I move:—
That a sum not exceeding £2,230,000 be granted to defray the Charge which will come in course of payment during the year ending 31st March, 1952, for certain Transport Services; for Grants for Harbours; for the Salaries and Expenses of the Marine Service (Merchant Shipping Acts, 1894 to 1947, and the Foreshore Act, 1933 (No. 12 of 1933); for certain payments in respect of Compensation, including the cost of medical treatment (No. 19 of 1946); for expenses in connection with the issue of Medals and Certificates; and for the Coast Life Saving Service.
In order to give Deputies an explanation in simple terms of how the total of the Estimate was arrived it, I think I had better begin by quoting certain figures. It is anticipated that the operating losses of Córas Iompair Éireann in the present year, including expenditure on renewals and replacements, will amount to £1,236,560. Fixed charges, excluding the interest on transport stock which in the present year will be paid out of the Central Fund but which will be due for repayment to the Central Fund by Córas Iompair Éireann later, will amount to £224,522, these fixed charges being contributions to pension funds, £180,000, and interest payable in respect of the Fishguard and Rosslare Harbours Company, £44,522. Repayments to the Central Fund of interest on transport stock advanced by the Central Fund in July, 1950 and January 1951 will amount to £433,000. In addition, the company estimates that the cost of replacing certain materials used during the current year because of higher prices will involve an increased charge of £204,000, and they have in their minds a figure of £241,000 as the cost of certain exceptional stocks of essential materials built up in anticipation of supply difficulties. Against the total of these sums, which is £2,339 082, there is a credit of £66,372 in respect of rent and interest receivable, so that the total amount required is £2,272,710 which, for the purposes of the Estimate, has been rounded off to £2,250,000.
In August last, the board of Córas Iompair Éireann requested financial assistance. It then estimated that the deficit for the year ending March 31st, 1952, without taking into account interest on transport stock, would amount to £1,400,000, and it stated that the sum of £600,000 was urgently required to enable the board to meet its current needs. As there was no possibility of getting that amount voted by the Dáil before the Dáil reassembled for the present session, and as there was no provision in the annual Estimate for any payment to the board, the board was authorised by the Minister for Finance to borrow up to the limit of £500,000 in accordance with the provisions of Section 28 of the Transport Act, 1950. That sum was borrowed and represents the total amount which the board can procure in that way. It is consequently necessary to put them in funds at once in order to enable them to meet current outgoings. A Supplementary Estimate is necessary because there was no provision for payments to Córas Iompair Éireann in the main Estimate of the Department for the year.
The theoretical ground upon which provision for advances to Córas Iompair Éireann was deleted from the Estimate was that the board was expected so to increase its fares and charges during the year that no loss would in fact result. The board stated that they did not think that would be possible, and early in March last they estimated their requirements for the financial year to be £1,997,000 and they did not themselves propose to attempt to recover more than £1,000,000 by higher fares. They estimated then that a subsidy of £1,000,000 would be required. For reasons of which I am not fully aware, fares were not, in fact, increased until September 10th.
The board estimate that the additional fares which came into operation on September 10th will in a full year yield an additional £1,179,000. It is clear, therefore, having regard to the experience of this year, that even that increase in fares will not allow Córas Iompair Éireann to break level if their experience next year is the same as it has been this year—that is to say, if the traffic available to them remains unaltered, or if their operating costs remain the same. That increase in revenue would allow the board to break level on operating costs, but it would not provide anything over and above operating expenditure to meet fixed charges or interest upon transport stock. The board has, however, expressed to me the view that the present rates and fares are as high as the traffic will bear, and that any attempt to deal with the situation by increasing them further would not, in fact, bring in additional revenue because the loss of traffic would offset the effect of the increase.
I met the Board of Córas Iompair Éireann shortly after I resumed office and I discussed the position with the undertaking in some detail. I asked the board to furnish me with information as to the steps which they had already taken to reduce the operating costs of the various services and as to the effect of these measures, and for information about any further proposals which they had in mind to achieve economies. I asked them to give me their plans for the future reorganisation of the undertaking and, particularly, to report upon the possibility of expediting the re-equipment programme which they have prepared and which is an essential part of any reorganisation scheme. The board had previously proposed to me, as I mentioned in the Dáil at the time, that their problem should be relieved by imposing further and quite drastic restrictions upon private transport—by that I mean the transportation of goods by private lorries. I asked them to submit these proposals in detail. I have received the observations of the board in that regard but I have not had an opportunity of examining them in detail or of coming to any conclusion on them.
I think that the House will agree that the aim should be to make the public transport services provided by Córas Iompair Éireann pay their way, that is, to give them the support necessary to secure the volume of traffic that will permit of economical working, subject to practical measures being adopted to achieve efficiency and economy in operation. If, arising out of the proposals which the board has made to me, any decisions are required from the Government, and particularly, of course, if any proposals for legislation should emerge, the matter will come before the Dáil. However, I cannot say yet whether that will be the case.
Over and above the money required by Córas Iompair Éireann to meet the deficit in its revenue, the board have asked for authority to raise new capital to the amount of £2,500,000. It is estimated that of the new capital required, approximately £600,000 will be expended before the end of the financial year mainly on the purchase of diesel rail cars and on the building of additional omnibuses, lorries, wagons and carriages. The measures to be taken to provide that additional capital to the board are under consideration. There is likely to be some problem for the Minister for Finance to solve in that connection. It is recognised, however, that if it is the aim of the Government in relation to transport services to provide efficient services capable of earning revenue to an extent that will avoid calling upon subsidies from public funds then quite substantial capital expenditure upon reorganisation and re-equipment may be required.
We need this Vote now, before, the end of this year, so that the Exchequer will have authority to pay out money, as needed, to Córas Iompair Éireann. The full amount will be needed before the end of the financial year but the amount immediately required will be advanced at once. There is no other source from which Córas Iompair Éireann can get money except from the Exchequer. It has already secured bank accommodation to the full limit permitted by the Act and unless this amount is provided the company will find itself in immediate difficulties.