would do anything which might jeopardise that employment. There is urgent necessity, however, for establishing harmonious relations and goodwill between employees and employers in relation to C.I.E. Some lead should be given in that regard. I do not like to be uncharitable to anybody. Unfortunately, my own experience has been that, instead of goodwill, I was faced with opposition. Self-appointed dictators should be sent to some kind of school to learn something about human relations.

I have come up against the same kind of thing in concerns other than C.I.E. This is a small country and there is no reason why we should not have goodwill and a common understanding between employer and employee. I have a great respect for the majority of the members of the Board of C.I.E., but one unworkable cog in a machine will upset all the works. It is most disconcerting to find oneself up against an individual who, when one is trying to hammer out agreement, will take it upon himself to say: "You can go to hell, or wherever you like." It is only in this House that we have an opportunity of ventilating that kind of experience and publicising what we think of such individuals.

There is very little use, as Deputy Casey has said, talking about setting up joint consultative councils if we do not have people of goodwill on both sides. It has been my experience that, provided one shows goodwill, one will find a reasonable approach. There is good in every organisation. Redundancy can cause a lot of hardship and it is in relation to redundancy that we shall need a joint consultative council. There will be, of course, the normal wastage that takes place in all big concerns. No man who has given long and faithful service to C.I.E. should be made to suffer. He should not be dismissed with a paltry pension in recognition of that faithful service. He should get a full pension. Otherwise, he will be looking for home assistance.

The Minister has spent years trying to solve the problem of C.I.E. He has spent years in consultation with experts, with C.I.E., with the trade unions and all others concerned.

Strangely fruitless years, it may be said.

Deputy Burke has a kind word for everybody.

Except for the bloodstained dictators who have not yet been identified.

Were it not for the present Minister, there would be no railways in this country to-day.

The Deputy will make the Minister blush.

I do not blush so easily.

The Deputy will make the Minister break down if he continues in that strain.

I listened to Deputy Norton quite silently. Redundant employees with long service should get full compensation and they should not be dismissed without consultation with the trade unions concerned. If at any time the Minister finds this joint consultative council is not working properly, then he can nominate people competent to bring both sides together to find a solution for any difficulties that may arise. A number of C.I.E. employees live in my constituency. I am familiar with their grievances and many of these grievances could be eliminated by goodwill and a common understanding as between management and employees.

I must pay tribute to the present labour relations officer. He is doing an excellent job. I have found him courteous, co-operative and helpful. It is men of his calibre we want if we intend to make a success of C.I.E. The lead must come from the top. Those who fail to follow the lead can be dealt with, and anyone who does fail is not worth his salt. An honest effort must be made and where there is an unworkable cog in the machine that cog must be replaced. I trust the points I have raised will get sympathetic consideration and I endorse the sentiments expressed by the two previous speakers.

Before Deputy Kyne speaks, will he tell me how many unions cater for railway workers?

In round figures, 18 or 19. I appreciate that the amendment brought in by the Minister is an improvement on the Bill as introduced. This amendment is the direct result of talks with trade union representatives and the Minister's proposal to further amend on the Report Stage had the agreement and approval of the trade unions. It is understandable, as the Minister has explained, that the trade unions would find themselves in a very awkward position if they had to openly, if you like, agree to the dismissal of workers in relation to schemes of reorganisation. I suggest that events which occurred in Cork and Limerick on Whit Saturday give cause for reconsideration. On Whit Saturday ten or 12 men were reduced both in status and in wages on the mere statement of a superior officer without any consultation with a union. As Deputy Casey pointed out, that was done at a time when the employees concerned could not get in touch with the union. That kind of action gives unions second thoughts.

I suggest that, prior to a further amendment on the lines indicated on the Report Stage, it might be desirable for the Minister to meet again the representatives of the unions and discuss the matter in the light of what happened over the weekend. I appreciate, and the unions appreciate, that this was not a scheme of reorganisation which would come within the scope of the particular amendment. It is obvious that there is a general fear that co-operation will be lacking. Irrespective of whether or not trade unions will be formally asked to agree to reorganisation, I suggest a further amendment to make it clear that, before any reorganisation takes place, the unions must have knowledge of it, even if they are not asked to give prior consent to it.

This Bill is to a large extent based on hypotheses. I suppose, because of its very nature, it has to be so based. One thing that has struck me very forcibly is the degree of realism reached in the course of the discussion. We cannot close our eyes to the fact that C.I.E.'s biggest liability is redundancy. Anybody using the C.I.E. system between here and Cork cannot but be struck by that obvious feature. It is apparent in every station along the route. Deputy Dillon mentioned a simple solution and one worthy of consideration. It is gratifying to find Labour representatives here who would apparently be quite satisfied with some arrangement on the lines suggested, namely, a negotiating committee to consider the problem. What amazes me is that C.I.E. did not themselves advert to that possibility over the years.

It is wrong to recruit young people into C.I.E. at the moment. Any vacancies that occur should be reserved for redundant employees. They should be diverted into these vacancies with a guarantee that they will not suffer financial loss or personal inconvenience. Possibly some amendment along those lines could be enshrined in this measure. If the railways are closed, then alternative transport will have to be provided and it should be possible to absorb redundant employees into such alternative transport.

The Minister's announcement that he is prepared to make certain changes is welcome particularly in so far as he has indicated that one of the changes to be made will ensure that those affected—not just by the closing of the branch lines but by reduced working on the branch lines— will not suffer. I take it reduced working in any section will come within the scope of the Bill as a result of the Minister's amendment.

On the question of consultation, it is important to have, and it would be valuable to insist on, the prior agreement of the trade unions as far as workers becoming redundant are concerned. He has indicated that he expects C.I.E. will be in constant consultation with the trade unions in relation to reorganisation. One remark made by the Minister caused me some concern, particularly in view of the information that Deputies have given the House in relation to the manner in which C.I.E. management can operate without consultation or without any prior notice.

The Minister stated that, in general, the Bill was to deal with the position of workers who become redundant because of the introduction of a comprehensive scheme. He said he could visualise, however, conditions under which there might be redundancy in some sections, due to a reduction in working, and in such circumstances he felt it would be his responsibility to ensure that the workers affected would not get the protection of this Bill. I would ask the Minister to consider that position again. It is possible that the operations and decisions of the board might lead to redundancy which, on the face of it, might appear to be casual, but which in fact would be of a permanent nature.

I was very interested in Deputy Dillon's brief advice to the trade union movement as to how they should conduct their affairs. It appeared to me to come strangely from Deputy Dillon who, I have always gathered, is the advocate of the individual in this House. He suggests to members of trade unions, who have a deep personal concern with the operations of C.I.E., particularly when those operations might result in their becoming redundant, that they should pass over their rights and responsibilities from their own officials and committees to a plenipotentiary committee. Deputy Dillon makes everything very simple indeed. I do not know whether Deputy Dillon has ever attended a conference with a large number of representatives, either of trade unions or of employers. The fact that there are 17 different spokesmen does not necessarily mean that 17 different points of view are expressed at such a conference. It often means that, although 17 different bodies are represented, the representatives of which have the duty to report back to their own organisations, there may well be only one effective point of view put forward.

The difficulty of disposing of problems between management and workers within the C.I.E. organisation is not because there are 17 unions but because on the other side there is a reluctance to invite and welcome the active co-operation of the 17 unions representing all grades in C.I.E. If the management of C.I.E. were prepared to have normal negotiations and consultations, I feel there would not be any great difficulty arising from the fact that the workers of C.I.E. are in a number of different organisations. The Minister can testify to that himself. In respect of certain clauses in the Bill, he had discussions with the trade unions, and, through them, the C.I.E. workers, and I do not think he had seven, eight or 15 points of view put forward to him. If the powers that be in C.I.E. would follow that example, there would be much less trouble.

We realise that the question of redundancy is a very serious matter for any individual worker, no matter in what part of C.I.E. he is employed. I think it is fair to say that if it were reasonably possible to ensure the operation and development of C.I.E. on the basis of keeping all those workers in full-time employment, it would be welcomed here by every Deputy. Deputy Dillon suggested that recruitment should be stopped. He said that a number of employees would be due to go out on reaching pension age, thus leaving gaps which should be filled, not by recruitment but by transferring workers from the various grades.

That suggestion might be examined, but I think there would be quite a number of difficulties and problems to be faced. You are not dealing with a very simple organisation. There are specialists in the various grades, the signal grades, clerical grades and the road undertaking. There are craft workers in a number of these grades who have reached their present position because they have served their apprenticeship to their trades. I am sure the Minister realises quite well that it would be difficult, if not impossible, in the case, say, of a redundant checker, porter or linesman, at a time when there was a demand for a skilled craftsman, to transfer such an unskilled or semiskilled man into that category.

The same position could occur in connection with, say, the signalman. There are so many separate and distinct grades in the service that it would not be easy to make this transfer. Certainly, in proposing to adjust matters by way of such transfer, the representative unions would be involved and consultations would have to take place at I think all levels.

The Minister must be aware of those difficulties and I do not think it necessary to point them out at any great length. However, if it were possible to maintain the employment of as many of the existing employees of C.I.E. by that means, at the highest level, the very fact that the Minister brings this matter before us in this Bill would make it appear that he visualises that, even so, there is inevitably bound to be some redundancy arising from a change in methods, a change in services and a change in operations and that, therefore, this Bill is to deal with the situation of workers affected by such changes.

With regard to the amendment, we welcome the Minister's indication that he proposes to make some changes that will widen the scope of and give protection to further sections of workers. Again, I suggest that the importance of more active steps by the management of C.I.E. to obtain the co-operation and assistance of the trade unions should not be overlooked. I have no doubt but that, if C.I.E. want co-operation and assistance, they will get the whole-hearted co-operation and assistance of the various trade unions representing workers in the concern.

Amendment agreed to.
Question proposed: "That Section 13, as amended, stand part of the Bill."

This section provides for the payment of compensation to employees who become redundant because of the switch-over from steam to diesel traction, the closing of a branch-line or now, as the section is amended, reorganisation. Such compensation is payable only if a person becomes redundant for any of these three reasons within five years of the passing of the Act. I am at a loss to know why the five-year stipulation should be here. From the discussion we have had so far on the Bill, it is quite apparent that none of us think all the worries of C.I.E. will have passed in five years' time. The general view appears to be that in five years' time, while we all hope and expect that very great improvements will have been made and that C.I.E. will be well on the way towards the goal of being able to provide a proper transport system economically, very few of us feel they will have completed the task at the end of that period.

As the section stands, anybody who becomes redundant for any of these three reasons within the five years gets compensation. Anybody who becomes redundant, arising directly out of the closing of a branch line or reorganisation or dieselisation after five years, according to this section, gets no compensation at all. It may well be that a particular branch line may be quite economic for the next five years and that C.I.E. will leave it open. However, there may be changing circumstances. Some circumstances may be brought to bear on the situation in five years which will make that line uneconomic and C.I.E. may be forced to close it. According to this section, people who become redundant on the closure of that branch line get no compensation because they did not become redundant within five years of the passing of this Bill, when enacted. I am at a loss to know why the five-year stipulation was put in there. I would ask the Minister to have another look at it between this and the Report Stage to see if he cannot qualify it in such a way as to cover people who would become redundant because of circumstances such as those I have mentioned.

We are saying to C.I.E.: "We expect you to make an effort during this period of five years to get the undertaking on to a basis where it will have eliminated losses and be able to continue to operate in an economic way subject only to such fluctuations as may arise from time to time because of changing conditions." We are also saying to C.I.E.: "If, in the course of that reorganisation effort, you find you have to reduce permanently the number of persons employed on railway operation then we will not merely legislate to ensure that these persons will have a right to compensation on quite a generous basis compared, say, with the compensation payable in similar circumstances to employees in other public services but, also, we will place the whole cost of that compensation on to the shoulders of the taxpayer."

I am not saying that, at the end of five years, there will not be a compensation scheme. I do not contemplate, however, that it will be a scheme which will involve making the taxpayer meet the cost. I should hope that, at the end of that period, C.I.E. themselves would be able to carry the cost of any further compensation arrangements relating to redundancy which might then be considered necessary. Indeed, it would I think be a normal practice in an organisation of this size to deal with any such problem, if it arises at all, through the normal wastage which occurs.

This particular scheme of compensation—that is, compensation at these rates, the full cost of which will be carried by the taxpayers of the country —is a five-year scheme. I am not saying there will not be any compensation scheme after that but, at that stage, if the reorganisation is completed, the idea should be that we should get back to a more normal arrangement under which the cost of any future scheme of that kind would be a charge borne upon the company's funds and not by the taxpayer. These are special arrangements applicable to this undertaking and no other undertaking and applicable to this period only. We can justify it to the taxpayers on the ground that in the long run they will also save provided the reorganisation is completed and the losses are eliminated.

When the reorganisation is completed and, as I hope, C.I.E. is established on a more secure economic basis then we can consider the legislation that may be necessary—if it is requisite at all to cover that in the future—but at that stage I would contemplate that the compensation provision for future redundancy of any special character would perhaps, say, be related more to that of employees in the Government service and particularly that the cost would be a charge upon the company and not upon the taxpayer.

I appreciate the Minister's point of view. I am glad to hear him say he visualises compensation for people who will become redundant even after the five-year period. I think it is not unreasonable to say that compensation should not be payable by the taxpayer but should be put on the shoulders of C.I.E. I think it is right that after the five-year period they should be charged with the expenses of redundancy but does the Minister not think it would be desirable to write that into this Bill—that the State would carry the compensation for five years and that subsequent redundancy which would arise after the five-year period would be charged to C.I.E.?

That implies a little more optimism than I have. My view is that we should give C.I.E. aims and powers to make their position better within this five-year period. If at the end of five year we find the effort has failed, we could contemplate such an arrangement as has now been introduced in the Six Counties, the revision of the whole of transport policy, and we could not contemplate the burden of any compensation being imposed on whatever transport organisation would be left at that stage. I am hoping that we will see an economical transport system in operation which can look after its affairs from that on, but if it should be the reverse situation, it seems to me likely that Government financial help will be needed to deal with it.

There are two objectives I have in mind and I do not want any of them put on the long finger. I am saying to the company and to the trade unions that, provided they tackle this job in the five-year period, we taxpayers will help; we will give the redundant workers generous compensation but, if it goes beyond the five-year period, we will have to have another look at it. However, the situation at the end of that time may be all right and we can go back to the normal practice of putting these charges on the company. On the other hand, it may be the situation that this programme may not succeed and we will have to think in a more fundamental way about our transport policy.

The whole idea of the Bill is that within the five-year period they should make these efforts and it is to everybody's advantage that they should be made. I do hope that at that stage the burden of compensation will be one for the company. It may be at that stage that the compensation arrangements will be less generous than those contemplated in this Bill. We are giving inducements to everybody to start tackling this job as quickly as possible.

Decisions may be taken during any stage of the five-year period which may result in employees of the board becoming redundant. Has the Minister visualised that in the fifth year decisions may be made by the board to close down a branch line but the workers would not be affected until the sixth year?

The Deputy will appreciate that as it stands the company, the unions and everybody concerned, would have every reason to try to get decision completed during this five-year period. If the company were going to close down a branch line they can say: "Provided we close it down within the five-year period we will have this compensation charge transferred from our funds to the Exchequer," and the unions can say: "If we co-operate in getting the thing done in that period we will make sure our workers will have a statutory right to compensation." I admit we cannot allow decisions to go to the last stage, but if we decide to continue this arrangement a very simple one clause Bill would do it.

Question put and agreed to.
SECTION 14.
Question proposed: "That Section 14 stand part of the Bill."

Amendment No. 9, in the names of Deputy Casey and Deputy Larkin, has been ruled out of order.

On that point I should be glad if the Chair would explain to me and to the House why this amendment was ruled out of order and deemed to be outside the scope of the present Bill? The position as I note it is that this is a Bill entitled "An Act to make Further Provision in Relation to Transport."

The Deputy may not discuss it at this stage. The amendment has been ruled out of order because it is outside the scope of the Bill, since it relates to the employees of a company other than C.I.E. This Bill deals only with the reorganisation of C.I.E. and any amendment dealing with reorganisation of another company, or a supposed effect the reorganisation of C.I.E. would have on another company would not be relevant. The Irish Railway Clearing House, as far as the Chair is aware, deals with a variety of transport and shipping companies, and acts as a liaison between them and it is not seen how the internal reorganisation of one of these companies could directly affect its operations. If, for instance, a number of the transport companies were being amalgamated, the position of the employees of the Irish Railway Clearing House might conceivably be worsened as a result of that amalgamation, and an amendment on the proposed lines might be in order. The present Bill does not effect any such amalgamation which would bring the clearing house into the picture.

I think what, in effect, the Chair is saying is that it might be in order for the G.N.R. Bill.

With respect, Sir, provisions in this Bill can directly create redundancy in the Irish Railway Clearing House.

Yes, according to this Bill.

The argument is that redundancy may arise because of amalgamation between C.I.E. and G.N.R.

There are provisions in this Bill for the closing of branch lines and the possible closing of stations which will affect the clearing house.

They have nothing to do with the clearing house.

Naturally, the work of the clearing house is reduced by reductions in railway services.

So would a trade recession affect the clearing house.

Redundancy will be created and is being created in the Irish Railway Clearing House, and I respectfully submit it should be dealt with in this Bill. The Irish Railway Clearing House was last mentioned in legislation in this House in a Railway Act of 1924, which was termed "an Act to provide for the reorganisation of and future regulation of railways."

The 1924 Act amalgamated all the railways.

And it dealt with transport generally. I submit with respect that it is strange thinking to rule out this particular amendment.

It has been ruled out on the grounds stated by the Chair.

We will have another Bill next month and the Deputy can try again to get into order on that Bill.

Will it be in order on the G.N.R. Bill?

That is for the Chair to rule; but the G.N.R. Bill will involve amalgamation.

Will the Chair rule it out then?

That is a matter for the Chair. Our legislation could not impose an obligation on a concern which includes British and Six-County railways and shipping companies.

We could include it on the G.N.R. Bill?

I say it may be in order, but that does not make it any more feasible.

Question put and agreed to.
Sections 15 to 17, inclusive, agreed to.
SECTION 18.

I move amendment No. 10:—

In sub-section (2), after "period" in line 17, to add "and such service shall not cease to operate until, and unless, an alternative service shall have been provided by the board or by persons desiring to provide alternative transport".

If the Minister would clarify the position, perhaps I could withdraw the amendment. The position under this Section is that the board shall not terminate a service or close a station to any or all classes of traffic, unless at least two months before doing so the board has published notice of its intention, and that notice shall indicate the new or additional road transport services, if any, which the board proposes to provide in the area. If the board does not propose to provide them, they shall state that applications for passenger licences may be made by any person desiring to provide them.

If C.I.E. closes a service and does not wish to provide an alternative service, and publishes the notice I have mentioned, it would appear that a period of two months could elapse before the alternative service would be provided. The district concerned would be without a service, due to insufficient time being allowed to private interests to provide it. I want to provide that, until that alternative service is provided, C.I.E. will continue to provide the service.

I do not think that the Deputy can have thought it out very carefully. The effect of the amendment would be to ensure that C.I.E. could not close a branch line or station—in circumstances where they did not propose to operate an alternative service themselves—unless someone came in and said: "We shall provide the alternative service." If there were any local opposition to the closing of the branch line or station, it is almost certain that any person who would come in and say: "I shall provide the alternative service" would be most unpopular. Pressure would be put on him not to provide it, because under the Deputy's amendment, if he did not do so, C.I.E. would be compelled to maintain an uneconomic service. The only way is that proposed in the Bill. Under the proposed arrangements, they must give two months' notice, and wherever there would be objection to the closing, I cannot see circumstances in which an alternative service would not be provided. To put in a provision which says that circumstances could in fact arise in which C.I.E. could not close a rail service, no matter how much money it was losing on it, would be completely unreasonable, and that is the effect of the Deputy's amendment.

This does assume that the situation could arise where there could be no service.

That is so improbable that it is not necessary to provide against it. In every district where C.I.E. themselves do not wish to operate, it is certain there will be somebody prepared to accept a licence to operate a service, or some existing licence which can be extended.

That is the assumption in the Bill and I was providing for that assumption.

If what I have suggested does not happen, we shall have a look at it. The worst possible solution would be to compel C.I.E. to keep on providing an uneconomic service.

The only thing is that it is a national undertaking. We cannot compel anyone else.

It is so remote a possibility that it is unnecessary to have an elaborate provision to deal with it.

Amendment, by leave, withdrawn.

I move amendment No. 11:—

In sub-section (4), page 7, line 24, to delete ",if any,".

This is to compel C.I.E. to provide and keep a service going. It visualises circumstances arising where they would close a branch line. This is to ensure that if C.I.E. exercise that power, it will provide some other form of service. It will be the only undertaking which can be compelled to provide it. It is important that a public transport service should be available for the citizens in various parts of the country. It may be true that in certain circumstances some other concern would be prepared to provide it, but that might be done at a prohibitive cost to the citizens and the service may be entirely inadequate for those in that area.

There are many parts of the country, and even parts of urban areas, where a single service cannot be economic, as it is serving a restricted area and a relatively small number of families. Nevertheless, those families are entitled to be afforded reasonable transport facilities. If C.I.E. are permitted to close a branch line, without providing an alternative service, the citizens may well suffer varying degrees of hardship. That occurs whether it is the case of the carriage of passengers or goods. No private transport service would operate unless it were to be profit making. The Minister has indicated—and the House supports him—that he hopes, by certain changes, C.I.E. may be able to run as an economic unit, but the opinion has been expressed even by the Minister himself that it is only a hope. It may be realised but I think the Minister would not like to make any prophecy.

In this regard, there is a problem which will affect rural areas and communities more than others. It appears to be most unfair to give to C.I.E. the power to close a branch line and deprive the people served by those services and, at the same time, to say to C.I.E. there is no obligation upon them to make any other means of transport available for goods and passengers in that area. It is unfair to leave the citizens who will be contributing their measure of support to this £5,000,000 to the pleasure of an individual or company prepared possibly to operate a transport service on the basis of a profit without very much regard to what charges are imposed because the people will be completely dependent on and at the mercy of that individual or company.

This is one of the general charges regarding the whole question of public transport, that it has been looked upon as a means of making a profit rather than as a means of giving service to the citizens. This amendment is to ensure that if C.I.E. decide to close down a branch line, there will be an obligation on them to provide alternative transport in the particular area.

Might I ask the Minister for an explanation in relation to the administrative method of procedure under this section, which must obviously have a very great bearing on the amendment? As the section is drafted, if C.I.E. decide to close a branch line, they give two months' notice, and if they do not propose to provide an alternative service, anyone who is interested can apply for a licence to operate in the area. Is it the intention of the Minister to restrict the licence which he will give, to one person, to one licensee, or not? I think it should be put very strongly that it should not be so restricted. If there is to be any monopoly in transport services in any area, it should be a State monopoly or not a monopoly at all.

As the section is drafted, it is on the administrative method of dealing with the licensing of an alternative service that I would like this information. If two people apply to provide a service, will they both be given the appropriate licence if C.I.E. is not to provide a service? If only one is given the licence, then that person will be the monopolist and in the position of being able to fix charges as he likes for the people in that area. I do not think that is a situation we should allow to arise. If it is understood that there will be no restriction to a single licence, then if he fixes his charges too high he will know there is danger of somebody else coming in to provide a service.

It is not quite possible to give a "yes" or "no" answer to that question. In so far as the provision of an alternative road passenger service might arise, I would normally contemplate a single licence. I do not think it is likely to arise often. I do not think it would be practicable to have two operators in an area where C.I.E. did not think they could make a service pay at all, under their method of operation. In the case of freight services—and it is the question which is most likely to arise—there will be the right to carry freight for reward already held by a licensed road haulier. Normally, I would consider it preferable to meet such a case by extending the scope of the licence of the existing haulier, if that should prove to be necessary, to meet any particular problem that arose.

This situation is most likely to develop in circumstances where C.I.E. decide to close down a small intermediary station upon some line. If a branch line is to be terminated, it is to be assumed that C.I.E. will have a very lively interest in meeting the transport requirements of the area served by that branch line. It is almost inconceivable that C.I.E. would not wish to utilise in full its right to provide alternative services. The question is most likely to arise where some small station is no longer able to promote sufficient traffic. If there is a transport problem in the area, which is not being met by existing services or licensed operators, it can be met by giving a new licence. That is all we are taking power for here, to give new licences in these circumstances and releasing C.I.E. from the obligation that they must provide an alternative service.

Can I put it another way? In the granting of the licence, will there be anything to prevent the Minister, at a later stage, from giving a further licence if that licence should be thought necessary?

No. The requirment which the Minister must bear in mind is: are the transport needs of the area being adequately served? If he thinks they are not, he can give a licence or extend the scope of an existing licence.

It is not intended to limit it?

No, in circumstances where some service of a particularly local character is required which C.I.E. do not wish to provide. The position is that at the moment C.I.E. cannot close a rail service without providing an alternative road service, whereas if a station had not been there, we could give a licence freely to a private operator. C.I.E. will not have to provide an alternative service, no matter how uneconomical it is. We are taking power to do what we can now do, if no railway was in the area, to give a new licence or extend an existing one.

If a local operator raised his charges outrageously, what would be the position?

The Minister would have power in that case. The passenger charges are controlled and will be controlled. I would agree fully that if there was a genuine complaint if any area regarding the transport facilities available to the people, these would be circumstances under which the position could be met by granting a new licence.

I think the Minister, for reasons of his own, has deliberately played down the significance of this section, to keep his arguments only to the closing of branch lines.

I think that is where it is most likely to arise. It is the only circumstances in which C.I.E.——

That is giving hostages to fortune. Once this Bill is passed by the Oireachtas, then its administration is in the hands of the C.I.E. board. Deputies cannot ask questions here on the day-to-day administration of C.I.E., once this Bill is operated by the directors of C.I.E. What is the purpose of the Bill? It is to enable the board to terminate any service of trains for passenger and merchandise, or either of them. The board was told then they might not terminate the service, unless they were satisfied its operation was uneconomic or that the prospects of its continued operation would be uneconomic within a reasonable period.

Every branch line is virtually uneconomic to-day because the heavy loss of C.I.E. is on the railways side. The Dublin bus services and the provincial bus services make a profit. C.I.E. road services make a profit. All that profit, plus a subsidy of £1,000,000 or £2,000,000 depending on the year, is to be poured in to keep C.I.E. going.

This relates only to railways.

I know it relates only to railways. Under our existing legislation, if C.I.E. closes a branch line, there is a statutory obligation upon them to provide alternative road services. In this Bill, we are tearing up the present statutory obligation which rests upon C.I.E. to provide alternative road services in lieu of the terminated rail service. We are saying to C.I.E.: "If you do not like to provide an alternative road service, you need not do so. Instead we will see if anybody else in interested in running a merchandise service or a bus passenger service over that route. If anybody is so venturesome we will give him a licence to operate." That is what is envisaged by the Bill.

When you are dealing with a situation where most branch lines are probably uneconomic by any orthodox standard of accountancy, C.I.E. directors can be deliberately embark upon a policy of amputating all these branch line arms of C.I.E.; give notice of their intention to do so and there is no obligation on them to provide an alternative road service. I agree that C.I.E. may say: "We cannot make a success of that branch line, operating it as a rail service, but we think it would be a much better proposition economically, if we operated a bus service on the route." C.I.E. will naturally want to substitute a road service for a train service in such circumstances. There is no obligation on them to do so, unless they feel they will be economically rewarded by providing the alternative road service.

So far as the public in that area are concerned, it may mean that if C.I.E. closes a branch line, there is no obligation on the only statutory body we have providing public transport, C.I.E., to provide an alternative road service. The question as to what service will be provided, if any, depends upon the financial avarice of some people who may be willing to provide a bus service or a merchandise service, depending upon the reward they will get from its operations.

It is a pretty big jump in this Bill to remove from C.I.E., the national transport authority, the responsibility of providing an alternative road service where they close a branch line. I think that one of these fine days many people in rural areas will wake up to read a notice by C.I.E. that they propose to close a branch line and there is no compulsion on them to provide an alternative road service. I think the Minister is going too far in that respect, at this stage at all events.

We ought to give this new Bill a trial, say, of 5 years. With the new freedoms they get under the Bill and the generous financial assistance they get under the Bill an opportunity of operating in these new circumstances should be given to C.I.E. If they close a branch line—that possibly may be inevitable in the light of the economics of branch line operation—we should not allow C.I.E. to get away from its present statutory obligations to provide an alternative road service.

I think that is far too big a step, and far too drastic a step. I am afraid it will mean for rural communities living in isolated areas that C.I.E., not having the obligation to provide an alternative service, may leave people in those areas to fend for themselves. The Minister is giving C.I.E. far too much power in this respect. What the House has got to remember is that, once it passes this Bill, then its administration and all the decisions taken, so far as the closing of branch lines is concerned, will rest not on the House, not on the Minister for Industry and Commerce, but on those who will constitute the board of C.I.E.

I do not know who they will be. We have no experience of them. We do not know what their mentality will be but the House is giving hostages to fortune if they give the board power to close down a branch line without the statutory obligation to provide an alternative road service. We are taking this step too quickly.

It is certainly contemplated that C.I.E. will in the future eliminate from the rail service any branch or stations which are uneconomic and where there is no prospect that they will become economic. When they have decided to close a branch line or station, the question of alternative transport facilities in that area arises. C.I.E., as the law stands at present, are obliged to provide alternative road services. That has been a deterrent for them in some instances in effecting economies which they would otherwise have wished to bring about. If they were not to provide an alternative road service, can we reasonably be sure that a road service suitable to the area would be provided? The pressure is in that direction. This is not a case of trying to force people. The entire pressure is for an extension of privately-owned transport services.

There are at the present time a number of bus services operated by private companies in areas where C.I.E. were not prepared to provide a service. Where they were not prepared to provide a service, a licence could be issued. The only complication that arises in that regard is where the particular area has been served by an uneconomic railway. If there was no rail service, there would be no problem. C.I.E. would provide the service. It was because there was a railway that the question arose.

C.I.E. have the first claim with regard to the provision of transport services, but if they decide not to provide a service, somebody else can get a right to do it. That will be given in the form of a licence under the Road Transport Act. A passenger licence carries with it the control of charges made on passengers. In the case of freight services, there is a number of privately-licensed hauliers who have got rights in respect of whole districts. In so far as there are not a sufficient number of them to provide the transport requirements of an area and where C.I.E. are not prepared to provide the requirements, licences will be given. The problem is not to induce people to apply for licences. Rather will it be to limit the issue of licences to the number which will permit the people concerned to get livelihoods.

This section is certainly the denationalisation of C.I.E. The Minister said the mere fact that they would have to provide such a service did not in the past stop them from closing down the rail service. They would have had to provide the service at a loss. Who will make a profit out of it if C.I.E., with all their organisation, getting everything at first cost, cannot make a profit out of the road service? How is a private person to do it? We know very well how it will be done. It will be run on a cheap scale, without giving the amenities to the people that is expected of the service provided by C.I.E. The alternative will be that some private people will exploit the public of the area in the provision of a passenger or road haulage service at a charge which they will determine. That is not, to our mind, what this Bill should be doing. It is the complete reverse. It is the end of C.I.E. as a national service and the introduction of private enterprise to exploit people who will be in the position that they cannot retaliate.

C.I.E. have a right to provide a service. If they provide the service, nobody else will get a licence.

Can the Minister tell us under what conceivable circumstances the private lorry owner could provide a service? As I see it, C.I.E. will close a branch line and will have the first option to provide an alternative road service. If they feel that it would be an economic proposition they will proceed to provide both freight and passenger road services. The only conceivable set of circumstances in which they would refuse to do so would be where they felt that it would not be a paying proposition. As Deputy Kyne pointed out, if C.I.E., with their vast organisation and facilities, cannot make a service pay, how does the Minister visualise that some private individual, starting from scratch, could feel that he could make it pay?

So far as freight is concerned, that is no problem. It will be some merchant in the town who has a lorry who will undertake to provide a freight service.

And some individual will feel that he can make it pay on that?

He will have other uses for his lorry.

The position will be that where C.I.E. close a branch line and feel that they cannot provide an alternative road service as it would be uneconomic, the people of the are will be left high and dry without a service. At that stage, this House will not be able to compel any private enterprise to provide a service. The only transport organisation that we can compel to provide a service is the national transport organisation. Our legislation up to now has been so designed that, even if it were uneconomic for them to do so, they have been compelled, as the national transport organisation charged with providing services, to provide that service and we should not deviate from that principle. If we do, the dangers outlined by Deputy Norton will definitely arise.

It is the other way round. The rail service from Cavan to Bundoran has closed down because of the Six-County Government decision in respect of their rail services and last week or the week before I issued a licence to a private firm to operate a seasonal bus service from Cavan to Bundoran. C.I.E. having examined the position, decided that they were not interested. Probably they felt they could not make it pay. This private person thinks he can make it pay. It is up to him to show whether he can or not. By reason of the power I had to give that licence to a private individual in circumstances where C.I.E. was not providing a service, the people are getting a service that they would not otherwise have got.

Only so long as he makes it pay. The minute he loses, he drops out.

And they will then be where C.I.E. would have left them anyway, without a service.

Is it not clear that if C.I.E. abandon a railway line and say that it does not pay them to provide an alternative road service, the local people will be dependent upon the ability of some person to provide an alternative service for them? I agree that, so far as the transport of merchandise is concerned, there is always a substantial collection of applications in the Department of Industry and Commerce for an extension of the area of operation and of the type of goods they are entitled to carry. So far as that is concerned, probably the transport of merchandise would be alternatively arranged all right. I am not too sure that that is the position with regard to bus services. There are only a few private bus services operating in the country. I never heard anybody paying glowing testimony to their efficiency. I suspect that that is not due to modesty alone. If C.I.E. will not provide an alternative road service, we have to rely on some fellow being able to box the compass of accountancy in such a way that he will run an alternative service.

I want to deal with the passenger side. That person will run an alternative passenger service and the assumption is that that kind of person will be forthcoming. C.I.E., with all their transport talents and advice and long tradition and interconnected services, cannot make a "go" of a road passenger service in a particular area when they close a railway line but this unknown warrior, who has never been in the transport business before, comes along and says: "I know where I can buy a second-hand bus and I shall run the bus and carry people." The assumption underlying this section is that that kind of fellow will come forward. Of course, he may make a "go" of the thing financially by working people for 12 hours a day, in conflict with the Road Traffic Act. He may pay them low rates of wages.

He may run a very small bus. A lot of these services are run with ten-seater buses, which C.I.E. do not operate, and it may be quite an economic proposition with a bus of that size.

There is no prohibition on C.I.E. running a ten-seater bus.

There are certain difficulties.

C.I.E. can easily run ten-seater buses and, if ten-seater buses are economic, there is no reason why C.I.E. should not have them. In the main, as the Minister well knows— as the Department well know, in any case—a lot of these privately-operated lorries are made possible of operation only because of the fact that people work very long hours and are paid low rates of wages and no decent standards in respect of conditions are observed by many of those who employ labour for the operation of these lorries. I agree that there are notable and noteworthy exceptions but quite a substantial number are operated on the basis of working people for ten and 12 hours a day and paying them low rates of wages, and no overtime. They have to take whatever the employer cares to give them. Their operation is made possible only in that way.

If C.I.E. is not compelled to provide alternative road services in lieu of a closed branch line, the people in the particular area will have to depend on that kind of fellow coming forward to carry at least passengers, whatever about goods. I do not think that is treating the people fairly. It is making third-class citizens of people who live in these areas.

The Minister talks about giving a licence to somebody to operate a bus service from Cavan to Bundoran. You will get these exceptions, I know. It seems to me that that would be a reasonably profitable route. I do not see why C.I.E. would not be interested in it.

Let us take an example close to home. C.I.E. at present run a bus from the City to Rathfarnham and on to Whitechurch. Suppose they say that it does not pay to run the service from Rathfarnham to Whitechurch and that they will stop at Rathfarnham, anybody who wants to travel on that bus can exercise himself in the future by walking from Rathfarnham to Whitechurch. That is possible under this Bill.

It has nothing to do with this section. This relates to the termination of rail services.

I agree that that is probably not a good example but, in the case of places where a rail service is economical to a certain point but is not economical beyond that point, C.I.E. can operate the train service to that particular point and close the remaining portion of it and, in that case, the only reliance which people have for future passenger transport is on somebody being willing to get a bus and operate it.

Not the only reliance. In 99.9 per cent. of cases there will be a C.I.E. bus service there already.

I do not know why the Minister says that.

Because that is the general opinion of the House, that wherever there is a rail service there is a bus service.

Why is this being put in the Bill? The Minister said in reply a few minutes ago that it was the obligation imposed on C.I.E. to provide alternative road services that prevented them closing down branch lines.

I said it was a deterrent.

If the Minister looks at his uncorrected speech he will see that he said very definitely that it was this statutory provision of providing an alternative service that operated to prevent C.I.E. from closing branch lines.

"Deter" was the word I used.

There does not seem to be much difference. If you are deterred or prevented you do not do it; that is the gravamen of the case. C.I.E. are getting powers which are far too wide. Many people stand in the danger of getting a raw deal under the provisions of this section and their sole hope of deliverance from inconvenience and hardship is the possibility that some individual may be found who can operate a bus service. I am suspicious of a bus service operated by one individual who buys a bus on hire purchase, and who runs a service, working people ten and 12 hours a day. I have never seen these services to be satisfactory and I do not think it a propersubstitute for nationally owned transport such as C.I.E. is providing. The Minister should keep upon C.I.E., for at least another five years, the obligation to provide an alternative road service. We are travelling far too quickly and it is the public who will suffer for it.

There are about 30 firms carrying on private bus services at the moment on routes on which C.I.E. are not prepared to operate. I have never heard a complaint about one of them and some of them we know to be quite satisfactory services which have met a public need that C.I.E. was not prepared to fill because of certain difficulties about their equipment, their organisation methods or something of that kind. The reason, for example, why C.I.E. would not run the service to Roundwood was that their standard bus would not run up the hills on the route. That service was given to a private company. It is being satisfactorily run and C.I.E. do not want to take it over because it would mean a different type of equipment. There are many small services run with small buses which do not need a conductor and on which it would be uneconomic to have a conductor.

I think they need a bus.

Unlikely as it is, a situation could arise where a small community might be isolated through lack of a bus service.

I do not think it could arise that if a service is required somebody could not be found ready to provide it; indeed the whole assumption underlying all our thinking is the reverse of what the Deputy is assuming, because the alternative to maintaining C.I.E. as an economic operation is to remove these restrictions altogether and have a free-for-all on the roads, in which case there would be superfluous services as everybody knows.

I am not suggesting that. I am suggesting that a situation might arise where a community could be isolated, a community which, as the previous speaker said, is contributing to taxation through the overall subsidy to C.I.E. If that situation should arise they are entitled to some service by the national undertaking. Some provision should be inserted which would ensure that such a service would be made available by C.I.E.

I cannot see any such circumstances arising.

I think myself it is unlikely but we should not exclude the possibility altogether.

Question put: "That the words proposed to be deleted stand."
The Committee divided:—Tá, 47; Níl, 30.

  • Aiken, Frank.
  • Blaney, Neal T.
  • Boland, Gerald.
  • Boland, Kevin.
  • Booth, Lionel.
  • Brady, Philip A.
  • Brady, Seán.
  • Brennan, Joseph.
  • Brennan, Paudge.
  • Breslin, Cormae.
  • Briscoe, Robert.
  • Browne, Seán.
  • Burke, Patrick.
  • Calleary, Phelim A.
  • Childers, Erskine.
  • Clohessy, Patrick.
  • Collins, James J.
  • Cotter, Edward.
  • Cunningham, Liam.
  • Davern, Mick.
  • de Valera, Eamon.
  • de Valera, Vivion.
  • Fanning, John.
  • Faulkner, Padraig.
  • Flynn, Stephen.
  • Gibbons, James.
  • Gilbridge, Eugene.
  • Griffin, James.
  • Haughey, Charles.
  • Healy, Augustine A.
  • Hillery, Patrick J.
  • Hilliard, Michael.
  • Lemass, Noel T.
  • Lemass, Seán.
  • Loughman, Frank.
  • Lynch, Celia.
  • Lynch, Jack.
  • MacCarthy, Seán.
  • McEllistrim, Thomas.
  • Medlar, Martin.
  • Moher, John W.
  • Ó Briain, Donnchadh.
  • O'Toole, James.
  • Ryan, James.
  • Sheldon, William A.W.
  • Smith, Patrick.
  • Traynor, Oscar.

Níl

  • Blowick, Joseph.
  • Browne, Noel C.
  • Casey, Seán.
  • Corish, Brendan.
  • Cosgrave, Liam.
  • Desmond, Daniel.
  • Esmonde, Anthony C.
  • Everett, James.
  • Fagan, Charles.
  • Giles, Patrick.
  • Hughes, Joseph.
  • Kyne, Thomas A.
  • Larkin, Denise.
  • Lynch, Thaddeus.
  • McAuliffe, Patrick.
  • McGilligan, Patrick.
  • Manley, Timothy.
  • Mulcahy, Richard.
  • Murphy, Michael P.
  • Murphy, William.
  • Norton, William.
  • O'Donnell, Patrick.
  • O'Higgins, Michael J.
  • Reynolds, Mary.
  • Russell, George E.
  • Spring, Dan.
  • Sweetman, Gerard.
  • Tierney, Patrick.
  • Tully, John.
  • Wycherley, Florence.
Tellers:— Tá: Deputies Ó Briain and Loughman; Níl: Deputies Kyne and Tierney.
Question declared carried.
Amendments Nos. 12 and 13 not moved.

I move amendment No. 14:—

To add to the section a new subsection as follows:—

() When the Minister grants a merchandise licence following an application made in accordance with sub-section (5), he shall grant adequate extensions of the conditions specified in such licences in respect of standard vehicle unladen weight, area of operation and classes of merchandise.

The purpose of this amendment is to enable the Minister to grant adequate extensions of the conditions specified in the licences. I think most of us are familiar with the changes that are to be seen in the type of lorries and equipment at present in use compared with lorries and trucks of, say, 25 years ago. As the law stands at present, under the 1933 Road Transport Act, although power is contained in that Act to grant certain extensions in particular cases, the overall weight is restricted, and in most cases the maximum overall weight is 2 tons 15 cwt. In some cases, the extension varies for certain equipment, but, as I understand it, the present position is that modern trucks may have two-speed gear axles, helper springs, power-assisted steering, sack-loaders and more recently containers, which present a new aspect of the problem. Quite a number of lorries are now provided with containers.

A specific case has brought this question very much to the forefront where a lorry owner was requested to weigh the lorry with the container and notice has been served on him drawing his attention to the relevant provisions of a Statutory Instrument, No. 13 of 1958, which was made by the Minister for Local Government and which obliges the owner to weigh the lorry in accordance with the relevant section of that Order. I would, therefore, suggest to the Minister that adequate extensions should be given which will enable modern equipment to be used and enable lorries to be used that have these added facilities which make them weigh more than such lorries weighed 25 or 30 years ago.

Progress reported; Committee to sit again.
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