Transport (Re-organisation of Córas Iompair Éireann) Bill, 1986—Second Stage (Resumed).

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

The Transport (Re-organisation of Córas Iompair Éireann) Bill, 1986, is the latest in the long list of statutory documentation dealing with internal transport in this State. I am not going to go through the long list of reports and tribunals and examinations of internal transport. Suffice to say that like this Bill, almost every one of them purported to be a panacea for the trials and tribulations of internal transport in the Republic. To what extent the mandarins of the Department of Transport and Power have pressed their personalities upon this Bill, or for that matter the "princes" of Heuston Station, I am unaware, but I do know that even the most naive of us here cannot help but surface with the conclusion that it owes a great deal to a firm of international consultants, McKinsey, a name that has been bandied about in debate in this Chamber for a considerable period of time.

I have had the privilege of listening to Senator Lanigan who spoke quite eloquently about those international consultants and suggested that perhaps the time was nigh when they should be examined as to what their function in life was. It occurred to me that politics is a strange game because somewhere along the line somebody seemed to have forgotten that there was a certain catholicity about the employment of McKinsey. The first employment of McKinsey was by CIE when they hired them to produce a document, which I am sure at the time they fondly imagined would mesh well into their vision of an internal transport system in which they would be the predominant agency. Not long after that, the former Minister for Transport and Power, Deputy Faulkner, hired McKinsey presumably with the same objective in view to produce a document that would in some way be the mirror image of the political necessities of the day. Between them, the inevitable surfaced that when you employ a firm such as McKinsey it is merely a recognition of the old adage that you employ them to produce what you want and they will produce what you want provided you pay them.

However, it is important to set this Bill in some form of historical perspective. When this small State was established, one of the things bequeathed to us by our colonial masters was a proliferation of internal transport by way of its railway network. We had a tremendous number of independent railway companies, although the four major ones were particularly well known to the public — the Great Southern Railway, the Great Northern Railway, the Midland and Western Railway and the Dublin SouthEastern Railway. In between we had this plethora of small railway companies operating on a quasi-provincial basis some of them even operating on a county basis. Some of those provided the necessary stimulus and catalyst for song-writers like Percy French who wrote about at least one small little railway line in the south-west of the island. It became abundantly clear in a very short space of time that the investors in these railway companies had quickly come to realise that there was no return on capital invested, and certainly there was no incentive to invest any further money.

It appeared that the combination of the First World War, the macadam road— which incidentally preceded the railways — plus the internal combustion engine was now contributing to the rapid demise of the railway system which, incidentally, had been built to service military needs in any event. An attempt was made to rationalise the structure and as a consequence the number of railway companies operating in this island was considerably reduced. That did not meet the problem in its entirety. There was a reluctance on the part of those who had been in at the early days of railways and the industrial revolution, those who had benefited from the enormous profits that were to be made through railway transportation and those who had made tremendous profits out of the land rights associated with railway companies, to stay with what they regarded as a dying means of transport. Tremendous pressure was put on the Government of the day to take whatever remedial steps were necessary to preserve this essential element of the national infrastructure.

We had the 1950 Transport Act which created the national transport company. The national transport company was regarded as a very brave exercise in its day, certainly on the part of a small State with a population of fewer than four million. Even then, there were difficulties. All the railway companies were taken under the umbrella of CIE, with the exception of the Great Northern Railway which traversed a geographic border. There was always a reluctance on the part of those in the Six Counties to accept that a single management could manage the railway company, North and South, for fear that that might be taken as an acceptance that there was a capacity to administer the nation. Be that as it may, eventually the Great Northern Railway or that portion of it which operated between Dublin and the Border, was subsumed into CIE. We then had a national railway company.

There were parallel developments in respect of the road system. From the twenties — and I got this from reliable sources — it was not an unusual sight to see the Red Star bus race the Emblem Line bus to the bus stops to pick up passengers. They were not too particular about whether their buses mounted the footpaths in this exercise to pick up available custom. They were not too particular either about the maintenance of their vehicles. Some of them even had all of the qualities which would demand the expertise of a rally driver to keep them on the road.

A parallel exercise was carried out in order to rationalise that sector of transport. We had, as a first stage, the merging of all the independent operators who had no generic title in those days. PAMBO had not yet been invented. They were all merged into the Dublin United Tramway Company. The concomitant provincial bus operators were taken into the Irish Omnibus Company. The inexorable pressures towards rationalising an internal transport network came into full force. These in turn, became integral parts of CIE so we were one of the rare nations in the world who could claim that we had successfully brought all the strands of transport together under one central management.

However, the great difficulty experienced by CIE in all of these processes was their high profile. CIE, as a semi-State company had a very high profile, certainly in excess of any other semi-State with the possible exception of the ESB, because everybody used CIE. There was maximum public utilisation. People knew when the bus was late. People spotted immediately that if the train from Kingsbridge did not leave on time that that was a serious problem. There was always a battle to provide the maximum balance of convenience to users. People tended to forget, in respect of the bus services operated on a metropolitan basis by CIE, that Dublin was a medieval city bisected by a river and criss-crossed by bridges which made it virtually impossible for any sort of organised scheduled services to operate with efficiency. I can personally recall the enormous difficulties I had in trying to convince the city fathers that we should have busways and that we should have contra-flow systems. In 11 years of constant endeavour with Dublin Corporation, I finally succeeded in having a contra-flow system at Parliament Street. One can almost clear Parliament Street in four or five strides.

Nevertheless, all this image, which was constantly exposed to public scrutiny, led to an almost collapse of the morale of those who were not only charged with the running, management and operation of CIE, but those who worked in it. At every turn of the wheel, we had economists telling us why the enormous subsidy which was being paid to CIE should be stopped. We had all these burgeoning economists, who were about to make reputations for themselves, pointing out that there were better and easier ways of meeting the transport needs of the city and the nation. All of them concentrated, almost to the point of exclusively, on the need to subsidise CIE. They noted that CIE's subsidy was £10 million, then £15 million, then £20 million and so on. They said that the subsidisation was out-running and out-pacing the rate of inflation. There was a massive preoccupation with the subvention required to maintain CIE and the national transport company.

Of course, while this was happening nobody was commenting on the enormous sums of money which were being channelled into the private sector, because when the money was being channelled into the private sector it had grandiose titles like "development grants", "the provision of social employment" or "the development of research". It had all sorts of names to obscure the fact that substantially the financing arrangements for these entrepreneurial exercises came from the State coffers. CIE stood naked and unadorned to the public image by way of their subvention. The public — and this is understandable because the public were only interested in when the bus got there when the train got there and when the road freight lorry got there — never questioned, for example, the need to maintain, equip and enable to operate the law enforcement agency. In this gregarious society of ours, it was accepted that we must have law or we would sink into the oblivion of death and destruction.

It never occurred to them that was being paid not on a profit and loss basis but, purely, on a service basis. It never occurred to the public, for example, that although we are completely wedded to the concept of neutrality since the formation of the State and have repeatedly made that statement, that we will not become involved in an international fracas of any description. I certainly remember the eloquence of the late Eamon de Valera defending this nation's stand against Britain's call for the ports and its ultimate involvement in the war. We are wedded to the concept of peace. Nevertheless, we spend a great deal of money on Defence for which there is no material return. Nobody focuses any great attention on that and, perhaps, that is as it should be. For example, the biggest single employer in this State is local government — the Civil Service and the public service generally. They are needed to maintain the infrastructural mechanisms which make this geographic unity of ours a State. They do not make any profit. They provide a service and until recently nobody saw fit to challenge them to any great extent.

There is no doubt that a nation's vitality is judged by its transport network. Movement is the beginning and the end of life. If you are moving you are alive and when you stop moving you are dead. I am told that for millions of years the only form of locomotion known to man was Shank's mare which was the movement of his legs in order to go from one point to another. That was the way early man moved with the climate and followed the herds in order to be fed. I am told by my academic friends that the horse was first domesticated in the year 3000 BC and suddenly there were people who could travel at 30 to 35 miles per hour. That lasted for almost 6000 years until the industrial revolution, when Stephenson had the wit to harness Watt's steam engine to a set of wheels and we had the first locomotive. As a consequence, the railway systems have now adorned the globe. Suddenly, in a very short period of time man could move at 60 miles an hour. Within 150 years the speed of movement rose to something in the region of 32,000 miles per hour en route to the moon. That is what transport is all about. That is why the vitality of the nation is measured by the efficiency and the regard it has for its transport system. In fact, having spent a lifetime in transport I have long come to the conclusion — and it is not necessarily a subjective one in that it comes from a series of bad experiences, good experiences and a determination to learn as I went along — that transport as we understand it in western developed societies operates exclusively within the philosophy of growth. The free market objectives much of which stand as the basis for this Bill, are quite clear and specific. Profits and growth are taken as complete, absolute values. Our society, and most western societies, have relied again in almost absolute terms on this phenomenon of growth. It was pursued in purely quantitive terms and applied without reservation to all areas of human activity. Growth was the essential and the primary, almost the exclusive, measure. It was pursued, among other reasons, because it was considered to be the one way to preserve employment. It occurs to me now that the ever-increasing growth in the number of unemployed in this little State of ours and, indeed, throughout industrialised countries in the west constitutes a self-evident contradiction of that economic distortion.

We all know, even if we pretend that it is not a fact, that growth is finite. All of us live until we die; all of us grow until we reach maturity. If we go beyond that we enter the world of abnormality. We are no longer regarded as being representative of our type or class. This Bill is the child in many ways of the long list of statutory documents which have emerged in respect of transport. It owes a great deal to the current economic crisis because that crisis has focused acute attention on the transport industry, and, as a consequence, the domination of the transport industry by the forces of the market, a market which operates on a model of total competition with a view to formalising the dream of most political aspiratants, that of a transport policy.

We have always claimed that the establishment of the national transport company was in many ways the microcosm of a transport policy. We had achieved in the fifties to some extent, and many of us believe a substantial extent, what the Common Market is now striving for and what many in the Common Market regard as a dream or a myth.

I am reminded of an article which was written by the Irish representative of theEconomist intelligence unit and of the Financial Times when he said in regard to efficiency of State enterprises:

The problem of efficiency in State enterprises is an extremely difficult one, chiefly because of the absence of any quantitative standard by which efficiency can be measured. Even the profit test, that crude measurement of efficiency which exists as between private enterprises does not apply in the case of State enterprises which, although they may aim to avoid subsidy and to be self-supporting, are not intended to seek to maximise profits.

The man who wrote that 20 years ago was Deputy Garret FitzGerald, the Taoiseach. It may well be that he has matured in time and has been required to measure up to the realities of life as the difficult circumstances are presented to him.

The Senator might give us the exact reference.

The exact reference is a small handbook published by the Institute of Public Administration. The author is Garret FitzGerald. I cannot recall at this stage the title of it. I am sure that the administrative section of the Seanad will have no difficulty in locating that document.

The Irish Congress of Trade Unions have had an opportunity of looking at this Bill. They have consulted with their constituent members. They have endeavoured to achieve a consensus viewpoint against the variety of demands upon their services. I would be a fool not to admit that their major preoccupation is with the employment conditions and services arrangements in respect of the labour force employed by the company. They issued a press statement on 14 March 1986. By stressing that it is a press statement and advising of the date so that there will be no difficulty in ascertaining its basis and where it came from. I want it read into the record because it is important as a formal statement of policy by the central trade union movement.

The information is for the Members of the House so that they can consult it.

I do not need to go as far as to provide every Member of this House with a copy of it. The press statement says that the CIE unions have considered the Government's legislation on the proposed re-organisation of CIE. The unions support the idea of renewal and improvement of CIE services. They think that this Bill is not the best approach. The proposal to increase Government control over CIE wages and conditions is a recipe for chaos in the industrial relations of the companies that are proposed in the Bill. Unions are disappointed that the Government, in drafting the Bill, have totally ignored the views of the CIE workforce expressed through their unions. They are critical of the proposals to separate the different sections of CIE into independent organisations under the Companies Act, particularly in the light of the experience of the taxpayer and the workers in Irish Shipping. If intelligence or education mean anything it can be reduced to the simple definition of accumulated knowledge. If history has any value it teaches one not to make the same mistake twice.

The divorcing of the railway and the provincial bus services is not practical as the services share joint facilities. This can only lead to a costly duplication of those services and the eventual deterioration of the service to provincial communities. The unions make the positive point that the proposed legislation should be amended in consultation with all parties. If suitably amended, this legislation would help in improving the services provided by the national transport company.

That statement related to a number of references in the Bill which constituted major changes. For example, section 6 of the Bill, provided for the establishment of three companies. One is almost flabbergasted in the search for the reasoning behind this type of approach. In all my years in transport I have accepted that the bulk of criticism levelled against the company, particularly in terms of the services provided to the community, was levelled against the Dublin city services. One could not read a newspaper without finding some reference to the appalling industrial relations set-up in Dublin city services. Whatever criticism was levelled against the railways was levelled against them for the fact that they were responsible for the major proportion of the subvention needed to keep CIE afloat. Nobody ever took into account that CIE are required to maintain from their own resources their own permanent way, whereas everybody else uses the road services on the basis of paying whatever tax is imposed by the Legislature.

The logic of establishing a bus company for Dublin city is unassailable. Nobody has raised any serious objections to it. It is of sufficient importance, in terms of its contribution to solving the demographic problems that face a city which has within its boundaries one-third of the total population, to demand that some sort of exercise be undertaken to ensure that it is run at optimum efficiency. It is not logical to challenge the railways for being responsible for the major subvention to CIE and then suggest that they stand alone with an expensive permanent way despite all the rationalisation techniques that have been introduced into CIE. Despite the abolition of signal men and the fact that there was a signal box every couple of miles in order to ensure that the safe passage of a train, and despite the introduction of electric signalling installations which now only require one cabin, CIE will have to meet the enormous expense on their own, unaided and without any inflow from any other activity, this subvention which has been their cross for years. To suggest that the whole tide of history be reversed and that the provincial bus services be hived off to operate as a private entity in competition with the railway not only baffles me but suggests a distortion of thought which is totally unexplainable.

Again, perhaps, it is because of this obeisance to the concept of competition — that everybody has to compete to be successful, that everybody has to be better without realising that the provincial bus services turn out to be better in terms of public appreciation than the railways — that the railways suffer. If, on the other hand the railways should by dint of much effort, provide a service which is more palatable to the citizens of this State, then the provincial bus services fall apart and die. This is an assault on the whole concept of an integrated transport system which was the dream of the early founders of the State and still remains the dream of the European Economic Community.

I was appalled when I read the Bill and discovered that in section 11, despite all the publicity in the past 20 years and certainly in the past decade for worker directors and for the recognition of the right of workers to participate at board level in respect of the enterprises that employ them, there is no specific provision in the Bill for the maintenance of worker directors. It is another reversal of the tide in respect of human and industrial relations. While there is reference to the appointment of other directors, there is absolutely no reference to the fact that worker directors are the only directors in this company or indeed any other company who recognise the principle and concept of worker directors who have to stand the test of the ballot box. They are the only people who have to stand up and say why they should be elected as directors. They are the only people who are required from time to time to answer to the constituents and that should have had some appeal at least to those helping in the drafting of this Bill who had some political background and who knew the difficulties of the electoral process and particularly the difficulties of re-election. There is nothing in the Bill about worker directors.

Section 14, which essentially provides for the dissolution, makes no provision whatsoever for conditions of service prior to the vesting arrangements. If one man or one woman gives a lifetime of service to the railways in some shape or form and finds that because of some peculiar circumstances the particular exercise in which he or she was involved in now a constituent part of the road passenger provincial services and has to transfer there, it is not clear how the conditions of service are to be protected, what is to be done in respect of this transfer. This has particular relevance in respect of clerical people employed in CIE.

Section 29 which deals with the terms and conditions of employees — to me at least, and I am perfectly prepared to accept that this may well be a naive assumption — smells of ministerial interference to a point which in my judgement can only bring about in time industrial relations chaos. There is no point in talking about free collective bargaining and the concept of free collective bargaining if there are all sorts of cop-outs along the way. It means exactly what it says — free collective bargaining. It means that people sit down and face a common problem and iron out whatever differences there are between them in the hope that in that process a mutually acceptable and palatable solution to the problem will emerge. In the recent teachers' dispute that came into high relief. If that type of process provides for arbitration that is what it should be. My simple definition of the word "arbitration" is that somebody sits in judgment on the issue, arbitrates and decides one or other of the parties is right. There is no cop-out; neither side can go elsewhere to seek to upend that decision. I can see within this Bill clear provisions by which that happens and will happen in CIE if the Bill goes through in its present form.

Section 29 is not new; I did not have to wait for this Bill to be produced to be aware of this provision. I have been around a few public State bodies and I have seen a few letters from the Minister for Transport telling the various boards that they have no business doing business with their trade unions or staff associations on the matter of wages. I have seen the development of this type of command structure where from the dug-out of a ministerial office the generals in the field are told: you cannot do this, that or the other. Then, when the bubble explodes one side or the other is blamed for the industrial unrest that is created. Either one appoints a board to do a job or forgets about it. The whole art of leadership is to delegate to people the responsibility for completing an exercise which you have in mind. One does not sit over them all day watching how they do it and holding them to task when in your judgment they go wrong. One has got to have sufficient faith in them to do it the way they see it should be done from the perspective of being on the ground.

There is no doubt in my mind that section 29 carries within it the seeds of an approach designed to affect with some stringency the complete element of wage control. That is something that will not rest easy in the labour forces of whatever company are established. It certainly will not rest easy with me, if I am approached by those labour forces with that constituting a problem. I read the Green Paper which preceded the Bill and, as a matter of interest and purely as a national connotation, it just occurs to me that that booklet published by Dr. Garret Fitzgerald had an orange cover: the Green Paper is green and I understand the Act will be white. Whether that means that it is all in the interest of the little nation that we serve I do not known but it was a peculiar coincidence. The Green Paper says as regards mainline railways, for example, that the Government have decided that they will be retained in the medium term and the breathing space provided by that decision allows time to consider whether (a) the existing railway network should be retained in the long term or (b) retention should be on the basis of a reduced railway network or (c) the railway network should eventually be closed down. One does not have to be over clever to come to the conclusion that whoever set out those three options could hardly be described a railway afficionado. Of course he is not. In his booklet Dr. Garret Fitzgerald says the history of Córas Iompair Éireann, the inland transport monopoly, has been a less happy one. This was some 20 years ago. He was talking in terms of a comparison between CIE and other semi-State companies. He went on to say that during the fifties following its nationalisation it cost the State in non-repayable grants over £20 million but that during the first half of the sixties a programme of re-organisation was expected to eliminate operating losses.

Apparently he was not as good an economist 25 years ago as he is supposed to be today. That expectation did not come to fruition.

He further stated that since the results of the first year of this organisation programme suggested that these hopes might be realised even more rapidly than expected, that if in fact it becomes possible to eliminate the losses of this company which derived from its railway operations this would be an outstanding achievement for geographic, economic and demographic conditions in Ireland which are, to an extraordinary degree, unsuited to the successful operation of railways or indeed to any kind of public transport.

Is it any wonder why one of these bright boys who successfully aspired to become Minister for Transport should produce a Bill like that the one before us, given that his masters voice echoed in his ear? It would appear that the acute, erudite contribution toThe Economist and to the Financial Times all those years ago was to have an enormous later influence on the Minister for Transport and Communications and indeed on Government policy. If one has the Taoiseach expressing that view about railways and about public transport at large you could hardly expect his Minister to introduce a Bill which would be in direct contravention of those stated philosophies.

The Green Paper went even further when it talked about buses. It talked about the utilisation of post buses for example. I do not know a lot about postmen but apparently the use of post buses in provincial areas as a substitute for scheduled bus services was on the basis of economics: it would be much cheaper. Apparently, somewhere in the Green Paper was the nuance that industrial relation problems might be fewer if it was a postman delivering human cargo rather than a bus worker. I do not know much about postal workers but I do know that they generally react in the same way as everybody else in respect of industrial relations problems.

It was not only postmen he was talking about but also about using taxis which suggested that he did not have much experience about taxis. He suggested that taxis could be used as part of the transport infrastructure. He was suggesting taxis for areas like Tallaght which is a besieged area in terms of transport. There is absolutely no hope of a railway extension to Tallaght; at best all I can hope for is a bus expressway. The Taoiseach was suggesting a combination of taxis and post buses to supplement and expand the transport facilities to an outlying area of Dublin which is growing apace and rapidly nearing the total population of Cork city. I remember remarking at the time that perhaps the only reason he did not suggest rickshaws as a panacea for these problems was the climatic conditions which we enjoy in Ireland.

There is nothing in this Bill to suggest that it is what I think the Minister secretly believes it will be, a panacea or a partial cure — all for the transport problems which we allegedly face. There is nothing in this Bill, and particularly in respect of its dictum that there should be three separate companies, to suggest that that sort of dream can be realised. There is nothing in this Bill to suggest in any shape or form that it carries with it either the imprimatur of those who have for a lifetime in one way or another shape or form, for good or for bad, managed CIE. There is nothing in this Bill to suggest that there has been adequate consultation with the thousands of people who are employed in this enterprise to ensure that they will be protected. There is nothing in this Bill to suggest that given complete consummation of its contents and given that it goes on to the stocks as a piece of law, it will improve the situation as apparently the Minister envisages. If one goes anywhere in the world and examines any public transport enterprise and tries to examine it against the backdrop of financial stability he will be searching for a holy grail because it is not to be found anywhere.

I am not suggesting that the Bill is designed to ensure that everybody pays his own way but implicit in it is the assertion that if you do not pay your own way you go to the wall. The employees of CIE are very conscious of the fact that this was a relatively easy decision to take in respect of another semi-State company which had the nerve to get into commercial operations and had the nerve to engage in activites in the free market and take on all the mantles of private entrepreneurial skills, and got caught up in the economic recession and was promptly put into liquidation.

There is a need to have enshrined in this Bill a mechanism to ensure that before that can happen in respect of any of the companies set up that both Houses of the Oireachtas have the right to examine it and make a determination upon it before it goes into effect. That is not an unreasonable request to make because every successive Government have insisted in terms of their industrial relations problems that they should have the right as a fall-back if there were difficulties, to come back to this House and have the House either approve or disapprove of the settlement. I am adamant that there should be that sort of mechanism within this Bill. The Minister is no stranger to transport; he is the product of a transport world albeit an insular one. The only knowledge he has of railway systems is a small little inter-company railway which operates within the 52 acres which constitute Guinness's breweries. Other than that, he does not know anything about railways except that he passes Heuston Station and that it is in his constituency. But at least he is from the transport world and should know the dynamics of transport. He should be prepared to sit down with the people who operate the first real genuine attempt at a national transport enterprise and ensure that whatever was agreed as constituting the elements of this Bill when the Act was produced due regard was had to all of these problems.

I think we have heard the voice of experience here from Senator Kirwan. Clearly, his knowledge of the whole transport system and the experience he has gained down through the years will benefit people who are interested and pay attention. He has explained the situation clearly. He has outlined the history of transport and to some extent, the fears expressed by the workers over the various periods of investigation down the years and which in the final analysis are manifesting themselves in this Bill. There is the real question of job security and conditions of employment. While we may talk in terms of 500 if the Bill goes ahead in its present state without sufficient safeguards being built into it we can be talking of anything up to 5,000 if one takes into consideration the possibility of the railway going to the wall, with the inevitable consequences for ancillaries and subsidiaries.

We have a serious situation and I can understand how strongly the Senator feels about it. I think it is necessary that Labour Party policy on CIE should be stated. Labour policy always has and always will recognise the dependence of many workers and their families on CIE for a good livelihood. The organisational structures must be geared to the provision of efficient public transport services and the provision of worthwhile employment.

The Labour Party see CIE as being about people rather than management structures, operational methods or financial deficits. That is why I share Senator Kirwan's strong views about the fears that are in workers' minds. There has been a tremendous amount of investigation into CIE in the past not all of it has been very conclusive. Even where it was conclusive it has not always been given effect to properly. When we talk about people we are not just talking about CIE and their customers — who are an important element — but also about the staff and the people who depend on CIE. We represent all these people. CIE customers are the users of public transport and the purpose of CIE is to provide the public with a good transport service. Therefore, we would never argue about efficiency. We want to see rationalisation. We want to see improvements, and have encouraged this down through the years. The public are entitled to a reasonable and efficient service. We want it to be customer orientated, to be public orientated, to be flexible and non-bureaucratic. Any rationalisation that might take place must not overlook maintaining high standards of safety and passenger comfort. It must monitor carefully changing customer needs and seek to satisfy them as efficiently as possible. It must provide a variety of useful information. We would expect them in the course of any rationalisation to update their services. Every step must be taken to secure the highest standards from all their staff. We would not make any excuses for people not co-operating with that kind of thing. This Bill is not the way to go about this.

The nub of the problem is in the question of two or three companies. When wages, conditions and so on are added to the question of the three companies the fear becomes that much more apparent. Apart from the safeguards not built in on the question of job security, section 29 and other matters, there is this terrible fear of the two companies as against three companies. I do not know when the Minister is replying whether he will be able to make a very strong case for the three companies. He did not do so on Second Stage. Perhaps, at the end of the debate, having heard all the points made by Senators, he will realise that there is a case to be made. The whole question of the two versus three being the nub of the problem is something that has got to be resolved here on the basis of a suitable amendment that will have regard to allaying the fears of people who have worked in CIE for a long number of years giving long and hard service and who do not enjoy at the end of their days the very good pensions like they do in very many other places.

CIE in recent times have made great efforts to perform efficiently and have worked well within the figures set down by the Minister. Having regard to all points I made earlier on about the high standards of safety, I think CIE have lived up to the desires of the Labour Party and particularly in recent times. We were painfully aware of many of the deficiencies which discredit public transport and particularly discredit CIE in the eyes of the public.

The defence of public transport must go hand in hand with rationalisation and the question of making it, generally speaking, a good crowd to belong to. It must provide for customer satisfaction, staff satisfaction and generally merit a more desirable point of view than the public can express about it at present. The reason for public dissatisfaction is that the public are not fully aware of the situation. Perhaps this debate will help them. They are not aware of the number of investigations which have taken place into CIE. They are not aware of the hatchet job given effect to under the 1958 Transport Act arising from the Beddy Report, 1957. At present two-thirds of the railways have gone. It would not be difficult to wipe out the railway side if it were put in competition with someone else.

With regard to the staff and their efficient performance, this requires an enlightened staff relations policy. CIE by their governing legislation can maintain reasonable conditions of employment. That should not be interpreted narrowly when discussing the Bill. We must think in very broad terms in so far as those conditions obtaining at present can be eroded by legislation being too tightly worded or being so inflexible that it is not comparable with a situation where people work in a combination situation and then are moved into wide open competition where they will be more vulnerable. We are anxious that our people pay attention to efficient performance. They have been doing this. They have been working within the ambit of the money available.

It is not possible to make a blueprint for a perfect situation. However, we should not overlook what may have caused some of the inefficiency in the past. In this respect, one would wonder whether, in fact, while we had worker directors operating in CIE and semi-State companies, this on its own goes to make real industrial democracy, and where you have no function below board level for worker participation in any effective way, whether the desired results of co-operation, understanding and mutual agreement and better investigative procedures are agreed to as being desirable for the company to function properly and in the interest of the employees.

I mentioned that CIE was one of the most investigated public bodies. They are one of the largest Irish State companies and provide a service in all corners of the country affecting the lives of thousands of people. They have been criticised always for their failures but never do we hear very much about their successes and they have had their successes. The poor image in the eyes of the public is paralleled by the attitude of successive Governments who have generally regarded CIE as being a drain on public finances. Therefore, when you are going to do something about it, even though they may not have the full knowledge of the thing, pragmatism is your answer. You start to bring in something that will bang, bang, bang.

Without having regard to other factors such as the question of the history of industrial relations which to my mind, apart from bad management, has been the cause of many of the problems that the public got into their mind, I do not think the problems were that bad but the public have this belief about CIE and it finally gets to the point when nobody has a full understanding and when all the investigations will not bring about that full understanding. Even I might add, that is difficult to do because probably many of the people who are investigating it, understand it to a substantial degree. On the other hand, the public, while they would agree it was fully investigated, they probably acknowledge that it is the least understood. That is a very important one because it is a very complex situation. Anywhere you are dealing with such a large number of people and a workforce that works on the basis of combination, this kind of abuse is easily singled out. Consequently, the whole picture is never quite understood. You can investigate all you like, the public will know you are investigating, but despite all the investigation, CIE, probably because of their complexity, are likely to be the least understood by the public.

On the question of their remit from the State, sometimes this has been confusing, sometimes contradictory. If they have to provide adequate and efficient public transport services, including socially necessary but unprofitable ones, they have to operate commercially. To constrain their deficits, CIE themselves have had to decide which services were socially necessary and which would be discontinued. Therefore, when you come to the question of a decision to cut back or abolish certain services, you have to have some reversals in this thing. Some political pressures said that you cannot go that way, so it does not happen. Possibly the pressures have come down the years from Governments who first introduced something and then on the way the pressure reversed that process. Consequently, the position now is, on the one hand, you have a degree of measures to start making changes in it. Then you criticise the size of the deficit and then after pressure you realise that you have not established sensibly the criteria for dealing with that socially necessary aspect of CIE and supporting them on that basis. This has been a failure of Governments down through the years. It is a real problem for all Governments.

Here we are dealing with a situation where many of CIE's services are definitely of a commercial nature but this has not meant the CIE could enter into the ruthless competition which would have injured private operators of a similar service. The private operators could enter into the ruthless competition that could affect CIE. They are at a disadvantage there. This is due really to their unacceptability to the public eye or to Governments who by and large down through the years, have favoured private enterprise. The favouring of private enterprise over State enterprise always brought forward in the people who were bringing in the idea of change and rationalisation, the whole question of the free market operation that Senator Kirwan dealt with so cleverly and so well. The whole competitive behaviour in CIE in those conditions obviously did not have regard to the question of the social aspects of the company and how difficult it was to get the support on that basis rather than on the basis of being a commercial enterprise and thrown wide open to the whole question of competition.

Because of the whole scene with regard to railways down through the years and the hatchet job of 1957-58, in current conditions, without understanding the thing fully either the public attitude might result in accepting advocates of the idea of the question of development of the road passenger and road freight which would act to the detriment of the railway and which would call into question of the railway. Quite clearly, this is a very worrying area of concern.

When we are talking about the question of rationalisation, we decide to split the company up into three companies. Then arising out of those three companies we are bringing in the question of competition from people who can be very ruthless when it comes to the question of competition.

Some way or another it has got to be put on the record that there is a history to CIE. It is just as well that we might know something about that history.

Between 1950 and 1956 the railway system was largely converted to diesel traction. It was hoped that this would improve the company's finances but losses continued to mount despite that move for efficiency in 1956. Again, possibly, due to the social aspects not being properly considered. The Government on that occasion commissioned an economist to report on CIE. That results in the Beddy Report of 1957 in which there was the conclusion that the railway should be abandoned without any serious consequences to the community and recommended the closure of all but 56 of the 373 stations and the integration of the bus and rail service. Historically speaking, the fears expressed by Senator Kirwan and myself and the workers in CIE are very well founded on that basis. The situation is aggravated a little in this respect having regard to the fact that, under section 19 of the Transport Act, 1958, it is possible for someone to decide by ministerial order that a railway branch line would close down and the hauliers in the area could come into the CIE stations, get details of what freight or what transport were available and other information that would be useful for them to go into competition with other parts of the railways.

Perhaps, I am reading this section wrongly. The worrying aspect of this is that it is not down as one of the repeals of the present Bill. The section goes a bit deeper but it seems, on the surface, that that is the general tone of the section. Even though some guarantee may be given in the course of winding up the debate, if there is an Act that is repealed that leaves the situation loose in that the Minister by ministerial order, without reference to the Transport Authority Act — not particularly this Minister but some other Minister maybe or some other Government, could walk in and, while there are guarantees under this particular Act but because another Act exists and has not been repealed, it is then quite possible that a problem would arise in the sense that the competition which we feared originally from the beginning and which may have marked the deathknell of the railways could become a reality. It could be an impediment to competition which they might enter into so that would make them that much more vulnerable. The fears are there and rightly so. Somebody has got to stand up and allay those fears before this debate concludes.

In the Transport Act, 1958, it was recognised that CIE could not be expected to make a profit. A subsidy of £1,175,000 for each of the five years ending 31 March, 1964 was provided. In the same year the great Northern Railway Board was dissolved and the section of the system in the Republic was allocated to CIE. Arising out of that, many railway lines were closed in 1959 and closures continued every year up to 1963. The most controversial closure was that of the Harcourt Street line in 1958. Generally speaking, whatever else we might have thought about some of the branch lines, the actual decision to close down Harcourt Street was a public decision. It is now widely recognised as a bad decision. Probably in strict financial terms that policy was a success. At that time the profits on the Dublin service were not in a bad way and the operators were allowed to keep the profit. That enabled them to remain within their subsidy.

Another point which emphasises the concern about the whole question of railways as being vulnerable was dealt with by Senator Kirwan. He dealt with the aspects both of the provincial buses and the railways. He sees that either one can be actually vulnerable. I would agree with that.

I would like to emphasise that railways are vulnerable. A subsidy was provided for in the Transport Act, 1964 for the following five years. In that case it was £2 million. Again, CIE were instructed to balance revenue on expenditure. This, of course, led to a further series of closures and, consequent staff reductions. There was one success, too. There was a bulk rail freight service which carried 250,000 tons in 1964 to more than one million tons in 1969. The overall deficit increased only slowly during this period. A rapid increase in rail deficit was offset by profits in other areas.

I should like to come to the point I made earlier where there was one series of line closures. Is it any wonder that people get scared when rationalisation programmes are introduced? The situation is bad enough with a private employer but where the State is the employer and it is the body that introduces legislation and gives the type of protection that is necessary and the amount of encouragement to go along with the question of rationalisation in making the company or institution more efficient and so on. It is sad if, when that type of legislation is introduced, the proposals embodied in it keep the fears in the minds of the people who have to represent workers and try to get the best deal they can for them. Having done this, the legislation still persists in having proposals embodied in it that keep those fears alive. If one has regard again to the industrial relations situation down through the years, if that is the way the company have been behaving down through the years, the question of bad industrial relations can be well understood.

For example, we are talking about investigation into CIE. People have made many complaints about CIE. There are certainly no complaints about non-investigation. As a consequence of more problems in CIE which were never properly resolved, particularly those of the railway, the Government commissioned the 1970 McKinsey report. At that time provincial bus tours and hotels were profitmaking. Dublin city services and road freight were breaking even. The railway side was, in fact, making a loss. The report concluded that on purely financial criteria a decision to close the railway down would be more expensive to the nation than to improve the financial performance of the company, that is, the current financial performance on the basis of the 1970 report. That is the financial performance of the railway.

They suggested that this might be done by making selected modifications in certain areas and some investments in the rail system as a whole. In the following years, a number of changes were implemented, for example, in the railway system. There were faster passenger trains, air conditioned rolling stock, the introduction of block freight trains, the rationalisation of freight railheads, the mechanisation of Sunday traffic, improved signalling but despite all that and all the co-operation they got, a limited number of closures were involved. If we go back to the 1957 Beddy report and follow on to the 1970 McKinsey report we find that the railway has been taking a hammering. It is quite clear where the underlying fears of the staff lie. After the 1970 situation the financial position worsened rapidly despite closures.

Several reports have been published in recent years. For example, the Oireachtas Joint Committee on State-Sponsored Bodies published a report on CIE in 1979 and there was a report by the economist, Sean Barrett, which was published under the titleTransport Policy. From my discussions with the people who represent CIE workers and trade union officials, I have found that the majority of those who read Sean Barrett's book believe it contained a variety of inaccuracies and out of date statistics. As a result of this CIE were discredited. It seemed to the workers that this was deliberate. I am not totally au fait with the contents of that booklet and I am not making the charge that it contained inaccuracies but people who are experienced in this area hold that view and have passed it on to me.

Much of the analysis of the railway, for example, Sean Barrett's book, was based on a comparison of output. This is the allegation made by the workers whom I spoke to. They believe that he compared a nine months period in CIE in 1974 to a 12 month period in British Rail. If that is correct and if the allegation is correct there is no way he could make a correct analysis. Even if he did not compare the nine month period in 1974 against the 12 month period elsewhere the fact is that it is not very easy to make a comparison with the rail systems in Britain. I say that having regard to the way our transport is integrated. There is probably some doubt about the results that Sean Barrett produced on that occasion. If I were to make a case for Guinness workers who were loading ships at the North Wall, it would hardly be relevant for me to say I wanted for them the same rates and conditions as apply to dockers in Manchester or Liverpool. Consequently, the book was probably an intellectual exercise. I do not know whether it served any useful purpose for CIE. The workers did not believe that it was done fairly and they expressed a lot of concern about it.

The Transport Consultative Commission issued two reports. The first was in March 1980 on transport passenger service in the Dublin area. The second was in 1981 on road freight haulage. Again more rationalisation resulted. I am stitching this point into the record deliberately because in the public eye it is believed that inefficiency has been allowed to flow on uninterrupted, that there have been no investigations, that there has been no agreement from the workers to rationalise the situation, no thorough investigative procedure before strikes broke out and so on. All these reports are there and they are all in the history of CIE. Unfortunately it is not that easy to get that across to the public but it must be made known to the public in the course of this debate that CIE are probably the most investigated company in the country, certainly the most investigated public body, and, as I said earlier, the least understood.

Arising out of all those investigations and as a result of the Beddy report in 1957 railway lines were closed. As a result of further investigations and reports there were more closures of railway lines. Many other alterations and changes took place inside CIE which we do not hear about in day to day discussions between people. It is necessary for this type of debate to reassure the public that much has been happening in CIE and that it has not been let drift.

This is not the first time we have tried to deal with the rationalisation of CIE. I hope that on this occasion this Bill will be more humane when it comes to the question of dealing with the employees of CIE, their families and the people who depend for their livelihood on the spinoff of CIE.

The public do not think very often about how CIE were set up. Their origins lie in the compulsory amalgamation of the various railways in the Free State into the Great Southern Railway Company, the GSR, in 1924. In 1944 the Transport Act provided for the abolition of the GSR and the Dublin United Transport Company and their replacement by a new company, Córas Iompair Éireann. The new company came into existence on 1 January 1945 as a publicly controlled private owned company. The intention was that the profits of the DUTC should cross-subsidise the railway operation. In 1947 there was an almost total cessation of rail passenger service due to a coal shortage as a result of the severe winter of that year. That contributed to a heavy deficit of £1 million. The following year the Government commissioned a report into internal transport in the Republic of Ireland. The major recommendations of that report were that rail, road and canal should contribute equitably to the unkeep of infrastructure as part of a national system, that branch lines should be retained when that was in the public interest, that the Government should meet interest charges and that steam traction should continue in the railways. However, the company's losses continued.

Despite all that has gone before we are in a situation now where there is a proposal before us to divide the company into three. The fears being expressed by the labour movement — the Labour Party and the trade union movement — are that despite all that has been done and despite the recognition, very reluctantly, on some of the occasions of investigation on the question of the social aspect of it, the railways have never been able to pay their way. This will present a difficulty when we come to the question of the two versus three companies. We will see the same thing happening again if the competition becomes too heavy the people who are responsible for reporting back to the workers will go back and reassure them. They will hold a ballot and it will be accepted. The railway will then go to the wall because we will not have provided enough protection in the Dáil to give it a proper chance under its new organisational umbrella. We need to give it a proper place in the competitive field. CIE was finally nationalised by the Transport Act passed in June 1950. The Grand Canal was taken over at the same time. The Company had responsibility for all rail and inland waterways and most public road tansport operating wholly within the Republic. They were required to see that an efficient, economic, convenient and properly integrated system was provided. They were also required not to make a loss.

In relation to the point of their being required not to make a loss, the company was integrated with the canals and some companies who used canals, such as the milling companies, the flour millers and Guinnesses Brewery used to send much of their goods by canal barge. They decided that it was no longer efficient. Having a couple of horses pulling the canal boat up through a lock was not the way. It was too slow and so a new method was introduced. On the basis of the latter report I referred to, CIE now find themselves at the whim of the private companies who do not need their services any more. To meet their own competition they dispense with the service that CIE are providing and as a result this throws CIE into a loss situation. The point I am trying to get across is that it has been proved by investigation that it is very difficult to make CIE a paying concern, but that it is possible to make it efficient, have good safety standards, good air conditioned carriages for passengers, etc. It seems that it is a mammoth task to try to make CIE, no matter what you call the new companies or what way you frame them,in toto go into competition where it is very vulnerable to the private side of our enterprise and expect them to come out of it making a profit. Not only are they not liable to make a profit but, if we insist on having three companies and put one of their own companies into competition with the others, without any kind of supervisory board it will not work. One of them will hit the wall as a result of that. No matter what undertakings the Minister gives on the question of conditions of employment etc., the staff have to be clear in their minds that the parent company will be responsible for any redundancies that will result and for absorbing that labour.

That brings us to the question of rail workers suddenly becoming redundant as a result of this unfair competition. What happens? Can you take a man who was a driver on the railway and find a suitable spot for him in the parent company? It is very hard to give any meaning to an undertaking like that. At least some sort of undertaking of the nature of protection of employment is essential. The distinction between a guarantee of redundancy payment and a guarantee of a job is a very big one. There are enough people on social welfare who are waiting for jobs, without us — when we have an opportunity to try to protect jobs — adding to that by not taking care of the way we word our legislation and by not giving as much security as possible in the context of the overall situation that CIE will subsequently be thrown into if this Bill is passed in both Houses. Therefore, we naturally welcome proposals that will rationalise CIE but when the proposals contain a danger for public transport in Ireland as a result of a series of investigations that have never been very successful except for the co-operation the workers gave which brought about some success, we should get in and do something about it.

It is welcome that at least CIE is not being broken upin toto as was recommended in the McKinsey report of 1980. What was of grave concern to the people who are actually dealing with the workers, the trade unions was that nothing had been clearly agreed or finalised, yet rumour was abroad that the chief executive was advertising for people to apply for positions in these companies that were going to be set up. That, if it is true, seems rather an extraordinary way of going about industrial relations problems. Certainly, and I will be quite frank about it, when I was representing workers I would not have stood for that. I do not know if it is true and I am not putting it on the line here that it is true but it was something running through the minds of the people who were in the course of trying to have constructive consultation. They were faced with a fait accompli in that the top man responsible was actually advertising for people to take up positions in companies that have not yet been legislated for. That seems to be a little bit extraordinary. Maybe I am getting it wrong. It could be that a certain kind of executive was needed and it was advertised in that way.

We must take into consideration all of those things and the knowledge that the workers have from the various investigations down through the years and that what it means to them is the question of jobs, pay and overall job security. We can understand their views. We would be very remiss if we did not put it as hard as possible to the Minister that it is imperative that the Government give to their employees the best possible that is available. I frankly do not think that this Bill will do that. I think there are many factors in it that need to be looked at and I will refer to one or two of them. I hope that as a result we can introduce some changes that will make it a little more palatable for the people whom we would like to see protected.

By protecting the staff and getting their agreement on rationalisation and getting them to work the system you are also protecting your customers. That is very important. God knows people have heard me labouring the right of the community often enough. I do not shirk from it now. There is a way of dealing with this so that the community's interest can be protected and the workers' interest can be protected much more effectively without denying the community its right to efficient service, cheap fares etc.

I do not know what the full proposals are going to be when this Bill becomes law because obviously there is going to be more consultation with the unions. It should not be on the basis of afait accompli— take it or leave it. If we make the alteration at this stage it will certainly ease the situation a great deal when the company is established, whether it is two or three. The more we put into the legislation as regards security of employment and the other guarantees that are necessary, the better it will be for industrial relations for the future. As I said earlier on, industrial relations have been a terrible bugbear in CIE. I said I was not happy about the whole question of worker directors. I am not suggesting in the course of rationalisation that you can enter into anything else. It is not the be-all and the end-all of things. There has got to be something below the board of directors to make industrial democracy work properly and possibly this is where the company missed out down through the years.

We in the Labour Party would be opposed to the measures that would permit private operators of road transport further opportunities, because of the vulnerable situation our people would be put into, to provide, for example, scheduled or stage carriage services. Such operations which may operate profitably at peak demand thereby tend to undermine those off-peak socially necessary services which are not profitable. We do not go along with anything that would present further opportunities. The opportunities that have been there in the past have been taken up. Profitability will become the thing when the social end of the service which cannot make a profit will fall foul of these other opportunities that are thrown open to private operators. Naturally we are concerned about this as well.

In relation to the Road Transport Act it is the Labour Party view that the licence to operate road passenger services should continue to be controlled as at present. I do not think there should be liberalisation in the conditions under which licences are issued. The law should be strengthened and enforced to eliminate the activities of illegal and charter bus operators. We specifically as a Labour Party would want to defend the integrated public transport structure which exists in CIE as presently constituted. We would seek to extend it wherever possible and to improve its coordination etc. I mentioned earlier that we do not think the Bill is going the right way about satisfying the minds of the people who have to give effect to this service which is meant to be more efficient. As a consequence it is better that we pay much more attention to the attempts at present to introduce legislation that might help in no way towards good industrial relations, job security or to allay the fears in general of the people in CIE who should be entitled to look forward to long years of working rather than being faced regularly, through investigation procedures, with the threat of redundancy, closures, etc., hanging over their heads.

On the question of the proposed restructuring, the component of social necessity in each of CIE's services by road and rail must be clearly identified. Nobody has done so yet. In some of the investigations there has been a broad sort of reference to it but it has got to be clearly identified. As far as I am concerned, like it or lump it, we are stuck with this component and it must be paid for by the State, even by going to the point, if necessary, to show it above the line as revenue on the company's accounts. That is the way we look at it. The way we further look at it is that an end must be brought once and for all to the nonsense, and that is what it is, that somehow public transport can in general be operated in modern conditions on a commercially profitable basis. I frankly do not think it is a possibility. The whole question of the social concern must be re-emphasised and identified; otherwise we are going to be faced with bad relationships which we have had to overcome in recent times. This will arise because fears have not been allayed in legislation.

Many of the CIE services especially in Dublin need to be re-examined with a view to restructuring. We would not argue about that. We appreciate the DART feeder service. It is a welcome development in Dublin. We would even go so far as to say that perhaps further traffic management schemes might be essential to give more effective use or more priority to public transport in our cities. That is something we would see as necessary as well. I hate coming back to the Harcourt Street busway but it is on everybody's lips. We in the Labour Party think of the Harcourt Street busway as being constructed as part of the Dublin rapid rail transport plan. We welcome the one man bus operation even though it took a long time to come in. It is hard to put the finger on who is actually responsible for that. I do not know if I am correct or not but if memory serves me right the Tavistock Institute made an investigation into industrial relations in CIE about 25 years ago. I am not sure whether the people at the top wanted to know too much about that because I do not remember any effective industrial relations ever arising out of it. After all, if somebody commissions a report and the report makes recommendations and there is no follow through or if there is difficulty, it will certainly be highlighted in the press. I cannot remember any outstanding effort to bring about changes in the industrial relations code as a result of that report. If there is to be a central bus station for Dublin consideration should be given to the question of its construction in the sense of its being part of the rapid transit system. We are concerned about the railway. The Labour Party recognise that the railway has an important role to play in Irish public transport and we see it as playing that role for the foreseeable future. We see it as an indispensable alternative and complement to the main roads. It is unrivalled in speed, comfort and safety for passengers. It has an important part to play in freight transport and in carrying heavy and bulk loads and dangerous substances. If the railways are to be weakened how is the efficiency in those areas to be maintained?

If we are to keep in mind the question of the transportation of bulk loads and dangerous substances and if we are to maintain speed and comfort for passengers we can hardly set up two companies to compete with one another. One might start to reduce the other to so weak a position that the essential matters could not be dealt with as efficiently as might be the case in a much bigger situation where there would be much more supervision and a much more efficient input. I do not know where the railway operation stands with regard to competition on the internal air transport but it is certainly fuel efficient and it has long term potential for automation. It is obliged to maintain its own infrastructure. As a result of this obligation there is an unfair burden on the railway compared with the roads. There is a distortion between the two in terms of competition. The Government should fund railway infrastructure in the same manner as it funds the roads.

We are happy with the rail electrification. We should continue along this line where possible. We are hopeful that the rapid rail transit system may find its way to Tallaght, Clondalkin and other areas of greater Dublin. Such places, too, as Lucan, Leixlip, Celbridge and Maynooth can be regarded now as forming part of Dublin, for instance.

There are other CIE services, in addition to the railway, the road freight service. When one is dealing with the question of the road freight services one has to define clearly what the role of the railway is in freight carrying and decide exactly what is most appropriate for it to carry. The road freight haulier side of CIE is not given sufficient opportunity to compete with private hauliers all over Ireland. That is an area which could be developed. There are the questions of permitted weight, safety precautions, vehicle emissions, working conditions etc. which are all problems. We would want the regulations in these areas enforced vigorously. We believe that such an approach can be made to both road freight and the railway. If we enforce the conditions properly in respect of both, not only should CIE road freight go into greater competition all over Ireland but if the operation is supervised correctly it could have very beneficial environmental effects.

I have been dealing with the history of reports concerning CIE and I want to make some observations about what the Bill represents. One of the special cares of the Government, that is the employer, is to secure employment for the benefit of the families of their employees. I did say in my contribution earlier that this Bill does not offer that security. This is the nub of the problem and it is aggravated by the question of three companies as distinct from two. We have a situation here whereby people are employed by the State. They are employed to provide service which is useful to many others in society in so far as that service satisfies the needs of many. It is the forging link with the social needs of society. This is a very important aspect that is generally overlooked when we come to the question of rationalisation, threatened or potential privatisation. The ownership of the means of production of that service is not like ownership on the private side which is vested in the hands of relatively few people, for example in the case of capitalism where the means of production — lands, factories, mines, etc. — is in the hands of a few. The State in this case is the owners. Consequently one cannot deal with the problems by following the lines of capitalism whereby the inevitable results will be that the three companies will go their separate ways. I hesitate to say it but at least one of them will find its way into liquidation or receivership. The least profitable or nonpaying side will be left in the hands of the State. The survivor of the competition between the provincial buses and the rail will be on offer to private interests.

That is the way I see it developing if we do not take another look at the Bill and build in some safeguards that can protect the workers and their families. This can be done best by having two companies rather than three. The idea behind this form of reorganisation can only suggest to the workers concerned that the calculation of the utility or value of all factors of production of this social service is being subjected to the criteria that apply to the production of commodities. They are not producing commodities. They are producing a service. There is no way you can deduct the expenses from the receipts of businesses when you are dealing with a national transport service which has a substantial built in social element. One cannot measure this State company by the criterion of keeping prices high and production costs low so as to maximise profit. It does not work that way. The Bill suggests those tendencies. I do not want to say that these intentions are doubtful because I have great trust in the Minister but the workers who do not know the people behind this plan are entitled to have some doubt about the real intentions. I heard the approach described as a bastardised version of service and co-operation because it was born out of a failure to write safeguards into the Bill I do not know whether that was meant sarcastically but it has been said.

When a private enterprise goes into receivership the property is taken into consideration when creditors are being paid off but here we are dealing with the whole question of the land and all the other instruments of production which remain the common property of the people. If it remains the property of the people it ought to be governed by the people for the people. In that context it must be based on the criteria of social service and co-operation. The competition which the Bill encourages will do away with jobs in these companies just as happens elsewhere in capitalist societies. It may seem strange for me to make that argument but it is not new. We have always listened to the argument that competition actually increased jobs and was very good for the economy but if one looks at the nature of competition one finds that there is another word for it and that is the word "war". Some of the advertising we have seen in the papers from supermarkets is incredible. They are outlining their prices and telling us where they are cheaper and where their quality is better than that of their competitors and so on. Recently there was the deal whereby H. Williams bought Tesco, held it for a couple of weeks and then sold it to another supermarket chain at a vast profit. Apart from assisting a selfish greedy system the competitors are saying in essence that if they can get all of the business for themselves, whether that business be in the area of supermarkets, transport or anything else, they do not mind who goes to the wall in the process. We have recent evidence of this as I have outlined. The criterion is to get every ounce of the market for themselves.

Can one imagine asking the railways to enter into a competitive field like that? We are often told that competition is the rule of all production, that it is good and stimulates progress. I was born in 1920 and I do not ever remember competition to the extent that it prevails today. It is much more violent now. I think I am entitled to call it a war because that is what it is. Competition is a nice word. If people in competition want to be honest about it, it means that at the best it is pursuing your own advantage at someone else's loss and that is what is going to happen to CIE.

If CIE break up into three companies somebody else will pursue their own advantage in this free market competition situation where CIE will be vulnerable and this will cause a war, the result of which can be only the loss of permanent jobs in CIE. An example of commercial war is where a certain market is demanding a service and there are, say, 50 different companies who market that service. Any one of those companies, if they could, would keep that market for themselves. They would struggle desperately to get as much of it as they could. They may not always get to the maximum but that is what they aim for. The obvious result is that the market is glutted and the service sinks into cold ashes. Who do Members of this Chamber think will sink into the cold ashes if CIE, and particularly the railside, is faced with that sort of competition?

Most of us see the way competition is proceeding in this modern day and would regard it as a war. It is the whole question of getting the business for oneself.

Take the worker who is concerned about this situation, the real provider of the service. How does this scramble affect him? His boss or higher executive in the eagerness of his own war has to collect into one neighbourhood an army of workers. When he has them well drilled in his marketing propaganda, he has them equipped for a special task and that task is to make profit.

However, when the glut comes every "private" who has been depending on a steady demand in the market and who has been acting in a way that gives him no choice, goes to the wall. If a soldier has been recruited to go into competition and that competition fails because of the strength of someone else, what becomes of that soldier who is one of those affected by the person who put him into competition? Take it in the context of CIE redundancies as a result of this competition. It may be argued that the Dáil would have to discuss receivership or liquidation. This would not mean anything other than that they would become redundant by statute. It is still putting people in a very vulnerable position. I am not suggesting that you can secure anybody for the rest of their lives. By throwing them into an area of competition which is war-like, the State as their employers has an obligation to ensure that the maximum amount of protection is written into the legislation which as while not giving them total security, at least gives them a chance of survival. If they do not survive, a means, although difficult, would be found for absorbing them into the parent company.

CIE employees have been brought up in an atmosphere whereby to exist was by combination rather than competition. Combination is impossible to the profit makers. It is necessary for them to have a war. If the organisation is split into three companies the people who are used to warring commercially will come out on top. The Government must think more deeply on this. The competitive principle is driven home by splitting the company. In the final analysis the employees will be fighting for the right to work. The principle of first in last out need not necessarily apply. By legislating properly and having a proper understanding of what is involved, and building in the necessary safeguards, we may circumvent much of that.

If one man survives when he starts competing with himself as a result of other major competition, he is in the same league with people who are at war for business. He is fighting in a different sense, he is fighting to feed himself and his family. That can only be done on the basis of depriving someone else. There is a danger here of cynicism growing into it and someone like me asking for an exhibition of brotherhood. On the one hand we have major overall competition that puts one of these companies into liquidation. Arising from that, if it is railway workers who are redundant, and who are not suitable to be taken into the parent company, a war starts as to whether they should be retained.

The principle of first in last out need not apply. If CIE have bus drivers trained, it would be difficult for a train driver to say I must be trained as a driver. If they have enough drivers and conductors on reserve it would be difficult for the railway worker to establish a claim to a job as a driver. The Minister and his advisers, Senators here might think this is emotional. Let us look at what happened in the docks: there was a stepping up of mutual antagonism between the stevedores and the dockers. If someone gets into the queue for a read, someone counted the number of people he needed and the rest had to go off. All sorts of corruption began to creep into the system. Certain families started to take control in the docks. Many abuses arose because of this competition.

I pay a great deal of attention to redundancies. I and another senior trade union official had the unenviable task of negotiating away 1,100 jobs over a period of five years. It does not matter how well the people are going to be compensated. We were negotiating away jobs that would never be replaced. One is caught in the position of negotiating away those jobs arising out of this competition. Not only were we negotiating away the jobs of the people we directly represented but inevitably the people who depended for their livelihood on being carriers, shippers and so on were also affected by our decisions. This system continues. It is a serious matter to talk about putting CIE, through legislation, into a situation in which, based on past experiences of rationalisation, they may be competing with one another.

We know what happens. There is great isolation when one becomes redundant or is unemployed. At a certain age there are no jobs open to an unemployed person. The situation is that one starts to turn in on oneself. Unfortunately, there is a stigma attached to it. People consider that one has become a lazy loafer, or something like that. Unemployment carries a great stigma with it. Naturally, we become emotional about it. Of course, I am. I am not saying all decisions should be based on emotion. I am not saying that decisions that are arrived at have an element of emotion in them. While not comparing a football team to Government or any other organisation there is very little forward movement unless there is a little emotion thrown into the arguments leading up to the final decision. It has got to be there. If we think about the people we represent and have had the privilege of being elected to represent, we will be a little emotional about the situation. The trade union representatives at the moment who are representing the people in CIE are being a bit emotional about it, of course, and rightly so. I trust that out of that emotion we will be able to tease out what we believe is the right way to approach this Bill. Perhaps when we get to the Committee Stage, suitable amendments can be put down and will be accepted. That would alleviate some of the problems.

That course of action will not solve all the problems. It will make many of the problems less acute. We have to think seriously about the Committee Stage of this Bill and deal with the question of suitable amendments.

I believe that the Government is an organisation for the control and security of the rights of people. When they have their own people, who are employed as a result of the legislation, they have a very serious responsibility to give good example to other employers. We are dealing with the question of Government being an organisation for the control and security of those rights which the men cannot secure for themselves without regulation. They must get regulation. The Bill, in my view, does not deal adequately with this fact. We are going to finish up in the final analysis, with dispossessed people. If there are not adequate guarantees in the Bill for people who may reach that extreme, then we are in difficulty with regard to the whole question of settled labour relations in a place that could very well do with an improvement in their labour relations.

I feel that three companies will lead to what I have described as the "going to the wall" of thousands of jobs rather than the 500 jobs suggested. The 500 is an obvious figure at this time. Let the boys loose and let the competition start and 5,000 is not such a big number when we have to have regard to many other things that are happening in society. I believe that two companies would give the people who are taken out of this large combination a better chance. At least it would greatly improve their chance. It would give them a much fairer start. It would certainly give a more even chance of making the best of body and mind, because with two companies they would not have that extra bit of competition from their own company.

There are aspects of the Bill such as, for example, the formation and registration of subsidiary companies to which we would be opposed. We would be opposed to the concept of splitting up the company. Any of the proposed three new companies, which would be registered under the Companies Act, could be liquidated. That is the way the Bill is written at the moment. Perhaps when the Second Stage reply comes, we may get more enlightenment on this point. If not, we will have to bring in suitable amendments.

The wording of the Bill seems to conflict with the same undertakings the Minister for Communications gave to the ICTU deputation. This is the information which the ICTU gave me at a meeting on 25 October 1985. I do not know whether they are correct in that or not. The Minister is the one who can answer that.

The name and capital formation of companies are referred to. It must be emphasised here that the break-up of CIE into three companies is contrary to the wishes of most of the men's unions, if not all. If it is enacted, the trade unions see the Bill as being one which will throw the companies into major conflict with each other. Obviously, if they are in competition with each other you can follow my line of argument about competition: it can only be to the detriment of some of them.

The principal object of the company can impose difficulties subsequently on the road section. We are concerned about that point. It could lead to unrestricted competition between the subsidiary companies, as already stated. By and large, there are many areas of concern for the people in CIE and for the unions in general.

I have covered most of the points. Senator Kirwan was making very much the same points as I have made. Possibly I have taken a while longer to make them. I have said it in a different way. Nevertheless, it was necessary to reiterate some of the points made and to try to drive home this point about the Bill being suitably amended to allay the fears and alleviate the concern of the people who represent the workers, as well as the workers themselves.

I would just like to say that I spoke earlier about the questions of the worker directors and of industrial democracy. Historically speaking, even though the industrial relations are quite good in recent times, there have been problems. Certain measures must be taken with regard to the future reorganisation in the area of industrial relations to see if it is possible to have a supervisory board under the parent board. If the Minister could not see his way to choose one such board, we would prefer two worker directors and we believe the question of having two is the real argument. Inevitably, the only way to allay the fears would be by way of putting two workers' representatives, one from the railways and one from the provincial buses, on to that supervisory board. They would supervise the management of the other two companies. Our amendment would be in the direction of two companies.

The question then arises even by putting two people on the board, does that satisfy industrial democracy? Quite frankly, I do not think so. Industrial democracy is much deeper and wider. It involves the whole question of industrial relations.

I have a document in front of me which was about to be introduced into Guinness, Dublin, at the time when I had a share in it. We were at a stage when industrial relations were developing in a deep way. It started off with a working party and then a steering group. Inevitably, a brewery council was set up. We got into the areas that it should represent. Annually, the managing director of the parent company would come over and every employee would be released from work for one hour, over one week, when the company would actually give details of the whole trading position, for example, losses, gains, new enterprises being entered into, the political reasons why they did not open in some other area, and so on. That has never affected the company in the sense that information leaked out which would be advantageous to somebody else. It was done openly by way of slides and lectures, and a question and answer session. It helped to lessen the traumatic effect in the rationalisation programme and following on from that helped personnel to settle down very well.

Those brewery councils worked very well. They covered areas such as health and safety, general purposes, pensions and social welfare, economics, communications and involvement. The council was split into sub-councils. They had departmental involvement groups. Perhaps the Minister would read this document: "Participation and Involvement in Guinness, Dublin." It is quite an experience in the question of industrial relations. It will be helpful not only in the context of future trends in CIE but also generally speaking, for anybody to read it. Perhaps the Minister for Labour would read it. It has something that is unique. It has the potential of developing into other areas. Companies may not be as large. The consequences are that one is dealing with employees who are best informed about their work, wages, conditions and the whole question of communication and prior consultation. It deals with communication in an educational way, upwards, downwards and horizontally. I suggest that it would not be a bad idea if somebody gave it a thought.

I would like to conclude on this particular point by reopening the question of the 1958 Act to show the concern that has been expressed about it. Perhaps the Minister's reply would give us information which might allay the fears of people who are concerned about their jobs and their futures. If we do not repeal that 1958 Act, does it not, in fact, make the railways in CIE much more vulnerable? If that is the case, what can be written into the Bill, if anything, to protect CIE? Would the Minister be prepared, if there is no way round it, to ensure that some other Minister or some other Government might not be able to use this method of damaging the railway section of CIE? If it is not repealed under this Bill and if it is there for use — if I am correct in this, as far as I know one can only check up to 1976 on the question of whether or not it can be repealed — it is a concern that is hanging over the heads of people. Serious consideration has got to be given to the repeal of that Act. If the Minister gives his word in replying to Second Stage that we will not find ourselves under some Minister or Government dealing with the whole question of liquidating or getting rid of CIE as a result of that Act, that will allay fears.

A casual reading of the Bill would probably mean that you could come up with a decision that it is a progressive measure. Indeed, the Bill is progressive within a given context. It depends on the ultimate situation as it will develop, say, four to eight years, or five to ten years. The Bill goes in the right direction. Like anybody travelling, it is not concerned very much about speed, but about the direction in which they are travelling. They stop from time to time and ask the way. The reply is: "where are you going"? You say where you are going, and you are then pointed in the direction that suits the person to whom you put the question. He may put you to the right or to the left because you are at a crossroads.

This Bill has many crossroads. Basically, there is nothing wrong with the Bill is a given context. If in a commercially orientated context the Bill is all right. If the orientation contains, along with the commercial, vulnerability, exploitation and examination eventually and if it contains the basic social responsibility and obligation to be faced by the Government, then the assurances given by the Minister are more acceptable. The assurances that I refer to are: first, he dismisses completely, and with justification, the people who talk about privatisation because his assurance says, and states quite clearly, it is not on the road to privatisation.

The Minister also give assurance about the State enterprise. In fact, it would seem from his assurances that he believes in State enterprise. That calls for some examination of State enterprise in our commercial context within these islands, in Europe or anywhere. There are circumstances in which Government intervention can be considered. I call it Government participation because it is more positive; intervention is something that we will only bring in the last minute because it is a bad thing. We should not be talking about intervention at all in our society. If we have to have it, we will let it in. State participation is different.

The Minister, or those who think like him, has indicated clearly by giving Government and Cabinet support to this State enterprise that he believes not only in the maintenance and continuation of the State enterprise of which a basic ingredient must be service to the people in this transport system but also that there is a future for other such enterprises, and that it is not an evil thing for the State to go into virgin territory, untouched by the private entrepreneur for the variety of reasons which I need not spell out: he does not want to do this because it does not seem that he should speculate in this area as it would not produce a profit.

I am not denigrating profit. I am making a factual statement. This is the nature of private entrepreneurship. I am not saying that it is an evil thing. We have to live with it. It is a fact of life. The State takes over because of a particular failure, or their own failure. If the State continues to lose against the yardstick of profitability, the people who did not take it over in the first place are the first to claim that the a State enterprise idea and theory is wrong because it cannot make a profit. State intervention happens in the case of weak members of the commercial society. It also happens in untouched virgin territory.

CIE is a transport company that is not a virgin unit untouched. It is a transport system that was obviously going the way of all transport companies in practically all the countries in the world. It is nothing peculiar to Ireland. It suffered initially — and always will — from the kind of criticism levelled all the time at it even when the Government does its best, as it is doing here, to face up to its social responsibilities in giving a service to the public in general.

The people who conceived the idea of CIE in the early days were not thinking of labels. They were not thinking about private enterprise as against State enterprise. They were not concerned about these arguments, lengthy and fulsome as they can be and are. There is always the attaching label that there is something repugnant about State participation both in the virgin territory and in the weak territory. Note that I did not use the world "intervention" again, but "participation". These people were not concerned about this. They saw what had to be done. They saw that a transport system had to continue and had to be maintained and they did it. They were pragmatic economists. They did what was necessary with action. Now, they faced the problem of the future, too. Who can tell what changes will emerge in five to ten years in any given situation? By this I mean that it is difficult in these fast-changing, modern technological societies in which we live to legislate far into the future.

I would say that if workers are more afraid today about this awful word "redundancy", there is no such thing as a redundant worker, it is their jobs that are redundant, and not the workers. This terrifying word "redundancy" has specially hit a State-supported, financially-aided enterprise. This fear would be lessened, if not eliminated, provided the environment produced a higher degree of full employment. You would not have to wait for the young people to be offered voluntary redundancy or imposed redundancy. They would move out in a full employment society with more opportunities where there would be less apprehension. There is apprehension about the motivation behind the Bill. Notwithstanding assurances, workers are afraid. I shall deal with that later on.

I have divided the Bill into two parts — one part dealing with all the sections appertaining to and impinging on the needs and the fears, the protection and the phraseology in the legislation to protect workers' interests. The second part is the basic component of the Bill dealing with the companies. In relation to the two and three company proposal — I tried to reduce it to simplistic terms so that people would understand more clearly where the issues are and what they are — we are not talking about two companies or three companies, but one company or two in the provincial areas outside Dublin City. If it is simplified in this way we will get to grips with the rudiments of the company's proposals and what is behind them. Is the yardstick to be commercial viability? I shall deal with this later. Some of what I have to say is theory. Other parts of what I have to say will contain some reservations. It may well be that there are parts of the Bill that I disagree with. There are some, especially the guidelines section which bears the resemblance of statutory wage control. I have to be convinced that this is necessary. If we give what appears to be a commercial, flexible situation to the companies and then have a restraining paragraph in the Bill, that is inconsistent, if not unjust.

I have already stated that most of what I have to say would be regarded as theory. I support this claim by saying that if we do not get the theory right the practice will hardly be right. I am conscious that I am examining the question of State enterprise, that we call CIE, and that it is being broken into sections for identification.

Prior to the setting up of CIE in 1944 it should be noted that the condition of the transport system in the country was such that the decision was right. The Government of the day had no other option in the face of their responsibility to provide and maintain a transport system to meet the social and economic obligations clearly indicated.

Debate adjourned.
Sitting suspended at 5.30 p.m. and resumed at 6.30 p.m.