asked the Minister for Transport if he has received from CIE, details of the service cuts they will have to make, and how these cuts will affect the travelling public, if the Government subvention is held at £86 million; if he will give details of the proposals; and if he will make a statement on the matter.
Written Answers. - CIE Operators.
443.
I propose to take Questions Nos. 442 and 443 together.
As the Deputy is aware the CIE subvention provision of £86 million for 1983 was settled by the previous Government. When the new Government came into office last December the general Exchequer position left it with no option but to confirm that provision.
In the meantime the Government have taken the opportunity to review CIE's finances and related matters. As a result, and bearing in mind that CIE had recently indicated that the 1983 deficit could go as high as £99 million—excluding any provision for a general pay increase for CIE employees, it was recognised that the board could not live within the £86 million limit without severe cuts in services. The Government have decided to accept a maximum deficit corresponding to that projection, that there can be no increase in the subvention of £86 million and, taking account of savings of £2 million—£3 million which CIE have been directed to achieve, the board's residual deficit should be financed by temporary borrowings. As a result, it will be necessary for me to seek Oireachtas approval for an increase in the board's statutory borrowing limit and I hope to introduce a Bill for this purpose early in the autumn. The specific areas and manner in which savings are to be achieved is a matter for the board of CIE.
The 1983 financial arrangements were settled by the Government in the context of a package of changes in the arrangements for financing CIE for the short term. The other main features of the package are:—a formula for the settlement of the CIE subvention which from 1984 will be determined as 50 per cent of CIE revenue or 33? per cent of expenditure, whichever is the lesser;—the payment of subvention moneys to CIE as revenue i.e. appearing above the line in the CIE accounts;—a reduction of 12 per cent in expenditure in real terms over five years from 1984 and involving an annual reduction of about 2.5 per cent;—the establishment of a Permanent Capital Committee to appraise and monitor CIE's capital expenditure; and—the extension and clarification of the board's mandate.
The package is designed to get the financing of CIE under firm control, to set objectives for the board against which their performance can be measured and to create a new environment within CIE where a committee organisation can do an effective job which is publicly recognised.
Questions Nos. 444 to 447, inclusive, postponed.