Ceisteanna — Questions. Oral Answers. - C.I.E. Re-organisation.

6.

asked the Minister for Communications if, in view of the strong opposition expressed to the proposals by the trade unions concerned, the Government intend to proceed with the plan to divide CIE into separate independent organisations.

17.

asked the Minister for Communications the timetable for the enactment of legislation for the new CIE structures.

I propose to take Question Nos. 6 and Priority Question No. 17 together. The Bill to give effect to the re-organisation of CIE is being drafted and I expect to be in a position to introduce it in the Oireachtas shortly with a view to having it enacted by the end of the year.

At the request of the Irish Congress of Trade Unions and the CIE group of ICTU Unions the Minister recently received a deputation to discuss the Government's plans for restructuring CIE. In the course of the discussion and as a result of a number of points which the Minister was able to clarify, it seemed to him that a number of the trade unions' concerns were based on misapprehensions.

The decision to restructure CIE must be viewed against the deficits incurred by CIE over a period of years and the experience more recently. In the period 1969-79 to 1982 the annual deficit had increased from £3.234 million to £109.374 million a factor of 33.8 while in the same period the consumer price index increased by a factor of only 5.4. This clearly was not a situation which could be allowed to continue.

In 1983 a new formula which imposed cash limits on the CIE subvention and set specific financial targets for the board for the future was approved by the Government. This new formula also recognised the social element of the services provided by CIE and for the first time provided for the treatment of the subvention above-the-line in the CIE accounts. Since 1983 the pattern of escalating losses has been reversed and a reduction in the CIE deficit of 20 per cent in real terms in 1983 and 1984 was achieved. CIE are so far this year on target. The future of the freight service seems to be secure on the basis of recent performance. All has been achieved without any major impact on CIE services and the achievement was made possible by the combined efforts of the board, management and workforce of CIE.

These first steps were complemented by the decisions on CIE outlined in Building on Reality. The decisions were taken only after long and careful consideration by the Government which took into account the views expressed by various interested parties, including the CIE unions, the board of CIE and the McKinsey recommendations.

The improvement in the environment is also strongly influenced by the Government assuming responsibility for the interest charges on DART and agreeing to provide £30 million to replace CIE temporary borrowing. Other significant elements in bringing about the changed environment in CIE were the new urban and provincial bus fleets, the mainline carriage building programme and developments in signalling and communications.

The decision to restructure CIE was in the overall interest of developing further their new environment. The new structure will take the form of a parent board to three subsidiary companies having responsibility for Dublin city services, provincial bus services and railways.

Provision is being included in the new legislation to ensure that the new subsidiary companies, which will be registered under the Companies Acts, cannot be sold or alienated. Provisions will be included in the Bill which will provide for the protection of conditions of service for employees transferred to the subsidiaries and for staff mobility within the CIE group.

There is, understandably, uncertainty and worry among CIE staff about the future of CIE. I am very concerned to bring that anxiety to an end. In that connection the drafting of the Bill is being expedited. The Government are firmly committed to retaining CIE in State ownership. The prospects for all in CIE are much better now than they have been for years.

In the course of his reply the Minister praised the improved efficiency of CIE. Is the Minister satisfied that in the past number of years the existing integrated transport system has proved efficient and has been praised internationally for its railway system as being better than the systems in Britain, Finland, West Germany and Italy? Is the Minister satisfied that the retention of the existing integrated transport system which has dropped 5,000 jobs in the last number of years is the best method of ensuring the continuation of both the bus and the rail services?

There is no doubt that there has been a fairly substantial improvement within CIE in response to the activities of all sectors involved. However, the Minister's idea and the Government's idea on this is to build on that improvement. All of those things, including the improvement that has taken place recently, were considered but it was felt that this would be a more efficient way to get even further improved management of the various sections of CIE and that this would consolidate and build on the improvements and lead to greater efficiency. A lot of thought has been given to this and it is felt that this will give a further major impetus to the improvement that is taking place in CIE.

Would the Minister of State not agree that, but for the establishment of CIE 30 or 40 years ago, the railways would not have survived? Does he not agree now that setting up a separate company for the railways means death to the railways, that they will not now survive as a separate company?

That seems to be an opinion.

Can the Minister of State not see that that was why CIE were formed in the first place?

I am aware that suggestions have been made that two companies might have done as well as three and that perhaps eventually the buses and railways would be in one company. That was considered in great detail and it was felt that this would be a more efficient manner. We are trying to secure the future of all sections of CIE. As I said, the freight section has shown a considerable improvement and is doing very well. I do not think that the fear expressed by Deputy Mac Giolla has any foundation. This would be more beneficial towards the protection of the railways than if matters were allowed to go on as they exist at the moment, or even with two companies.

The Minister of State gave a lengthy reply during which he mentioned DART and mainline carriages. Would he like to indicate to the House when the one-man bus feeder services to the DART system will commence? Secondly, will he indicate, as he mentioned the mainline carriages, what went wrong with the mainline carriages which had to be withdrawn from service after being finished in the CIE works?

I regret that I have not got a reply to those questions. I have no doubt that the Minister, who unfortunately cannot be here, would be able to answer the Deputy. I have not got the information to deal with them, but I will communicate with the Deputy. I feel there is a question down about the one-man buses, perhaps for written reply.