Seanad Éireann debate -
Wednesday, 24 Apr 1963

Vol. 56 No. 10

Private Business. - Transport Bill, 1963—Second Stage.

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

Minister for Transport and Power (Mr. Childers)

The main purposes of this Bill are to extend the existing statutory powers of Córas Iompair Éireann in relation to

(i) the construction of railways;

(ii) temporary borrowings;

(iii) long-term borrowing for capital purposes;

(iv) the abandonment of railway lines;

(v) the payment of redundancy compensation

and also to provide sundry statutory safeguards for members of CIE staff transferred to the new Hotels Subsidiary Company known as Ostlanna Iompair Éireann Teo.

The necessity to extend CIE's statutory powers in relation to the construction of railways arises from the fact that the Board proposes to extend the railway line at Wicklow so as to provide a rail connection to the factory of Shamrock Fertilisers Ltd., Wicklow. At present traffic between the factory and the railway station has to be hauled by road and the proposed rail extension would allow of traffic from the factory being loaded directly on to railway wagons. The present arrangement involves double handling of fertilisers consigned for onward delivery by rail from Wicklow with a resultant increase in costs.

The extension is a relatively small job involving only about 700 yds. of new line at a cost estimated not to exceed £8,000. The extension line will, however, run partly over the public roadway and partly through private property. It would seem at first sight that CIE could be given the necessary powers to construct this railway extension by the making of an Order for the purpose by me under Section 14 of the Transport Act, 1960. I have, however, been advised by the Attorney General that in the laying-down of new lines other than lines on its own property or on another person's property with that person's consent the Board might successfully be restrained if some part of the construction works, for example, the breaking-up of the public roadway, were held to be in conflict with Statute or Common Law.

Since the proposed railway would run for some hundreds of yards through the town of Wicklow along a route adjacent to the sea front, it will be necessary having regard to the Attorney General's advice in the matter to extend the existing statutory powers of CIE in relation to the construction of railways. This I propose to do in the present Bill.

The proposed statutory powers are in Sections 2 to 10 of the Bill. There is nothing novel in these proposed powers; they are, with a few minor exceptions, identical with the corresponding powers conferred on Bord na Móna by the Turf Development Act, 1946.

As CIE have already constructed minor railways under powers conferred by two separate Ministerial Orders made under Section 14 of the Transport Act, 1950, it is proposed for the avoidance of doubt to provide as at Section 11 of the Bill that the two Orders which are specified in that Section shall be treated as if they had been made under this Bill when enacted.

CIE are empowered under Section 28 of the Transport Act, 1950 (as amended) to borrow temporarily from their bankers for general financing purposes. They may borrow at their own discretion up to £½ million and to the extent that these borrowings exceed £½ million my prior approval, given with the consent of the Minister for Finance, is required. The Minister for Finance is empowered to guarantee these borrowings to the extent of £1½ million. CIE normally exercise these powers to secure short-term accommodation during periods when revenue drops seasonally. There has, however, been a rather serious deterioration in the Board's revenue position during the past financial year and it is clear that the Board will be obliged to have recourse to temporary borrowings to a greater extent and for a longer period than in preceding years. It is proposed accordingly to take powers in the present Bill to enable the Exchequer, in the person of the Minister for Finance, to lend direct to CIE within the existing £2 million statutory limit of such borrowings by CIE. As a complementary measure, the Bill proposes to empower CIE to borrow temporarily from sources other than bankers. I think that the House will wish to have some explanation as to the reasons for deterioration in CIE's revenue position. It will be recalled that in the period following the enactment of the Transport Act, 1958, CIE made substantial progress towards achieving the objectives of that legislation. The Board's operating losses, which amounted to £1,950,000 in 1958/59, fell to £709,000 in 1959/60 and to £246,000 in 1960/61. This progress suffered a sharp setback during the year ended 31st March, 1962, due mainly to the eighth round of wage and salary increases and associated improvements in conditions of employment, which in that year together amounted to an increase of £1,024,000 in the Board's wage and salary bill. In a full year the cost to the Board of these increases amounts to £2.35 million. Other factors also contributed to worsen the Board's financial position; these included heavy additional maintenance costs of a periodic nature, increased depreciation charges, and the cost of additional road staff recruited to handle increased business. To these factors there was added a continuing decline in railway business and the fact that the increased rates and charges only came into operation in the last few months of the year. There were on the other hand offsets resulting from increased road freight and passenger business and from economies introduced. The net result, however, was that the board's operating loss for the year 1961/62 rose to £1,696,000 as against £246,000 in the preceding year. During the financial year ended on the 31st March last, the course of events I have outlined continued without significant change and the operating loss is, I understand, even greater than for the preceding year.

I regret to say that the position now is that the Board seems to be without prospect of overtaking the effects of the eighth round. It now appears clear that the increased fares, rates and charges which the Board introduced to counter the effects of the eighth round cannot be expected to bring in more than £1.13 million in a full year. The cost of the eighth round has worked out at £2.35 million a year and there is, therefore, a gap of £1.22 million. This corresponds roughly with the Board's forecast deficit on operating account in the current financial year.

A reasonable comment on this situation is that if the eighth round increase for CIE, including the cost of associated improvements in employment conditions, had been at the National level of 12 per cent, as recorded in September, 1962, instead of the actual increase of 20 per cent, then the deficit for 1962/63 would, on the provisional results, have been reduced by about £900,000.

CIE are empowered under Section 28 of the Transport Act, 1950, as amended, to raise funds by stock issues to meet their capital requirements. The Act sets a limit of £12 millions to the amount which may be so raised and this limit was reached by the last stock issue for £2 million which took place in May, 1962.

The Board have estimated that its expenditure on capital account, including renewals, replacements and additions, in the two years ending 31st March, 1964, will amount to £6.13 million. Initially the programme amounted to £9.7 million but, having regard to the desirability of curtailing the rate of new capital expenditure, the Board, at my request, revised the programme so as to defer until after 31st March, 1964, substantial blocks of capital expenditure. These deferments, together with an arrangement for obtaining the 37 new diesel locomotives purchased in 1962 on an extended credit instead of a cash basis, have made it possible to reduce total capital expenditure for the two years 1962/63 and 1963/64 to £6.13 million. This revised estimate represents maximum practicable deferments of capital projects and takes account of planned rail and station closures. Included in this programme are such essential items as payment of the instalments totalling £883,590 on the new diesel locomotives, the construction of new railway coaches of an advanced design, the continuation of the railway wagon construction project, the cost of new and more up-to-date buses for the Board's touring services and the provision of additional road freight vehicles including vehicles required to replace branch line services which have been closed down.

Of the total estimated capital expenditure of £6.13 million, a sum of £3.261 million will be provided by the Board's depreciation provisions leaving £2.869 million to be financed from new capital funds. The Board must also, at this stage, take account of capital requirements arising in the earlier part of the financial year 1964/65, which amount to £734,000, approximately. In addition, provision must be made for contingencies and for the expenses of Stock issues, together estimated at £250,000. The estimated total capital requirement for which provision must be made is, therefore, £3.853 million. The capital funds remaining available to the Board since the last stock issue of £2 million in May, 1962, will not suffice to meet this essential expenditure. It will, therefore, be necessary to empower the Board to raise further capital funds and it is accordingly proposed in the present Bill to increase the existing limit of £12 million, to which I have referred, by £3 million to £15 million.

I would like to reassure the House that the capital expenditure proposed by the Board in the two years I have mentioned, 1962/63 and 1963/64, would all be necessary even if a firm decision were taken to reduce the milage of the CIE railway system to that envisaged in the Beddy Committee Report. The present milage is 1,459 miles compared with 2,168 miles in October, 1958, and the 850 miles envisaged in the Beddy Report, to which must be added 63 miles of the former GNR line from Dublin to Belfast. Much of the proposed expenditure is, in fact, being incurred on equipment for road passenger and road freight services, both of which activities give a satisfactory return on the capital invested in them as may be seen from the Board's accounts.

The entire operation of CIE in all their sections and departments is being steadily reorganised. Very detailed information has already been given on this inevitably lengthy process of modernisation. Suffice to say that by April, 1964, the annual loss and consequent burden upon the taxpayer could well have been as much as £3 million or £4 million save for the measures taken by the Chairman and the Board.

The whole question of future transport policy, with particular reference to the position of CIE after 31st March, 1964, is at present under review. CIE themselves have embarked on a comprehensive analysis of the operation of the whole undertaking with a view to providing a fully documented factual basis for the formulation by the Government of new policies on the future of the railways, for the purpose of new long-term transport legislation which will be necessary after 31st March, 1964. That legislation must take account of, among other things, the long-term capital requirements of CIE.

I myself have spoken in very great detail on this problem and have made it clear that the taxpayer will not be asked to pay subsidies in order to maintain any type of public transport if another less costly and more efficient type, either publicly or privately owned, can be provided. I have also analysed the position in regard to the additional cost of maintaining roads where branch lines have been closed and have made it clear that there is a considerable nett saving to the collective body of taxpayers and ratepayers.

Criticism of this policy, I am glad to say, has come largely from a minority of public representatives and the overwhelming defeat in the Dáil of the Private Members Bill, whose object was to relieve CIE of the obligation to pay its way, was significant. Senators have been fully briefed in this matter over the past four years and I do not need, at this stage, to say any more on this subject.

In December, 1961, a subsidiary company Ostlanna Iompair Éireann Teo., was incorporated to acquire the Board's hotels and to administer its catering services. In order to facilitate consultations between CIE and the trade unions on matters arising out of the establishment of the proposed subsidiary, I undertook at the time to introduce certain measures relating to redundancy compensation and pension rights. Provision is now being made in this Bill whereby staff transferred by CIE to Ostlanna Iompair Éireann Teo. will retain their existing rights as CIE employees to redundancy compensation under transport legislation as though they were still in the employment of CIE. Provision is also being made whereby staff transferred to Ostlanna Iompair Éireann Teo., who are already members of CIE superannuation schemes, may continue in membership of such schemes.

The Memorandum and Articles of Association of Ostlanna Iompair Éireann Teo. provide for a degree of official control of the company comparable with that exercised over CIE under the Transport Acts. Provision is made in this Bill for certain additional controls complementary to those in the company's Memorandum and Articles.

Experience has shown that it would be desirable to provide for two minor amendments in the law relating to the abandonment of railway lines. The existing legislation does not permit of the abandonment by CIE of a railway line on which all train services had been terminated prior to the transfer of the railway line—for example from the GNR—to CIE. Secondly, the existing legislation does not permit of the disposal of tenanted premises on abandoned lines to the tenants thereof by private treaty. These matters are covered in the Bill now before you.

The Transport Act, 1958, and the Great Northern Railway Act, 1958, provide for payment by CIE of compensation to employees whose services are dispensed with within five years of the passing of the Acts, that is, up to and including 15th July, 1963, and the recoupment of the cost to CIE by the Exchequer. Section 19 of the present Bill proposes to extend this provision up to 31st March, 1964. The extension has been found to be necessary because the schemes of reorganisation which CIE are introducing under the Transport Act, 1958, will not be fully completed until some time between 15th July, 1963, and 31st March, 1964. It is, therefore, necessary to safeguard the position of staff who may become redundant between the two dates I have mentioned and for that purpose the Bill proposes to extend the provisions for redundancy compensation from the present termination date, which is 15th July, 1963, to 31st March, 1964, which is the date of expiry of the reorganisation period envisaged in the Transport Act, 1958.

I think that, at this stage, I should give you some figures of the number of CIE employees declared redundant by the Board since 1st October, 1958. Up to 31st March, 1963, a total of 1,247 CIE employees had been retired with compensation and some 50 other employees are expected to be retired with compensation between 1st April, 1963, and 15th July, 1963.

CIE estimate that 300 employees will be retired on redundancy during the period 16th July, 1963, to 31st March, 1964, and that the ultimate cost to the Exchequer of the compensation payable in relation thereto will amount to £900,000. The provision in the Vote for my Department for recoupment of redundancy compensation in the current financial year is £400,000.

The opportunity is now being taken to deal, also, with two small defects in the Great Northern Railway Act, 1958. It was the intention that ex-GNR employees transferred or seconded to CIE as a result of the transfer to CIE of that part of the GNR undertaking in the State would have the same rights to redundancy compensation as CIE employees. I have been advised, however, that while the provisions of Section 17 (1) (c) of the Great Northern Railway Act, 1958, cover redundancy arising from such causes as the reduction of rail services or the substitution of diesel for steam traction, the subsection does not extend to redundancy arising under reorganisation schemes covered by Orders made by me under Section 14 (6) of the Transport Act, 1958. It is accordingly proposed to remedy this defect by amending subsection 17 (1) (c) of the Great Northern Railway Act, 1958, so as to bring its provisions into line with those of Section 14 of the Transport Act, 1958, in accordance with the original intention.

A further drafting amendment to Section 17 of the Great Northern Railway Act, 1958, has also been found to be necessary. Subsection (3) of that section deals with, inter alia, the grant by CIE for the purpose of determining entitlement to redundancy compensation, of an increase in pensionable service of a person taken into the employment of the Board at a late age. It now appears, however, that the application of this provision does not extend to employees who become redundant under the provisions of Section 14 of the Transport Act, 1958. As it was not the intention that this provision should be so restricted it is proposed to take the opportunity of extending it to cater for redundancy arising under the Transport Act, 1958.

Finally, I come to Section 21 of the Bill. This section is designed to remedy a defect in paragraph 5 of the Second Schedule to the Transport Act, 1958. That paragraph relates to the abatement of redundancy compensation where the recipient is employed by a State-sponsored company or a local authority. The paragraph as at present drafted does not embrace subsidiary companies of such boards or bodies. This defect is now being remedied in so far as future redundancies are concerned.

I recommend this Bill to the House for acceptance.

Mr. Murphy

I welcome this Bill as far as it goes. Maybe this is not an occasion for a major debate or review of transport policy, but in so far as it is an amendment of the 1958 legislation and an extension of an important provision of that Act, we are entitled to ask what progress has been made under the 1958 Act. I think the Minister made the point rather strongly in the Dáil recently that the 1958 legislation was agreed legislation. There was no vote against it in the Dáil or Seanad, and it was the culmination of a good deal of consultation with the trade unions whose members were affected by the legislation. It was agreed and accepted, and it would be fair to say that it was the enactment of an understanding between the then Minister and the trade unions involved in CIE.

The Government's policy in regard to the railways was made clear by the then Minister for Industry and Commerce, now the Taoiseach, in the Dáil on 27th November, 1957. He was introducing a Supplementary Estimate for his Department but he was, in fact, announcing the Government's policy after consideration of the Beddy Committee Report. It would be no harm for all of us to refresh our memories on the then stated Government policy which, as I say, formed the basis of the 1958 legislation. The Minister's statement dealt largely with the problems of the railways at that time. I quote from Col. 1049 of Vol. 164 of the Official Debates of 27th November, 1957. Here is what Deputy Lemass then said:

For these reasons the Government have reached the decision that we must try to preserve railways as an integral part of the national transport system. The aim of the policy measures upon which we have now decided, or other measures which may be approved in the future, will be to make effective that decision to maintain railways as an integral part of the national transport system by reducing the gap between the revenue and the cost of railway operation and thereby to make the whole of the national transport undertaking capable of paying its way.

Later on in the same speech the Minister made an appeal to the trade unions, and he made it even clearer when introducing the Second Reading of the Transport Bill early in 1958. The sense of that appeal was that the unions should face up to the position, accept that there would be reduction in the overall employment on the railways, and that reduction would make more certain and more secure the employment of the remainder. It is fair to say that the unions concerned, particularly the unions dealing with the railway workers of CIE, have carried out their part of the bargain. There has been as far as I am aware no opposition to re-organisation schemes designed to improve the efficiency of the railways, and to reduce the cost, even though that involved redundancy and considerable hardship in the transfer of staff affected.

Unfortunately, the attitude of the Minister now dealing with it subsequent to the passage of the 1958 legislation has created the impression that he regards the CIE employees as parasites, people who have had to be supported out of public funds, who are a continuous charge on the taxpayer. In his speech this afternoon there was another reference to the charge on the taxpapers. I think that that is unfair to the people concerned and, in fact, produces no good results whatever. Also we got the impression that the people who managed the railways and ran them prior to the enactment of the 1958 legislation were in some way failing, that they did not know their jobs, and that that was the reason why CIE were in a financial mess. We were told—and the Minister was very good at telling the general public this—that there was the need for the application of modern management techniques, to use the modern phrase, to CIE.

My experience of this is that the application of modern management techniques has meant in a large measure the importation into CIE of people with no previous experience or knowledge of public transport or of the problems involved. Some of them are very capable and very good and have been very useful acquisitions. On the other hand, I do not think that I can let the occasion pass without saying that as far as I can see the only qualification of others was their connection with Fianna Fáil.

CIE have been controlled by the Government since 1944. They were nationalised and brought under more direct control in 1950. It would be too much to expect that Government political influence in the making of appointments could be completely excluded. I do not expect that, but it is fair to say that under this Minister's administration there is more evidence of political influence in making appointments and promotions within the organisation of CIE. I am not saying this because I am opposed to Fianna Fáil or to the Minister's policies. I hope that I would be equally critical if the Labour Party were in control and behaved similarly. My criticism is not against these people. My criticism is because of the damage which is done to an organisation and a service which must be as efficient as possible, and which depends so much on the morale of the staff.

Mr. Childers

Might I interrupt the Senator and ask him what sort of CIE staff appointments he is referring to?

Mr. Murphy

I am referring largely to the management staff.

Mr. Childers

Will the Senator accept my assurance that I have not in the faintest manner directly or indirectly interfered with the appointment of managerial staff in CIE?

Mr. Murphy

I accept that.

Mr. L'Estrange

You interfered with the appointment of doctors in my county.

Mr. Childers

I did not interfere in the appointment of doctors.

Mr. L'Estrange

Other Ministers have told us that you made representations for other doctors.

Mr. Murphy

I accept the Minister's assurance and I am sure that he is sincere about it. I will ask him to use his position and his influence as Minister to prevent members of his Party from exercising their influence. I have seen where difficulties have occurred simply because people were put into posts for which they were quite unqualified, and the local people can tell you that the only reason for that particular appointment was their connection and their work for Fianna Fáil Deputies.

I hope my criticism is as shocking as the Leader of the House said and I hope that as a result of its being shocking this thing will stop. I am more interested in preserving nationalised public transport, preserving the employment of the people as a whole, than in any particular appointment or any particular promotion. CIE and their employees have lived through many crises, have lived under various Ministers, under various administrations.

Mr. Childers

That is nothing but a slander campaign against the Chairman of CIE. It is completely untrue. The Chairman of CIE has the utmost contempt for any kind of political representations and the Senator should know that.

Mr. Murphy

The Chairman maybe. Letters have been seen passing between Deputies and, I think, in some cases Ministers, favouring people for certain employments in certain posts and, at the same time, for the first time, there has appeared in CIE advertisements, where they have advertised in the press and advertised internally, the phrase "canvassing will disqualify". I hope that means what it says and I hope that it will be shown to mean what it says in the future.

Mr. Childers

Every local authority and every State company are flooded with representations from TDs and Senators on every side. That signifies nothing by itself.

Mr. Murphy

It signifies nothing, does it not? What about Aer Lingus? Do they not warn all Deputies and Senators that if they attempt to canvass they will disqualify a candidate? They have, and quite rightly so. I should like to see the same apply to CIE.

Tomás Ó Maoláin

The fact of being a member of Fianna Fáil is almost a disqualification to get any job in CIE. Is that the Senator's contention?

(Interruptions.)

Mr. Murphy

That is the best joke I have heard this afternoon. There are no personal jealousies involved in this at all.

Mr. Childers

I hope that when the Senator is reported in the newspapers his acceptance of my statements will get equal publicity to what appears to be the usual rather current slander against the Chairman of CIE.

Mr. Murphy

I am not slandering the Chairman of CIE. I am sure he does not see every appointment and every promotion. I am sure he does not. It is not his job to do that. There is this embargo, which I hope will come to mean something, that canvassing disqualifies; that it will be shown to mean something as it has in Aer Lingus. That would be better and a safeguard for all Deputies and Senators for the future.

Tomás Ó Maoláin

On a point of information, would the Senator give us the names of those managerial jobs for which he says——

Mr. Murphy

I could very easily do that.

An Leas-Chathaoirleach

As the Leader of the House knows, I can stop people talking but I cannot make them talk.

Mr. Murphy

I could very easily avail of that invitation, but I do not think it would help. Certainly, it would not be very helpful for the individuals concerned and it would not help the improvement of CIE.

(Interruptions.)

Mr. O'Reilly

If they are incompetent it would help CIE. You suggest they are incompetent.

Mr. Murphy

I am not saying they are all incompetent. The Senator did not hear me. I said many were very good people, very competent. In regard to others the only qualification that anybody can see is their membership of or their association with Fianna Fáil.

Mr. O'Reilly

Apart from their competence.

Éamon Ó Ciosáin

Would the Senator say that membership of Fianna Fáil should exclude them?

Mr. Murphy

I am not saying any such thing.

Tomás Ó Maoláin

That is what it means.

An Leas-Chathaoirleach

I think the matter has been sufficiently ventilated now. Perhaps, Senator Murphy would get down to some other aspect of the Bill?

Mr. Murphy

CIE have in recent years been the happy hunting ground for industrial consultants. I do not mean that in any derogatory sense. Personally, I very much favour the application of new minds, examination by people who come in fresh without prejudice or any previous experience but who look at an organisation and see its function and advise as to how that organisation could be improved. I am very strong on one point about it and that is that with any industrial consultants the ultimate responsibility, the ultimate decision, must rest with the people who know and who have to work the organisation. I feel that in many cases in recent years in CIE new ideas have been taken because they were recommended by industrial consultants and, in fact, they had not worked out. The economies supposed to result have never seen the light of day.

In connection with that, as the Minister knows, the whole management organisation within CIE has been changed since 1958. It was formerly a very highly centralised management organisation. It was found to be understaffed. Under-managed would be the right term. Dr. Beeching had a similar experience when he looked at British railways. He found that, because of financial pressure over the years, in fact, the number of executives, the number of management, was unreasonably low in relation to the size of the organisation. That has been changed in CIE. From being a highly centralised organisation the management has been largely decentralised. I am not criticising that. I should like to make the point that that necessarily is a more expensive system of management than the highly centralised system. I hope, and I have figures to show this, that it is a more efficient way of running the organisation.

The point I want to make, arising out of this, is that the changing of the system or personnel of management of CIE is not a solution to the problems of public transport. It would be quite wrong and unfair that the idea should be let go abroad that the then financial position of CIE was due to the people who formerly ran the undertaking, and I cannot pretend to speak for them. We have seen different personnel and a completely different system of management and still we have the problem of the CIE's finances. I think, therefore, that it would be helpful if once and for all we recognised that the problem of trying to make a nationalised public transport system pay in this country is not a management problem. It is a problem which exists in practically every Western European country that railways as such, a public transport system as such, cannot in this day and age be made economically viable.

In recent years the Minister has underlined this by quoting for us the number of people made redundant. There has been a great deal of re-organisation in CIE and the bulk of the people made redundant were made redundant because of re-organisation rather than by any closure of branch lines. I should like to stress again that the ability to make this re-organisation has depended on the existence of adequate compensation provisions embodied in the 1958 legislation. The level of compensation as seen by the previous Minister, has enabled trade unions to co-operate in such re-organisation and has avoided putting trade unions into the position of opposing the re-organisations considered necessary by CIE.

We are now, however, within sight of the end of that cover provided by the 1958 legislation. It has been extended by this Bill to the 31st March 1964 but that is something within sight. I referred earlier to management organisation, the setting up of a decentralised organisation instead of the previously highly centralised organisation, but so far as I know not all the staff affected by that decentralisation have yet been completely dealt with. In other words, staff are employed whose work and whose responsibility have been taken from them by reason of the new management organisation. They are still employed and no steps have yet been taken to make them redundant. It is most humiliating for any individual whose work has disappeared, whose responsibility has disappeared, to be kept on, coming in day after day not knowing what is going to happen to him, with no work, no real responsibility, to carry out. As well, it is bad for the morale of the rest of the staff.

I do not know the reason for this. Various reasons have been advanced. One is that in the interval of setting up this new organisation there is possibly reluctance to dispense with older staff who managed previously and that it is a form of insurance to keep them on to see how things will pan out, but surely that day should have passed. Another explanation I have heard is in fact that the Minister was opposing further redundancies in CIE at least for a period, that he thought the rate of redundancy too heavy a charge on the Exchequer and that CIE should carry on for a while without making more people redundant. I do not know. The only point I am making is that when people have been made a surplus by reason of a change in the organisation those people should be dealt with as quickly as possible and not left stringing along with no work and no responsibility, wondering what is going to happen. Either they should be given new jobs and new responsibility or they should be put out under the compensation arrangements provided in the 1958 legislation.

As I said, we are within sight of the end of the cover period of the 1958 legislation. That is a matter of some concern for the trade unions because I am sure the Minister will appreciate that an examination of a department or a system of working started now may not bring forth its eventual redundancy, its saving of staff, until well after the 31st March, 1964. The unions have been in a position to co-operate—or actually of being able to avoid opposition—by reason of the compensation provisions in the 1958 legislation but very soon there must come a time when any prudent trade union must say: "A halt now. If you are proceeding to do this we do not want to find a situation where our members will be made redundant after the 31st March, 1964, with no cover whatever with regard to compensation." That effective date of decision by the trade unions must arise much earlier than 31st March, 1964. I think the Minister understands the problem here and that he will appreciate the desirability of clarifying the position much earlier than next spring or indeed the autumn of this year.

The Minister is very fond of lecturing all and sundry on the need to face up to modern developments and to learn from other progressive countries, particularly countries of the Common Market. I do not know whether he has seen the article in the most recent issue of the Sunday Times, a very interesting article comparing the developments in industrial relations in west European countries with those in Britain and very strongly making the point that Britain will have to do something about it quickly. I think in this context we could read “Ireland” as well as Britain. The particular paragraph to which I want to draw the Minister's attention is this:

If the countries of the Common Market had ceased to flourish we could ignore their experience, but both they and their northern neighbours are still expanding economically faster and more steadily than we are. The lesson they teach is that until joint consultation has become a firmly rooted habit it is impossible to create a climate in industrial relations which allows a modern mixed economy to grow. It is a lesson which it ought not to be impossible for us to learn in Britain.

Business suspended at 6 p.m. and resumed at 7.15 p.m.

Mr. Murphy

Before business was suspended, I was quoting from an article in a recent issue of the Sunday Times which made a point that until joint consultation has become a permanently rooted habit it is impossible to create a climate in industrial relations which will allow a modern mixed economy to grow. I must confess that when the 1958 legislation was enacted I had hopes that we would develop in CIE a more modern and a more efficient method of staff relations and that we could have progress and at the same time peace within the industry. Now, it is true that joint consultative machinery has been established in CIE but there is a rub in it all. It is not joint consultation in the commonly understood terms sensibly worked.

I think I can best illustrate what joint consultation should be by quoting from a document dealing with the system in Sweden. It says: "It is in the nature of joint consultation that it precedes the making of decisions and the emerging of change." The system in force in CIE does not provide for joint consultation before the taking of decisions or the initiating of changes, the provision for the giving of information to the trade unions of the staff of changes already decided upon. Now, this, certainly to me, is disappointing because I thought that in CIE we could lead the way and establish procedures and methods which not alone would be of service to CIE but be an example to other services and industries in this country. However, that is not a matter on which I want to go into any detail at the present time but I think it is appropriate to remind the Minister, who has so frequently reminded us, of the lessons we can learn from other countries. Here in an organisation under his control we have very little progress towards the modern and successful method we can see on the Continent of Co-operation between management and staff for improvement in staff relations. I should like now to refer——

Mr. Childers

Before the Senator departs from that, I should like for the purpose of my reply to know does he mean the entire staff of CIE when he speaks of co-operation between management and staff.

Mr. Murphy

Yes.

Mr. Childers

That is all I want to know. I can reply to the Senator more easily.

Mr. Murphy

I want now to refer to Section 13 of the Bill which provides for advances from time to time by the Minister for Finance to CIE of up to £2 million. Now, it seems to me from the reading of that section that what is envisaged is a return to the former system of borrowing to meet losses as compared with the present arrangement of a fixed annual subsidy. I was going to remind the Minister of what he said in Dáil Éireann some few months ago, the certainly that in spite of the loss made by CIE in the year ending 31st March, 1962, and the expected loss for the year ending March just ended, nevertheless, CIE would find it possible to break even in the time limit provided for in the 1958 legislation. But the Minister in his speech here today has apparently abandoned that and he now admits that that is impossible of achievement. That is so, but I think it would be very wrong if we blamed anybody or blamed one another for that position.

The 1958 legislation was, as I said, agreed legislation. I think the principle of laying down a target and attempting to work towards that target is very good. It is much better than the system of leaving losses accrue and eventually having to do something about it which is demoralising for everybody concerned. The five-year period has proved to be too short to enable CIE to make the necessary reorganisation in order to break even. Now, I personally feel that it will be impossible for public transport in this country and in most modern countries to break even. Certainly a five-year period has proved too short and I hope the Minister will make an early announcement as to the policy and as to the legislation which will be introduced to take care of the position when that five-year period elapses, in favour of a continuation of the subsidy related to the current situation, but still with an obligation on CIE—I include the staff as well as the management in this—to aim at improving efficiency progressively and continuously and trying to make the organisation as economical and as efficient as possible. We have heard a lot recently about the situation of British railways—the famous Beeching Plan. It might be no harm to remind ourselves that what Dr. Beeching is aiming at is not to make British Railways pay their way: he admits that he cannot hope to achieve that. All he is hoping to do is to reduce the annual loss to within a more manageable figure.

We have a position, in Britain, a highly industrialised country, of big movements of goods and passengers. After an examination of the position they accept that it would be impossible, in spite of modernisation and very severe curtailment of railway services, to make British Railways pay their way. The same applies in most western European countries. Offhand, the only example I can think of, where the railway pays its way, is Switzerland—and possibly the Netherlands. Recently I had an opportunity of looking at the position of the railways in Sweden. There they have a very modern progressive economy and the railways are something like CIE, an integrated nationalised undertaking losing between £6 million and £7 million per annum. I think about a quarter of its railway lines have been assessed by the railway company as being uneconomic, but the Government have refused to allow any Swedish railway to close. They say: "In the national interest this must be kept going and we shall pay you for the losses involved". That is not an explanation, I say, for the £6 million or £7 million annual deficit. The great road undertaking loses a considerable amount of money and that is not having regard even to the city transport and Stockholm which again loses very heavily.

Sweden, as I said, is a very progressive country. They do not seem to be bothered about any local opposition to the closing of railway lines; they do not seem to have any attachment to railway lines as such. But, as I said, they lose money in spite of their continuing efforts to improve the efficiency of the railways.

I do not think that we should be ashamed or in any way feel that we are deficient because we cannot make CIE pay their way. I quite agree with the Minister that there should be a continuing pressure towards making them pay. But let us at the same time realise that it is not because of any fault of the organisation or management. I have shown that change of personnel, change of organisation, have not affected the position appreciably. It is not due to any deficiency of staff. The reason, I suppose, is common to all countries, with the very existence of the internal combustion engine. It is part of the modern economy that public transport, unfortunately, finds it very difficult, if not impossible, to pay its way.

I want to urge on the Minister the desirability from everybody's point of view, including the trade unions, that an early decision and announcement should be made as soon as possible to let us know where we are going and what we should hope to achieve, what we should plan for. I referred to joint consultation and I think I might underline that somewhat by reminding the Minister that Parliament has attached an obligation on CIE to regulate the rates of pay and conditions of service of their employees, including road employees, in agreements made from time to time with the trade unions representing those employees. That is a legal obligation put upon the railways by the Oireachtas in 1924 and extended to road employees in 1933—I think. It has been continued in legislation since then. I think that shows the thinking and the will of Parliament on the management of public transport to regulate, consult and fix the conditions in accordance with agreements with the trade unions. I do not know if the Minister has studied that aspect of it. I do not want to deal with current defects, current disputes. That might not be particularly helpful. The obligation exists and is put upon CIE by Parliament and I think there is a lot to be learned from the wish and the will of Parliament in that direction.

There is another section of the Bill to which I wish to refer before concluding and that is Section 21, which appears to me to be retrospective legislation and very undesirable altogether. From my reading of the section—the amendment of the Act which it proposes to amend—it would seem to have the effect of taking from certain people compensation which they had already been awarded. In the case of compensation awarded to certain people in Dundalk for loss of employment with the Great Northern Railway, and who have been paid this compensation since then, it seems to me that this section, as it is drawn up, will now have the effect of depriving them of the compensation they are at present being paid. I am referring of course, to continuing long term compensation of annual figures rather than a lump sum. My reading of the section is that it would take from those people the compensation already awarded to them.

Perhaps, the Minister would be kind enough in his reply to clear my mind about this. I very much hope I am wrong. Might I in conclusion say, as I have said at the start, that I welcome the Bill so far as it goes. The Minister has been co-operative with the trade unions concerned in bringing forward this Bill to take care of the position of the difficulty which might arise between July and 31st March, 1964. He has also met fully our point of view in regard to correcting a flaw which has appeared in a section of the 1958 Act.

Mr. Fitzpatrick

Reading this Bill prior to coming to the House today I found it rather difficult to follow it, or to understand what its proposals were. It would take a great deal of research and study to find out exactly what the Bill aims at, and to find out the aims of certain sections. I think it was a mistake on the Minister's part not to circulate an explanatory memorandum with the Bill. It is the type of Bill which would be greatly helped by an explanatory memorandum. I understand it is not the practice of the Department to send out explanatory memoranda with Bills, but I respectfully suggest to the Minister that he might revise that practice and do so in the future.

The first 11 sections of the Bill—or approximately half the Bill—deal with the construction of railways and the making of orders entitling CIE to construct new railways. When that is all boiled down it really means that CIE propose to lay about 700 yards of line outside Wicklow town. I am sure if the present policy is pursued, it will be many a long day before any further railway line is laid. That is the type of thing I have in mind when I say an explanatory memorandum would have been very helpful and might have saved much time. There are a few points in the first 11 sections with which I should like to deal, but they are matters of detail which can be more appropriately dealt with on Committee Stage.

The next part of the Bill deals with the powers of borrowing at present enjoyed by CIE, and proposes to confer further powers on the board to borrow from the banks, and otherwise. It is a pretty alarming state of affairs to be told by the Minister in introducing this Bill that in 1961-62 the operating loss of the board jumped from, I think, £240,000 to £1,696,000. So far as the Minister can ascertain the loss was even greater in 1962-63.

As I see it, that means that CIE are, apparently, to continue to be a substantial drain on public funds. When it was decided to nationalise transport we were led to believe that the public would receive a cheaper and a better service. We were also led to believe that transport employees would be happier under a national transport system than they had been. I do not think either of those objectives has been achieved. I do not think that in many parts of the country, at any rate, we have a better service, and we certainly have not got a cheaper service.

It is true to say that management and employees have failed to regulate their business and their relations in such a way as to avoid disruption of public transport. Before the board were formed there were some transport systems in the country which were giving complete satisfaction and paying their way. I refer to the Dublin United Tramways and the Grand Canal Company. If CIE are to continue to be heavily subsidised at public expense, there is a serious obligation on the Minister and the board on the one hand and on the employees on the other hand, to get together and agree on some satisfactory machinery under which differences and disputes can be solved without causing untold hardship to the very people who are called upon to subsidise the undertaking, and pay the piper.

The next matter dealt with in the Bill is redundancy and compensation for redundancy, and the time within which claims can be made or paid is being extended. That is desirable, but something else strikes me about the question of redundancy. Some serious effort should be made by the State to absorb redundant CIE employees in other State or semi-State employment. It is a fact that State and semi-State bodies are by far the greatest employers of labour in this country.

I should like the Minister to tell us when he is replying, if he can, how many redundant CIE men, aged about 40 years or thereabouts, we shall say, have been absorbed by the Department of Posts and Telegraphs, the ESB, and other such institutions. I am afraid there is not much co-operation between the various Departments with a view to providing redundant employees with alternative employment.

Perhaps if I gave the Minister a case without mentioning any names it might illustrate my point. I know a man aged between 40 and 45 years who was employed by CIE for 16 years. Before the little station at which he was employed was closed down this employee bought a small farm of land, about eight acres. He bought it through a loan in the bank and improved the house but had not paid off the loan by the time that CIE closed down the station where he was employed. His wife was rather delicate and he had a couple of children. That man was offered alternative employment over 100 miles away, but were he to accept it he would have had to take digs 100 miles away and try to run his home where he had established it. He was reluctantly compelled to take the serious decision of resigning his post with CIE. He had to do so without any compensation because he was offered alternative employment and all he got was a refund of his superannuation contributions.

Within a matter of months there was a vacancy in the very same little village for an auxiliary postman and this man applied for it. It would have suited him down to the ground because the £5 or £6 he would have got for it per week, coupled with his little farm, would have enabled him to live on where he had made his home. I know that the Minister for Transport and Power was written to with a view to making representations to the Minister for Posts and Telegraphs, and he replied stating that this was something which constituted the day to day running of CIE and he had nothing to do with it. Then the Minister for Posts and Telegraphs was written to and the position pointed out to him and he was asked to do something about it. I think he replied saying that he could not interfere in another Deputy's constituency. The long and the short of it was that this man who was rendered redundant in one type of semi-State employment by Government policy did not secure a suitable job in his immediate area in another State-sponsored undertaking.

That is a deplorable state of affairs, and there should be co-operation between the Ministers. The Government as a matter of policy should lay it down that if and when such a man became redundant due to Government policy he would be put first in the line for other Government employment. I do not want to introduce a controversial note, but this particular man had a wife and two children and the person who was given the position had not any family. The reason was obvious. Political influence was stronger in the case of the man who got the position than the unfortunate man who had been rendered redundant in CIE and left to fend for himself. That is bad. It is something that the House should take note of and the country should know about.

I do not want to make a speech at any length, but there is one little matter I should like the Minister to deal with in his reply. The Minister states that one section of this Bill is necessary to amend the law because existing legislation does not permit the disposal of tenanted premises on abandoned lines to tenants thereof by private treaty. Surely that is not so? If it is so, CIE must be acting ultra vires their powers.

Tomás Ó Maoláin

I would not have intervened in this debate were it not for the remarks made by Senator Murphy and a passing remark made by Senator Fitzpatrick. Senator Murphy in the course of a mean and low attack, a left-handed attack be it said, repeated the canards and shibboleths and the things that have done duty for mean-minded people in this country for many years. Senator Fitzpatrick also referred to political influence being stronger than the claims of the man with a wife and family. It is time for public men to get away from that sort of thing. It is time that public men should stop trying to do what the Communists do in every country where they seek to undermine the public administration—that is, to denigrate the Government and to bring the institutions of public utility into disrepute and break them up.

Mr. Fitzpatrick

It is time that it was not necessary to draw attention to it.

Tomás Ó Maoláin

It is time that that was stopped. We have been listening to it since I came into the Seanad, time after time, about this alleged political influence exercised in every job and this alleged membership of Fianna Fáil which qualifies you for a job. I am General Secretary of the Fianna Fáil Party and I should like very much to know where are these people in all those public bodies who would give anybody a job because he is a member of Fianna Fáil. I have failed in my efforts in recommending people time after time. I have failed to even get them called for interview. If anybody can tell me how that can be done because of the fact that he is a member of Fianna Fáil I will be very grateful. These public boards which appoints appointments selection committees, these institutions like Aer Lingus, CIE and Bord na Móna, have got a selection machinery of their own. They take no notice whatever so far as I can see of representations by public men. They take no notice whatever of any letters. Senator Murphy referred to letters sent by TDs and Senators apparently as if it were a crime that TDs and Senators should make representations about the character and ability of someone they know and can stand over. There is no reason in the world why they, any more than any other citizen, should not give a reference just because they are public representatives. It should not be made out here by Senator Murphy or anybody else that that is a crime to be ashamed of. As I say, these public bodies have a system of selection of staffs of their own. I have no knowledge whatever that anybody by using influence can get anybody into one of these institutions on a preferential basis.

There is this to be said—if it happens that a member of a political party who has more brains than the other applicants, or more qualifications than them, is successful in securing a position it does not mean that because of the fact that he is a member of a political party or his father and mother were supporters of that party he should thereby be debarred from securing employment in his own country. That is the meaning of what Senator Murphy in his mean attack here tonight intended to achieve.

Mr. Murphy

Oh, no.

Tomás Ó Maoláin

Senator Murphy also said that some of the management changes in CIE brought no solution to CIE's problems. Let me bring him back to a few figures given by the Minister to us as to what the change of management did mean in regard to the operating losses of CIE. The loss fell from £1,950,000 in 1958/59 to £709,000 in 1959/60 and £246,000 in 1960/61. Senator Murphy is well aware of the reasons why there has been a hold-up in that progress in the past couple of years. In 1961/62 the operating loss rose again to £1,696,000 and the 1962/63 loss, according to the Minister, is likely to be even greater. Senator Murphy again knows why. He also sneered at what had been done by the management in regard to industrial consultants and the fact that none of their so-called economies ever saw the light.

Senator Murphy surely must be in closer touch with what has happened in CIE than anybody else. In my opinion he must have a secret service and I think it is a matter which should receive the attention of the Board of CIE. If Senator Murphy is in a position by reason of the information received from his studies within the company and within Aer Lingus, and even in other bodies, to be able to come here and say that certain people got jobs, then Senator Murphy must be able to prove it, that he is not drawing on his imagination for political purposes. I should like it to be noted that Senator Murphy must have an intelligence service that supplies him with this information. Otherwise, he would not make the sort of statements he made here tonight.

Senator Murphy in his back-handed attack on Dr. Andrews, has admitted that on Dr. Andrews taking over the Chairmanship of CIE the concern became a vital and a significant factor in Irish affairs. Dr. Andrews, it should be remembered, is the man who was sent down to a virgin bogland many years ago, and through his efforts and through his genius and self-sacrificing ability, made that bogland into one of the most powerful and profitable industries we have today. It was so developed under his able leadership and Bord na Móna was so developed that experts even from Eastern countries, where peat is highly developed, have come to Ireland to learn and the machinery developed by Bord na Móna has been copied by many countries which are far ahead of us in industrial technique.

Every person of goodwill, who has no bias, will admit that when Dr. Andrews took over he made a revolutionary change in the concern immediately. I do not think it was fair or proper for Senator Murphy to make the insinuations he made or the attack he made on Dr. Andrews. He spoke of Dr. Beeching. It is interesting to know that years before him Dr. Andrews was on the job and quite a number of machines and plant may be said to have been copied from that which Dr. Andrews has used in this country.

It is all right now to think of the things which Senator Murphy said, but I would remind him that entrance to CIE for young people is by competitive examination and how can one use any political influence in competitive examinations? I should like Senator Murphy, if he makes any further reference of that nature, to give us a little more information in regard to whom these people were, how they got the jobs, and what type and variety of influence was used.

It is nice to know that, in spite of Senator Murphy's sneers, a new line will be laid to the Shamrock fertiliser factory. CIE are experienced people to lay that line and just as the lines which they laid for Bord na Móna brought such tremendous prosperity to the bogland communities, so we hope that this line will bring equal prosperity and good luck to Wicklow and surrounding districts.

I notice in the Minister's speech he says that the whole question of public transport is under review in preparation for the 31st March next when the provisions of the present Act come to an end. There is one thing I hope the Minister and the Government will not consider and that is this foolish clamour which has arisen, not alone in Dublin but throughout the country, as a result of recent events, that the Government should do something to hand the Dublin transport back to private enterprise. I hope no heed will be given to any suggestion of that nature no matter from what quarter it may come. We notice also there is provision for the transfer of employees to Ostlanna Iompair Éireann. In that connection I should like to pay tribute to Dr. Andrews for the way he revitalised the Great Southern Hotels which were taken over by CIE. Anyone who had the opportunity of visiting these hotels, even before the establishment of this subsidiary, knows this, and foreign visitors to this country have testified that they are the finest and most comfortable hotels in this or in any other country. Due to the interest, ability and knowledge which Dr. Andrews brought to these hotels and the improvement of them, CIE have as fine a chain of hotels now as any country in the world. I think this is a good Bill; it is a useful Bill and I hope the Seanad will not make undue delay in bringing it to a conclusion.

Professor Quinlan

I listened carefully to the speech. I admit that there was no attack whatsoever implied in the speech made by Senator Murphy, and certainly not a personal attack on the Chairman of CIE.

Mr. Murphy

I never mentioned the man. I never mentioned Dr. Tod Andrews. I mentioned Dr. Beeching.

Professor Quinlan

I am sure Senator Ó Maoláin would be rightly indignant if his remarks were taken as meaning that he was implying that the previous Chairman of CIE was utterly incompetent and a failure. I am sure nobody who knew the late Mr. T.C. Courtney would for one moment subscribe to that, and I do not think that Senator Ó Maoláin would wish to imply that. Yet it is just as wrong to distort what Senator Murphy said into an attack on Dr. Andrews as it would be to distort what Senator Ó Maoláin has said into a disparagement of the late Mr. T.C. Courtney.

To come on to this Bill, I think those of us who have travelled with CIE for the past few years can certainly pay tribute to the efforts made. We do notice the efforts made to brighten up, and superficially we see that an advance has been made. It is the type of advance that railways are trying to make everywhere in competition with road transport in other countries, and with air transport as well. The same problems face railways everywhere and, unfortunately, our problem here is complicated by the fact, as the Minister put it in a previous debate, that we have too many thousand miles of line per million inhabitants. That is the wrong way to look at this. What we should say is that we have far too few inhabitants per thousand miles of line. In other words, the real difficulty is the sparseness of our population, which as we know is unique in Europe today. We should look at the railway transport in Holland. In a country little over the size of Ireland they have 12 million people to draw on. Their output is almost double ours. Certainly if by any magic we could overnight increase our output by 50 per cent, that of itself would completely solve the difficulties of CIE.

CIE need a great deal of sympathy and understanding in the problem they have on hands and if we wish to have a transport system available to all sections in the country and especially to those who have not got the luxury of motor cars, we must face up to the fact that CIE have to be maintained. Undoubtedly every effort must be made to get it as efficient as possible, but having reached that stage I do not see what is so immoral about an element of subsidy in running such a concern which is as much a national service as the Army or the Garda Síochána. The magnitude of the subsidy—even if we take it on the Minister's figure that last year's loss on working account was nearly £2 million—is not too great. It looks a big sum but in relation to the population it is 13/4d. per head. We have trains and buses running far below capacity and one other short journey by each citizen in the country would last year have sufficed to right the balance. Looked at in that way, it is nothing to get alarmed about.

We must, however, look at all these things realistically and we must beware of all the showmanship and flamboyancy surrounding the recent reorganisation of CIE. By all means praise what has been done and give credit to the workers and management who are doing it, but let us recognise even at this late stage the disgusting flamboyancy of the past two or three years in trying to create the illusion that one single man has been able almost overnight to produce a million in CIE. We read in the Minister's report today that the board's operating losses which were nearly £2 million in 1958-59 were £709,000 in 1959-60 and £246,000 in 1960-61.

This is the kind of nonsense—I am sorry to use the word but it has to be used—to which we are treated by the Minister and the public Press regarding CIE. I have here a quotation I have kept since June, 1961. It is by the political correspondent of the Irish Times and is headed: “CIE Turning the Tables.” The miracle had happened: there was a credit balance of £1,576,000. It goes on with the usual: “The Minister for Transport and Power, Deputy Childers, and the Minister for Finance must be wondering if the two Transport Acts of 1958 overestimated the requirements of CIE or underestimated the prowess of Dr. C.S. Andrews, the chairman of the Board.” It painted a picture of millions suddenly brought out of nothing.

The real figures are available to anyone who would dig for the facts, to anyone who could adopt an intelligent approach to a balance sheet. They could be dug out of a glossy report that conveyed the misleading picture in 1961 that there had been an improvement from a loss of £709,000 to £246,000.

An Cathaoirleach

I take it that the Senator is quoting from the certified accounts, certified by the auditors of the company.

Professor Quinlan

I am not disparaging the accounts but their misinterpretation to the general public. I am not impugning the auditors. What has been done is perfectly legitimate but a saving of £463,000 is held up as a marvellous achievement by CIE when in fact it was not a saving in any real sense.

When you look at the account you find that, due to the generosity of the Government, in the 1958 Act it provided £1,175,000 yearly to build up CIE so that it would be in a healthy position at the end of the five-year period and able to meet its capital requirements at the end of that period. This succeeded in changing the interest position for the board. In 1960/61 the board collected an additional £80,000 in interest by investing the surplus they had from the Government. As well as that, by the Traffic Act itself they were relieved of the contribution to the County Donegal Railway Association of £14,000 and the closing of the canal, a direct consequence of the Act, relieved them of £28,000 loss. Their fuel bill went down by £105,000 because the diesels were coming in. The taxpayer had subscribed very generously to provide them as being necessary for efficient and low-cost transport for the future and they showed up by reducing the fuel bill by £105,000. As well as that, a new industry was developed—again a perfectly legitimate industry—of taking up tracks and the proceeds from taking up tracks were used to meet expenses that would have had to be met out of the current budget if these were not available. As is shown in this Bill, out of a surplus on taking up tracks of £173,000 they spent £128,000 in special expenditure on the modernisation of works, rolling stock, stations, building and office equipment. In other words, it was spent on work which CIE should do in any case and would have had to be footed out of the ordinary bill for the year if the other were not available. Then old rolling stock and engines were sold.

On page 26 of the account under the heading "Movement on Capital Reserve" we find that they succeeded in making £232,000 on the disposal of surplus land and buildings and that £50,000 of that was taken over into capital expenditure on railway lines and works during the year, again a task that should not have been done if it were not necessary and if it were necessary would have had to be footed, if the other sum were not there, from actual current account.

When these figures are added, a total of £393,000 is accounted for out of the £463,000 and that leaves us with just £70,000 for which I have not accounted so far, but if you go back you will find that in that year, 1960/61, CIE—again perfectly legitimately — changed the basis of their depreciation calculation. They decided that buses should be depreciated over 16 years instead of 15 and the life of a railway wagon was increased from 40 to 50 years. The result of this perfectly legitimate decision of the board was that less money was set aside for depreciation so some of that £70,000 would have been taken up in depreciation charges if depreciation charges in 1961 had been the same as they were in 1960. My guess is that most of that £70,000 would have gone on that.

We have also, of course, this problem of redundancy because, as well as saving on the roads, CIE were empowered to lay off any men they declared redundant. Today the Minister gave some figures on that. I think 1,500 more have so far been laid off and the cost this year will be a mere £400,000 to the taxpayer to meet redundancy claims. Where, then, is the vaunted improvement hailed in the Press between the years 1960 and 1961? If you refer to the previous year when the really spectacular improvement was lauded—the drop was from £1,900,000 to £700,000—again, you will find that all the items were a direct consequence of the 1958 Transport Act or else of management decisions by CIE, perfectly legitimate in themselves, but it meant that less was set aside in one year than the other. For instance, a number of lines were closed in 1960 compared with 1959 and the amount set aside for the maintenance of the lines was promptly reduced by that figure. I think one-seventh of the railroad mileage was closed and the amount set aside was reduced by one-seventh.

These are perfectly legitimate and there is nothing whatsoever against the auditor or anybody else for making those decisions. They are perfectly legitimate but they are only juggling with book-keeping figures as far as providing any basis for substantiating the claims that CIE had worked wonders. They had improved their position by one million one year and a half million the next year. Now CIE begin to moan and groan because the workers read what was written in the papers and they believe that CIE were really making money fast. Therefore, who would blame the workers demanding their increase? The size of the increase and even a good deal of the eighth round increase due to that was directly caused by the unfounded claims about the improvement in the position of CIE. In fact, if the Minister had only in the 1958 Traffic Act given them another half million a year the interest on that would have meant they might have broken even in 1961. It is just as simple as that to do it.

I am emphasising that CIE did make a real contribution in holding the line firm and in holding their position in the competitive transport position in the country. That was a big thing to do. Let us give the management credit for it, but let us, please, divorce the management from the ballyhoo that went with it. I am also glad to see that the ballyhoo of the 1961 report with its pictures, glossy covers and all the rest of it, was not repeated in the 1962 report which was a more modest production and less costly, though, in point of fact, neither of the reports carry as much information as the much despised little green book issued by CIE prior to 1958. You will find in this book, on ordinary paper, in the first 15 pages of it, a full explanation of the various movements and the various figures contained in it. I am sorry to say that most of that information is not available in the subsequent books. In the subsequent books not even the number of employees in CIE is available. In other words, the books do not give the picture showing the numbers that have been let go through redundancy in the year in question.

If the Minister is seeking economies he should suggest to CIE that they get back to the little green book with the ordinary paper; give us the facts in that and save the cost between that and the art covered model that they and all other semi-State companies are producing for our enlightenment, or is it bafflement, at present. The only real figure you can come up with, looking at the position of CIE, is, after all, the total number of people carried or the number of passenger miles and the total amount of freight carried on the roads. That is the hard reality. You will find there that, while there was a certain improvement in freight between 1960 and 1961, the overall freight carried increased by about 14 per cent. But then in that year there was at least 14 per cent or slightly more freight available because our exports had gone up, I think, that year by almost 20 per cent, so that was the measure of the freight available. The proper interpretation of the increase shown by CIE is simply that they got their own share of the increase that was going around—no more, no less. Again, I say that may be something to congratulate them on but yet it just meant they were holding their position.

There has been this transfer which is becoming slightly marked from road to rail freight. In the figures on this we should realise that at present the railroads carry something like 2,000,000 tons as against something like only about one-twelfth of that carried on the roads. In other words, the bulk of our freight is still carried very much on the railroad and long may that last. I had an experience coming up today—probably many of you encounter it driving up with all the big lorries on the road, a menace to themselves and to everybody else: I was between two big lorries—I would estimate they were 20 ton lorries—and I found we were actually doing 70 on the road leading into Portlaoise. Surely it should not be beyond the power of modern transport authorities to get those lorries back on the railroads? I cannot see why heavily laden lorries must go all the way from Cork to Dublin or even further when there is a perfectly good railroad available. The difficulty is that we have not a quick enough change-about, something like the American piggyback system by which you can almost drive the lorry on to the railroad wagon and let it go on from that.

Mr. Murphy

The passenger train is very fast.

Professor Quinlan

Oh, it is. In any case, that is the position. I came across one really amazing statistic and one that speaks very highly, indeed, for management. Between 1959 and 1961 there was a considerable amount of traffic diverted from the railroad to the roads, as we all know. You had the branch lines closed in West Cork and elsewhere and CIE in that year increased their road fleet by 20 per cent as shown in their report. The amount of tax paid—the total tax and the licences for the upkeep of the roads— in 1959 was £263,000 and in 1962 it was £273,000. The contribution to the upkeep of the roads increased only 3 per cent as against an increase in vehicles of 20 per cent. That is very good business, undoubtedly, for CIE but it is not so good for the nation. Somebody had to pay for the cost of these roads. I think the dearest economy that was ever made in CIE was the closing down of the whole 70 miles of the West Cork railroad. It was supposed, at that stage, to be losing £70,000 a year. I wonder how much had to be spent on the road since then due to the traffic diverted on to it? Certainly, the extra £10,000 a year paid by CIE between 1959 and 1962 to the Road Fund will not go far in repairing the damage done to the roads by those heavy trucks, especially the beet lorries that have, during the past winter, proved a menace in Cork City. The traffic in the next couple of years will be in a chaotic condition due to the presence of those lorries tying up the traffic of the city. There is no reason whatsoever why that traffic could not have been on the railroad.

I think we should look to the future. We should get away from this nonsense that a body can be made to pay its way simply by an Act of Parliament. If that were the case we would be living in Paradise altogether. Why not, if it worked for CIE, legislate for every other body in the country that has got any kind of subsidy? On every occasion on which I have spoken on this subject I have condemned it as being mere nonsense. I have hope for this country as I trust we all have and I look forward to a great expansion not alone in output but in population in the near future. In fact, because of the way Europe is coming together, we cannot stay in possession of what is regarded as a luxury in Europe—unpopulated space. Whether we like it or not, within the next 20 or 30 years we are bound to have a big influx of population, and then we shall need the railroads we are scrapping today.

It is a very shortsighted policy, too, if, in the future, as has been proposed, we will have the scrapping of so many other stations and branch lines. That is a defeatist policy; it is only a scapegoat policy. We are made to feel, and the taxpayer is led to believe, that because stations are being closed down —all in the name of efficiency—something will happen. In point of fact, if we are losing £2 million a year, how can you possibly segregate the line that is economic and the line that is not? All lines are uneconomic by that yardstick.

Some rather weird notions of distribution exist. For instance, you have a spur of 10 miles of railroad and on that spur, say, £100,000 worth of traffic originates in a year. That is being carried to Mallow and elsewhere. Suppose the average haul for the products originating on that line is 50 miles, then the mathematics of the thing state. All those goods are going 50 miles. Therefore, you cannot credit the whole £100,000 to this spur, you can only credit in the proportion of 10 miles to 50. In other words, you reduce the £100,000 by the factor 5 and you say that effectively only £20,000 worth of traffic is originating on that spur. You can prove anything with figures. I think the vital thing for us is, even if it may be unprofitable in certain cases, to have a continuous service on some lines. In fact, it may even be desirable to shut them down for a certain time.

Surely, to go to the other extreme of making it impossible to re-open them should happier times and greater production prevail is really wrong, especially having regard to the amount that can be gained by the sale of rails and all the rest. Why not leave them there either for seasonal traffic or for happier times in the future and for the time when some real railroad genius will arrive who will be able to shuttle lorries or their contents on and off the railroad economically even over distances as short as 30 or 40 miles? When that day comes we shall look forward to getting those hideous monsters of lorries off the roads and thereby contribute both to the enjoyment of driving on the roads and cutting down the upkeep costs, I would appeal to the Minister not for one moment to entertain the idea of any further truncation of the railroads.

Finally, it seems to me that the amount involved, as I have said, is relatively small, provided we feel that there is efficient operation. At most it is £2 million. What is it? Twopence on the packet of cigarettes. Let us look at it in another way. It is just one additional journey of about 25 miles by every citizen in the country. If the citizens of the country choose to use their private transport it is not asking very much to have them contribute another 13/4 to the railroad, or the £2 million could be raised by putting a long overdue tax on the dancehalls of this country. When you read of the poverty and then read of the 300 dancehalls in County Mayo, you wonder what kind of a world we are living in at all. You see the Minister for Finance, for the second year running, closing his eyes completely to the position of these dancehalls and the money floating round them just for the taking. That money should be used for CIE as well as for any other laudable interest in this country. It is something that everybody would welcome.

I must say in conclusion that I was as baffled as some of the other Senators by the Bill as it stood. I regret very much that there was not a White Paper to accompany it. For the life of me I could not see why the first half of the Bill was devoted to extending railroads. A few short memoranda would have made the position quite clear—that it just referred to this one position. We are asked to subscribe to an increase in capital for CIE. If adequate or modern standards for depreciation had been set aside in previous years that should have met the capitalisation job. In fact, the capital we are asked for is largely a measure of the failure of the company—through economic necessity, no doubt—to set aside money for depreciation and for renewal. What has been set aside has not been adequate in the modern sense. Therefore, we should not indulge in any more day dreaming. We should try to look at the accounts critically. It is not possible for a single man in any one industry to do a conjuring trick and produce millions. CIE are to be congratulated on holding the line steady.

I endorse Senator Murphy's view about joint consultations. We pride ourselves on our Christian principles and surely a sharing and pooling of ideas in joint consultation for the welfare of all is at the root of Christian principles?

Mr. Cole

The implications of Section 13 have been touched on by several Senators already, and what Senator Murphy said was very much to the point. I know the Minister said in his opening remarks that if possible he would never go to the taxpayers for a subsidy for CIE if a competent service could be maintained in any other way. Like Senator Murphy, I think the time has come for a re-examination of the position as to whether we can run an adequate transport system without some sort of subsidy. To my mind Section 13 is the first step in that direction. Whether we like to accept it or not, I think that is so.

Practically everyone in the country was very anxious to support the idea put forward in 1958 that CIE should be able to break even and be an economic concern in a certain number of years. Almost everyone hoped they would not need much assistance by way of revenue from the State. Perhaps adequate time was not given for a real examination and a complete reorganisation. A great deal of thought was needed in regard to closing lines and reorganising the services. Perhaps five years was not adequate, when we consider that possibly the roads are not sufficiently good to take the traffic that has been put on them, and that might mean a greater deterioration in vehicles. That would be important to a company like CIE with a vast number of vehicles.

The only way the company can pay their way and increase their revenue is by increasing the fares and increasing the cost of transport. As regards passenger fares, I think we have probably gone to the limit if not beyond it. I would like to think that over a long-term period they would be reduced. If they are increased it is the poorer sections of the people who have to pay them, and that is my whole objection to the idea of an increase in fares. Usually the poorer sections have no private transport of their own. I know an instance of a line that was closed and when a bus took its place the fares were doubled within a month, and they have been increased since. I agree that wages have also increased. Usually the people who have to pay these fares are the people who have to get some assistance from the State.

I agree that the idea of CIE being able to break even by next year was good. Perhaps another five-year plan or something like that should be introduced. I for one am prepared to admit—perhaps the Minister is not, but the vast majority of the people are—that we cannot hope to have a reasonably cheap transport service here because if it gets completely beyond the capacity of the businessman to use it for his goods, the alternative is that he must buy his own lorry.

I am rather worried about subsection (5) of Section 13 which reads:

The Minister for Finance may, for the purpose of providing for the advance of sums out of the Central Fund under this section, borrow on the security of the Central Fund...

I feel that this should not be a question of borrowing. Sooner or later we must realise that it will have to come out of revenue, and accept it as a substantial capital investment. I am not satisfied that the Minister for Finance should consider it as a capital sum if it is to be repeated in a year or two. We will have to subsidise our transport system and, as Senator Murphy said, we need not be ashamed of that. That is a problem in most countries in Europe.

Mr. Mooney

It is a matter for congratulation that in a country which was criticised on a number of occasions for having aped other countries in the methods which we adopted, the work that has been carried out quite recently by CIE, under the chairmanship of Dr. Andrews, is now to be the pattern of future railway systems in Great Britain. We have not made enough capital out of that matter. If the thing were reversed we would have heard a lot about it. It is a grand thing in this day and age to say that we lead and others follow.

CIE have been the butt of criticism over a long number of years, and the people who have been most critical of them, as in so many other matters, are the people who have made very little use of it. We must face the position that if railway lines have closed it has not been entirely the fault of either the Government or CIE. It must be the fault primarily of the people themselves because they have failed to use the railways either for passenger traffic or for the transport of goods. We had a railway system in my area and fought very hard to retain it, but when we did so the arguments were all against us. Figures were produced showing the amount of transport of passengers and goods by private hauliers and other means. The same thing might arise in the future in regard to our road transport. Each of us is fully aware of the fact that people are more anxious to obtain free transport than to pay for it. We have discovered that even where buses are operating on the roads they usually wait until the bus has gone and then stand on the corner to get a lift. That is the experience of the majority of us in this House. If that position continues to exist, CIE will find it impossible, even in the case of road transport, to maintain the buses on these scheduled routes that they have at present.

I have the opposite view to Senator Cole in relation to affairs, especially in regard to road traffic. If the same dynamic approach were adopted in the case of the road passenger service as in the railways and we had reduced fares on buses and return fares on our long distance buses, especially to seaside resorts in the summer, many more people would avail of them. In my own area three services are operating to the seaside. Of the three, CIE are public and the others are private. CIE are the dearest of the three. Naturally, people wait for the other buses on the particular Sunday they are travelling to get the cheaper fare and return fares to the seaside. When they weigh up the charges for a group of people travelling they often discover that they would be just as well to employ a car and have a full day as to travel by CIE and pay the fare down and back.

I should like to take the opportunity of paying tribute to the staff of CIE locally and at headquarters for their courtesy and efficiency. They are doing a very good job of work and have been most helpful and approachable. Very often people should get credit for what they do but sometimes do not get it. We in public life know ourselves that we are always reminded of the things we do not do but we are seldom reminded of the things we have done. The same thing applies to CIE.

I do not see any mention of this matter in the Bill, but I should like to make an appeal to the Minister in relation to the inland waterways. CIE had certain responsibilities in regard to the waterways. They have abandoned that right. In view of the tourist potential that is now in the Shannon and the waters connected with it, I would appeal to the Minister that at some future date, possibly in the very near future, he would relieve CIE of the responsibility for the waterways and give them to some other body such as the voluntary body, the Inland Waterway Association, solely or in conjunction with Bord Fáilte in view of the fact that there is a big potential in the matter.

Having thrown some bouquets, I have one criticism, probably on the lines of Senator Quinlan, in relation to the accounts. I had to make an application to CIE last year to give me some information on the cost of maintenance and the revenues they had on some of their waters. The reply I received was as follows: "I am directed to say that your request for information regarding the matters set out in your letter has been considered. The Board feels it cannot hold itself open to furnish information of the nature you have requested. You will appreciate that to do so would create a precedent and expose the Board to unlimited demands for information concerning the compilation of the accounts published in its annual reports. I am further to say that the Board asks you to accept that it does not wish to be discourteous in withholding the information."

I feel as a public representative that as they are being paid out of funds which had been provided by the public I was entitled to the information I sought. I believe that in a future Transport Bill provision should be made whereby if information is sought about the accounts of the company it should be made available at least to the elected representatives of the people.

I do not want to delay the House, but I would appeal very earnestly to the Minister in relation to the inland waterways. I understand that it is his intention, I hope in the very near future, to receive members of the Council of the Inland Waterways Association with a view to discussing the whole future of inland waterways in relation to tourism in particular.

Mr. Healy

I shall not keep the House very long but there are a few observations that I should like to make. I think that the Government have a duty to ascertain by every means in their power what is the most efficient and effective public transport system that can be maintained in the country. In the light of experience we may have been over optimistic in 1958 when we set a target of five or six years within which CIE should break even. I have a great deal of sympathy with that even though I feel that eventually that aim will not be possible and we will not be able to realise it. At the same time, I do not think that that should prevent us from doing everything possible to see if it is attainable.

I do not quite follow the arguments of Senator Quinlan when he suggests that a greater population would help to solve the problem. They seem to have a similar problem across the water, where the population is not the cause of the problem and it has not done anything to ease the situation over there.

There is a natural resentment, which I can quite understand as I travel a lot myself, against the heavy lorries and trailers on the road. Even though I swear under my breath at times, I cannot help reminding myself that it is quite possible that the drivers of those heavy trailers have reason to swear at the private motorist too. I wonder which of us has more right to use the roads.

I do not think we should leave ourselves under the impression that the sooner the goods traffic is driven back to the railway the better, because modern conditions in many countries have turned heavy traffic on to the roads and it may be that that will have to be the solution of our problem.

One remark was made which struck me very forcibly about the number of dancehalls in County Mayo. The figure of 300 dancehalls was given. When I read that first, having been in the Dáil for a certain period of probation and listened to members saying that there was no population left in that part of the country, I could not understand the influx of dancers into the county or whether they did not take in their own dancehalls with them. It is a most amazing figure if it is true. I am sure that the Leas-Chathaoirleach could enlighten us about that better than the newspapers.

There is another point upon which I should like the Minister to reply. We hear many criticisms about CIE, as we do about all such bodies, and I suppose it is quite natural. I should like to know have the employees of CIE any advantages now vis-à-vis their position before the 1958 Act in the way of security or better employment or anything of that kind. If they have, these things should be made known to us so that if there were better employment and a better opening for young people they should think of it in making up their minds for the future. I should like the Minister to answer that question if he can.

Mr. Desmond

It would appear for some time that the decision that CIE should more or less break even in 1964 was not correct. That appeared to be the view some years ago, that, by 1964, CIE should break even. It is obvious to anybody who has studied transport, not alone in this country, but in most continental countries, that transport, and particularly railway transport, is not breaking even. There is today a definite tendency to transfer to road transport, the volume of which is growing each year. The number of vehicles on the road is increasing and that is bound to lead to less traffic on the rails. That is the tendency in different countries—and it is the position in this country, with its small population—and it is bound to affect, as it is affecting, rail transport. Then we say to CIE, as against any other industry: "You are expected to break even in or about the spring of 1964," which of course just cannot happen. We were told last year that the 1961 figures appeared to suggest an improvement to such an extent that it was more than likely that position would be reached and then reasons were given to explain why the next report was not just so good—costings were increased and so on. That happened in all industries and there are other industries in this country which are vital to our economy and it is considered good policy to subsidise them. Generally the volume of employment in CIE is big and any money we devote by way of subsidisation is kept within the country. That is good policy.

Another point is that today when there are problems to be examined, the workers in an industry are regarded as a very important unit and are taken into consultation. I should like the Minister to tell us to what extent that is practised in CIE. I do not think we have works councils where the workers in the particular departments of CIE are taken into consultation and their advice on problems sought, on the basis of their knowledge of how the different departments function. Rather does it appear to be the policy that it is a matter for the board's decision. Undoubtedly we must have management at a particular level and somebody has to make decisions, but it is accepted, and not alone accepted but advocated by all responsible organisations from the Government down, that it is important to have consultations so that difficulties may be got over.

Finally, I should like to hear the Minister on the continual closing down of railways, first of all, and then the gradual taking up of the rails. I think that should be examined with care because railways are a very important element in the economy. No doubt road transport is very efficient, very quick and very convenient, but railways are capable of handling traffic of all kinds and the Minister should be slow to agree that if eventually a branch or part of a branch line has to be closed, the next action should be to remove the rails. Why not try to maintain the rails even if it costs the taxpayers more? After all, if the taxpayer decides to use road transport as against the railways, how far does he object to taxes for maintaining the railways? We should be slow to dispose of the railways. No matter how heavy the traffic, they can take it. Our roads are probably already finding it difficult to take a good deal of the heavy traffic being thrown on them, even though it is perhaps a more convenient form of transport. We probably pay indirect taxes towards the maintenance of the roads by way of the taxes on vehicles. Nobody appears to mind that, but if you pay it into a fund from which a subsidy is paid to maintain the railways everybody appears to become worried.

That is worthy of some examination. I do not agree that we should just close down the railways because there is no traffic for them. If we have come to the point of having to close them then we should see to what extent we can preserve them even when closed down, lest we should require them in future. It can be argued that the maintenance of a railway with no traffic on it is a costly business, but we might be glad, as we were before, to have them. I should like to hear the Minister on those points.

Minister for Transport and Power (Mr. Childers)

I should like to thank a number of the members of the House for their constructive criticism of the Bill. I think, first of all, I had better begin by pointing out simply in connection with the operation of CIE in all their phases that consultation between the management and trade unions has been perpetual. I mean that—perpetual and never ending. I do not think I need say anything more about that at the present time. It is all that needs to be said.

I think Senator Ó Maoláin has dealt very well with the remarks of Senator Murphy, the suggestion that in a competitive system of appointment in CIE, there has been the implication of a great deal of Fianna Fáil patronage. I should just like to say again what I said before, that that is absolute and clotted nonsense.

Senator Murphy suggested that I talked of the staff as though they were parasites. I cannot see what he meant by that. The staff who became eventually redundant in CIE gave very loyal and long service to CIE. I do not know how they could be called parasites. They worked in an organisation which was the victim of an outmoded concept of transport. They worked long and faithfully for an organisation that were in a legal straitjacket and where all the laws governing their operation presumed that the only competitor of the railway was the horse and the feet of human beings. That is not the fault of the staff and managements varied from time to time in their competence and excellence.

I do not believe in holding inquests on the past performance of the various staffs that conducted the affairs of the Great Southern Railways and then CIE. I have never thought of the staff as parasites. As I have said, they were living in a world in which CIE were supposed to avail of regulations relating to the 19th century.

There were also various observations on the possible viability of the railway in all the circumstances relating to its profits and losses in various services. Its viability depends on the comparative costs of transport by CIE and private transport; that depends on the efficiency and productivity of the whole concern and on the volume of business that can be done per vehicle and the consequent economic character of the service. In addition to doing business on an organised basis in package deals or on contracts established with various concerns, they have also to supply a fairly widespread regular service by rail and road where perhaps traffic may be very thin. This is part of their obligation as a public carrier and that adds naturally to the cost. Part of the trouble is that the labour cost on the railway service per ton-mile in the case of goods or per passenger-mile in the case of passenger services is two or three times higher than in any other country in Europe. The population of this country is very light per acre. The people live in a more scattered manner than in any other country in Europe, except Sweden. The proportion of people who live in hamlets, villages or towns compares very unfavourably with proportions in other countries such as France where the population concentrates at least in hamlets and villages. All that adds to the cost of public transport and makes it more uneconomic.

I still hold to my opinion that the future of the railways lies in becoming one fast conveyor belt for passengers and goods. I agree with Dr. Beeching on that subject and with all the other experts who have deliberated upon it. At conferences which have taken place of the International Railway Association—the conference was held in Munich last year—it is granted by the international experts of the world who dedicate themselves to the existence of railways, who have vested interests in the preservation of railways, that more and more it must be realised that railways in the modern world are unlikely to pay or give a real service to the community unless they become a vast conveyor belt carrying goods and passengers at high speed and at highly frequent intervals. That is the general understanding of what the function of a railway should be— of course with some exceptions like main lines where it is necessary on certain occasions to continue a main line at least to one focal point in a widely scattered area. You may make exceptions to this statement and it still holds good.

In this country, the rate at which private cars are growing in number means that unless the railway can speed up its services—as it has been doing by the closing of services—it will be extremely hard to compete with private transport in any distance under 100 or 120 miles. Senators may note the gradual construction of magnificent arterial roads from all centres to Dublin and they may note the competition this will bring with the railway services.

Senator Murphy referred to matters of importance to the staff of CIE. I want to deal with these matters so that there will be no misunderstanding. Compensation for redundancy occurring only after the 31st March, 1964, will have to be dealt with in new legislation covering public transport policy generally after that date. The date of the introduction of new legislation cannot yet be given, but, as Senator Murphy knows, we have now extended—or rather, when this Bill passes the Oireachtas, we will extend —the period for the payment of redundancy compensation and I do not think the trade unions representing the men in CIE need have any doubt about the position, any fear that during this transitional period, CIE might suddenly engage in a new productivity measure whereby the men themselves might suffer any uncertainty as to their future position. All that will be regulated in such a way that there will be no uncertainty as far as the men are concerned until the final step is taken; the men, therefore, will either receive compensation as a result of the passing of this Bill or new legislation will be passed so that they will be certain of the results of any change.

Mr. Murphy

Surely the drive for increased productivity is going to continue? It is not going to stop suddenly in September.

Mr. Childers

There are various types of productivity measures, some by wastage, some by the transfer of staff, but the Senator can be certain that the last thing CIE would want, particularly in a period of transition after five years of intensive organisation, would be to fail to wait six months to take action. That there should be uncertainty that people might be removed from offices in which they had served for years is inconceivable.

Mr. Murphy

Trade unions want to know far in advance of 31st March, 1964, what the position is to be.

Mr. Childers

The position will be made clear. If productivity practices have to be undertaken, the particular sections of the trade unions will be told: "This is something in which there will be redundancy; it will be taken under the 1958 legislation and this amending Bill;" or else they will be told what the position is if it is not that and it will be made quite clear to them.

Mr. Murphy

They will be told after the productivity drive is completed that staff will be redundant-not all this bull about "constant consultation". They will be told that X, Y or Z is redundant and has been paid off. They will not be told: "We are contemplating doing something. What is your opinion?"

Mr. Childers

The Senator need not have any worry. It would be inconceivable in the interim stages to cause unnecessary fears among the staff and unnecessary difficulties for CIE.

Mr. Murphy

I am not causing unnecessary fears or unnecessary difficulties. Trade unions must behave in a prudent fashion and see how men will be affected. I want the Minister to tell us what the position will be after 31st March, 1964.

Mr. Childers

Legislation will hardly be introduced before December or January—1963 to 1964 would be the period.

Mr. Murphy

Surely we could be told before that what its provisions will be?

Mr. Childers

If it is necessary to give certain preliminary decisions in order to safeguard those in CIE, that will be done, but I do not think it will be necessary.

Mr. Murphy

It is very necessary. If the Minister will pardon my interrupting him, the trade unions may behave this way: "Right. We finish. No more co-operation in any increased productivity because we do not know what the position is going to be after 31st March, 1964." They might be able to bring pressure on CIE and pressure on the Minister that way, but surely in this day and age, it would be more logical that the Minister should tell us as soon as possible what the position is.

Mr. Childers

Of course I shall tell you as soon as possible.

Mr. Murphy

But December or January next will be far too late.

Mr. Childers

Senator Murphy spoke of redundant men who are still employed. I do not know of any such men. I know of certain people for whom a very high level of compensation would be necessary, who would like to retire on compensation rates but who, in fact, I understand, will continue until the pensionable age. But, I have not been told, nor have I knowledge of any noticeable number of people who have not yet been informed of what the ultimate decision is to be or who have not yet been asked to leave and be put on compensation rates.

Mr. Murphy

Perhaps the Minister will tell us how the present staff compares with what it was five years ago. He has told us the number made redundant but how does the present total compare?

Mr. Childers

Of course, it is very difficult to give those figures because there are a very large number of temporary people employed from one period to another. I have one figure here. The staff employed on 31st March, 1959 was 21,600. It is estimated that by 1964 the staff employed will be 20,459.

Mr. Murphy

A reduction of 1,000.

Mr. Childers

1,200.

Mr. Murphy

What is it now?

Mr. Childers

I have not got the figure now. On 3rd March, 1963 it was 20,759.

Again, Senator Cole and other Senators referred to that part of the Bill which deals with temporary loans secured by the Minister for Finance. I should make it clear that this is a purely temporary measure for borrowing and I agree with the Senators who said it should set no precedent in regard to dealing with deficits. In other words, it would be frightful to contemplate a position wherein this particular section of the Bill set a precedent for a new system of assisting CIE in which we would give loans to be vaguely paid back or not paid back each year in order to help them along. I agree with the Senators in regard to that and this does not set any precedent in that regard. It is not intended to have any relationship at all to any future decisions to be made in regard to the financing of CIE and to how it should progress.

I should say in regard to the new legislation to be devised after March, 1964, whatever form it will take, I am perfectly certain it will be legislation which will stimulate and induce efficiency in CIE. It would never go back to a system by which deficits were made good by advances of one kind or another or in a manner which would encourage a carelessness of attitude towards the receipts that could be obtained from the public purse. Some Senators referred to the fact that railways abroad lose money. It is true a good number of them do lose money but there are quite a number in Europe where, if you subtract the exceptional losses in pensions provided as a result of not only one but two world wars, they would actually be paying their way and there are at least two European railroads which fully pay their way and in some cases have not got the assistance of a road service.

Senator Murphy referred to the Swedish railways. They actually paid their way until 1958 and then their costs increased and with private motor traffic increasing, they began to lose money and they have been closing a considerable number of lines, even though they are keeping others open. In the case of the Netherlands railways, they closed after the war one-third of the system and 67 per cent of the stations. That is an illustration of the drastic change that can be undertaken in order to make a railway pay its way and work economically and efficiently.

Senator Murphy referred to Section 21. This will apply only to men who become redundant after the passing of this Act and it is not retrospective.

Mr. Murphy

The section does not say that.

Mr. Childers

That is what it means anyway. If the Senator has any doubts, he can deal with it on Committee Stage. I am completely baffled by Senator Quinlan. I do not know how to answer him. He loves to pick and choose statistics.

Professor Quinlan

I do not.

Mr. Childers

It takes very close study on my part to interpret what the Senator said.

Mr. Murphy

Oh, the Minister would never pick and choose statistics himself.

Mr. Childers

I should say one thing, arising out of what the Senator said. I will tell the House that the sale of rails by CIE is not taken into account in declaring the profit for the year. I did not understand that particular argument he made. He does give the general impression——

Professor Quinlan

The point is it is not taken into account in the figure arrived at but it was taken into account in paying for certain modernisations of track and of others. My contention was that these things should not have been done, unless they were necessary, and if they were necessary, then they would have to be done and would have to be paid for out of the regular budget if this windfall of the rails were not there to meet it.

Mr. Childers

In reply to the Senator, this was in connection with the capital account, not the current account of CIE. You cannot transfer one item from one account to another and juggle them around. Senator Quinlan's speech was a little bit different from the one he made on the last occasion. On the last occasion, he did seem to me to question the honesty of the auditors of CIE.

Professor Quinlan

Oh, no.

Mr. Childers

On this occasion, he did not; he said they were perfectly all right. At the same time, he gave the impression that you could prove anything with figures in a set of accounts of a State company such as CIE. I cannot follow him down that track at all but I will say this, that I cannot understand what he said when he tried to disparage the work of the Board of CIE in reducing the losses of CIE. If they had not taken all the decisions they took, if they had not been aided by a Government subsidy, if they had not been provided with Government capital, if they had not been enabled to dispense with staff who had become redundant, they could not have done the work they undertook. But, nevertheless, the fact remains that their managerial decisions have been significant and important in the progress of CIE.

There has been a very considerable increase in the volume of road freight carried by CIE, a small increase in the volume of rail freight, a certain extra number of road passengers have been carried, more coach tours have been inaugurated and then there has been a whole series of changes in relation to the movement of goods through the provision of containers and a reorganisation of that movement of goods, a reduction in the cost of handling of goods, the mechanisation of track maintenance and a whole collection of other matters in relation to the productivity, all of which have been significant in reducing the loss of CIE. The decisions to close the branch lines were based on the most elaborate calculations.

May I say to Senator Quinlan that it is possible under modern conditions to work out the receipts and the expenditure applying to a spur line and in the case of CIE, they could very well ascertain on a proper basis the receipts, about 98 per cent of the receipts, when they only attempted to allocate about 74 or 75 per cent of the expenses because of the difficulty in distributing certain overhead charges, for which the whole of CIE is responsible, to a particular spur line. The whole work they have undertaken in order to make quite sure that they were not closing a line that could become economic was the result of the most careful study and co-operation with consultants and again resulted in a number of branch lines being closed and considerable financial betterment being secured as a result.

I do not know whether at this stage I need to go over all the arguments in relation to the closing of branch lines. Not many Senators mentioned this subject but I think I may say this: when Senator Quinlan gaily talks about subsidising transport through charging pennies on cigarettes, there is a distinction between subsidies for such things as milk and bacon, where the farmers' profits are permanently constricted by trade relationships which have some dependence on another country's trade policy, and a subsidy for transport. When the amplitude of private transport becomes ever and ever greater every year in this and, indeed, in every other country, and when, therefore, subsidies become all the less necessary, we ought to try to avoid them if we possibly can and have them reduced to the lowest possible level, consistent with being able to have a good service.

About 1970, at the 1951-1961 rate of increase in the number of private cars, there will be one private car to every ten of the population in the country and one to every four in Dublin. There is nothing we can do about it. I can assure the House that the maintenance of a branch line will not prevent a decision by the people of this country that private transport is one of the most important factors in their lives. One of the most significant facts is that for a number of years the number of private cars, in relation to the national income of this country, has been the highest in Europe with France. In other words, although our national income per head is, as I might say, at a medium level in Europe —about tenth out of the total number of countries in Europe—the decision made by the people of this country to have private cars indicates that it is very much a first charge on their income. That is caused by the scattered nature of the countryside and the fact that the vast majority of the people live in scattered areas and not in villages or small towns. Then, again, may I assure the House that CIE are not going to clutter up the roads by closing a few private lines.

Senator Quinlan gave the figures for the increase in the number of lorries operated by CIE and quoted from a certain year. He did suggest, I thought —I may have misunderstood him— that the considerable increase in the number of new lorries bought by CIE —vehicles of various kinds—had some relation to the closing of branch lines whereas, of course, they had relation to the fact that new traffic was being secured by CIE, not only because branch lines were closing but because of the package deal business.

In order to allay the fears of Senators, CIE are placing a huge amount of transport on roads which were already supposed to be overburdened with heavy lorries. I thought I would mention this. On the 12th April, CIE published notices intimating the withdrawal of railway services from 56 stations in the Midlands and West of Ireland. To provide the substitute service CIE will require two lorries with their appropriate containers and trailers for full-time use and upwards of eight extra lorries to cope with seasonal traffic, for example, beet. Nobody is going to suggest that that brings a tremendous burden of transport to bear on the roads either to the disadvantage of the ratepayers or to the discomfiture of the motorists.

We shall deal next with the buses. The total number of buses required for the closings which commenced in autumn 1962 and for which the statutory notices have been published, is ten single-deck buses and two double-deck buses, that is to say, for the Wexford area, the Midland areas, the Cobh-Youghal area and all the Midland stations. That is being found in the case of nearly all these closings of stations or railway lines. The Senators who have fears on this subject can be assured that there is not an exact comparison with Great Britain, where the British people seem to be reluctant to use railway trains, even in some quite congested areas—congested by our standards. These closings have been taking place in areas where, even if the population increased by 50 per cent in the next twenty years, there could be no real congestion through the closing of the lines, which were really in the nature of a road over which a few bus loads of passengers were taken in the day. That is not my definition or anybody's definition of what a rail service should be.

In connection with the stations, the closing of which has been announced, the number of people joining the train per day at these various stations and the number alighting per day varies between three and five. It is impossible to maintain a railway service on a reasonably economic basis when you have that kind of usage of the service. It is far more suitable to have the bus services in these circumstances, in my view.

Senators referred to the fact that every effort should be made to make use of the railways and to keep fares down. CIE have a number of cheap fare arrangements. I hope they will experiment with others in order to ensure that as much use is made of the railway services as possible. When it comes to the movement of goods, as the House already knows, there are a great many classifications of goods which, in the quantities they are sent normally, simply cannot bear any longer two handlings. That is one of the difficulties faced by all the railroads everywhere no matter what decision can be made. Only at the expense of an enormous subsidy by the taxpayer for railway services can rates be such that the goods will bear the double handling involved. That has been found to be the case everywhere. I see no reason to believe there could be any change here in that regard.

Senator Mooney asked for information about the canals. The canals which are now used for navigation cannot be closed until three years after their navigation has ceased unless by a special Act of the Dáil. All that matter will be examined in connection with the new legislation and every effort will be made to examine what is the tourist potential for traffic along the canal and the matter will be fully dealt with, I think, in an intelligent way. We shall have the help of Bord Fáilte to advise us in regard to the tourist potential both for our own people and for tourists coming from abroad.

Senator Cole referred to the increases that have taken place in freight rates and in fares. I did indicate that CIE were only able to cover half the recent wage increases by the increase in rates. They have not passed the whole of their increased charges on to the public. I think they have done everything they can to keep down freight rates by making package deals. They have undertaken various experiments in cheaper rail fares. I certainly encourage them myself to make experiments with cheap fares as far as possible. This is also operated with regard to school children on the buses and it has been very much appreciated.

Senator Mooney asked a question about the refusal of CIE to present him with some sectional accounts. That is a difficult question. It is quite impossible to imagine that any person in the House, a member of the Dáil or Seanad, or members of local authorities, could ask any State company to break up its accounts into sections and provide information in regard to some particular phase of its activities.

One of the reasons for allowing State companies to undertake their day-to-day activities free from either my interference or interference by the Dáil, is that once it became possible to ask for detailed information in regard to particular sections of activity, speaking either of functional or geographical sections, a tremendous amount of pressure would be exercised by the public who, using the information, would say to the State company: "Why not give a better service here or a better service there? Why should it cost more to provide a service in area A than in area B?" It would create absolute chaos and prevent the efficient operation of the company.

I think that both capitalists—if there are any true capitalists left in the world—and socialists agree that when State companies operate in that way, it is impossible for the public to be given that kind of detailed information, as it would simply result in pressure lobbying. If there were no pressure lobbying, there would be no harm, but if there is pressure lobbying, it simply reduces efficiency, and every time one group in the community got a better service, a more elaborate service, or a cheaper service, they would almost certainly be getting it at the expense of another group. It would become a matter of competition.

Senator Healy asked me whether I thought there was the same opportunity for a young man joining CIE now as there was in 1958, or whether there was hope for the younger staff joining CIE. I think that if all the staff of CIE work with heart and hand, we should provide the very best possible service, and if reorganisation continues, perhaps of a different kind but with the same enthusiasm that has prevailed in the past five years, there should be very good opportunities for younger people who join CIE now and who are properly trained and qualified.

A great deal depends on what the cost is to CIE. If labour charges rise very rapidly over a short period, CIE can get into the same difficulties as they got into recently, whereas, as I indicated, if wages had gone up either on the basis suggested by the Taoiseach in proportion to the growth of the national economy, or on the basis of what the average rate increase was in 1962, the financial position of CIE would be far better, and they would be better able to compete with private transport.

Assuming that we can now expect good industrial relations nationally, and a greater understanding of the meaning of national productivity in relation to the growth of either profits or wages, I think there is hope that CIE will gradually become more efficient as the years go by. It is not possible for me to make a prediction about the future until I see the report of CIE and the report of the committee studying the position, and until I can see what we can envisage in the future.

Members of the House have already said CIE have not succeeded in reducing their loss. They would not have reduced it to nothing even if wages had gone up only by the amount of growth of productivity, and making certain other assumptions, they would not have completed their job, but I believe they are on the right track and have the right ideas. I believe that given reasonable conditions, and given another measure of legislation which will face realities and, at the same time, ensure that there is a sound public transport system, they can make progress.

Professor Quinlan

May I ask a question? I understood the Minister to say that the sale of the tracks was only included in the capital account. If the Minister turns to page 23 of the Report of CIE for the year ending 31st March, 1962, he will see the figure given there:

Surplus arising on disposal of Rolling Stock and Railway Lines previously written off, £201,197 less:

Special expenditure during year on modernisation and reconstruction of rolling stock, stations and buildings and office equipment, £88,656.

That establishes my contention that this was used for something that would have to be paid for in any case.

An Leas-Chathaoirleach

I do not think that is a question.

Mr. Childers

It depends on how we define our terms. I said it had not been included in the general figure for loss or profit they declared each year, but it is added in after the main figure has been declared.

Professor Quinlan

It was used for something that would have to be included and paid for out of the general profit and loss account, if this source were not available.

Mr. Childers

I do not understand the Senator.

Question put and agreed to.

Committee Stage ordered for Wednesday, 8th May, 1963.

The Seanad adjourned at 9.50 p.m. until 3 p.m. on Wednesday, 8th May, 1963.