Liz O'Donnell
Question:30 Ms O'Donnell asked the Minister for Transport, Energy and Communications the State subsidy to the transport industry; and the Government's policy regarding future availability of such subsidy. [3755/95]
Written Answers - Transport Subsidy.
Seamus Brennan
Question:187 Mr. S. Brennan asked the Minister for Transport, Energy and Communications the reason for the 5 per cent reduction in the CIE State subsidy in the 1995 Estimates. [3790/95]
I propose to take Questions Nos. 30 and 187 together.
State financial support for the provision of socially necessary but financially unviable public transport services has been very substantial over the years. In the past ten years a total of over £1 billion has been provided by way of annual Exchequer subvention to the CIE group. In 1995 a sum of £99.5 million is being provided by way of Exchequer subvention to CIE.
The high levels of State financial support for the provision of public transport services reflects the commitment of successive Governments to the best possible provision of public transport services nationwide. Approximately 90 per cent of the annual subvention goes to support the rail network. This level of support for the railway, together with the major mainline rail investment programme totalling £275 million planned in the period up to 1999 again indicates the importance attached by the Government to the upgrading and development of the railway. The balance of the subvention is deployed in support of the extensive range of socially necessary urban and rural bus services provided by Bus Átha Cliath and Bus Éireann.
The levels of subvention paid to CIE in each year are determined by the Government by reference to a range of factors, including the financial situation of CIE and more generally the need to balance the many urgent and competing demands on the Exchequer. Successive Governments have pursued a policy of containing, and where possible reducing CIE's requirement for State financial support. This policy and the CIE Group's positive response to it, has resulted in a reduction of over 30 per cent in real terms in the CIE subvention since 1980. Moreover, this reduction has been achieved while maintaining the extensive network and levels of service provided by CIE and has been accompanied by a major improvement in productivity throughout the CIE group.
Until Government decisions on the future development of the mainline rail network were made last year in the context of the National Development Plan, and pending completion of negotiations with the European Commission concerning the operational programme for transport, it was not practicable for my Department and the CIE group to fully develop a multiannual business planning framework to address subvention levels and other key business issues facing CIE for the period to 1999.
Now that these critical policy decisions have been taken, my Department is engaged, with the CIE group, in a detailed analysis of the CIE Business Plan 1995-1999. That analysis will address a wide range of issues arising in relation to the future development of CIE and its operating subsidiaries, including appropriate subvention provision in the context of a multiannual planning framework, while recognising the prerogative of the Government to settle definitive levels of subvention on an annual basis.