Private Members' Business. - Transport (Re-Organisation of Córas Iompair Éireann) Bill, 1986 [Seanad] Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

I am pleased to have the opportunity to contribute on the transport Bill. It gives me a chance to speak about one of our State boards, that of Córas Iompair Éireann. In case the Minister, or anybody in this House, is not taking me seriously, I want to comment on civil servants coming in here to work for the Minister wearing labels and tags. It is disgraceful and I abhor it. It should be discontinued and discontinued forthwith. It is a little like schoolboy tactics, that experienced officials of our Department——

Would Deputies cease speaking?

——should be asked to wear identification badges on their jackets.

The Minister, on a point of order.

Deputy Fitzgerald, who is a very experienced Member of this House, spoke for at least five minutes before the Adjournment and for three minutes now and he has not yet addressed himself to the Bill.

That is not a point of order.

That is nonsense.

My colleagues should know all about nonsense.

The Minister should leave order to the Chair.

Deputy Fitzgerald is speaking on a matter which is really for the Committee on Procedure and Privileges. He is not speaking to this Bill, a Cheann Comhairle.

The Minister should leave that to the Chair.

Obviously, the Minister is getting touchy at this hour of the evening. The strains of office and the discontent of his backbenchers are getting him down. They are having their effect.

Could the Deputy address himself to the transport Bill?

I understand there was a rather difficult party meeting.

The Deputy is unable to distinguish between the rules of the European Parliament and this Parliament.

Before the Minister rudely interrupted me on a point of order which turned out not to be a point of order——

He is very edgy.

——I intended to say that civil servants are being asked to wear badges in this House.

Is that in order?

I would ask you, Sir, if nobody else does, to re-examine the need for this. I agree with security and with identification, but the little card in the pocket is the way to do it.

Is that in order?

That is not in order. It is a criticism of the Committee on Procedure and Privileges. If the Deputy has any complaint to make about that, he should get the Whip of his Party to raise the matter with that committee.

I have raised the matter in the House. I shall be quite happy if it goes for a decision to the Committee on Procedure and Privileges. I am sure you would not like to muzzle me from making my point of view known in this House. That was never your form and I am sure it will not be now, either.

I think it only right to say that identification badges are being worn by visitors pursuant to an order of the Committee on Procedure and Privileges made on the advice of experts on security.

I am not talking about visitors. In case the message was not properly received, I am referring to servants of this Government, of this House, of this State, and I do not believe that senior people should be asked to wear badges. In my opinion it is degrading.

Everybody who is not a Member of the Parliament and who is in the precincts is a visitor. Will the Deputy come to the Bill, please?

I accept the need for security where visitors are concerned but I do not accept the points made. If the Committee on Procedure and Privileges have done this, I believe they have been wrong in so doing.

Regarding the transport Bill, the Minister who is in the House is the wrong Minister to handle any changes in any State body and I hope that the end for CIE will not be like the end of Irish Shipping or comparable to the dreadful cutbacks in B & I. CIE over the years have come in for immense criticism. They have been ridiculed on occasion, usually most unfairly. The vast majority of those who work in that large and diverse enterprise are committed to doing their best to serve the public. Like every other organisation, CIE have their weaknesses and strengths. Of course there is always need for improvement, especially in a very large organisation.

I support the view expressed by our party spokesman that dividing CIE into three separate parts is not the way to go ahead. He has advanced arguments as to why it should be broken up into two parts.

I wish to refer to one aspect which has not yet been mentioned. I was approached recently by people who work in Ethiopia among the underprivileged. They have approached CIE, the Taoiseach and, I presume, the Minister with a view to getting some of the old or obsolete rolling stock for use in Ethiopia. Although this stock may no longer be considered railworthy here, I understand it would serve the need there and would prove adequate. I thought this was an excellent idea because I appreciate we cannot always meet the needs of the Third World from our resources. Can the Minister tell me whether there is some obsolete rolling stock and perhaps some road vehicles that could be shipped to the Third World to help the many missionaries, lay and religious, who are working so hard in trying to provide and distribute food to the starving millions?

Is the gauge all right?

Not being an expert I cannot answer that, but I received that request this week. These people had gone to the Taoiseach and they thought he received them very sympathetically, but a wall of silence developed from there. That is not unusual, from what I hear my colleagues say about the performance of this Government. We experienced it earlier during the debate on health.

The structure of CIE has its weaknesses and strengths but CIE, to their credit, have something that most other State boards do not have. I refer to their decentralised type of operation. One of the most unfortunate developments is the over-centralisation of Government and the siting of the headquarters of so many State boards in our capital city. Many of them should have their headquarters elsewhere. There is a need for decentralisation of many of the boards under the aegis of this Minister. CIE have decentralised their structure more than any other board. I hope the Minister will encourage decentralisation as a policy to be pursued by the new boards, of which I hope there will be two.

I am not being parochial when I talk about Cork since I know it better than anybody else. Centralised Government are often inclined to forget that Cork is more than 160 miles from Dublin, while the Beara Peninsula is more than 110 miles from Cork. The difficulty of access from the capital to the south-west orvice versa is often forgotten by our administration. This Government have fallen completely into the trap of over-centralisation, something which we in future decades will pay dearly for. Our decentralisation plan was scrapped because, we were told, it was too expensive. It is far more expensive not to implement it and the sooner it is done the better. In the restructuring of CIE I hope care will be taken to ensure that the regions will be remembered and that the structures will be as decentralised as possible.

There is anesprit de corps among CIE workers and they play a supportive role to many of their less favoured colleagues. This is a credit to them, but it is often forgotten by others. I have personal experience of how loyal the employees of that company can be and the excellent role they perform in difficult times for their colleagues.

One can refer to the Cork-Dublin rail service, of which I have much experience, as ranking among the finest in Europe. Unfortunately there are many other aspects of the rail service which leave a lot to be desired. This Minister has presided over many things. We are at present buying buses which are made abroad although in Shannon a suitable plant still stands idle, another monument to a Government with no commitment to employment. This is a tragedy because the expertise is there, the equipment and factory all there and the need is great. The Fianna Fáil posters are criticised because they carried the message that there is a better way, and that is what I believe.

We are told that tourism will be one of our expanding activities up to the year 2000. Some of the activities in which CIE are engaged are closely related to tourism and this has led to competition. The coach tours being organised by CIE in competition with other operators are an outstanding success. We must encourage such a move. CIE must develop their services to get the greatest benefit from the tourists who are attracted to our shores. There are many reasons for the tourist industry not being as successful as it might be. The distribution network is very important. We must be able to provide services at reasonable prices and of reasonable standards.

Even today there is still no ferry into Cork harbour from the British mainland. In that regard the Government were "Mickey Mousing" with a few hundred thousand pounds too late. A ferry is an essential starting point, whether it is operated by CIE or anybody else. I do not mind. If there is a mix of public and private enterprise all the better, but there must be a ferry and buses to collect the passengers and carry them where they wish to go in the Cork and Kerry region. Today I heard some Government backbenchers criticise the service available in County Cork on the grounds that it is very inadequate.

I am not criticising the subvention to CIE because I believe they are providing a very important social service, an aspect which all too often is forgotten. Admittedly, this service must be improved and there must be a more businesslike approach ensuring that transport will be available at the most suitable time for passengers. I believe CIE have many advantages over other operators. If I were talking about Aer Lingus I would tell the House of the shameless neglect by this company of the Cork region. I cannot explain how the flights times are decided, but the company will say that statistics prove they are providing the service at the most suitable times. We cannot prove they are wrong simply because there are no statistics showing the number of people who leave the night before because the morning flight times are not suitable. Admittedly, the position is not as bad so far as CIE are concerned but they must maximise their services to suit demand.

The need for competition in the provision of a road freight service is obvious and it is important that there be competition because private enterprise has done a great deal of good in that area. I understand the CIE road freight service has not been a success in some areas, but is has been extremely successful in Cork. There are a very committed hard working group of people involved in this service. I can see this operation expanding rather than contracting and we should give it every encouragement. I would like the Minister to give me an assurance that road freight will be given a priority in one of the companies and that there will be no question of writing off the road freight service, as many of his collegues would like him to do.

That is what Fianna Fáil did when they were in Government.

I am entitled to ask the Minister what he is doing about road freight. If he is testy at this hour of the night. I cannot be blamed for the difficult party meeting he had today nor for the fact that the Deputies behind him are getting more and more unhappy. That is his problem. I want an assurance that the road freight service in my area will be maintained and given priority because this Government have done a great deal of damage to Cork. I can see them writing off the Cork road freight operation. Therefore I want to guarantee that the operation will continue, that it will be expanded if possible and that it will be able to compete fairly with private contractors.

It is fine to have a rail or road distribution service, but our population is small and the imbalance is becoming more obvious. The projections for Dublin for the year 2000 are frightening. There will be too many people there and they will be taken from the provinces, whether north or south. All these imbalances will mean that it will be more difficult for a transport company to operate and the social need will become greater. If the transport infrastructure in one of these regions is diminished, it will be the region which will suffer ultimately. That must be borne in mind.

Our spokesman, Deputy Wilson, dealt more than adequately with the CIE subvention and the playacting that appeared with the Government handlers telling us CIE were in profit for the first time. How silly, how schoolboyish can one be? I am not criticising the subvention, but what has changed? There has been an accounting change. This year CIE got a subvention as they did last year and other years. This Government starved of good news tried to give the impression that Minister Mitchell had acquired the Midas touch and that subdenly CIE had made a profit. That was far from the truth. If I had read that during my school days inOur Boys, It would probably have been in the column under “Smiles”.

I do not want to delay the House but I want to take this opportunity to say that CIE have had problems in the area of industrial relations. I want to compliment my colleague, Deputy Wilson, for the painstaking way he faced a number of difficult problems and began to plough the furrow which is now so much easier for the Minister. In his time Deputy Wilson acquired a fine knowledge of the difficulties in this area. His trade union experience and his approach to life made him the ideal person to try to tease out the difficulties which would result from any changes in CIE — and there is no doubt changes are needed.

I am glad workers are being given an important role to play in the operations of a diverse company like CIE. They will have many valuable suggestions as to where improvements might be effected, working in co-operation with management. Industrial relations have been a major problem which can be put down to many reasons not least of which is the number of unions operating within the company. It is a multi-union structure with diverse interests for many members because of the type of operations CIE carry out. No doubt there are other contributory factors. I am sure there is also the frustration of Dublin city bus drivers — that has to be a frustrating experience — all day, every day, coping with very heavy traffic. Indeed the same can be said of Cork city, smaller, but unfortunately, a city prominent at present for its filth. The Government have almost turned a blind eye on the problem there. However that is nothing strange in the performance of this Government over the past four years.

I support our spokesman when he said he favoured the establishment of two companies rather than three, and that after mature and serious consideration having been given to the matter. The Minister is not the man to be handling companies of this nature. He seems to have a determination to wipe out the public sector, a strange mind for a man who, at one time, used to boast of such a strong trade union connection in the city of Dublin.

A point arises from what the previous speaker said and perhaps the Minister might take it up with the people who matter in Government, that is the fact that the Eastern Region Development Organisation have undertaken a study indicating that there has been a massive increase in the population of the greater Dublin area which, as far as I can ascertain, does not address itself at all to the whole question of transport infrastructure in that area. Although other regional development organisations have carried out similar studies around the country, in response to a question of mine to the Government I was told there was no co-ordination of these studies and no co-ordinated response to them. It seems extraordinary to have these studies going on and projections being made without there being any coherent approach to the whole question of regional development.

If I might address myself to the question of public transport, it has to be accepted — and I am sure the Minister will accept — there is no possibility of a comprehensive public transport service being provided by the private sector. CIE exist because of the failure of private companies in the past — in the thirties in particular — to provide such a service. The State had to step in to take over because of the utter chaos obtaining on account of the operations of private bus operators at that time. There is clearly no possibility whatsoever of the private sector taking over CIE railways. We will have spokesmen for PAMBO clamouring for routes in the Dublin city area and, presumably, profitable routes in other cities, demanding that they should have a share, but they have never indicated that they are prepared to take on the loss-making routes as well as the profitable ones. The effect of handing over such routes to them would be that the State would still have to carry the can and be responsible for a truncated service, with no co-ordination and, more than likely, the subvention required by the State would be greater in the long run.

The Bill before us has been fairly significantly amended in the Seanad in many important respects. Many of the objections voiced in relation to the original Bill were met by the Minister to some extent. I know that workers in CIE describe the whole approach in the original Bill — and I think many would be of the same opinion today of the present Bill — that it constituted simply the recommendations of the McKinsey report being introduced under another guise. I tend to agree with that view. The point has been made by the workforce and others that there does not appear to be any valid case for splitting up CIE into separate companies. There is no reason whatsoever that CIE could not have been reorganised on a rational basis without the necessity for introducing the type of Bill originally introduced or that is now before us. That is the fundamental objection to the Bill: unless the long term objective is to hive off parts of CIE more easily into the private sector, then there is no other valid reason for its introduction because the reorganisation of CIE under public control could have been done without it. That is not to deny the points made in the Seanad which have led to its improvement. The Minister is to be congratulated for having accepted many of the points made by those who opposed the Bill in its original form but the basic objection remains valid.

The point made in relation to splitting up provincial bus and rail services is a case in point. There are so many points at which these services cross, there are so many aspects of the services shared by both, it does not seem to make sense to split them up. In my view it can only lead not to a cheaper service but to a whole range of duplication of facilities for both services.

The Minister has indicated he will ensure that the majority of board members are common to both companies. That does not overcome the fundamental objection to the problem which could arise in relation to the duplication of facilities, staffing, accounting and so on. There is a very strong suspicion among the staff of CIE that the real reason for this Bill is to render it easier to hive off parts of CIE into the private sector. Staff numbers have already been reduced from 20,000 to 14,000. I am told that there was no consultation at all with the unions before the Bill was published. The union representatives still object to the method proposed to be used to establish the new companies under existing company law. They argue — and I think they have a strong case — that it will make it much easier to liquidate some of them in the future if that is felt to be necessary. We must be reminded of the ease with which it appears Irish Shipping Limited were done away with virtually overnight. There is a need to defend CIE against unreasonable and generalised attacks. Unfortunately I have to say that although, indirectly at any rate, Members of this House are ultimately responsible for CIE, many of the attacks on the company emanate from them. This is despite the fact that many of them are dependent to some extent on the fact that they can have influence on the services being provided by CIE and can gain kudos from that fact with their constituents. Many of those who are most noisy in their criticisms of CIE are representatives of private transport operators. I am not talking about Members of this House. Many of these private transport operators are only interested in getting their hands on the profitable routes and have no interest whatsoever in serving the wider transport needs of the community.

A point which must also be borne in mind in relation to CIE's rail services is that they have, over the past ten years, become one of the more efficient services in Europe. From a study published on international railway economics by Dr. C. A. Nash of Leeds University it has been shown that our services are more efficient than either the British or the German services. That is something of which both CIE and Members of this House should be proud. I ask the Minister to indicate in his response to this debate what he proposes to do with the tourist section of CIE which is a very profitable section. What will be done with Rosslare Harbour which is also under the auspices of CIE and is also a profitable service? I ask the Minister to indicate what commitment he or his Government have to the extension of the DART service. The service which exists at present has been shown to be a successful service. Unfortunately, it serves a section of the city which is not necessarily the one which is most in need of such a service. Nevertheless, it is reaching its targets. If we are serious about having a modern transport infrastructure for a major city, there is a need to seriously consider the extension of that service. Tallaght is an obvious point to which the DART service should be extended.

In the original plans produced by CIE they intended extending the service to a wide range of points around the city and many wayleaves were already provided for this service. I ask the Minister to indicate what plans or what commitment he has to ensure the extension of that service to the areas which are most populous. Tallaght is an obvious example. Blanchardstown, Finglas, Ballymun and Clondalkin are also areas which would, if the service was extended to them, make the whole operation far more profitable and far more efficient.

I wish to refer to another point in relation to CIE, a point which is fundamental to the whole question of our approach to public transport and that is the extraordinary way in which CIE bus fares continue to rise. This has a direct bearing on the drop in passenger numbers travelling with CIE. It now costs a family of two adults and two children approximately £5 to get from the outer suburbs of Dublin into the city centre and back out again. That is an extraordinary cost for many thousands of families who do not have transport of their own. If they can afford to buy a car they cannot afford to run it. We must seriously address ourselves to the whole question of the fare structures and fare levels so that those for whom the public transport system should be primarily provided, those who cannot afford to provide their own private transport, should be encouraged to use it as often as possible. This would have a spin-off effect because those of us who have our own private transport would be encouraged to use CIE buses and trains.

On a number of occasions I have asked the manager of the Dublin city services to introduce a pilot scheme in the Finglas area. Buses which travel from the terminus in Finglas West or Finglas East heading towards Finglas village are more often than not completely empty in midmorning. The buses pass dozens of women with young children walking up to two miles into the village to do their shopping. It would make sense, and I have made this case with the manager, for CIE to introduce a cheap fare, a 10p or 20p fare, for that run from the outer termini in Finglas into the village. It would generate additional income. The response I got from the manager is that he is obliged under the terms of reference given by the Minister to CIE to ensure that the fares relate to the economic cost of the service. It does not make sense that we can have a special rate for shoppers travelling from Parnell Square across to George's Street mid-mornings on weekdays and it is not possible to provide the same kind of cheap fare for women in the main — there are men also — who are passed every morning of the week by empty buses heading in their direction. They cannot afford to pay £1 to get to the shops. There is a need to look at the whole position.

It is clear from that point that I do not accept that CIE are a perfect organisation or that there are no inefficiencies and no waste in CIE. I believe that there is, and to a large extent it is as a result of historical interferences with CIE by various Ministers and politicians who seemed to think in years past that CIE was their playground and they could place people in jobs and interfere in promotions and so on. I hope that day is past and CIE can be run effectively and efficiently by effective and efficent managers. I hope that waste and inefficiencies are cut out and that services which the people need are provided. There would have been no growth in the private bus services which leave Parnell Square and O'Connell Street every week-end for the provinces if CIE had been permitted by top management to be flexible enough to respond to the market needs that exist there. It is not possible for private bus owners to provide the kind of comprehensive service which is needed in this State.

I wish to refer to some points which have been brought to my attention by staff in CIE who are concerned with the direction in which things are going in regard to this Bill. The points made are mainly that problems are arising and will arise because of the contents of this Bill in relation to the demoralisation of staff. They do not feel that they are getting the commitment, the back-up and the security that they need from this Bill to ensure that they give as much of their services as possible to the company. There is a possibility of duplication or even triplication of some staff positions in the companies it is proposed to establish and that will have the effect of worsening the efficiency of the transport system rather than improving it. Interdepartmental movement of personnel, difficult though it is to achieve at the moment, will be virtually impossible if separate companies are established. That development, too, would make it impractical to split up shared office locations, buildings and facilities and would result in various systems of auditing and accounting being duplicated.

One of the submissions made to me by one of the unions involved was that in regard to staff problems, it was generally felt that the considerable funds going on consultants' fees which seem to be readily available could be more advantageously used in motivating staff at all levels and that this motivation could take the form of greater dispersal of information regarding policy, combined meetings, discussions and endeavours by management, workers and unions to face common problems and competition, to improve image, secure more business, recruit lost business and improve the lot of all. That indicates that the staff of CIE are willing and anxious to help in the development of an efficient and profitable service — in so far as that is possible with a public transport system. The manner in which this Bill is re-organising CIE is wrong. Unless we change the Bill drastically it can only lead to problems in the future.

There is absolutely no necessity for the three companies, Dublin Bus, Irish Bus and Irish Rail under the holding company of CIE. This could be done quite adequately with two companies. We have to accept that Dublin Bus is necessary and we would be in favour of that. But Irish Bus and Irish Rail should not be two separate companies but an Irish bus-rail company.

With two companies there would be an unnecessary duplication of services with additional costs in the running of the two companies and there would be competition between the two. The Minister may have suggested, when Deputy De Rossa was speaking, that this would not happen but there would be an extra management structure, additional jobs for white collar workers, additional jobs in middle management and in top management, possibly at the expense of those we should be considering most for jobs, those at the bottom of the scale.

I would like, in the few minutes available to me, to refer to transportation in my county of Donegal. Most people in my county would agree with me that in the early days of this century there was a much better transportation service in County Donegal than there is today. In those days we had the Lough Swilly Railway Company and the Great Northern Railway and one could travel from Dublin to the extreme west of Donegal, to Burtonport, for instance, by train. Those trains were used to export fish, particularly salmon, from there to Derry and then on to Belfast. The fish was then transported from Larne to Stranraer, and then on the train down to Billingsgate market in London. That is not possible now.

When that era was terminated some decades ago we were given the distinct impression in Donegal that we would not be at a loss as a result of this but we certainly have lost over those decades. We were led to believe that more finance would be made available in County Donegal for the improvement of our roads and infrastructure generally. That has not happened. Indeed, the roads in my county, apart from the national primary road which is being grant aided by Europe, have not been improved since then. It was a sad day for our county when this era of the rail service within the county was terminated.

No extra finance was made available then and no extra finance is being made available now to our county. While other counties can avail of a rail service throughout the country, to west Mayo and Galway, to Limerick, right down to Kerry, we do not have any such link. The Government should take this into consideration. While we are being deprived of a service the rest of the country is very fortunate to have, we should be given equal treatment at least financially to try to improve our roads and infrastructure in Donegal.

CIE cannot help us in west Donegal to import the necessary raw materials to the industrial estate in Derrybeg. They cannot help us with the transport service to export our fish from Burtonport and Killybegs. Indeed, CIE are unable to help us with a roll-on roll-off refrigerated service. In this field we are about 20 years behind the times. It only dawned on us how necessary this was when many of the private companies, particularly in Northern Ireland, provided this service. CIE should have been more far seeing. They, too, would have had the money at that stage to purchase refrigerated containers and tractors. They should have been providing this service from the west to Europe and Britain.

We have two sea ferry crossings to Europe where the main markets are but that is an expensive way to export from the west. Because our county is so isolated it is an added cost on our overheads. We are receiving no benefit whatever. Indeed, were it not for our proximity to Northern Ireland which gives us the advantage of being able to get to Larne more quickly to use the ferry, we would hardly be noticed. It is sad that one can leave Waterford, travel to the north east, take a ferry crossing from Larne to Stranraer and drive to London more cheaply than if one leaves the north west and uses CIE services to a point of exit to go further afield.

If these companies go ahead they should, even at this late stage, take a serious look at the possibility of providing a good roll-on roll-off service from this country to the various parts of Europe. Small private contractors go regularly to Greece from here. They are giving a service. I am fearful that CIE could not compete with these contractors. If that is the case there should be some advantage given to these private hauliers by way of a refund of VAT, for instance, to allow them to compete with the roll-on roll-off service from the north eastern part of Ireland and the many who come in from the Continent picking up loads for the return journey. I suggest we do that because even at this stage we cannot compete with them. We are 20 years behind, and the Minister as a member of the Government should consider a refund of VAT for these companies.

After the budget last year there was a refund of VAT for coach tour operators. Unfortunately, that seemed to have been designed for CIE only because only coaches with a height of 3.5 metres were eligible for this. That was absolute discrimination against the many coach tour operators who had to purchase expensive coaches. The yardstick of cost should have been applied instead of the yardstick of height. The smallest coach eligible had to be 10 metres in length by 3.5 metres. Anyone who wanted to avail of this had to purchase a coach which was that little bit more expensive and at the end of of the day it was no advantage to those operators. If it was designed for CIE and CIE had an input into it then it was a shrewd move on their part but it was detrimental to these other people who wanted to improve the standard of their touring coaches but were not on a par with CIE.

The north and west of County Donegal have been serviced by the Lough Swilly Railway Company. I believe a substantial subsidy is being paid to this company by the Department. I am worried because I have never been able to establish whether the Department or CIE have contingency plans to go into operation in the event of this private company withdrawing this service. They are giving a road passenger service, a freight service and a school bus service. Maybe the contingency plans are there, but if they are I would like to hear that from the Minister either tonight or at some stage in the next few weeks. The fears of many people in the county would be allayed if that information could be made available. That company are doing extremely well with this subsidy and with the payments from social welfare because of free travel.

I ask that CIE, whether by their new bus service or their bus cum rail service, give consideration to the part of the country north of the line from Galway to Dublin. It is generally accepted that while we get some CIE touring coaches in the county we do not get our fair share of them. Part of the reason for this is the condition of the roads in the county. CIE cannot be blamed for that, but the Minister here is responsible for CIE and will be responsible for the new companies and the holding company. He should use his influence to try to impress on the Minister for the Environment that he should assist us by providing finance for the roads when we have not got the rail service the rest of the country enjoys.

The taxpayers are contributing quite an amount of their income each year to service CIE. It is not right that the people of my county should be asked to contribute towards this while we are obtaining absolutely nothing in return. I do not think the Minister or any previous Minister could suggest that Donegal was getting its fair share from CIE or from the Department of Communications. When CIE decide that the buses are not good enough for the other counties they send them up to Donegal. The private bus owners in Donegal can provide a service to Dublin at less than £10 while CIE's charge is twice that. It is sad to see CIE buses leaving Donegal and Letterkenny and coming to Dublin. They cannot compete with these other people who are giving a service, not merely for the sake of doing so but to make a profit. If they can do it at the price they charge why cannot CIE do it? In speaking on a transport Bill I must compliment those people. Were it not for the service they have given over the years people in Donegal would have been much the worse off. In our county we have little to thank CIE or the Department of Communications for with regard to transportation.

I must compliment the management at Stranorlar who are responsible for the school bus service in the county. They do an excellent job there. They are the only management in this sector with whom we have direct contact and it would be remiss of me if I did not refer to them. They are having serious difficulties at the moment. CIE may not know that a great deal of the time of CIE officials in Donegal is spent trying to prevail on the private school bus drivers to continue to give the service. I can appreciate fully the difficulties of the many small bus owners who are providing this service, driving on rural roads which have not seen maintenance for the past 20 years. That brings me back to the initial point I made, that if we are to obtain a reasonable service — and I cannot see CIE in the short term improving on this — then we should receive income in some other way to improve our roads and our infrastructure generally so that at least on a financial base we would be on a par with the rest of the country.

We cannot term ourselves as being on a par with the rest of the country as far as free transport is concerned. People from any other part of the Twenty-Six Counties have the advantage of free transport but we do not have this to the same extent. The new companies will have to give serious consideration to opening discussions with the private bus companies from Donegal and ask them to consent to give the free transport service to those who qualify for it. Because of cutbacks in the Department of Health and in the North-Western Health Board, many people in Donegal find it is costing them up to £150 per trip to find their way to Dublin, whereas those buses leaving the west and coming to Dublin should be able to provide the free transport service. Certainly there is a case for having discussions with the private transport people in Donegal. I hope CIE will accept that they were giving that excellent service and that they should not try to do anything to hinder them.

CIE have come in for an amount of criticism, some of it fair and some of it unfair. CIE in their present form have served the people reasonably well over the years. Their biggest fault is that they did not move with the times and the workers were always made the scapegoat. In many cases the management were appointed by political parties not because of their ability but because of their political affiliation. They had no interest in changing CIE's structures where that was necessary.

Having regard to their monopoly, CIE should have been able to operate in the markets available. However, private enterprise outpaced them and outpriced them and, as a result, thousands of jobs were lost to CIE. I worked in Enniscorthy with CIE and at that time 25 or 35 people worked in the goods station. Today that station no longer operates and those jobs have been lost. That is sad and it should not have happened. Today the goods come to Carlow and private enterprise companies are collecting them and delivering them to the various towns in Wexford.

Deputy De Rossa referred to Rosslare Harbour as a profit-making section of CIE. It continues to operate efficiently. In 1984 the profits were £1.277 million and in 1985 they were £1.328 million. That shows the importance of developing Rosslare Harbour for the south-east and the country in general. Over one million passengers came through Rosslare Harbour last year and facilities are being developed in that area. Perhaps the development is not moving as fast as it should. There was a lot of aggression recently because the Government had not applied to the EC for moneys which were alleged to be available. All moneys coming from Europe have to go through the Department of Finance and have to be applied for by the Government. It is not good enough for the Government to say that CIE did not look for it. CIE will be happy to avail of the money. It is up to the Government to recognise the value of Rosslare and to apply for the money to ensure there is continuing development in Rosslare. Because the Minister has family connections with Wexford, he should ensure that the Department of Finance will apply for whatever moneys are available from Europe.

Many Deputies have claimed that CIE should not be part and parcel of Rosslare Harbour. CIE and their workers have a role to play in the development of the harbour. They have excellent labour relations in that area and they have a strike-free record in Rosslare Harbour. They have excellent customer relations; the workers are committed to their work and many have family traditions in CIE going back many years. It is important that we politicians recognise the important role that CIE have played there over the years and we should ensure that they are part and parcel of whatever further developments take place.

The McKinsey report did not champion the railways, but they are a very important system expecially for the south-eastern region. There is a tendency to run down railway lines. The Dublin-Rosslare line should be upgraded along with the Wexford-Rosslare Harbour-Waterford line. The equipment being used on those lines should be upgraded to cater for the thousands of tourists coming through Rosslare. CIE are waiting for the Government to give the go-ahead to put new rail cars on the Dublin-Rosslare route and this would increase the quality of service. There has been major investment on the Dublin-Cork line and the facilities there are top class. I do not object to that but it is important that the link to the south-east should be given the same facilities as this is a major tourist area and all politicians have put a major emphasis on tourism. We should have up-to-date equipment to cater for the million passengers coming through Rosslare every year. We should encourage them to travel by rail and bus and use CIE facilities.

Dublin city is choked with cars. The DART service is a worthwhile service. Some rural Deputies criticise it from time to time because of the huge amount of money spent on it. It is essential to encourage more people to use the feeder service and the DART and the bus services in Dublin. Recently I took a taxi from here to the Mater Hospital for an appointment and it cost me £4.10p. I returned on a bus which cost 45p. Obviously the bus service is value for money. I wonder how the taxi service in Dublin can attract business having regard to the high prices they charge. The Dublin city bus service should be continually improved so as to encourage people to leave as many cars as possible outside the city centre.

In relation to school transport, the thing that amazes me about CIE is their inflexible attitude to change. Their catchment areas for the school buses were worked out many years ago but they refuse to change where changes should take place, for instance, where there was a pick-up point for children which is now unused and where perhaps a mile up the road a number of children are attending school and a more convenient pick-up point for them would be more appropriate. The school transport system should be reviewed and perhaps it could be handed over to private enterprise. In the rural areas a lot of this work is done privately. Perhaps this area, with little cost to CIE and little effect on employment, could be hived off to private enterprise and they could operate the system as they saw fit in each rural area. The Minister should look again at rail and bus services because avoiding competition will cause friction. Therefore, the company should consist of one body or board.

Táim ana-bhuíoch de na Teachtaí Dála a ghlac páirt san díospóireacht tábhachtach seo ar Chóras Iompair Éireann. Do thaispéan siad tábhacht gnóthaí an bhoird do pholaiteoirí agus lucht oibre CIE agus is dócha gur nocht siad smaointe na mílte daoine atá ag brath ar sheirbhísí taistil CIE. Táimid uile anseo beagnach ar aon aigne maidir le atheagrú CIE agus a thábhacht do lucht oibre CIE sna blianta atá le teacht. Tá sé soiléir go bhfuil muintir an Tí seo uile ar thóir maitheas CIE agus muintir thaistil Éireann.

I appreciate the general support for the Bill given by the House. Members acknowledged the achievements of CIE since they were set up and their very good financial performance in recent years. There is a recognition that CIE are tackling their onerous responsibilities as the national transport undertaking in a workmanlike way. That is not to say that Deputies believe that there is no scope for further improvement. The need to adapt CIE and to equip the board to meet the challenges of the future is recognised by all.

What has particularly impressed me is the more general praise about the change in the image of CIE which has been projected by the board staff and their efforts to try harder. The debate has been most constructive and it was clear that a number of Deputies had done careful research and given full consideration to CIE affairs before presenting their views to the House.

I should like to summarise the major conclusions I have drawn from the debate. There is general support for the Bill and its value is recognised in strengthening and improving the CIE organisation. There is generous recognition of the improvements in CIE, including contributions to those achievements by the chairman, the board and the workforce. There is a will to see CIE succeed and improve their position in the transport market. This is attended by admonitions about the need to improve marketing and a greater need for the board to become customer-orientated with a view to increasing passenger support for train and bus services. There were demands for CIE to utilise the resources and skills available in the interests of utilising the board's assets in a pragmatic and profitable way. There was a recognition that CIE industrial relations had improved considerably and a general wish to improve further transparency in CIE finances.

The major bone of contention was that adopted by Deputy Wilson and his party that there should be two bodies instead of three. Deputy De Rossa said that a case had not been made for splitting CIE into three companies. He said that changes could have been achieved by internal reorganisation. That is not so. It should be remembered that CIE's losses or deficit increased from £2.5 million in the late sixties to £109.2 million in 1982. The situation had previously caused such alarm that the then Government, under the leadership of Mr. Lynch, decided to call in consultants to give an explanation for the alarming increase. Bear in mind that the increase from 1969 to 1982 represented seven times the rate of inflation. However, if it had merely gone up by the rate of inflation from 1969 to 1982 the loss in 1982 would have been £12.5 million. It turned out to be £109.2 million so the Government were right to call in consultants. There is tittle-tattle about a Member of the House who is alleged to be involved in mis-spending about £500 but nothing was done in relation to CIE where there was such an incredible increase in their deficit. That episode has done more to damage the concept of State enterprise than all the detractors of State enterprise in this century.

The McKinsey report was issued in 1980 and recommended that CIE should be scrapped and three new companies created. Road freight and sundry services were to be ended forthwith. The Government rejected that approach on major grounds on which I will now elaborate. There was another part to the recommendation which was that there should be a transport development unit created in the then Department of Transport — now Communications — involving the setting up of an enormous addition to bureaucracy which would have cost more and which would have had little effect. It was wrong of Deputy De Rossa to say that the Bill is a copy of the McKinsey report with a few changes. There are very profound changes in the Bill.

Deputy Wilson, in opposing the setting up of three companies and saying that there should not be competition of any sort between the railways and the bus company, said that what I had said in the Seanad was wrong, that he had never as Minister promoted the idea of three companies. If he wants to see the files I will show them to him. In a memorandum dated 10 September 1982 and circulated to other Government Departments, whose observations were received in my Department before I became Minister, he proposed to accept the McKinsey report in full.

It was not a ministerial circular.

It was approved by Minister Wilson for circulation to Departments——

It may have been circulated to Departments but it was not a ministerial or Government circular.

It was the Deputy's decision when he was Minister. His signature is on a memorandum dated 10 Méan Fómhair 1982.

No decision was made to adopt the McKinsey report. I may have sought the views of——

Deputy Wilson sought the approval of the Government. I will refresh his memory because I know Deputy Wilson is a very honest man and that he just cannot remember. He said in this memorandum that the Minister for Transport would seek authority from the Government to prepare a plan for the creation of a separate Dublin bus company by 1 January 1984 at the latest. He also sought the creation of a separate national railway company and a separate national bus company by 1 January 1985 at the latest. He wanted termination of the road freight and sundries activities at present carried on by CIE by 1 January 1985 at the latest. Later on in the memo he states and I quote:

It could be argued that one Board could operate the railway and the provincial bus services. However the Minister would not favour such a course because this would, in effect, preserve intact a major portion of the CIE structure along with the self sustaining momentum by reason of which, as already argued, CIE as constituted is not susceptible to external or even internal control. He believes that the correct approach is to have entirely separate operations with the competition between the road and rail services being regulated by the Transport Development Unit. Seán Mac Liam, Teachta Dála, 10 Meán Fómhair 1982.

Sent around for observations by civil servants and the Minister knows that. There was no Government decision at any time.

No Government memo leaves a Department without the Minister's approval. If the Deputy likes, I will quote the observations of his colleagues.

Was there a Government decision?

No. There was no Government decision but we have on record the accumulated views of every member of the Government and I can quote them as well if the Deputy likes. So much for the hypocrisy about two or three companies.

Fianna Fáil did not make any decision and that is that.

The Fianna Fáil Minister, Deputy Wilson, proposed doing away with 1,400 jobs in road freight which I have saved. He proposed the full implementation of the McKinsey report.

The jobs are gone in Enniscorthy.

I want to explain to Deputy De Rossa the difference in what I am proposing. I am not having any increase in bureaucracy in my Department. The losses in CIE have been arrested. If the trend of 1969 to 1982 had continued the losses for 1986 would be in excess of £170 million. That is on the normal subvention. The deficit this year would be of the order of £104 million or better. No jobs have been lost and there have been no redundancies or major cuts in services. That is what has been achieved. What I am proposing to do now is to build on those achievements and to give a new environment and a new hope for all those who work in CIE and for all those who need CIE for their transport needs.

I am very proud of what has been achieved in CIE, not just for myself but for everybody in CIE. I believe that the chairman down to the most humble and junior worker in CIE deserve to share fully in what has been achieved. Many Members have said that CIE have received a lot of flak in their time, some of it justified, some of it unjustified. When there is real achievement we should be ready to say so and encourage even greater achievement. I congratulate the chairman, the board and management, and the workforce of CIE and thank them for what has been achieved. I encourage them to keep it up. I would remind them that if the course which was followed between 1969 and 1982 had been continued there would be no CIE today because the Exchequer could not afford £170 million this year, going up by a multiple of inflation.

Deputy De Rossa is wrong in saying that this Bill prepares for privatisation. There is a specific section in the Bill which prevents the alienation of any shares out of State control. The reason for the company format as presented in the Bill is that I have always believed as someone who was born and reared within the shadows of the walls of the CIE works in Inchicore that their enormous property assets and human skills have been grossly under-used. They could be exploited to great advantage in the interests of the company, the workforce and the people.

Unfortunately, as in the case of statutory corporations, CIE can only do what the statute under which they were set up says they can do. They are rigidly confined to what the statute says they can do. The statute is inflexible. CIE will be in a position to seize new opportunities as they arise by changing the memorandum and articles of association. We had the same argument, debate and discussion in the case of the Postal and Telecommunications Services Bill. Why not corporations instead of companies? Because workers fear that companies can be liquidated. That is an understandable fear. We have tried to provide all sorts of safeguards against that in the Bill. If liquidated, all those employed on vesting day go back to the board of the main company with full continuity of service. All services will have to be continued by the board as if they were never interrupted but the company format will allow CIE and each of their subsidiary companies to look at opportunities to exploit their property and human assets to the advantage of the company and the country.

Many of our State companies, notably Aer Lingus, have been brilliantly successful in developing what they call ancillary activities in order to generate profits from those activities to offset the inevitable losses in the transportation side. Aer Lingus did it by exploiting and utilising the enormous skills they had within the organisation. We want CIE to replicate that performance. The company format facilitates that kind of performance.

Can a creditor put in a liquidator?

The provisions in the Bill would, strictly speaking, allow a creditor to seek liquidation. To do otherwise, as was discussed at great length in the Seanad, would be to pervert bankruptcy law and company law. What we have built into this legislation is that should the like ever arise, and it is most unlikely that it ever will, the services of the company and the employees of the company on vesting day will go back to the board without interruption. That is where we are heading for and that is why it is so important for this Bill to build on what has been achieved in the last four years by CIE. An enormous amount has been achieved. The financial results are the clearest indication of what has been achieved.

Deputy Gene Fitzgerald derided the announcement of profit by a Government who had no other good news to announce. It was not announced by the Government at all but announced by the Chairman of CIE. What we have done is to bring the presentation of accounts into line with how accounts of transport companies are presented in almost every other country in the EC. When the State ask CIE to provide a service they say they are going to pay so much for that service just like every other customer and just like the State pays in the Social Welfare Vote for the free travel of old age pensioners etc. and in the Defence Vote for dependants of the War of Independence etc. That is received as a receipt. If CIE can out-perform that target they will have made a genuine profit just as British Rail, if they beat their target, will have made a genuine profit. CIE made a profit of £7 million in 1985, in other words they beat their target by £7 million after at least meeting their targets in 1983 and 1984. We should contrast that with what occurred in the previous 13 years, deficits escalating and multiplying into oblivion.

There is no room for complacency although a great deal has been achieved. A great deal more remains to be achieved. Yes, we have guaranteed the future of the road freight operation that was scheduled for closure in 1982. That section of the company has been turned around and is making a profit. We transferred the hotel division out of CIE ownership and now they are almost at a break-even stage because they were put under better management structure in the State sector.

The European Social Fund is helping.

It may be but the move was sensible. That operation had been losing millions and now, while it is still in the State sector, it is doing well. Hopefully, next year it will move into profit. The canals, which are no longer a means of transportation, have been moved from CIE to the Office of Public Works. CIE have responsibility for the Dublin city bus services, the provincial buses, the railways, road freight, and international tours. I want the company to build on their achievements and go on to meet the targets set by the Government for 1989 as they have met the targets set by the Government back in 1983. If the company can do that the provincial bus service will be making a profit of about £4 million, the Dublin city service deficit will be one-quarter of what it was in 1982 — it is already down to half of that figure. If the company can achieve the targets we have set them the railway deficit will be contained and the escalation halted.

However, I am thinking in more ambitious terms than that. It is my belief that the Dublin city service is capable of breaking even and at a reasonable fare level. I take the point made by Deputy De Rossa that fare levels are high, particularly for those who live in the outer suburbs. Deputy Browne made the point that to take a bus from the Mater Hospital to the Dáil for 45p was very cheap when one compared that charge with the taxi rate of more than £4. However, we must consider the example given by Deputy De Rossa of the unemployed husband and wife with two children living in Finglas wanting to travel to the centre of the city. It will cost that family £5 to make the journey to and from their home. That is a lot of money for such a family to have to pay. His criticism was valid.

I have indicated on several occasions that while meeting the targets I set CIE must achieve at least a stabilisation of bus fares and, if possible, a reduction in the years ahead. With the introduction of one person buses after years of protracted negotiations there is a possibility of reduced bus fares in Dublin. I have been told by the chairman, and board of CIE, that when the one person operation is complete within a couple of years CIE will be able to offer major reductions in fares especially to constant users. Another target I set for CIE was to reduce Dublin bus fares while at the same time reduce the deficits. I accept that my targets are ambitious but given the right environment, good management and leadership they can achieve them.

I take Deputy De Rossa's point that for too long CIE were messed up by interference by politicians in their day to day operations. That has occurred. I am not referring to Ministers or the Department only and I suspect that they did not interfere as much as TDs. Members of the House have been under pressure in regard to different services. If the company propose to remove a service or alter a route political pressure is brought to bear on the company not to alter the position. The company were not allowed do what they wanted. The result was that management were not controlling the company and that was a significant factor in the deterioration of the finances of the company. That deterioration was scandalous and inexplicable during those 13 years, even allowing for the fact that in that period we experienced a big increase in fuel prices and car ownership. The factors I have mentioned combined might have resulted in an increase of three or four times the rate of inflation but hardly seven times the rate of inflation.

We never seriously addressed how the State relates to its companies. Many of the problems in the State sector arose because the relationship between the State and the companies was never properly thought out or defined. For instance, appointments to State boards all too frequently were considered as a type of substitute honours system under which party worthies were appointed. They were worthy people in their own right but they were not always suited to the board to which they were appointed.

Is the Minister saying that this has changed?

It has changed substantially. I am not saying that there is perfection now or that any one party in Government was any more guilty than another but over the 13 years those appointments were a factor. I am not making a party political point about this but it is a trap that successive Governments fell into. I can understand the pressures they were under. Secondly, we did not equip our Departments with the necessary accounting skills to vet the finances and accounts of the State companies. When I was appointed Minister for Transport on 14 December 1982 I was astonished to find that there was not one accountant in the Department. We now have a financial unit in the Department. Thirdly, no serious financial objectives were set and the mandates were unclear, if they were mandates at all. Meetings between Ministers and the boards of directors were rare. There were no regular reports on the finance as against the budget; certainly there were no quarterly or half-yearly reports or even reports on losses. Many changes have taken place in the last four years. We now get four-weekly financial reports against budgets submitted at the beginning of the year and if things are going wrong we can detect them early on. While it is important that the Department should have those figures it is equally important that the companies should have them.

I was astonished to find in 1983 that CIE had not these figures themselves. Is it any wonder that things went wrong? There was not a budget broken down, subhead by subhead, Department by Department, accounting period by accounting period, so that things could be checked against it. I asked about this before I went to the Government to ask for a five year budget and found that there was no such management information available, that it would take some weeks to assemble it. That major change has given, at least, controls over the finances to the board and the Department if things are going astray and mainly because of that principal change, things are less likely to go astray. We now have a proper financial unit which can vet these figures, read them and understand them, which has diminished the likelihood of things going wrong as they did 30 years before.

I wish to thank the Deputies for their contributions and particularly to thank Deputy Wilson, although I disagree with him concerning the two companies. His was a wide ranging contribution to the debate. It was typically constructive, as always, and the points I have not been able to answer here I shall answer direct to him and to the other Deputies concerned. When we pass this Bill we shall be doing a great job for CIE, for those who work there, for those who need CIE for their transport needs and for our country.

I am grateful to the Minister for his promise to answer the questions about transparency and the other matters. I should also like to put it on the record that the Fianna Fáil Government made no decision to implement the McKinsey report.

I have already said that.

Question put and agreed to.

When is it proposed to take Committee Stage?

On next Tuesday, 25 November, 1986, subject to agreement.

Committee Stage ordered for Tuesday, 25 November 1986.