asked the Minister for Tourism and Transport if he will specify in detail the new system arising out of EEC Regulations under which grants to Córas Iompair Éireann are paid since the 1st January 1975 as referred to in note (b) to the Estimate for Transport and Power, Vote 42, for the year ending 31st December, 1975.
Written Answers. - CIE Grants.
382.
In order to comply with the provisions of the EEC Regulations governing State aid to transport undertakings a new subvention structure for CIE was introduced with effect from 1st January, 1975.
Particulars of the relevant EEC Regulations and of the manner in which they have been applied to CIE are as follows.
(a) EEC Regulation No. 1191/69 enables payment of compenation by the State to transport undertakings in respect of losses incurred on services operated under public service obligations which are deemed essential to ensure the provision of adequate transport services. Payment is being made to CIE under this regulation in respect of losses remaining on rail passenger services after fares increases and any possible economies in operation.
(b) EEC Regulation No. 1192/69 provides for compensation by the State in respect of specified financial burdens borne by railway undertakings. Payments were made to CIE in 1975 under this regulation to cover the following costs in respect of rail freight operations; superannuation and pensions costs less savings arising from the board's exemption from payment of certain social welfare insurance contributions in respect of clerical and supervisory staff; 50 per cent of the costs of maintenance and control of level crossings.
(c) EEC Regulation No. 1107/70 specifies certain additional circumstances in which State aids may be paid to transport undertakings. Under this regulation payments are being made to CIE in respect of; 50 per cent of infrastructure costs in respect of rail freight (Article 3.1 (b)); losses on the board's road passenger services which cannot be recouped by fares increases or eliminated by economies in operation (Article 3.2); residual deficits on railway operations and losses on maintenance of canals (Article 4).
As provided for in the June, 1975, budget introduced by the Minister for Finance, the board reduced, with effect from 28th July, 1975, its fares on Dublin city bus services, provincial road passenger services and Dublin and Cork commuter rail services to the levels which obtained before 12th May, 1975. Compensation was paid to the board to cover the losses of revenue in 1975 arising from this reduction in fares and which amounted to £1,790,000 on Dublin city bus services, £945,000 on provincial road passenger services and £76,000 on Dublin and Cork commuter rail services.
A grant is also paid to CIE by the State in respect of losses incurred on the Galway-Aran ferry service.
Particulars of the total Exchequer grant of £26.5m. paid to CIE under Subhead D.1 of Vote 42 of Dáil Éireann in 1975 are given in the following table showing the relevant provisions of EEC Regulations:
EEC Regulation Number
|
1107/70 |
1107/70 |
1107/70 |
||||
|
1191/69 |
1192/69 |
Article |
Article |
Article |
||
|
3.1. (b) |
3.2 |
4 |
||||
|
£ |
£ |
£ |
£ |
£ |
£ |
|
|
RAILWAYS |
||||||
|
Operation of passenger services |
10,388,194 |
|||||
|
Reduction in fares on suburban rail services from 28/7/75 |
76,000 |
|||||
|
Normalisation of accounts (rail freight)—Class III (pensions) |
710,918 |
|||||
|
—Class IV (level crossings) |
151,702 |
|||||
|
Infrastructure grant (rail freight) |
1,579,979 |
|||||
|
Excess payments |
72,806 |
324,380 |
||||
|
Residual deficit grant |
6,826,283 |
|||||
|
Total—Railways |
10,487,000 |
1,187,000 |
1,579,979 |
6,826,283 |
||
|
ROAD PASSENGER |
||||||
|
Dublin city services: |
||||||
|
—Reduction in fares from 28/7/75 |
1,790,000 |
|||||
|
—Deficit on operation of services |
3,245,042 |
|||||
|
Provincial services: |
||||||
|
—Reduction in fares from 28/7/75 |
945,000 |
|||||
|
CANALS |
||||||
|
—Deficit on maintenance |
381,696 |
|||||
|
GALWAY/ARAN |
||||||
|
—Grant towards losses on ferry service |
58,000 |
|||||
|
Total—All Functions |
£10,487,000 |
£1,187,000 |
£1,579,979 |
£5,980,042 |
£7,207,979 |
£58,000 |
NOTE: The amounts under Regulations Nos. 1191/69 and 1192/69 in respect of "excess payments" i.e. a total of £397,186, represent the extent to which payments received from the State exceeded the deficit on rail passenger services and normalisation costs as established in the final accounts. However, the residual deficit grant made to CIE under Article 4 of Regulation 1107/70 was inadequate to the extent of £479,788 and this inadequacy was offset to the extent of £397,186 by the excess payments received under Regulations 1191/69 and 1192/69. After taking account of the payment of £945,000 in respect of road passenger provincial services which more than offset the deficit in respect of these services, the total net deficit on all services subventable under EEC Regulations and on the Galway-Aran ferry service was £26,512,981, compared with the total payment from the State of £26.5m.