I am assuming that the procedure which was followed in the other House will be acceptable here; that is, that this measure and the Railways (Miscellaneous) Bill, 1931 be dealt with together; that we may refer to the Railways (Miscellaneous) Bill while the Road Transport Bill is under discussion, so that the debate on the two Bills would take place simultaneously.
Road Transport Bill, 1931—Second Stage.
Question proposed: "That the Bill be now read a Second Time."
Minister for Industry and Commerce (Mr. McGilligan)
Cathaoirleach
I am sure the House will have no objection to that procedure.
Mr. McGilligan
The first of these Bills is the Road Transport Bill, 1931. I can state the aim of this Bill with a fair amount of brevity. It deals with road passenger services in the main. It establishes a new situation with regard to road passenger services —a policy at which we have been aiming for some time, and which was foreshadowed some years ago, when in this House the question of co-ordination of the transport services was first raised. I then indicated my point of view, that co-ordination of the transport services could best be brought about by some of the great transport concerns in the country, that is, the railway companies and the tramway companies getting into the field that was affected by road competition, and making way at least to the point of demonstrating that they could operate passenger services by road as efficiently as any of the rather disorganised privately-owned companies. Later on, when an appeal was made to me by the Great Southern Railways Company a Bill was brought in giving power to the company to run vehicles upon the roads. That measure was passed in 1927. Railway concerns operating road vehicles were subjected to certain restrictions, in fact to greater restrictions than those I had in mind when first bringing in the legislation. But these restrictions were insisted upon by the Oireachtas on the grounds that if the railway companies were not bound in some way they could, owing to their superior financial position and to their better organisation, crush out all the smaller concerns then on the roads. It was considered that it was not in the public interest that that should happen, and so we had the restrictions in that measure.
In this Bill we propose to remove all the restrictions that at present lie upon the railway companies—the restrictions put upon them by the 1927 Act. We subject them only to the regulations at present laid upon any other transport agency running passenger services on the roads, i.e., regulations with regard to speed and safety. They will have imposed on them the same taxation that lies upon those who own bus companies and who run them for their own private profit.
In the second place, in this Bill we lay down as a general rule that after a certain date nobody, railway company or private concern, will be allowed to run a passenger service on the roads unless there has first been obtained a licence. All passenger services hereafter will be carried on under licence. Distinction is made in the legislation with regard to the giving of these licences. Where the services have been carried on efficiently and adequately for twelve months before a certain date named here, then it is stated that the Minister must give a licence on application being made. Those services that have already been operating for a year efficiently and adequately, on making an application for a licence under the new legislation, must be given a licence. So far as other people are concerned those not on the roads for a year and those who have not been running what could be described as an adequate service, are not automatically to get a licence. They may be considered as suitable for a licence, but it is in the Minister's discretion as to whether or not the licence should be granted. There is a second Section in this Bill which deals with the attachment of conditions to those who do get a licence. Conditions may be imposed on both classes, both those who on application must get a licence, and those who merely may receive a licence. In other words, when the Minister is giving a licence, whether he is bound or whether it is within his discretion to grant this, he may attach conditions to the granting.
As I indicated in the Dáil, the main value of this Section with regard to the attachment of conditions is that it enables me to carry out a particular line of policy, and that line of policy is this: I intend to operate that Section of this Bill so as to secure that in a relatively short period after the passing of this legislation there will be in the main three transport agencies in the country. There will be in the Dublin City area the Dublin United Tramways Co., and its allied bus services; there will be outside the Dublin area in the main the Great Southern Railways Company and its allied road services, and in another portion of the country there will be the Great Northern Railway Company and its allied bus services.
There will be therefore three zones: The Dublin zone I define as an area of fifteen miles radius from the G.P.O. and within the Greater Dublin area of that zone it is my intention to attach conditions that the long distance passenger bus services will not be permitted to take up and set down passengers. In other words, the long distance services will not be allowed to cater for local traffic within the Greater Dublin area. I have said that in the main there will be these three transport agencies. I do not think there will be a monopoly in each of these areas. I must license other independent bus owners who have already been giving good service to the public for twelve months. Though these people will be subjected inside their zones to competition from the railway company and the tramway company, under the new regulations there will be sufficient power given to the Minister to regulate transport in these three zones, so as to establish firmly the three agencies I have described, but also to have with them these private operators who have so far justified themselves. They may in the course of time disappear by the process of amalgamation, purchase or absorption; but that will have to be left to time and to whatever arrangements may be made between the companies and the private owners, and to whatever sanction the Minister may give under the terms of the Bill when it becomes law.
Those are the two main items under the first of the Bills. We free the railway companies and the tramways company, in so far as they are going to operate road passenger services, from any and all regulations which at the moment impede them. If there are to be any regulations placed upon these companies it will merely be the regulations as to speed and safety as apply to all bus proprietors. All the services will operate, in so far as passengers are concerned, on a basis of equality.
The other aim of the Bill is so to regulate affairs of the passenger service type that hereafter there will be three zones. There will be one reserved for the Tramways Company and its allied bus services, together with a small number of independent bus proprietors. Outside that there will be the area covered by the Great Southern Railways Company and its allied bus services, again with a small number of bus owners who have proved themselves efficient. A smaller part of the country will be left to the Great Northern Railway Company and its allied bus services. These are the two main items in the first of the Bills.
The second Bill, the Railways (Miscellaneous) Bill, deals with the transport situation from another angle. Of the two Bills with which I am dealing, it is the less properly understood one; in fact it is the worst understood piece of legislation that has been brought before the public, if I am to judge by comments made upon it. I will refer first to the two items specifically dealt with. Two special matters arise in connection with this second Bill. One has reference to the directorate of the Great Southern Railways Company. In that we are operating pretty definitely at the request of the Great Southern Railways Board itself, and the clauses are there and can be read. They allow for a gradual reduction in the directorate to a certain minimum point.
The second point is the debated and vexed question of the branch lines. There has been a considerable misunderstanding as to the effect of this part of the second Bill. At the moment there is considerable legal doubt as to the situation in respect of the baronially guaranteed lines. I know there is a considerable volume of legal opinion to the effect that the baronially guaranteed lines can never be closed down or abandoned. I know in addition to that legal point of view there is the equitable point of view, that so long as any baronial guarantee is being paid a line baronially guaranteed should not be closed down.
In addition to the baronially guaranteed lines there are other lines in the country which were built out of public funds. Some of these had attached to the giving of the grant a statutory condition that trains to a certain number should be run for ever. In other cases grants were given without these conditions being laid down. There is doubt, owing to the amalgamation scheme, as to the exact position of the Great Southern Railways Company which, at the moment, would stand in certain areas as the operating company under pledge to the building company to operate certain trains in perpetuity.
We take the baronially guaranteed lines and those other lines which were built out of public grants, and we say that where there was a statutory obligation that obligation continues, to start with, but only to start with. Where there was no statutory obligation in relation to the number of trains which should be run we say, to start with, that the railway company must run such number of trains, as in fact they were running when this Bill was introduced. I have emphasised the phrase "to start with," because it is only as a beginning that we stereotype that situation and we do that first to clear up legal doubts and thereafter to give ourselves power to withdraw statutory obligations if they are found to exist.
On an application being made to the Minister, he may grant certain orders. The orders may be in the nature of a modification of the service or they may be in the nature of a complete cesser of the service. I have taken certain power to hold local inquiries. It will be my object to have a local inquiry in nearly every case in which an application is made for the cesser or the modification of a service on a branch line if that line is a baronially guaranteed line, or if it were built out of public funds, whether or not a statutory obligation attaches. The local inquiry has this definite purpose. We want to have displayed to the people of the neighbourhood affected the conditions under which the two types of rival service will be run; in other words, we will get the economics of the two types of transport explored.
At the inquiry information will be produced in reference to the branch line and we will be told that its expenses are so and so, and that it serves such and such a route. The alternative offered is a service by road. Maps can be produced and the people will be in a position to see what areas it is proposed to tap, and they can get a good idea of the economics of the different services. After public opinion has been canvassed by means of the inquiry a decision can be arrived at as to whether the branch line should be closed and the railway company's obligations in regard to it removed. These are the two main points.
May I start now to deal with the misunderstandings to which I have referred? It has been expressed to the public recently that I have imposed special obligations on the railway companies, and those who use that phrase do not hesitate to use it in such a way that the impression is created that Clause 6 of the second Bill has a reference to the entire area of the railway companies service. It has no such relation. It relates only to such portions of the railway services as are either baronially guaranteed, or were previously built by free grants of public money. We think it is right that where a railway company came into possession of, say, certain moneys from these baronially guaranteed areas, or came into possession of a piece of line built, not at their expense, but at the public expense, they should, for a start, at any rate, have the obligation put upon them to continue the running of such service as they were in fact giving until they make the case that the service should be discontinued. When that case is being made, it will have to be shown that an alternative road service will be provided by somebody. One gets back to the origin of this: that when public money was granted it must have been because the necessity of subsidising transport in certain areas was felt and the subsidy was given either by way of a baronial guarantee or else a free grant of money. We think that there are certain obligations put upon the railway company in consideration of their getting baronial moneys or else of getting a railway provided without any preliminary costs to themselves.
With regard to the rest of the lines the situation is as it was before the introduction of this Bill. If the railway companies had previously power to abandon any section of their main line—and I think they had considerable powers in that way, powers which would probably frighten the public if the public were properly apprised of these powers—then they can still operate these powers. The only handicap put upon them is that the Railway Tribunal may come down on the railway company on either of two grounds: that the closing or the singling of any portion of their main line may operate unduly to the disadvantage of the travelling public, or may operate as a preference to one port against another. But if the charge brought before the Tribunal, on either of these two points, cannot be justified, then the railway company can close down or single their lines, or modify in any way whatever services they are at present running on their main lines. I want to stress again that the part of the Bill which in any way can be described as imposing obligations, has reference only to those portions of the line where there are obligations pretty definitely existing at present. If it goes one step beyond that it is only in this limited way, that there may be portions of line built out of public moneys with no statutory obligation to run trains attaching to them, and we say, in order to have a clean situation facing us at the beginning, the railway company must operate existing services until they get an order modifying or ceasing whatever services they were, in fact, operating at the date on which the Bill was introduced. I consider that no hardship. If the railway company for its own good reasons was operating a service in a particular place where it was not called upon to operate a service, it is no hardship to ask the company to continue that until such time as the people in the locality are enabled to appear before a local inquiry and give reasons why that service should be continued or why an alternative service should be provided.
I am told by critics of the Bill that the Transport Bill simply allows the railways to ply on the roads for passenger service. That is a complete misstatement. The phrase used is that it simply allows the railways to ply on the roads for passenger service. If one is to read into that that it allows the railway companies to ply but that there is hidden somewhere some restriction which is not going to apply to any other operator of a passenger road service, then the phrase is completely wrong. From this time on all those who want to operate passenger services must get a licence, the railway companies as much but no more than any private operator. They will all be put on the footing of equality. In a sense, the railway companies are getting more benefits from this, because up-to-date the railway companies were hedged about with restrictions, and these are being removed in their entirety. If the arguments previously used in 1927 have any weight at this moment, the railway companies are going to be put into a very much superior position to any other transport agency. The old arguments were that they were in a superior position financially and also in regard to terminals, sidings, sheds and everything else, and that therefore the railway companies would be able to offer a much better service—road and railway service. If that argument had any weight, it has as much weight now as in 1927, and by freeing the railway companies from that restriction put upon them, we do put them in possession of an advantage over all their natural competitors.
I have been told that the great defect of the present method of dealing with transport is that it leaves the railway companies still shackled with an enormous number of obligations which do not apply to their competitors. I have heard that phrase used often, and I always notice that there is a disinclination when the phrase is used to have details given as to what are the impediments and the shackles put upon the railway companies. I know one that is referred to is the Railway Tribunal, and the Railway Tribunal is mainly referred to in relation to one point, and that is the fixing of the fares. If that is the gravamen of the complaint against this legislation, I want to know what is the alternative? One alternative has been expressed, and that is that the railway companies should be put in a position to deal with their own fares, subject only to an overriding maximum. In other words, it is said that while the railway companies have to meet competition by road, they are shackled in their efforts to deal with this competition, and that they are shackled mainly by the fact that they have their fares fixed by the Railway Tribunal. The alternative definitely suggested to this is to allow the railway companies to fix their own rates and fares subject to some overriding maximum. I want the reactions of that observed. First of all I want to clarify the position a little bit. The railway companies have no shackle upon them whatever in relation to road services, whether passenger or goods. From this time on the railway companies can put lorries or buses on the roads. So far as they are buses they will be subject to the same regulations concerning licences as any other concern, and no more. In regard to lorries, the goods carrying type of vehicle they will be entirely free. They can cut rates; they can beat down any competitor so far as road traffic is concerned. When it comes to transport by rail they are certainly subject to the limitations spoken of, and for a good reason. There is a certain limitation in having the rates fixed, but I want the full extent of that limitation observed. The Railway Tribunal was asked under the 1924 Act to establish what should be the standard revenue to the railway companies. Having established that they were asked to establish what were called standard charges, such rates as would enable the companies with proper and economic management in any year to bring in the standard revenue. These rates have been fixed. The railway companies, under the terms of the 1924 Act, can at any moment reduce any of the standard rates down as low as 40 per cent. below the rate without going near the Railway Tribunal. If they wanted to fix anything lower they must go to the Tribunal. But in the circumstances of the last couple of years the Railway Tribunal procedure has been to allow the railway companies, when they find the necessity upon them to reduce the rates even more than 40 per cent., to make the reduction right away and to come to the Railway Tribunal for retrospective sanction afterwards. That is the procedure which has been adopted, and I know no instance of the railway company dropping a rate even lower than the 40 per cent. allowed and being refused retrospective sanction by the Railway Tribunal afterwards. All that we impose in the way of obligation on the railway companies is that they should make their case, either before or after the event, to the Railway Tribunal in relation to a lesser charge.
I think the Tribunal is necessary in such a case, and for this reason. If the Tribunal is not to be there, what would be the situation? The railway companies will be faced with a trader in a certain town who has been approached by a lorry-owner to take goods, say, between Athlone and Dublin, and a rate is quoted. The railway company, wanting to get that traffic, will quote for that trader a rate lower than the lorry-owner had quoted, and they need not quote the same rate to another trader in the same town. All the whole mass of legislation built up in order to prevent undue preference between individual traders is wiped out. Again, if the railway companies want to divert traffic, so as to get the long railway haul, which is always its object, they may quote to a trader in a Southern town sending out goods by a Southern port a rate which they may not quote to other traders who are not sending out goods through that port. Having diverted the traffic from that Southern port to Dublin, they may then close the route. They have effectively closed the route when they do away with the business, and then they can raise the charges back to the overriding maximum. The Railway Tribunal only functions to prevent undue discrimination between trader and trader and port and port. That is what is called the shackles put on the railway companies, and that phrase is used in relation to the procedure I have outlined: rates fixed on a certain basis, 40 per cent. reduction allowed to the railway companies without any appeal to the Railway Tribunal, and for any rate they drop lower than 40 per cent. they go for justification generally post factum to the Tribunal. I think the Tribunal is a necessary factor in this whole situation; somebody should be there to see that when these rates are given they are going to be given to all and sundry in particular areas. Without the supervision of the Tribunal I think the situation will undoubtedly be that some trader will get a preference over other traders in the same line of business and in the same area, because one will be approached by a lorry owner and the other will not. Ports will get a preference one as against the other, and the old regulations which we had amassed in order to prevent undue discrimination as between trader and trader, and area and area will be wiped out, and will not for years be reestablished.
I am told the Railway Tribunal has cost the Great Southern company many thousands per year, that £20,000 has already gone in hard cash. It is difficult to evaluate that statement in the way in which it is made. If it means that the £20,000 has been paid in appearances before the Tribunal I do not consider it is worth arguing about. £20,000 in seven years or £3,000 per year is what the railway company is being made to pay in order to justify itself before the travelling public and the users of the railway. I suggest to those who agitate about this that they should get a segregation of that £20,000 and find out how it has been spent, find out how many delays and adjournments of the Tribunal there have been asked for and urged by the railway company itself on the ground that it had not its case fully prepared, and that it had to get further details. They should ask for a segregation of this money so as to find out how much of that money has been spent, say, agitating against what are described as the shackles now put upon the railway company. They should find out how much money has been spent on this item of exceptional rates, or of fares that have been dropped below the 40 per cent. allowance given to the company.
The phrase has also been used that the railways cannot move hand or foot in any direction without leave of the Railway Tribunal or the Government. I do not know any point in which the Government comes in in regard to the railways, except in so far as they have established the Tribunal. I know that the Railway Tribunal comes in in the way I stated. I know another body that comes in, and it is said, also, that that is Governmental activity although it is not said to be this Government's activity. A change is requested in this also. I am told for instance that the companies have to pay wages imposed upon them by a Government of former times, which are absolutely out of date so far as present values are concerned. This is brought in in the context of Government interference. Again, what is the exact situation there? There was established in the first instance by an agreement with the railway trade unions certain machinery for negotiation in connection with wage disputes, and that includes an appeal to what is called the Irish Railway Wages Board. The composition of that board is interesting. There are representatives of the company, of the men, of the traders and the trading public generally—Chambers of Commerce and bodies like that—and there is an independent Chairman. The railway companies and the unions can make their appearance before that body when there is any question of wages being debated. If there have been imposed upon the railway companies wages which are now absolutely out of date so far as present values are concerned, then they have a tribunal before which that case can be made. On a tribunal weighted in that way the representative of the railway companies may be expected to take one point of view about rates of wages, and the unions may be expected to take another, but beyond these, and having a decisive say in the whole matter there is an independent Chairman and representatives of the trading public. If the present wages imposed upon the railway companies are completely out of date in respect of their value for such services as are given, there ought to be a clear case which they can make before that independent body, and get some satisfaction. We are invited to condemn the Railway Bill as a failure, because I presume it does not in one swoop reduce these wages to whatever somebody—not that independent body but somebody else—considers to be the fair wage that these employees should get at present. We do not intend to change the wages board. The board has given satisfaction, I think, so far, and until a case can be made clearly that the railway wages board has not taken into consideration certain factors which operate, and that it is in fact an unreliable body, we think it better to continue the board in operation.
The last items referred to by way of criticism of this Bill can be taken together. I am told that this Bill imposes an obligation in the shape of having to run trains provided or not provided for in certain circumstances. That I have answered in part. The second part of this argument is that the railway companies are obliged to re-open closed lines at the will of the Government and to maintain lines that are closed. I can only take that to be a complete misreading of sections 8 and 9 of this Bill. What do the sections amount to in fact? That an application must be made for the modification or the complete cessation of existing services. They say that an order may be made by the Minister if and when he is satisfied that alternative transport facilities will be available, suitable and adequate to the needs of the public. They then go on to say that such order may be revoked but cannot be revoked unless first of all notice is given of the intention to revoke, and, secondly, unless the Minister is satisfied that by reason of the transport facilities alternative to the railway not being or having ceased to be available adequate transport facilities are not now available. There is a phrase, which has been the subject of a great deal of misrepresentation, used in section 8 (2) (c) to the effect that where the Minister has made an order allowing for the cessation of a service such order shall not relieve from, or affect, any liability of the company owning the railway to which the order relates to maintain all bridges, level crossings, fences, drains and other works constructed and maintained for the use, accommodation or protection of the public generally.
That is an important section and that is an important precaution which has to be taken. If and when a railway company abandons a line, it does not merely finish with the situation by dropping the service, lifting the line and sleepers and disposing of the land to other people. Generally speaking the railway companies have undertaken certain obligations to the county councils with regard to bridges. They have undertaken certain obligations to the road-using public in relation to level crossings and they have undertaken certain obligations to the owners of surrounding property in regard to drains. If and when a railway company abandons a line, it has got to make its peace with the other people affected —the local authority with regard to bridges, the public generally with regard to level crossings and other owners in regard to drains and such things. All we say is that we do not give them power to close and abandon a line and to neglect everything else. We simply say that the old obligations with regard to bridges, level crossings, drains and fences must be maintained. Those obligations can be got rid of by agreement—with the County Council with regard to bridges and with the other people affected in regard to other matters. There is no clear and definite obligation in any way on a railway company to maintain a line when closed. The argument may be used that as I have power to revoke an Order allowing cesser of a service, in such circumstances, any prudent railway company would keep some sort of line going. That is not necessary. Let us consider the probable circumstances. There is a branch line in existence. The railway company apply for an Order to close it. They either offer, themselves, to establish an adequate alternative service or they do not. If they do, I think it is only right that I should have some power—even if it be only a power in terrorem—to compel them to keep up that alternative service which they have offered. If they do not make such an offer and I hand the transport over to some other concern, in equity no Minister could ever compel them to reopen the line which they have abandoned, some other transport agency having taken over the business. I think that the fears the railway companies express in regard to this clause are entirely unreal. Their chances of ever having to reopen a railway line which they had abandoned except in circumstances in which they offered an alternative service and then did not provide that alternative service are very small indeed. The occasion I have described is the only one on which that clause could be used and I think the use of it will in fact prove to be very small.
In these two pieces of legislation, I set out to re-establish the railways. I admit in the frankest possible way that that is my intention. I want to re-establish the railways, but not merely as railway concerns. I think it is only right that people who previously embarked their money on services which previously were monopolistic in character and could be regarded as sound securities for the money invested should be protected so far as possible. The only limitation I suggest by the use of that phrase "so far as possible" is this—that there ought to be the fullest protection of these shareholders consonant with the needs and requirements of the trading and travelling public. We are giving these people who embark their money in these concerns the chance of becoming owners of a better transport concern. It will not be a better transport concern if the railway companies remain rail-minded as at present and the tramway companies remain tram-minded. They have got to recognise that a new agency has come into the field and they have got to make use of that second agency. We give them the chance of operating that second agency. They can become owners of road services. So far as passengers are concerned they engage on terms of absolute equality with everybody else. So far as goods transport is concerned they have the completest powers to operate and are entirely free from restrictions. All the experience they have of transport can be utilised in the new type of transport concern which ought to be rail or tram plus omnibus and lorries. We give them every power possible to enable them to develop this new transport agency. I said before, and I say again, that my aim will be, so far as the passenger side is concerned, immediately to weight the position in favour of the two railway companies and of the tramway company. I am not going to do that so definitely with regard to goods at this moment because the situation has not advanced to the point where regulation is possible.
At the moment, there are operating in the Free State about 8,000 lorries. I am told that these are the vehicles which are draining away the life-blood of the railways. Up to about a year ago, the representation made to me was that it was the motor-omnibus which was draining the life-blood of the railways. The statistics would seem to show—and very clearly show—that on the passenger side the railways were losing, and losing fast. So far as these Bills are concerned, we put the railway on a basis of absolute equality and so far as policy goes we give them an advantage over all competitors. On the goods side, the statistics are not so clear and on that side there are difficulties which I have found insuperable. There are 8,000 lorries in the Free State. Six thousand of these are vehicles of between 1 ton and 2 ton unladen weight. Of the 8,000 lorries in operation, 80 per cent. are owned by private traders who operate them primarily for the conveyance of their own goods. Twenty per cent. are operated by carrier companies of the professional type. But 80 per cent. of the vehicles are of the small type of lorry and are owned by traders who, in the main, operate them for the carrying of their own goods. There has been a system adopted of the trader who carries his own goods, in the first instance, looking for return cargoes from other people. I was asked to pay attention to that. I do not think it is possible to deal with it. I think the difficulties at the moment are insuperable. I sought suggestions as to how the matter might be dealt with. The only suggestion made advanced to this point—the difficulties of supervision being recognised. If a trader is to be allowed to carry his own stuff, it is going to be extremely difficult and will require the piling up of a huge administrative bill to secure that that man does not carry any goods except his own. If he is to be allowed to carry his own goods and if it is considered inequitable to allow him to carry other people's goods, the administrative bill in trying to stop the carrying of back-cargo will be enormous. That this was recognised by the only people who put up an alternative scheme—the Great Southern Railways Company—is shown by the fact that they claimed that the only way out of the situation was to prevent traders carrying even their own goods except within a ten mile radius of their base. That was the serious proposition which I was asked by the Railway Company to consider —that we should not allow traders to carry their own goods more than ten miles beyond the point from which they started. I consider that an absurd proposition. It is not one I propose for acceptance at the moment. I have said openly that if any when the railway companies operating under the powers we give in these Bills establish themselves as goods carriers, then the situation will clear itself up and, if it shows any signs of clearing up, we shall certainly do our best to help in the process. If the railway companies, which are now allowed to operate in the freest of free competition—cutting rates, cutting out competitors and operating in any way they wish—if they can establish to the satisfaction of traders that they can give the same door to door service as the trader is at the moment giving himself, I have had it represented to me frequently that the ordinary trader will only be too glad to go back to the railway company operating a decent transport in that way. The ordinary trader does not want the annoyance of the lorry and its driver, the petrol and repair bill, and all the expenses incidental to this new type of service. He only went into it because he found that it was the most powerful weapon in his hands to bring the rail companies to some sense of responsibility and to some sense of fairness in their dealings with him. If the railway companies operate these services so that they can give a decent service from door to door, a lot of the competing services will disappear, and if the railway companies establish themselves in that particular way we will intervene on the goods side as we are doing on the passenger side. At the moment, there are 8,000 vehicles on the roads, 80 per cent. of these being owned by private traders operating mainly for their own purposes. We think it would be most inequitable to stop this legitimate private trading right. We certainly cannot advance to the point to which the railway companies asked us to go—the point at which we would prevent traders carrying their own goods beyond ten miles from where they started.
There are a great many other matters in these Bills but they deal mainly with machinery and can be discussed later. I put forward these Bills as the completion of the amalgamation process started in 1924. I claim coldly and seriously for these Bills that if, and when, they are enacted, they will put the railways of this country into a position which has been achieved by the railway companies of no other country in regard to freedom of operation upon the roads in either direction and in regard to the advantageous position they are certain to achieve on the passenger side. I said that this is a continuation of the 1924 Amalagamation Act. Seeing that such misrepresentation has been indulged in as regards the effect of that Act, I should like to give two or three quotations from people in and about the railway companies on the effect of that Act of 1924.
The Chairman of the Great Southern Railways Company, speaking on March 19, 1926, at the annual meeting of shareholders said:
I should like to clear up a misapprehension which seems to have arisen—namely, that all the misfortunes which have befallen the railways in the Free State are to be attributed to amalgamation. That is not the case. Very large economies have been effected, which, if the railways of Southern Ireland had continued to be operated as separate entities, could not have been brought about.
Indeed under those circumstances, with the same conditions prevailing, a great part of the country would have been left without any railway service at all, and even the strongest companies would have found it difficult, if not impossible, to earn an ordinary dividend. Railway workers also benefited by the adoption of the policy of amalgamation, as unemployment on a large scale would most certainly have followed the closing of a number of the small railways of the country consequent upon their failure to earn working expenses and their fixed charges...
In 1928, the same Chairman, addressing the annual general meeting, said:
Whilst the question of costs of working is under consideration, it is well you should notice that any economies which have been effected have been made without impairing or imperilling in the smallest degree the safety or efficiency of the service.
The Secretary of the Irish Railway Stockholders' Association, speaking in 1925, said:
They should clear the air a little about the misrepresentations indulged in as regards the amalgamation. They would find that the Chairman of the Great Southern Railways would have the pleasure of telling them at the next annual meeting that the economies consequent on amalgamation had been very large and were growing. They did not hear very much about it, but it was a fact. Amalgamation had not been a failure, and it was as successful as could be expected, and the very thing that had happened had been anticipated.
To give a correct idea of the results of amalgamation, I want to quote a few figures. In 1924, immediately before amalgamation, the expenditure on the working of the amalgamated company amounted to £4,345,000. In 1930, that figure of expenditure on railway working had dropped to £3,069,000—a reduction of over one and a quarter millions. In 1924, in regard to the railway companies of this country, we adopted a policy which, as events have shown, has benefited them to the extent I have indicated. The expenses of railway working have dropped from £4,345,000 per annum to £3,069,000 per annum.
Have you comparable figures for the traffic carried in these two years?
Mr. McGilligan
I can get them if the Senator wants them.
The more traffic you would carry, the more expense you would have. If there was a very considerable reduction in traffic, there should be a very considerable reduction in expenditure.
Mr. McGilligan
I can give particulars of traffic under certain headings. In 1925, the tonnage carried was 2,297,000. In 1930, it was 2½ millions. The live stock carried in 1925 numbered 2,169,000. In 1930, the number was 2,341,000. There was a rise and a drop in between. In 1928, the figure for live stock rose to 2,753,000. That has gone down to 2,341,000. It started at 2,169,000 in 1925. Passengers for 1925 were 15¾ million, and for 1930, 12¾ million. We saved the railway company by the amalgamation process 1¼ million pounds, and, according to the Chairman of the Great Southern Railways Company, that saving was effected without impairing or imperilling in the smallest degree the safety or efficiency of the service. We saw from the statistics given to us that the passenger traffic was falling, and falling considerably. We set out in this Bill not merely to improve the passenger situation, but almost definitely to throw back the passenger traffic into the hands of the railway companies and their allied road services. We have not seen any such considerable shrinkage in the carriage of goods. We had a certain amount, but part of that can be easily explained by the drop there has been all round—not that traffic has been diverted from the railways in any great volume to the roads. We set out in this Bill to give the railway companies their chance to enter into competition for all types of traffic, but not to give them any special advantage so far as the carriage of goods is concerned, as we do in the case of passengers. We put them into a position to safeguard whatever money is in the railways if the railway directors have sufficient imagination and initiative to seize the present opportunity and become a real transport agency, to forget their old railway history, and get into the new system of transport which is going to link up road and rail. They have advantages in their particular position which nobody else can have. For those reasons, I offer these two Bills as the best solution, in the circumstances, of the difficulties that have arisen in connection with transport.
I doubt if even the limited amount of discussion which has taken place in regard to these two Bills is justified by the ultimate results which they can be hoped to achieve. They are both belated and inadequate. To anybody who looked forward to an efficient and economic form of transport this Transport Bill has undoubtedly come as a very bitter disappointment. It is more remarkable for what it omits than for what it contains. It proposes to effect a sort of control over less than 800 passenger vehicles, whilst it leaves without control or regulation of any kind 8,000 lorries. The Minister says that 1,600 of these are lorries plying for goods which they carry for reward. That will be a growing proportion, and yet all that is left absolutely uncontrolled.
Now this transport problem is by no means a new one. Its developments have been evident to everybody for the last six or seven years at least. In this House on, I think, three occasions resolutions were moved, and debates took place, with a view to directing the attention of the Government to the absolute necessity for introducing legislation before matters had got out of hand. They are very well out of hand to-day. The Minister has done nothing whatever during that time. His policy seems to have been to let bad enough alone: to trust to luck to things solving themselves. During that time there has been a very big investment of capital, that now constitutes a vested interest in the chaos that exists.
The Bill now introduced finds road passenger transport absolutely at its zenith so far as chaotic conditions are concerned. It proposes to leave it as it is so far as existing services are concerned because there is no effective power given to the Minister in the Bill to try to regulate the traffic that now exists. The Minister cannot, for instance, refuse a licence on any of the existing services on the grounds that the route is overserved—that the number of buses, trams, and other forms of transport constitutes a menace to the public safety—except or on the condition that they comply with his requirements as regards standard vehicle and so on. If they so desire he must allow them to continue, irrespective of the public requirements or the public safety. The Minister does not take power in the Bill to say to a man applying for a licence: "While I cannot give you a licence on this route there is another route, fairly convenient, which is underserved, and I will give you a licence if you agree to serve that route." The applicant can say: "No, I insist on getting a licence for a road service on this particular route, and you must give it to me." That is exactly the position under this Bill.
The Minister says that this Bill and the other Bill—the Railways (Miscellaneous) Bill—are intended by him to establish the railways, but not as railway services. Well, I am greatly afraid that the service to be rendered to the railways as a result of these two Bills is going to be a very negligible quantity—so far as saving them from utter extinction is concerned. It is a very melancholy fact to find people talking and boasting because a tariff gives employment to perhaps a few hundred extra men, while at the same time we have dwindling very rapidly the biggest employing agency outside of agriculture. The railways in the Free State alone, in the year 1926, gave employment to 19,200 people, and paid out about £56,000 per week in wages. The numbers they are now employing are slightly over 15,000, while the wages bill has fallen to about £47,000 per week. There has not been anything like the same number of people absorbed in the new forms of transport.
If a Bill like this had been introduced some four or five years ago it would have gone a long way to save a tremendous amount of disintegration and decay that has taken place since. The Minister could then have used the powers which he is taking under one of the sections of this Bill in regard to the new transport services. He could refuse a licence for a new transport service on the grounds that the route in question was already sufficiently served either by rail or tram. It is too late to do that now, because the services are already there, and the Minister has not the power to remove them. He could also have imposed conditions which would avoid what we find to-day: a pretty large region of country entirely neglected, while, elsewhere you have running alongside the railway line, already giving a good service, bus services that are altogether out of proportion to the requirements of the community.
Some people who know very little about commercial affairs and nothing at all about transport say: "Well, of course we cannot do without the railways, but they will have to confine themselves to long distance traffic and heavy goods." Now a person who makes a suggestion of that kind knows nothing about the economics of transport. A railway line simply cannot exist if it handles only long distance traffic, and carries only heavy merchandise and minerals. There is a system of charging based on an experience going back over a hundred years in connection with the railways, whereby traffic is charged a rate that it is able to bear. For instance, a charge of £5 a ton on high class drapery between Dublin and Cork might be cheap, but £5 a ton on potatoes would be absolutely unbearable. Yet, it is ton for ton, and of course it is much easier to handle drapery than potatoes. Again, £5 a ton on agricultural machinery might be cheap transport, but £5 a ton on scrap metal would be absurd. Yet, it is ton for ton, and it is much easier to handle machinery than scrap. What the railway companies have done is to impose upon the heavy, bulky traffic that is difficult to handle, but that is usually cheap and unable to pay the higher rate, whatever rate it is able to bear, and to impose on other forms of traffic, such as high class confectionery, drapery, boots and shoes, machinery and matters of that kind, relatively higher charges on these because they can bear them. In that way the railway companies are able to strike a balance and to convey the cheap goods at rates that they will bear. They are able to square their accounts by putting a higher charge on the dearer goods.
The position to-day is that the freelance lorry comes along and takes a lot of miscellaneous goods such as drapery, groceries, boots and shoes, and light machinery and other goods of that kind that can afford to pay a high rate. The lorries carry these goods at a cheaper rate than the railway companies for the reason I have just stated, and leave the big, bulky, unprofitable traffic to the railways. Supposing there was an arrangement whereby all heavy traffic were to be left to the railways and all other traffic taken away from them, the result would be that the railways would have to close down.
The Minister, in the course of his speech, quoted some figures. He referred to the millions of tons of goods carried by the railway companies, as well as the two and a half millions of live stock carried by the Great Southern Railways in one year. Fancy all that traffic being diverted on to the roads! Yet, the Minister says: "Well, that may happen, but I am blessed if I can find a solution for it."
The Minister points out what, in my opinion, is not a good objection to the difficulty of preventing people who licence a lorry for their own use only carrying goods for hire. An absolutely equal objection could be raised on the question of taxis and hackney cars. You know that if you have a private motor car you cannot carry passengers for hire in it. There are 32,000 of these in the Free State. Yet they are all prohibited from carrying passengers for hire. What is there to prevent their doing that? It is the fear of a very heavy fine that might take away all the profits they might make for a number of years. No big force of Guards or officials of any kind is employed to see that the law is observed in that case. Surely it would be equally easy to impose on 8,000 lorries similar conditions? You would not require a whole staff of officials; you would be able to catch an odd one here and there and impose a fine such as would make it very unprofitable for the owner of the lorry to break the law in future. That is the way that every law can be side-stepped to a certain extent.
If the Minister only extended his Bill to include merchandise traffic he would go a long way towards helping to bring about a solution of what is an exceedingly serious problem involving a very important point—in the first place, the employment of very many thousands, and secondly, from his own point of view more important, the interests of thousands of shareholders. What road transport company in the country to-day would be able to raise £100,000 on its credit? The national credit goes down with the railway system. At the last valuation, as fixed after the amalgamation, the Great Southern Railways had over £25,000,000 worth of stock. There was there certainly an important national asset, but there is none whatever so far as road transport is concerned. It represents at the present time really a contemptible attempt to deal with the transport system of the country. We do not know in some cases even the names of the companies, and the men controlling them in most cases are of no consequence. It is only a thing of shreds and patches; it has no order of any kind.
The Minister has referred at length to criticisms of railway shareholders at their meeting held yesterday. I would appeal to him to pay no attention whatever to the statements of railway shareholders. They know absolutely nothing about railway affairs. They have never taken, in my time, an intelligent interest in railway matters. Dust can be thrown in their eyes at railway meetings, and you might as well have a lot of legs of chairs round a table as a number of railway shareholders discussing railway management and economics. Their first and only cry is to cut wages. One would imagine, listening to them, that railway employees were overpaid and under-worked. Well, there are to-day quite a number of adult railway workers working for a wage as low as 32/- per week, and I think that is quite low enough for any man who has to keep a family and who has to maintain them in anything like an elementary standard of comfort. They have given up about £8,000 or £9,000 a week during the last five years.
The companies have had an opportunity on every occasion that they desired during the last eight years to place their claims for a reduction in wages before a Board constituted as the Minister has described, presided over by a judge of the High Court who is also intimately connected with the Land Commission and who consequently has some knowledge of agricultural conditions here and of what the relative wages for other industries should be. The rates operating to-day are the rates fixed and confirmed by the Board. The statement, therefore, that was issued by the railway companies yesterday is, in my opinion, an exceedingly misleading one and should not have been issued by any responsible body. They got a heavy reduction in wages last May. That reduction is in operation to-day, and to say that they are unable to get any real relief is certainly not stating the position correctly.
The Minister talks about dividing the country into three zones. He has not indicated how that is going to be done. There are hundreds of individual owners of buses at the present time and they are going to make a very hard fight for existence. Nobody can blame them. They have been allowed to come there and certainly they cannot be eliminated except he purchases them out at their own price. It is not going to be an easy thing at all. I can see no real prospect for many years to come of having three zones controlled by three transport companies; so that the Minister is painting an unduly rosy picture. Moreover, the Bill says nothing about that. The Bill does not provide for a whole lot of things which the Minister says will probably come to pass. It places in the hands of a Minister the task of bringing about something which is not mentioned in the Bill. There may be some other Minister in place of the present Minister at some future time who may have a different point of view. What guarantee is there that he will not upset almost everything which the Minister hopes to achieve under this Bill? So we are left in an absolute state of uncertainty as to what will be the basis of transport in this country.
The Bill makes no provision in connection with hours of duty. I think that when there is a diversion of traffic from one system to another that at least we might in these modern times before granting a licence to any licensee insist that he should observe reasonable conditions and hours of duty so far as employees are concerned. It is, in the first place, a human right and secondly it is absolutely essential in the interests of the travelling public. I do not care whether a man is an owner-driver or an employee. The fact that he works unusually long hours means that he eventually becomes a menace to the travelling public. He is certainly a menace to the people whom he is driving and he has to be reckoned with by anyone who is using the roads. I would make it an absolute condition that reasonable hours of duty be imposed, say eight hours in the case of men driving buses. The human element enters into the driving of a bus much more than the driving of a train. The train has steel rails along which it runs. It simply dashes along and all the driver has got to do is keep a lookout for stations and to watch signals which may be miles apart. He has plenty of time to look about him, but at every moment the human element enters into the driving of a bus. Every minute the driver has to watch out for other traffic on the road. He is stopping and starting and has to be constantly on the alert and therefore the regulation of hours in regard to road motor transport is of infinitely greater importance from the public point of view than where the railway workers are concerned.
This Railways (Miscellaneous) Bill is not, I think, of the importance that some people seem to attach to it. At all events it contemplates the closing down of railway lines. To that extent I see a great symptom of decay as far as railways are concerned. I see also a serious menace to the trade and prosperity of the country. I saw a communication from the Cork Correspondent of the "Irish Times" a couple of days ago. He stated:
The recent closing of the railway line to Kinsale has already had certain effects and by them one can judge what the results might be if branch lines are to be closed on a large scale. A road service has been instituted to the town for passengers and goods, but this has not prevented the trade of Kinsale from suffering severely. Like most other country towns in Ireland it derives a good deal of its prosperity from fairs, but the absence of a rail service has made it almost impossible for farmers to convey their cattle to Cork for shipment. In order to deal with this situation it has now been decided to try and ship the cattle direct from Kinsale to English ports, and a local company has been formed to carry out the plan. This will involve the construction of numerous lairages for the cattle and the necessary inspectors will have to be provided by the Government when the port is approved. The situation must be a serious one if a small town is willing to go to such expense for its cattle trade, and a further curtailing of railway services might lead to the formation of a number of small uneconomic ports along the coast. As for the inland centres, it is hard to see how they will get out of the difficulty.
That is, because one small branch line has been closed down the people have had to open in effect a new port with lairages and all the rest. The Government have to supply inspectors, and all the expenses of a small and uneconomic port have to be embarked upon. Moreover, if there is any return to prosperity to the railways, the fact of closing them down will make difficult the getting back of traffic when it comes. In England the railways are even more heavily hit. They were down over £15,000,000 in their receipts, but, far from closing down their lines or singling the lines, they are providing luxury trains, high-speed trains, and are giving more facilities. The Irish railway companies are simply scuttling out of the market altogether. They are singling their lines, creating delays in trains.
It was stated that the singling of the line from Galway to Dublin would not mean the delay of a single train. I only wish that were true. I can give numerous instances of gross delays to trains, including trains carrying live stock. All that is a policy of despair, but in one sense it is almost inevitable in view of the present conditions. The Minister says that the railways are not subject to any unreasonable restrictions. That is so, if it were not for the fact that they have road competition. It is true that the company may reduce its rates to a certain extent without the assent of the Railway Tribunal, but the Tribunal will not allow it to give preferential treatment to different traders. It has to come forward and justify it if it does, but the road pirate, the owner of a lorry, is just a local person and can just do as he likes. He can give one rate to one trader, another to another. He can reduce his rates to-day, raise them tomorrow, and so on. He has just to meet the requirements of the day, and he has to account to nobody. The railway company cannot do that, and there is no protection for them in that respect. If they give a reduction in one place they will have to give it all over.
Mr. McGilligan
On the rails.
On the rails. The Minister seems to think it good policy to encourage railways to embark upon the roads rather than encourage the railways. If that is his policy he is going the right way about it, but that is not good for the country, because the country will have to decide before long whether they want a railway or not. The population of the country is too thinly distributed to support two fiercely competing forms of transport. Practically all the big towns are on the coast and do not require the amount of transport they would if they were inland. Whilst road transport is absolutely essential, it should not be in the nature of competition, but rather by way of a supplement to rail services. At the time the railway companies went on the roads there was competition there already, so that, instead of trying to co-ordinate road and rail services, they had to go out and complete with the existing road services, and incidentally with their own rail service, and to-day you have a preposterous position.
I know a case of a town in the Midlands where a stationmaster and a clerk went out and canvassed traders in the district on behalf of the railway company and got a fairly good response. A week later a representative from John Wallis and Sons, who are the road transport section of the Great Southern Railways, came down from Dublin with an order that the railway clerk was to go out with him and canvass the same people on behalf of the road section. The clerk had to go out, and because he canvassed the same people and was able to offer them better terms he was able to get back for the road transport service a good deal of the traffic he had got previously for the railway. One can imagine the feelings of the clerk and of the people who were canvassed on behalf of the two alleged different companies. I suppose that is a symptom of the present case.
The Minister in the other House has refused to allow any provision for compensation for men who lose their employment as a result of the closing down of branch lines by an order issued by him. He contends that the railway any more than any other employers should not be compelled to keep a man that they want to get rid of. He comes along with a mild provision to reduce the railway directors. He means them to be three less than the number at the present time, but the reductions there are only to be as casual vacancies arise—in other words, as directors retire or die. Anybody knowing anything of railways knows that railway directors never retire and that they very seldom die. They have a nice quiet existence, and in the main they do not worry unduly, and unless dyspepsia or indigestion from over-feeding occurs, there is nothing to cause them to die until they reach the age of 80 or 90, as they generally do. I congratulate them on it. None of these are to be disturbed until it comes to their time to retire or die. The Minister may himself be dead before the three who he wants off the Board may have quitted this earth. I take it he does not want to deprive any railway director of his fee. It would not be fair, but the unfortunate man with 35/- a week who is trying to rear a family must go. It is an inexorable economic law that he must go, but the railway director must stay. That is an indication to the workers on the railway of the view of the Minister with regard to the rights of the productive elements on the railways as compared with railway directors, who are not railway men at all. Some of these railway directors have numerous other directorates—more than they can attend to—and even if they had to retire at once it would not be a great hardship. I do not attach any great importance to the salaries or fees paid to railway directors. If you abolished them altogether it would not make a great difference. What I would like to see is a small number of expert men appointed and paid decent salaries, and give them power to run the railways instead of a number of poor old men, in the main, who have no knowledge whatever about railways except the fact that carriages run on wheels and so on. To have them taking responsibility for the administration as they are doing is certainly a thing that is not in the interests of the railways. I would pick the most able of them, and with the chief officials of the company try and run the services on businesslike lines.
The Minister has indicated that lines that have been built at the shareholders' expense may be closed without permission from any authority except the Railway Tribunal, but he did not indicate that it is anybody's duty to raise objection to the closing down of a railway line. That is a very serious omission. Certain local authorities raised objections to the singling of lines before the Railway Tribunal, but long before the objections had been heard the railway had been singled, and it was a mere farce by the time the case came on. I think before a line can be singled, and above all before it can be closed down, that the Railway Tribunal should give permission, and that that permission should be sought and obtained before the work would start. A railway company cannot be opened up without legislation. I think that legislation or the equivalent of it should be necessary before a line should be closed. Otherwise it is a very serious matter. There may be a number of rather reckless directors or men who had a particular viewpoint in regard to railways, and they may close down whole regions of country, leaving them without a line, in one year, before anybody would have time to do anything.
These Bills are so restricted that I cannot see any possible way of effectively amending them, because an amendment that would be of any real use will be stated to be outside the preamble and the framework of the Bill. We are, therefore, in a straight-jacket so far as the Bill is concerned. The Transport Bill merely touches the fringe of the problem and the Minister says that the position in regard to merchandise will have to get a lot worse before he feels justified in trying to deal with it. That is a terrible outlook for transport. I do hope that he will change his view in that respect, and see that it is perhaps much easier to deal now with the merchandise section of the transport than it will be in five or six years' time.
These Bills practically hand over the whole transport of the country to the Minister. If we are content to do that I do not see that there is much to find fault with in the Bill except a few things here and there. Senator O'Farrell, who of course knows the subject better than anybody else, for certain reasons, has made certain statements. He thinks that nobody has a right to say or do anything about railways who are now in an official position because they do not know anything about the matter. He may be right. People who come to meetings probably do not know much about them, but they express their views. Railway managers ought to know something about it. Perhaps they do not. Anyway we are all here in much the same position. I do not suppose that any of us is very highly qualified on the subject of these Railway Bills. Yet we have to pass a law on the subject. So we must do the best we can.
There are some things in the Bills that I would like to see altered. One of the things is in Section 8 of the Transport Bill. Section 8 lays down that any person can apply for a licence to drive a car for hire. I would like to see that modified, and to see it stated that the person who applies for a licence should be a citizen of the Free State and resident in it. Otherwise I do not see why he should be allowed to apply for a licence or own buses and such-like things. I think it ought to be limited to persons who are citizens of the Free State and resident in it. That applies throughout the Bill. I need not go very elaborately into it. The Minister has absolute discretion to refuse a licence, and he may say that he will not give a licence to anybody who is not a citizen of the Free State and resident in it, but, on the other hand, he may not. I think it would be very unfortunate for this country if the Road Transport were to fall into the hands of people who live in another country. I would like to have this matter clear in the Bill. When the Third Reading comes on we might put in amendments for that purpose.
Section 29 states that any person or any company may raise money to establish a line of transport. I think there also it ought not to be allowed except they are citizens of the Free State. All these things tend to give an opportunity to outside companies, as was done in the case of mills and numbers of other things, to grab up the transport system of this country, and I certainly stand against that. Efforts ought to be made to prevent it. I think that at least fifty-five per cent —that is the majority of the capital of the company—should be held in this country by citizens of the Free State.
Those are the points that I particularly raise on this matter. I do not want to go into it very much more, but they go right through the whole Bill from beginning to end, and the same arguments apply in each case. I do not care to go through each of them. Except for a few things like that, I do not see how we can oppose this Bill.
I wish to speak on this Bill, but I should like to ask a ruling as to whether a Second Reading speech is to be also on the Railways (Miscellaneous) Bill, or is the Railways (Miscellaneous) Bill a separate subject?
Cathaoirleach
We are debating both, by agreement of the House.
First, as regards the Road Transport Bill, it effectively deals with a very difficult question, or rather series of questions. It has been the subject of a great deal of criticism. Most of that criticism does not impress me very much. It does not take the form of amendments that were able to survive debate in another place. There are a number of interests concerned, motor owners of all sorts, public traders, passengers, railway shareholders and railway employees. You also have got the co-ordination critics. Co-ordination is a very wise-sounding word. I very much doubt whether the great majority of the people who use the word put their ideas to any useful purpose. Personally, I am generally in favour of what is known as laissez faire, the policy of the survival of the fittest. In this case the main cause of the Bill is the deplorable position of the railways. That is not the result of laissez faire. It is the result of an unfair mixture of laissez faire and of Government interference, which is quite a different thing.
But for Government intervention I do not believe that the railways would ever be in the position in which they are now. We have had a sort of vicious circle, in certain respects. Under one form of Government control the wages were raised to great heights. The railways were obliged to raise their rates so as to be able to pay the wages and dividends and these high rates were more or less instrumental in starting the rival traffic on the roads. The general atmosphere of Government control and the guaranteeing of dividends to a great extent demoralised the railways in their commercial spheres, temporarily at all events.
I have said that there are various interests concerned. A legislator will be more or less influenced by the interests of which he himself is aware. Having been a railway man for thirty years and general manager of the second railway company in point of size in this country for fifteen years, I do not suppose I could expect anybody to look upon me as being entirely an unprejudiced legislator. Perhaps it is not out of place that I should give expression to my own opinion. No member of the Government, no railway company, has done me the honour of consulting me in connection with this matter. Even if they had I do not know that it would have made much difference. At any rate what I will say is entirely unprejudiced. I have no connection with the railway company except as a shareholder, and that not on a very large scale.
I am sure the great majority of Senators recognise that the collapse of the railways would be a national disaster. There is no use in going into the details. I will, however, refer to one aspect. In 1929 the Irish railway carryings represented 183,000,000 ton miles; that is, 183,000,000 tons were conveyed one mile. There were 14,000,000 passenger journeys made. All that went by railway and a good deal of it still does. Presumably it goes because railways are cheaper or are more efficient for the carrying of such goods or passengers. If the railways were to cease to function all that traffic would have to go on the roads. I do not know whether people visualise what that would mean. It would mean a stream of buses and lorries, a less efficient service to a great extent. It would mean an enormous increase in the cost of road maintenance.
I understand it was stated by the Minister, not in this House, that the bulk of the increased cost of road maintenance which has been brought about by the advent of buses is paid for by motor owners. I accept that. What I do question is whether a certain proportion of those vehicles, which would become a very large proportion if the railways ceased to function—about 20 per cent at the moment are of the heavier type of motor vehicle—would be prepared to pay a larger contribution. These heavy motor vehicles normally do more damage to the roads than other types of motor vehicles and they should be made bear a larger proportion towards the expense of maintaining the roads. I doubt if at the moment they are taxed heavily enough, but that is a question that does not now arise. The existence of such heavy motor vehicles is detrimental to other motor owners because it causes their taxes to be higher than they otherwise would be.
The object of this Bill is to put the railways on their feet, so to speak, without undue detriment to the public. We cannot ignore the fact that the advent of motors has been of tremendous benefit. Motors are more efficient than railways for the carriage of a great deal of passenger traffic and goods. Motors are more efficient for obvious reasons which I need not enter into. Does this Bill adequately tackle the problem? To my mind it is an honest, fair and painstaking attempt to cope with the existing problem. If it is improved in Committee to the further advantage of the railways, I shall be pleased. It remains to be seen what practical amendments can be brought forward.
This Bill puts the railways in a position of equality with road motor services as regards passengers and it enables them to go on the roads without let or hindrance. It enables them to try and find salvation as transport companies. It is in that direction and that direction only that they can find salvation. I may be told that the railways have gone on the roads and have lost a lot of money by so doing. That is quite true but, as the French say, it is the first step that counts. I suggest that the conditions that will be created by this and certain other Bills, one of which was referred to to-day, will produce a position very much more favourable to the railways without being in any way unfair to the general public. It will enable them to utilise the roads to better advantage financially than they have been able to do up to now. Most of the buying-up has been completed and possibly the worst form of competition is over.
I hope that the railways will have some opportunity of placing themselves in a better position under this and other Bills. Apparently there are numbers of shareholders who do not think that is possible. They may know their own business better than I do; people are very often in that position. One has to consider the question of political feasibility in this matter. We are not here as railway shareholders but as legislators. Can we as legislators restrict motor services to a radius of ten or fifteen miles, as has been mentioned by the Minister, and prevent private lorries from conveying goods belonging to people other than the owner? Would not that be looked upon as tyrannical legislation? I do not see that it is practicable; I do not see how it could be done; it is a very difficult matter to tackle and I am sure it would give rise to great public dissatisfaction.
No member of the House hopes more than I do that this and other Bills affecting the railways will enable them to find salvation. It must be remembered that if they do not there is nothing to prevent subsequent legislation doing anything further that may be required. I am well aware of the alternatives to this Bill and what would be likely to happen if the railways ceased to function. We would have State acquisition of railways, and I believe that would be the worst of all. I do not believe in Governments interfering in business. The phrase, "the dead hand of the State," did not obtain the vogue it had without some reason. It is not the function of the Government to handle things of this kind in an operative way.
I could say very much on this subject, but it might not be held to be strictly relevant to the debate. I consider that the acquisition of railways by the State is undesirable. State-owned railways are out of date. Amongst the best railways in the world are those in England, the United States, the Argentine, the Canadian-Pacific in Canada, and the French company-owned railways. State-owned railways are a burden upon the taxpayers. The post-war tendency has been very strongly to divorce railway activities and finances from national governments; this is being done in a great many cases. In Germany the railways have been leased to a company, and this has also been done in Belgium. The Canadian national railways have been separated from the national budget, and so also have the Swiss and Austrian railways. The Australian railways had a deficit of £8,000,000 last year, and New Zealand had a deficit of £1,500,000. The Indian railways had a deficit of £2,000,000, and the South African railways £800,000.
On a point of order, may we discuss the whole question of the nationalisation of railways?
Cathaoirleach
No.
I do not propose to go so far as that. I have referred to the possible alternative that exists. In France there are five company lines, and the operating ratio to the gross receipts is 84 per cent. In the case of the State railways that ratio is 106 per cent.—rather a large difference. Perhaps I can leave this subject. I have said enough about it. So much for State ownership as an alternative. This Bill is very much better than that, and if it is not an adequate measure we can have subsequent legislation.
As I have already said, it is a good measure. I agree with a great deal of what Senator O'Farrell said on the subject of this Bill. I agree with him, for example, about bus-drivers, and I agree that we should not allow longer periods than eight hours work for the driving on buses. With some of the Senator's criticisms I do not agree. I do not agree that the Government ought to have acted before in this matter. If they had done so it would prevent certain problems from arising, and I am not sure at all that it would have been a good thing.
Supposing that the Government drastically curtailed road transport? They might have cut road transport in the bud to the advantage of the railways, but whether that would have been to the advantage of the public— whether it would have been to the advantage of the public that the possibilities of road transport should not be fully explored is another question.
I agree entirely with the Minister that the ideal is to have three large transport companies in this country efficiently functioning. The Bill may not achieve that. Senator O'Farrell thinks it could not achieve it. I do not at all agree with the Senator when he says that this Bill shows that the Minister has no policy. This Bill seems to me to embody a perfectly clear policy, and as far as I am concerned as an individual Senator I think this Bill reveals a good policy, well and honestly thought out, and I hope it will be successful.
On a point of order, I thought we were discussing one Bill just now, but it seems to me we are mixing up the two Bills. When I was speaking I thought we were restricted to one Bill—the Road Transport Bill.
Cathaoirleach
Does the Senator want to speak again?
I am not very anxious, but there are a few questions I am anxious to ask.
Cathaoirleach
We will give you an opportunity of speaking again if the occasion arises.
I hope I will approach this subject with no apparent bitterness. Personally I see very little chance as the Bill stands of any great improvement in our railway finance. I cordially agree that the Minister has done the right thing as regards the passenger traffic. He could not have done more. Where I part company with the Minister is in the matter of the goods traffic. I think he ought to have attempted to tackle that question in a more vigorous manner if possible. He has naturally put up a very fine defence as to the reason why he has not done so. What I feel is that the giving power to the railway companies to run their lorries on the roads at the same competitive rates as the others is handicapping the chances of improving our railway traffic unless he meets it by some such process of freeing the railways from the control of the statutory rates, allowing them to charge the maximum rate but to adopt the lower rates themselves as they think will pay. I do not see any real hope of bringing permanent improvement to the railways unless they get freedom on the rail tracks to adopt the same financial policy in dealing with the public as they are allowed to do with the roads.
The temptation will be to carry their main traffic by road whether they do it by auxiliary companies or whether they do it direct themselves. The result as regards the finances of the railway company will be that the shareholders are not likely to see much improvement. What will be the result of transferring traffic in this way to the roads? It appears to me that it will lead to a very great increase in the cost of maintenance of our roads. We are now living in a sort of fools' paradise. The new roads certainly are well constructed, and at the cost of the motor owners of the country. That is all perfectly straight, but the time will come, and I do not think it will be very long, when the renewal of these roads, because of the heavy traffic, will have to be considered, and that will be a serious matter to face. How it will be done I have not the faintest idea. I do not think there is at present any sinking fund in connection with the road fund so as to provide for that contingency. From my own knowledge, and from what I have seen in England I am aware that some of the very best roads are now failing under the intense traffic. The traffic there is more intense than we are likely to have it in this country. I would like to lay special emphasis on that—that we are deliberately tending to transfer our goods traffic from the rails to the roads. If you look back about 100 years you will meet with a curious counterpart to this. About that time England had perhaps the best roads in the world, made by Telford and Macadam. At that time the coal industry of England was growing. Carts got on the roads, and the roads began to fail because of the great increase in the coal mining. This led the English people to the introduction of tram lines and railways, and was practically the basis on which the whole system of English railways was built up—transferring the traffic from the roads to the rails.
To-day we are doing the very converse—we are transferring traffic from the rails to the roads. I do not think that we have fully appreciated the great risk we are running. Of course it will be said how in the world is this to be done? The only suggestion I have heard which meets with my approval is to place the railways in the same competitive position as the roads. Have freedom of rate fixing so that they can compete. There would, of course, be maximum rates which could not be exceeded, and in that way you protect the public. By allowing them to manipulate their own rates below that it appears to me that you put them on the same basis as the roads, and give a chance of restoring traffic from the roads to the railways.
There is of course a great advantage with the road at present time in the matter of door to door traffic, factory to market and house to house. There are steps which have been much thought of by many distinguished men which may help in this connection. It may be possible to use railroad trolleys capable of running on the road, and without difficulty being transferred to the rails. That I believe is likely to prove one of the most hopeful directions in which this great difficulty may be overcome.
If it is overcome then the railroads combined with roads will have what some people call co-ordination. There will certainly be co-operation. That is the direction in which I should like to see them going. I have discussed the matter with some of our best railway engineers. They are leaning that way at the present time, so as to recapture if possible some of this road traffic which is tending to divert money from the railways. That is the direction in which I should like an amendment if possible to be introduced, in order to give the railway companies power to charge what rates they like below their highest standard. If that were done I would leave them to fight out their battle for several years to come, and I think it would be found that a great deal of traffic would return to the railways. There is a great deal to be said for rail traffic from the point of view of smooth running and safety, and I feel confident that something of that kind would meet with approval.
The only other point I have to make is that I wish this Bill to be considered carefully. We have done it individually. We have heard complaints and recriminations, right, left and centre. I should like this Bill to go to a Select Committee to inquire into the matter thoroughly, and to obtain the very best information available. If that could be done by postponing the consideration of the Bill until after the election it would be a very wise move, though not a very popular one perhaps. It would give time for thought and consideration of a problem which is of immense importance. When we come to think of the large sums of money invested in the railways, something like £25,000,000 I have heard it stated, and realise that a few years ago railway stock was considered gilt-edged and was largely used in trust, we can see at once what a very serious position we have fallen into. Those of us who are trustees do not really know where we are. If the railway dividends cease, I do not see how the law will save us. All I have said is with a desire to get Senators to think out the problem, and if possible to get time to think it out.
I agree with Senator Sir John Griffith as to the advisability of postponing the further consideration of the Bill, and referring it to a Select Committee. I do not however agree with him with regard to leaving any of the transport companies in a position to reduce the rates to any point it may wish. I think there would be one inevitable development from that, that the big companies would simply cut rates until they removed all competition from the roads, and the monopoly which would be created would then give them power to charge what rates they liked. There is one satisfactory feature in the Bill, and that is the Minister's determination to retain the powers of the Railway Tribunal. I should like to know if the Minister intends to have a similar Tribunal operating in regard to fixing bus rates and road transport rates. I know that the Bill gives him power to control the rates of all transport services. One has to admit that the railway companies have been up against a very stiff proposition. We all realise how essential it is that the railway companies should be maintained, but we cannot close our eyes to the fact that the railway companies watched the development of road transport for many years without taking any live interest in the competitive factor that had entered into the transport problem, and that they were very slow indeed to move in the matter. The position to-day is, I think, in a large measure due to lack of foresight on the part of the railway directorates in ignoring the competition that had sprung up. It seems to me that some years ago the railway companies might have attempted a system of co-ordination of their own, embodying road transport plus railroad services. They could have had bus services feeding central or pivotal points, and issued a combined ticket to the terminus in Dublin with fast express trains, thus eliminating the necessity for wayside stations, which may be uneconomic. If the railway companies had any appreciation of the realities of the problem they could have such a system operating some years ago.
There is one other point which I wish to bring to the notice of the Seanad in connection with the singling of lines and perhaps doing away with what is known as the permanent way in certain places. I believe that there are at present many experiments going on, particularly in Germany and France, with regard to using a new system of transport on the existing railway lines. I read recently that such an experiment had been tried, and it was thought that the Michelin Tyre Company had brought out a wheel or tyre that would suit this purpose and serve, what I think Senator Sir John Griffith was referring to, the dual service vehicle, that is, a vehicle that will run on the railway line and go on to the road from that. It might be worth considering the advisability of leaving the permanent way as it is. We must remember that if the rails are lifted and the permanent way destroyed or wiped out, and perhaps the land sold or the right of way given up, we may be up against a still more modern development in transport than we see to-day. We have gone from the road to the rails and from the rails to the road, and it is quite conceivable that some system may develop whereby we will go back from the road to the rails. It is a matter that we ought to be careful about, if such development is likely to take place. There are Senators here who can give much more information on that than I can, but I suggest it as a matter for consideration.
A great deal has been said to-day with regard to goods traffic. What operates in the mind of business men, manufacturers and traders is not so much the rates as the facilities of handling that the motor lorry gives them as against the double or treble handling that is necessary in connection with railway transport. A lorry comes into a factory and removes the goods, unpacked, or practically unpacked, and delivers them at the customer's door, whereas in the case of railway transport considerable expense is involved in packing the goods, removing them by lorry to the station, bringing them from one station to another, and removing them by lorry again to the customer's premises. All that means delay and considerable expense, and it would take very low railway rates indeed in most cases to cover the expenditure on this double or treble handling, plus packing. That is a factor that has to be considered.
On the whole, I must say that the Bill seems to go a long way to solve the problem. I agree with Senator O'Farrell that it is belated. Whether the Ministry felt that the situation had better be allowed to crystallise before being dealt with I do not know, but, however belated, this is an attempt to face up to realities. I would urge upon the Minister the absolute necessity of keeping rigid control over the rates, and when I say that I mean control over the cutting of rates just as much as the increasing of rates, because in the last analysis the cutting of rates below what is economic is a disadvantage to the public. It has only one object, to secure a monopoly in the hope of using that monopoly afterwards to increase the rates beyond what is fair and proper.
[The Leas-Chathoirleach took the Chair.]
I agree with Senator Bagwell that it would be a great national misfortune if the railways were allowed to fall into decay. I was very glad to hear the thoughtful speech made on this Bill by Senator Sir John Griffith. I would make the suggestion to the Minister that he should take time to consider some of the proposals made in that speech. I wonder whether, for heavy traffic, road transport can ever compete on equal terms with railway transport. It must be remembered that under existing circumstances the owners of the lorries engaged in the road transport of heavy goods are paying only their proportionate part of the running expenses, while the railway companies have to pay not merely for the running expenses, but for the capital expenditure which was required in purchasing the land over which the railways run and also in constructing the railways.
Senator Sir John Griffith has approached that question from another point of view when he said that England about 100 years ago had the best roads in the world, and that the heavy coal traffic destroyed the roads. The railways were then built at tremendous expenditure. I think the capital of the railway companies in England 30 years ago was over one thousand million pounds. I believe the capital of the railway companies in Ireland at that time was forty or fifty millions. That money was spent upon the construction of the railways and in the purchase of the land over which these railways run. Suppose that heavy road traffic continues. Suppose it is transferred from the railways to the roads. Will the roads be able to stand up to that traffic? Must the roads be remade? Will the owners of the vehicles that carry heavy goods over these roads pay for the re-making of the roads? These are questions demanding very serious consideration.
I think the Seanad is the place where this question could be considered, and I join in the suggestion that a Select Committee should be appointed for the purpose, if for no other, of making available the experience of men like Senator Sir John Griffith. I shall say only so much upon the general question. I have, as every Senator usually has, a special interest in this matter. We see in Section 4, Part II, of the Railways (Miscellaneous) Bill, 1931, that power is taken to deal with the guaranteed lines. The first railway I ever used as a passenger was a guaranteed line. I hope people will not smile when I say it was the West Clare Railway, which has been the subject of very much wit, but I regard it as a very good and useful line, and a very well-managed line, and a perfectly safe line. There have been no accidents upon that line—no smashes. Under Sections 4, 5 and 6 of this part of the Bill it will be possible for the Minister, upon application from the railway company, to discontinue the running of certain trains on that line which hitherto were compulsory. I hope when the Act comes to be administered that the Minister will require very strong evidence before he discontinues any of these particular trains.
I agree it would be a misfortune if the railways were allowed to fall into disuse. But I also am of opinion that a great many of the railway companies, before this new transport work developed, looked upon the railways as the last thing in transport. It was the transport in their view; there was nothing to knock it out. No attempt was made by those controlling the railway companies to provide by sinking fund or otherwise for the paying off of money invested in the railway companies. Senator Comyn spoke of the land that had been acquired 90 years ago for the making of the railways. If that land had been acquired by farmers at that time it would now be paid for through the operations of a sinking fund. It would not be hanging round their necks like the debentures. These debentures should have been reduced gradually, and the capital stock of the companies should not be as high as it is to-day. That is one of the things that should have been considered. You might as well try to stop the wind as to stop the traffic on the roads. You cannot stop it. No company and no Government can stop it. Even the nationalisation ideas which are prevailing in the country at the present time cannot prevent people availing of transport on the roads. Farmers must have their services up-to-date, and they have them up-to-date by reason of the transport on the roads. There is no other way of meeting the world competition of the present time. Why should we be compelled to send out goods by rail when we can do it better by our own lorries or by hired lorries? I cannot see that the idea is a reasonable one at all.
A lot has been said about the loss to labour caused by traffic being lost to the railways. Something like 4,000 people have been mentioned as losing their employment. The Minister for Industry and Commerce spoke about 8,000 lorries on the roads carrying goods. Surely if there are 8,000 lorries on the roads carrying goods they are employing 8,000 men or probably 12,000 men. I have a lorry on the road and two men upon it. I never send goods by rail except over long distances, but the idea that I should be forced by law to curtail whatever advantage I can get by using a lorry is ridiculous, and would not be tolerated by the farmers of the country for a moment.
That is not suggested.
It is suggested by inference. There is another point. The railway companies are aware that we cannot transport live stock by any other means than by their system. They are taking advantage of that, and they are charging us 100 per cent. over the pre-War charges. Nobody need say that it is costing 100 per cent more to run the railways now than it cost pre-War. But they know that we cannot send that traffic by any other system. Would it not be a good idea for a company to take over the railway company? At one time, I remember that the stockholders of the Munster Bank were very glad to accept 7/- or 8/- in the £. Suppose the railway stopped, and another company came along and bought up rail shares at 5/- in the £1, would it not pay as well as the Munster and Leinster Bank is paying to-day? These things should have been foreseen. A sinking fund should have been established to wipe out this redundant capital. If the railway company wanted to buy 100 wagons they issued fresh stock. That was done by a company 100 years of age. All these things should have been provided for by reserves. I believe that the Minister has gone far enough to settle the question, and I am going to support him in the line he has taken up.
Would the Minister kindly let us know how much of these lines have been pulled up, and on what lines trains have ceased to run? We hear about these things, but we have no definite information. With regard to what the last Senator has said, I see that there is an article in the Bill allowing the capital of the companies to be bought by the companies themselves. That is a very dangerous thing and was against the law. It is now being made the law. It enables the railway company to reduce the value of its stock and to buy it in at a very small price. I think that is a very doubtful procedure.
I desire to say a few words because of the line of argument taken by Senator Bagwell and Senator Sir John Griffith. That line of argument seems to be fairly prevalent at present. There may appear to be a long distance between the question of disarmament and the question of road and rail transport. I am old enough to remember a discussion about 35 years ago which is being revived to-day, that the way to stop war was to encourage nations to arm themselves to the teeth and to intensify the destructive elements at their command, so that war would be of such a nature that it would utterly annihilate nations. It was argued that if that were done nations would not enter upon war for fear of annihilation. That seems to be the argument here. It is urged that there should be intensification of competition between railway-owned lorries and privately-owned lorries. The argument appears to be that you must remove all checks and even all obligations from the companies, and encourage them to cut one another's throats in the hope that the fittest will survive. I thought we had got away from that notion. I cannot imagine anybody speaking in favour of the railways advancing as a parallel argument the intensification of competition for certain classes of traffic so that the richer companies would survive at the expense of the poorer companies. That surely is an out-of-date proposition although it comes from Senators with the experience and knowledge of Senator Bagwell and Senator Sir John Griffith. That seems to me to be a policy of utter despair, and entirely contrary to what one would expect of people advocating, as Senator Bagwell did, a zone system on the roads. We heard Senator Bagwell say that his ideal was a policy of laissez faire in connection with rail service, that the mixture of laissez faire and State checks had been ruinous, and that he would like to see complete freedom of action. His ideal in connection with road transport was three companies operating within three special zones allocated to them by State action—the very negation of the doctrine of laissez faire which he had a few moments before advocated in relation to railways.
I am being misrepresented. I never said what the Senator suggests I did. What I said was that it was not laissez faire that brought about the state of things to which reference was made in the past, but a mixture of laissez faire and Government interference, which is quite a different thing from what we are dealing with now. I made it perfectly clear that I did not oppose such regulation by the Government as this Bill provides for.
I hope Senator Bagwell is satisfied that that is a reply to any alleged misrepresentations. I cannot recall that I said anything contravening what the Senator has just explained. He will agree that he supported the ideal of three companies controlling road transport, each having allocated to it certain zones. I put that ideal, which I think is quite an acceptable one, against his proposition of laissez faire and against the proposition that preparatory to that ideal being reached there should be fierce competition between the railway-owned road transport and the privately-owned road transport, one seeking to devour the other, and the fittest to survive. I am in agreement, in the main, with what the Minister professes to aim at in these Bills, but I am very doubtful whether what he aims at is likely to be achieved. When the Minister tells us what he has in mind as to what will happen some time in the not too distant future, after a period of fierce competition between buses under regulations, we are led to believe that that is sure to be accomplished as a result of the passing of this Bill. As Senator O'Farrell pointed out, there is nothing in the Bills to indicate that it is the intention of the legislature, in passing these Bills, that that end should be attained. It is in the present Minister's mind at present. It may be that the next Minister will have an entirely different view of how he should use the powers contained in this Bill. Certainly I would desire to see an indication, at least in the Bill, that passenger traffic on the roads should be regulated and brought into some state of order out of the present chaos. Powers are given to have that done, but there is no suggestion that the zone idea is going to be fulfilled by whatever Minister is in charge of the Act.
I want to say one thing in regard to the grant of licences to the existing passenger services. The Minister has pointed out that he divides this section into two parts. The first is in regard to the existing services, to which he, more or less, says he is bound to give licences, provided they satisfy him that for twelve months they have been carrying on their services adequately and efficiently. There are certain grounds set out in the Bill on which the Minister may refuse to give licences to existing services. I suggest to the House that, at least, we ought to insert in respect of existing passenger services a paragraph giving power to the Minister to refuse even an existing service a new licence unless there has been something like human conditions granted to the employees. We are in the position to-day that some services are well conducted in that respect, that arrangements have been agreed to between the men, through their organisation, and the companies, and that certain reasonable standards have been granted and followed in respect to pay and hours. Others who are competing with these services are acting on lines which are entirely destructive, and which one would infer would meet with the support of some Senators who have spoken. That is to say, they have been entirely uncontrolled, and it is these uncontrolled sharks who are devouring the controlled services of reasonable employers. It is that unfair competition which is causing a great deal of the trouble that the larger transport services are meeting. I hope the Seanad will agree that there should be given at least power to the Minister in respect to existing services so that he shall be able to refuse a licence unless he is satisfied that the conditions in respect to hours and wages have not been such as to create unfair competition with fair employers. One may take for a concrete illustration the case of the Dublin Tramways Company and the railway-owned buses and one or two of the larger bus companies. They have been complying with something like human conditions in regard to the employment of their servants. There are others who have been entirely uncontrolled, and who have no feeling at all with regard to the conditions under which their workmen have been employed. Apart from the other kind of competition, they have been enabled up to date to pay less wages, to employ juvenile labour, and to keep conductors and drivers engaged for very long hours. I submit that, at least, the Minister should get power to refuse licences to existing services if he is satisfied that that kind of competition has been operating. I trust the Seanad will, at least, stand by the fair employers and throw upon the Minister the responsibility of taking into account the conditions of labour before he grants any licence to an existing service or to any future service.
The Seanad has heard a good deal about what happened in the past and the various reasons which made the Bill necessary. I do not think any of these reasons has got a very important bearing on the subject really before us—the discussion of a Bill the aim of which, so far as I can see, is to produce an effective and an economic transport complex of rail and road to the advantage of the country, and at the same time to restore one of our very largest national undertakings, in which there is an amount of capital invested greater than our national indebtedness, to a state in which it can pay a minimum dividend. I think two Bills have been brought in already, and that this is a gradual piece of evolution. So far as I can see, the Minister has gone through the normal process of evolution so far as he can go. Two or three points will require examination before we can decide that this Bill is going to do all that the Minister thinks it is going to do. He has told us that he is satisfied that a limited monopoly of the bus traffic will have the effect of restoring a large amount of passenger traffic to the railways. He says he can go no further in the matter of lorry transport. At the moment I do not think he can. Two or three points arise out of that. The Minister stated that in regard to bus traffic the railways will be in the same position as the outside companies. I do not think that is quite so, because the railway bus-driver will be a railwayman and will be paid at railway rates. Either he must be paid at that rate or the railwayman must be paid at the outside rate. The Minister says he is determined that the present limitation of rates on the railways will continue. If that is to continue, then some form of licensing of the privately-owned lorries, or the private company lorry, should be arranged in order to get things on the same lines. Otherwise the rate-cutting suggested by other Senators will undoubtedly have effect.
[The Cathaoirleach resumed the Chair.]
It has been stated that administration in connection with privately-owned lorries carrying goods on the return journeys would be extremely difficult. I do not think that is so, because in the Traffic Bill you have got that machinery at hand. Some form of licence which would prevent either the carrying of passengers or goods on return journeys by privately-owned lorries could be arranged. Finally, one thing of major importance occurs to me. I view with some alarm the singling or closing of any railway lines. If we look around the world we will find that there is no tendency whatever to close railway lines of any kind. If there is anything to be said for a possible expansion in years to come of our industries and our trade and commerce with other countries these arteries, which have been brought into being, and which other nations are keeping in being, and in some directions increasing, ought to be kept in their present state of preservation. The moment you close down a line it is going, to some extent at any rate, to fall into disrepair. If it is to be used again it will have to be built up so as to make it safe. I view with very considerable alarm the possibility that, if we do require these lines again, very great expense will be involved in their reconstruction. That is a very serious consideration. All these points are sufficiently important to warrant some further consideration of this Bill, possibly along the lines indicated by Senator Sir John Purser Griffith. At any rate, I hope the matter will be carefully considered and that nothing will be done hurriedly.
I desire to refer to the way in which the live-stock industry of the country will be affected by the proposed legislation. It is common knowledge, especially amongst those interested in the live-stock trade, that if there is to be a general closing down of railway lines it will mean that many important fairs cannot be held. That will result in great loss to the country. The railways have well been described as the iron roads of commerce. Their maintenance is highly important so far as the cattle trade is concerned. If you had not the railways there would be very little use in holding a number of very important fairs in the country. To give an illustration, during the present week eighty wagons of stock were carried from Nenagh fair. How could road transport deal with such a volume of traffic as that? I am aware, of course, that over distances of twenty and thirty miles cattle and sheep are now carried in lorries to the Dublin market. I know of cases even where cattle were brought in a lorry from Birr to Dublin, a distance of over one hundred miles. There is no doubt that the position created by the use of the lorries is very serious. It would be impossible, I suppose, to prevent people availing of the facilities they afford. The rates they charge are cheap. For instance, you can order an eight or ten ton wagon of coal in Dublin and have it delivered at your door.
In the County Kildare, farmers are now obliged to drive their cattle along the bye-roads because the volume of motor traffic is so great on the main roads. As a result of that they are put to a great deal of trouble and inconvenience. In many cases it means that those who formerly used to walk their cattle to the Dublin market are now practically compelled to get them taken there by lorry. I am very glad that the Minister has introduced this Bill. I hope he will bear in mind the point I have made about the importance of maintaining a railway service, because otherwise there is great danger of many very important fairs being wiped out of existence. That would be a serious thing for the country. There is no doubt that there is great competition between the railways and road transport. The Minister, in this Bill, is attempting to deal with the situation. It will not, I suppose, please everybody. We know the old saying that even if St. Peter himself came down from heaven he could not please everybody, and I suppose it will be the same with regard to this Bill. A few years ago no one would have thought that road transport would reach its present dimensions, but so far as one can judge it has not reached its full development yet. There are now in use lorries with two decks for fetching sheep to the Dublin market. These particular lorries can carry almost as many sheep as a railway truck. There is no doubt whatever that people will avail of the present cheap road transport facilities. Prices are bad in the live-stock trade, and of course it is only natural to expect that people will avail of whatever advantages are offered so that they may be able to make some little profit out of their cattle.
I hope the House will pass the Second Reading of both these Bills. We all have very great sympathy with the railways. Personally I have very great sympathy with them because I happen to be a shareholder, but we must be careful not to let our sympathy run away with our judgment and must approach these Bills from the standpoint of ordinary good business commonsense. I listened with great care to what the Minister said as well as to the debate. I also have read the two Bills with great care. I have come to the conclusion that this is a perfectly honest and sympathetic attempt, on the part of the Minister, to solve the difficulties presented by the railway situation in this country.
So far as the road passenger service is concerned, I do not see that the Minister could really have done anything more than he has done. He is providing here for its proper control. He is putting the railways in exactly the same position, so far as road passenger transport is concerned, as everybody else is on the road. I do not see that he could have done more than that, and I do not think that the railways could have asked him to do more than that. I think that on the whole they are probably quite satisfied with that part of the Bill. So far as road merchandise transport is concerned there are greater difficulties, but here, too, with all my sympathy for the railways, what I have been asking myself is: what more could have been done? The Bill removes the conditions that were imposed on the railways heretofore. The only thing that the Minister has left in the way of conditions against them is: he has left their rates within a certain large margin to be liable to control or disapproval by the Railway Tribunal. It is a very big margin. It is a margin between the maximum and 40 per cent. below it. I know from my own experience of the Railway Tribunal that what the Minister has stated as to the practice there is absolutely the case: that they do not insist upon the application being made before the reduction in the rate. They are quite satisfied if it is made as soon as possible after that, and then they are prepared to give it a fair hearing and, if necessary, set it up again.
There is only one other matter that occurs to me. The real trouble that the railways have at present is in connection with road merchandise now carried by light motor cars. I would like very much to see some way out of that but at present I do not. A number of suggestions were made but the only one that really appealed to me at all was the one made by Senator The McGillycuddy a moment ago. You cannot prevent a private owner of a car carrying his own merchandise. That would be absolute tyranny. You cannot very well prevent his carrying his neighbour's goods for a consideration, because you would have to carry out any such law as that by an administrative process which I think would be so costly and so difficult that it would not succeed. The only suggestion I have heard of any possible improvement on what is contained in the Bill is the suggestion of Senator The McGillycuddy, that possibly you might apply a licence system to that. It has never been applied to merchandise lorries before and I am not sure it would be a success. My advice to the railways, if I were in a position and if I had any right to advise them, would be to try this Bill. It is obviously for their benefit. The policy behind it is obviously for their benefit. They have been given not only fair play but a promise that these two Bills if they are carried out, will be worked, so far as they can be, in their interest.
While with Senator Brown I am prepared to give a Second Reading to the Bill, there are two points that I think should be borne in mind by us and by the railway directors. If I agreed with Senator Wilson in his views as to the business capacity of the railway directors of Ireland, I would strongly oppose this measure, but I cannot share his views in regard to them. However it seems to me that this measure gives a tremendous discretion to railway directors, and I think that should be in a certain degree accompanied by a warning. The through system of rates, I always understood, has been a tremendous handicap to Irish manufacturers. We know very well that goods can be sent from Liverpool or Manchester to Galway or Limerick at a cheaper rate than goods of the same class can be sent from Cork to these places. The Irish manufacturers have always considered this a very great grievance. If the railway directors are allowed to discriminate and to take goods of the same character from one man at a cheaper rate than they can charge to another man, it is a very serious thing for the community. This Bill entrusts railway directors with a good deal of power, but I have sufficient confidence in them as business men to know that they will not abuse that power.
The other point to which I wish to refer has already been raised by another Senator. I think it is a great mistake to pull up any of the rails that were laid down at such heavy cost. Apart from the improbability of their ever being replaced, it looks very unbusinesslike when markets are very bad to throw further debris on them because that debris cannot realise even the price that it would realise four or five years ago. There is always the prospect that some fresh invention may revolutionise transport; in fact the invention need not be fresh. There are already, I understand, in other countries modifications of the present engines for haulage that would make these lines practicable for use. In these circumstances, while admittedly it is hard to expect the railways to maintain these lines, though they are not using them, I think there should be a definite understanding that, unless for very grave reasons, none of the existing lines should be disturbed.
Minister for Industry and Commerce (Mr. McGilligan)
The two Bills have been received in such a way that it is not necessary to go into great detail in reply. There are, however, some points that have been stressed by Senators with which I would like to deal very shortly. Senator O'Farrell has made a complaint, and he was joined in that by Senator Johnson, that the Bill does not in terms establish, with regard to passenger services, the zone system of which I have spoken. It does not, of course, but it enables a Minister who is disposed to carry out that policy to effect it, and it enables another Minister, with another type of policy, say, contrary to railway interests, to effect that. I had to draft the Bill in this way because I believe that the policy of anybody faced with a railway situation and a transport situation as it is at the moment would be to proceed along the lines I have indicated. If conditions change and if the circumstances of the time warranted the carrying out of another policy, I think that a Minister so circumstanced should have the right to carry that out. It will be subject to the control of the Oireachtas in the sense that the Minister's conduct shall be under examination and he can be questioned on it from day to day.
I do intend, if I have the power to do it, to bring about this zone system. Senator O'Farrell questioned how it can be done. He referred to the licence that must be given and the licence that may be given, but he has not paid sufficient attention to the point that I stressed in opening, that conditions may be attached even to the licence that must be given. For instance the Senator referred to the point that I am not allowed to refuse a licence on the ground that an area is already supplied. I am not, it is true. I must give a licence to that man in the first place, but I can attach conditions, if I think fit, even to the licence that I am bound to give, and so make it better business for that man to divert himself to another area. I am not bound to give a licence simpliciter to the applicant who applies and who proves that he has run an adequate service in that area for twelve months prior to the Bill. I must give a licence certainly, but I can go further. I can attach conditions, and if the attachment of the conditions which I can impose under this is not sufficient, the facts of the new situation may be sufficient, for it must be remembered that an operator who decides, contrary to the best advice given to him, to go into an area already over-served, is going into a highly competitive field. He will probably find out very soon that it is better for himself to clear out. He will find it better in the beginning to take the advice given him and get some other area allotted to him. There is tremendous power given in the Bill to divert licensees from one area to another. Senator O'Farrell expressed the view twice, that matters must be worse before they get better. I do not think that that is a fair summing up of anything I said. As I see things, I think that the situation can be cleared up in most of the areas of the country. There will probably be certain areas where there may be a continuance of the present intensive competition if licensees are disposed to act contrary to the advice that will be given to them, but that will be their look-out. Senator O'Farrell also thinks that the 1,600 vehicles owned by professional carriers are likely to grow in number. The tendency is for the number to grow smaller. I disagree with Senator Sir John Griffith that we deliberately favour a policy of driving traffic from the rail to the road. My aim and object are to divert traffic the other way. I think the whole tendency of the Bill is to divert traffic the other way. Senator O'Farrell's remarks give me an opportunity to stress again what I said at the beginning as to my intentions and policy. I announced it publicly as my object that I want to preserve the railway companies as a transport agency. I give, moreover, the warning that if after a few years the railway company, operating the powers given to them, establish themselves in the goods field, then I will interfere in the goods line as I am now interfering in the passenger line. If people, in spite of this declaration, decide to buy new lorries they cannot claim to have vested interests in a few year's time.
It is the actual experience at the moment, and it is increasing.
Mr. McGilligan
The actual experience for some years past has been that passenger buses have been decreasing. There have been amalgamations brought about on a number of routes. Any tendency that I have observed with regard to the road vehicle run by the professional hauler is not towards any great increase, and the tendency favoured under these Bills is not towards any increase.
Senator Connolly asked with regard to the Tribunal, did we intend to establish a Tribunal to govern the charges. The only charges that are going to be governed under these Bills will be the establishment of maximum fares for passengers by road, and that work I intend to have done by the Department without any recourse to the Tribunal. Senator Comyn objected even to the enabling clause allowing the guaranteed lines to be closed. That is the most contentious objection that might be raised here from the point of view of the railway company. It is, I must stress it, only an enabling clause. Power will only be granted after a local inquiry, and the purpose of the local inquiry is to enable the opinion of that neighbourhood to be focussed on the relative economic factors in rail transport as opposed to road transport. After a full inquiry the Minister can proceed to allow the closing down of certain lines.
On a point of explanation. I did not oppose the Bill on that ground. The Minister will find that what I said was that it was only a recommendation to the Minister to be very careful before he closes down any guaranteed lines because he is quite right in saying that it is the most contentious part of the Bill.
Mr. McGilligan
The recommendation was hardly required because my own speech stressed that I was going to go to a considerable amount of trouble to ascertain the opinion through a local inquiry before modification or cessation would be allowed. The Senator also referred to the costs of the carrying road vehicle as opposed to the rail service. He phrased it that the road vehicle had not to bear the same proportion of costs as the railway companies who have to purchase land and everything else. Over a number of years the railway company have been given a monopoly of traffic to pay themselves back.
Out of increased rates.
Mr. McGilligan
Out of the rates they could charge when they were monopolists. They had years in which that could be achieved. If they had adopted the policy of which Senator Wilson spoke, of carrying sufficient reserves, they would not find themselves in the rather precarious position in which some of them are to-day.
The main point of objection taken was that raised by Senator Griffith. I noticed the peculiar phrase that Senator Griffith used. He said so far as passenger services were concerned the Bills are satisfactory, but he felt that I should have dealt with the goods side in a more vigorous way. Then he added: "If that were possible." Because I did not think it was possible it has not been dealt with in a more vigorous way. The only suggestion made by the Senator was that we should free the railways from the establishment of statutory rates and allow them to adopt lower rates. Senator O'Farrell went further. He said there were restrictions put upon the railway company and that they could not give an undue preference as between traders whereas the private road services apparently can. I take it that the inference is that he wants to put the railways in a position that they can operate as a private trader.
The other way about.
Mr. McGilligan
Or alternatively, that the private trader is not to be allowed to give undue preference to traders, that we are going to control the rates to be charged for every lorry operating in the country. I presume that means we will have to establish classes of road merchandise and maximum rates for them. I think what Senator Brown has said is correct, that the administrative cost of such a thing would be enormous, and as to attempting to supervise them even Senator O'Farrell ran away from that. Have the threat there; seize an odd man here and there. Think of trying to supervise 8,000 lorries, 6,000 of them being those one or two-tons unladen weight trucks.
I did not suggest that. I was only referring to the prohibition of private owners of motor lorries carrying goods for hire, that is, merchants owning their own vehicles and carrying other people's goods for hire. I said there was no more difficulty of applying the law prohibiting that than there was of prohibiting the owner of a private motor car from carrying passengers for hire.
Mr. McGilligan
I doubt very much if there is any considerable prohibition on the part of an owner of a private motor from carrying for hire.
It is supposed to be there.
Mr. McGilligan
It is supposed to be there. Any complaint I have had from the Labour Party in the Dáil is that the law is not being observed. The reason stated was because it was impossible to carry it out. In fact it was put to me that the law was not observed in another way, that people who have lorries occasionally carry passengers and are not being charged ordinary passenger licences. I was asked to put in a new clause to this Bill although it was definitely admitted that there was sufficient legislation. The only complaint was that the legislation was not being carried out. If it is not being carried out it is simply because of the difficulty of getting it observed.
Senator Griffith put forward a point that has been put forward outside. I was rather pleased to notice that it met with no support in this House, that is that the railway company should be free from the control of these established rates and allowed to adopt low rates. I would like the House to remember the situation. I want to repeat once more that while there are rates established, the company themselves can drop these rates by 40 per cent. of their own accord. The present procedure of the Railway Tribunal is that they allow even further reductions to be made without prior application to the Tribunal, but they supervise it afterwards. I know of no case in which the Tribunal has refused retrospectively to sanction these rates. The only point of difference is: is it considered safe to take away that power of the Railway Tribunal even to object to a rate that has been lowered beyond the 40 per cent. allowed. That is the only shackle that is upon the railway company, and that is supposed to be what is driving them to desperation. I think it is a very thin line of defence that the public have. We have weakened the defences almost to the point of disappearance. I do not think there is any complaint on that matter, that it is either costly or tedious to get to the Railway Tribunal or to get a verdict from them. Yet that is a big point upon which all discussion outside the Oireachtas has taken place. That is represented as a great shackle upon the railway company. The Senator has a clear-cut suggestion about it. Take away the Railway Tribunal, take away this control of rates and allow the railway company to operate as they please! Whether Senator O'Farrell wants it or not, I think there is no doubt that if you take away the Railway Tribunal you are going to have a complete disappearance of all these old clauses that prevented undue preferences as between trader and trader, and port and port. That is a situation that I do not readily contemplate.
Senator The McGillycuddy of the Reeks has made a suggestion the reactions of which I am not able to envisage at the moment. He suggested that the carrying of passengers for hire and of goods for hire could be controlled by some sort of licensed system. I know that we could establish a licence for goods vehicles. It amounts to putting on extra taxation, and if a little bit of extra taxation is put before the mind of the Minister for Finance, it would be readily accepted by him. It would increase road costs, but beyond that I do not think the suggestion carries much. I would like to see if the Senator has the idea worked out. We can discuss it in more detail in the Committee Stage.
I would like to correct one impression, that the bus driver is a railway man and has consequently to have paid to him railway rates. That is not so, and that is, to my mind, a saving factor in the situation. That is why I have resisted, and will resist hereafter, any attempt to tie up the road transport services with regard to wages and conditions in the way in which the railway companies are at present tied. I am not objecting at all to guaranteed hours or rates of wages. When you have a system applied to railways here as if they were the railways of a big industrial country like that on the other side, you have got to a point of absurdity. That was shown by the position in Donegal, where the railways had to close down because there was no relaxation in the conditions possible. The hours and conditions had to be kept, and consequently the railways went out of commission. They reopened about three weeks later and engaged about 50 per cent. of the staff.
There was no suggestion of an alteration.
Mr. McGilligan
The suggestion was made over and over again. What happened was the railway company had to close down. It reopened when about 50 per cent. of the men carried on on the old conditions rather than have whatever was got from the traffic spread out over the bigger number. The baronial lines have been questioned. There have been some doubts expressed as to the wisdom of closing them down. Senator Moore wanted statistics. So far as I know there has been only one branch line closed: that is the Kinsale branch. In the case of two small systems the railway service has been somewhat modified and a couple of other services have been reduced to a minimum. There are only three or four branch lines where there has been any big change in regard to singling. As between 1929 and 1930, there has been a difference made of 56 miles, due to the substitution of single for double lines. That is the entire extent of this matter about lifting lines and singling lines about which there has been such hubbub. There has been a bigger figure since, and if we go to about three times that, that is the greatest extent of it. People have referred to continental experience in this matter. I think people with continental experience will tell you that they have travelled many hundreds of miles on single lines on what seemed to be a main line system. One of the best features of this debate has been that we got definitely clear away from any talk of nationalisation.
Senator Bagwell.
Mr. McGilligan
Senator Bagwell only mentioned it to decry it. However it was the policy at one time of the Opposition Party. It was stated to be such even as late as December, 1931. It was then said: "Fianna Fáil are strongly in favour of public ownership of transport services with unified control outside the boundaries of the municipalities. Inside the boundaries of the municipalities we are in favour of municipal ownership and control of these services." That was joined with a phrase used in 1929 when the same speaker said: "The railways have fixed assets. They have lines and stations, etc., whereas the omnibus companies own only omnibuses. These have a limited life, and I believe very little hardship would be imposed on anybody if it were enacted that after a particular date, let it be one year or eighteen months ahead, the sole right of running public services on the road would be vested in that Transport Board, the establishment of which we suggest."
That was a very radical policy of nationalisation and the complete reservation of transport to the nationalised services without any question of compensation to the owners of these buses. That has apparently disappeared. I think if it has disappeared the country can congratulate itself. Senator Bagwell gave a considerable number of examples of nationalised systems and how they fared. He also pointed out that it was a sort of laissez faire policy, plus a certain Government interference, that had brought about the present situation. It was distinctly so. It is because I want to get back to the old spirit that I am going a certain length in these Bills, but not to the full length that some people want. I said in the Dáil that I felt these Bills would be considered disappointing by railway directors who simply want their task made easy, to railway shareholders who simply want dividends, whether they are earned or not, and to railway employees who simply want their work maintained, whether it is there for them or not. What I set out to do is to try and resurrect the commercial spirit that used to exist and that was broken down at the time of Government control. I think there is not the slightest doubt that both in England and here the old keen commercial spirit went out at the time when there was Government control, when an obligation could be put upon railway directors to do all sorts of uneconomic things and when they could get their return by charging anything to the public. We want to get away from that. We want to re-establish the old, keen competitive spirit. We are giving the railway companies certain powers. We make the way easy for them to enter into a new field of operation, but we do not give them the lazy ease that some of them want. We do not give them monopolistic control. We do not want to allow them to play about with rates in any way according to their pleasure. We are going to have a very limited and not at all onerous supervision over them for the protection of the public, but we open a big field to them and we hope that they will have imagination and initiative to seize on it.
I think it is a satisfactory feature of the debate that, first of all, the old cry about nationalisation has disappeared, and secondly, the Bills have been welcomed on an explanation given and understood by everybody, and reiterated by most speakers, that the railway companies are being given extraordinarily wide powers, but are not being assured revenue without effort on the part of the management. They are being given certain powers to enable them to get that revenue if they are efficient and economic in their management.
Question put and agreed to.
Committee Stage fixed for Wednesday, 27th January.