Dáil Éireann díospóireacht -
Tuesday, 3 Jul 1979

Vol. 315 No. 10

Private Members' Business. - CIE Fares.

Mr. Enright

I move:

"That Dáil Éireann deplores the recent increases in CIE fares approved by the Government."

I am sure I will have the backing of every Deputy in the House in deploring the recent increases in CIE fares approved by the Government. The Minister must be worried about introducing these increases at this point in time. I put it to the Minister that never before were we in such need of an efficient national transport system. It is absolutely imperative in the national interests that we encourage people to use the public transport system. Judging from news reports it appears that the oil crisis is becoming more serious as time goes by and this affects us as much as everybody else. We had an ideal opportunity to encourage people to use the national transport system, but what did we do? Instead of encouraging them we substantially increased the fares by a minimum of 15 per cent and a maximum of 20 per cent. Due to the oil crisis the numbers using CIE were increasing but with the increased fares the people will go back to using private transport. This happened before when an increase in fares was announced last May. I do not have accurate figures, I can only repeat what a CIE spokesman stated, which is, that the numbers using CIE because of the oil crisis were increasing. In America a record number of people are using public transport and are moving away from private transport.

The size of the increases will bear looking into. The amounts requested vary from 15 per cent to 20 per cent. The National Prices Commission recommended a 17 per cent increase in train mainline fares and in long distance bus fares and the Government saw fit to grant the increase requested. The National Prices Commission recommended a 15 per cent increase in road freight charges and that was granted by the Government. The Government should not have granted the full request. The National Prices Commission Monthly Report No. 82 for March 1979 stated that, although the increases proposed fell far short of allowable costs, it was felt that these were the maximum the market would carry at that stage. To give the maximum that the market would be able to carry according to the National Prices Commission and as accepted by the Government is something that one must seriously question. Although the National Prices Commission referred to the maximum the market could carry, only time will tell whether or not the market will be able to meet the amount. It appears to be in excess of what the market will be able to carry.

During the last few months for the first time in years there was freedom of movement on the roads due to the petrol situation. People were beginning to use CIE more. Because of the increased movement towards CIE the Minister should have taken his courage in his hands, gone to the Cabinet and stated that he was anxious to ensure that we had a public transport service worthy of the name and should have asked for funds to update the service and attract more people to use it. This would have been a tremendous boon to the country. The Minister would have helped working men and women by making it attractive for them to use public rather than private transport when going to work. The Minister would also have benefited tourism interests by providing reduced fares rather than increased fares for public transport. That would have been the wise course to have adopted at this time.

I consider the decision to allow the increases to be a dangerous step, having regard to present circumstances. Undoubtedly, these increases will mean a falling-off in the use of public transport. There has been such a falling-off in the past in similar situations. At a time when people were turning more to public transport, the Minister had a unique opportunity to take advantage of that situation. Instead, his action is bound to result in a reversal of that trend. It would have been in the national interest to have encouraged people to switch so far as possible from private to public transport because in that way the amount of petrol and oil being imported would be curtailed. Similarly, in regard to road freight the Minister has missed a unique opportunity to encourage people to switch from private to public systems. The real effects of this increase will only be realised when future CIE reports have been published.

The NPC report sets out the losses suffered by CIE down through the years. We note, too, that the subvention from the Government to CIE this year is £36,357. However, we know that that is not the end of the matter because, in reply to a Private Notice Question in my name, the Minister seemed to imply that it may be necessary to increase CIE fares further. He mentioned the fact that CIE had applied for an increase of from 15 to 20 per cent and said that the Government had decided that the board should be permitted to implement the increases sought, subject to there not being increases in respect of fare-paying school children. The Minister said that, even with the increases in rates and fares, the subvention to CIE this year would be seriously inadequate and that the company had sought a substantial increase in the subvention, a request that he was examining.

The Minister must consider the whole situation seriously because, if he is to allow further increases in fares, public transport will be hit badly. He has a serious obligation in this regard. We are told that on an annual basis the increases in fares that have been granted will mean additional revenue of about £11.612 million. When the Minister is speaking to the debate I should like him to tell us what further subvention have CIE requested from the Department. It is important that we have this informaton in order that we might know the exact position. If there is a further major subvention being sought by the company, the House should be told the extent of that subvention and we should be told also the level of additional increases likely to be necessary in respect of rates and fares in the event of the Government not granting an increase in the subvention.

In his reply to my Private Notice Question the Minister said also that it would be unreasonable to place the total burden of the increased cost on the taxpayer and that therefore those who use public transport should pay at least part of the increases. I should like the Minister to confirm during this debate that there will not be further increases in CIE fares. We want this assurance because if further increases should be made there will be a diminishing of the numbers using public transport and the consequence of that situation would be requests for further increases.

This year there has been an increase of 8 per cent in passengers on mainline services. That information is given in the NPC report. The move towards greater use of public transport began in 1978 and the situation has improved substantially. I note from the Order Paper that the Minister has tabled the following amendment to the motion:

To delete all words after "Dáil Éireann" and substitute the following:

notes that CIE's application for an increase in fares has been examined by the National Prices Commission and that the Commission have found that CIE's allowable costs were greater than the revenue expected from the proposed increases and that the application fulfilled the normal criteria for price increases; and recognises that if the Government were to refuse to sanction the increase in fares the resultant Revenue loss would have to be met by the taxpayer in the form of subsidy or CIE would be obliged to withdraw services with consequential loss of jobs.

The Minister is aware that between 1975 and 1 January 1979 the number of staff employed has been reduced by 3,652 to 16,292. Instead of helping to maintain employment the increased fares will lead to fewer people using public transport and a consequential loss of employment.

Never before have CIE needed an injection of capital. The Government should take their courage in their hands and give CIE a substantial injection of capital. The proper management of such capital would ensure that CIE had sufficient funds to modernise their services. Capital is also necessary to maintain an adequate transport system. If the money were allocated to CIE under specific subheads for the improvement of their services it would be of benefit to all sections of the community. I believe that CIE should be expanding their services instead of reducing them. As the new Expressway service is a success, I believe that expanding the service would encourage more people to use public transport.

Unfortunately CIE are working on a shoe-string. They are working on a day-to-day basis and are depending for finance on the whim of the Government. This means that they are unable to plan for the further. As the fuel which we import is needed for industry, tourism and many emergency services, we should be encouraging the public to use the services of CIE instead of encouraging them to use private transport. Of course, the best way to do this is to try to ensure that CIE's services are economical. The current increases in fares will only encourage more people to use cars.

The increases have also hit the poorer section of the community who depend on public transport. A 15 per cent to 20 per cent increase in fares is a large one for a working man and it will have a harsh impact on the standard of living of many families. For that reason I regret that an effort is not being made to lessen the impact of the increases on those who use public transport to travel to and from their places of employment.

As I said, the increases will lead to severe traffic congestion in our cities. I know that the Minister will say that I cannot prove what I have said. All I can say is that such increases lead to more people using private transport. Whenever there is an increase in CIE fares it leads to a situation where people ask themselves which is the most economical, the motor car or public transport. These increases tend to frighten people away from public transport and this is happening at a time when the Government are encouraging people to conserve energy. It sounds very strange to me that on the one hand the Government are advising people to conserve energy and on the other hand now increasing bus fares. I cannot see the logic of it.

While we are discussing this I feel we should touch on the present position in regard to what is happening to the transport authority promised by the Government at the last general election campaign.

An Leas-Cheann Comhairle

We are widening the scope of the debate if we are going to bring in transport authorities and things of that kind. The motion and the amendment refer only to CIE fares. I have allowed the Deputy a fair amount of latitude but he should not overdo it.

Mr. Enright

There is at this time an urgent necessity for the Minister to meet and consult with CIE to try to improve bus, train and freight services here. There are improvements that can be made. CIE themselves have met change in an excellent manner and have proved themselves able to adapt to change. The Government should increase the subvention to CIE. We are now in a situation where fares have been increased and one of the ways to avoid this would have been to increase the subvention. By running down CIE, or even by appearing to do so, and by increasing fares the Government are in the long run going to have to go back to the taxpayers for further increases and they are damaging CIE's efforts to improve the service they are providing. An increased subsidy at this time would certainly have been of benefit to them and would have avoided this increase in fares. The Minister helped people with motor cars by doing away with car tax at a time when a subsidy to CIE would have been of benefit to the poorer sections of our community and to people who commute daily to work and who use buses and trains each day. This increase in fares will mean much difficulty and a reduced standard of living in many homes here but it is no hardship for people with their own private means of transport.

In conclusion, I would put it to the Minister that never before was it so necessary for a Government to give a sizeable capital allocation to CIE to ensure that our national transport system is built up. I am confident that if we build up the national transport system we will save enormously on energy consumption and that this will benefit the economy. A sizeable capital contribution would safeguard the jobs of the workers in CIE. The Government's method of handling the situation at present will lead to a reduction in the numbers using public transport. It will lead to an increased demand for petrol and, in the long run, to further congestion on the roads. All of this is totally unnecessary. The Minister has the power to withdraw these increases. By so doing he would be encouraging people to use public transport, he would be protecting the jobs of the people who work in CIE and he would be helping to improve the national transport system, something which was never more urgently needed than it is at present. It is up to the Minister to take the initiative to ensure that the national transport system is put on a par with every other such system in the world.

Minister for Tourism and Transport (Mr. Faulkner)

I move amendment No. 1.

To delete all words after "Dáil Éireann" and substitute the following:

"notes that CIE's application for an increase in fares has been examined by the National Prices Commission and that the Commission have found that CIE's allowable costs were greater than the revenue expected from the proposed increases and that the application fulfilled the normal criteria for price increases; and recognises that if the Government were to refuse to sanction the increase in fares the resultant revenue loss would have to be met by the taxpayer in the form of subsidy or CIE would be obliged to withdraw services with consequential loss of jobs."

I regret as much as anyone the need to increase bus and train fares, but the harsh fact remains that in a situation of rapidly escalating costs the increases are unavoidable. In February 1979 CIE submitted proposals for increases in fares and rates ranging on average from 15 per cent to 20 per cent to meet increases in labour, materials and other costs which had arisen since the Board's last application to increase fares made in February 1978. In submitting their application to the National Prices Commission CIE claimed that they had incurred cost increases totalling £16.404 million of which £10.351 million (or 63 per cent) was for wages and other labour costs, £3.148 million (or 19 per cent) was for increased costs of materials and a further £2.905 million (or 18 per cent) was for increased depreciation and financial charges due to new investment charges and higher replacement costs.

The purpose of the CIE application was to secure increased revenue so as to contain, as far as possible, the board's subvention requirements for 1979 within the subvention provision of £35 million provided in the Estimate for my Department. When the National Prices Commission applied to the CIE proposals their strict criteria for evaluating the costs allowable for price increases, they found that £14.762 million of the total claimed by CIE came within their guidelines. Thus the Prices Commission were in fact saying that CIE had incurred additional costs of £14.762 million which would qualify to be met by increases in fares. However CIE were not seeking the full amount and were looking for a price increase which would yield £11.6 million in a full year or approximately 80 per cent of what the Commission said was allowable.

Therefore, on the basis of the costs shown in the CIE application the increases in fares and rates were justified. Moreover, while the application was under consideration CIE's costs continued to escalate, and it is now apparent that CIE's deficit in 1979 will substantially exceed their original projections. The increased deficit is due primarily to large inceases in labour and oil costs and the adverse effects on revenue of industrial disputes.

Accordingly, having regard to the observations of the National Prices Commission on the application and in the light of the board's financial situation and the increasing burden on the Exchequer, the Government decided that the board should be permitted to implement the proposed increases in fares and rates subject, however, to no increase being made in the fares of fare paying school-children. I want to emphasise that there was no increase in the fares for fare paying school-children. Even with the increases in fares and rates the £35 million subvention for 1979 will now be seriously inadequate.

At this stage it is not possible to make a firm prediction of the size of the final deficit on CIE's operations for 1979, and while I will shortly be seeking Dáil approval for a Supplementary Estimate of £10 million for CIE in addition to the existing subvention provision of £35 million, there will nevertheless remain a further significant gap between revenue and expenditure which will have to be bridged. The figures I am referring to here are no small amounts of money.

I am very concerned about this situation and I propose to have a critical assessment of CIE's financial position undertaken to see what remedial measures should be adopted and how savings might be achieved. Pending this examination, the provision of £10 million in the proposed Supplementary Estimate, together with the board's temporary borrowings and the yield from the increased fares and rates, will enable CIE to maintain services and to meet the board's commitments.

In the light of the situation I have depicted, I do not regard the increases of between 15 per cent and 20 per cent as unreasonable. As I have already informed the House, there are to be no increases in the fares of fare paying school-children, while the increases on urban and town fares will be on a tapering scale so that the impact on higher fare values will be minimised.

It is clear, therefore, that the users of public transport are being asked to bear only part of the additional costs being incurred by CIE. In fact, the increase in fares and rates will yield less than half of the total additional costs as at present estimated. I do not think that anyone can argue that it would be equitable to place the total burden of the extra costs on the shoulders of the taxpayer, who is already paying a very substantial amount towards the cost of CIE's services.

The increases in fares and rates may appear substantial, but Deputies should not overlook the fact that a very large percentage of CIE passengers avail of the concessionary fares offered on CIE services both road and rail. These include the monthly bus and bus/rail commuter tickets which give unlimited travel facilities on the Dublin city services and which are particularly favourable to regular commuters. There are, as well, a wide variety of return, season and other reduced fare tickets available on mainline rail passenger and provincial long distance bus services. It is of interest to note that only 8 per cent of the total number of passenger journeys on the mainline rail passenger services represent adult full fares while concession fares represent 75 per cent of total travel on Dublin suburban rail services.

Deputies should also remember that free travel is available to children who qualify under the free schools transport scheme, to all persons who are 66 years of age or over, to blind persons over 21 years, to veterans of the War of Independence and their wives and to the widows of those veterans. For example, free travel of all types represents 28 per cent of total passenger journeys on provincial long distance bus services. The provisions in the 1979 Estimates for those free transport services amount to £23.837 million and when this is added to the £45 million which is being provided by my Department, it is clear that the Exchequer and, therefore, the taxpayer is making a massive contribution to the provision of transport services.

It is on the railway that the bulk of CIE's losses are still being incurred. In 1978 the deficit amounted to £31 million, an increase of £3.7 million on the deficit in 1977. The present CIE estimate for 1979 indicates an increase of about £4 million over the 1978 figure. Successive Governments have approved of the retention of a national railway system for economic and social reasons while recognising that this would entail payment of subvention. At the same time the railway must be operated as efficiently and as economically as possible. With this in mind additional capital moneys have been made available to CIE to enable them to carry out a modernisation and development programme designed to improve efficiency and attract new traffic. The programme is based on the development of a radial rail network of some 70 passenger stations and about 45 freight centres.

The programme for freight traffic, which was commenced some years ago is nearing completion. The freight service has been totally redesigned and nearly all freight traffic is now carried in new purpose-built wagons on a block train basis. The train is the unit of movement and wagons are not detached en route and shunting of wagons is eliminated. Mechanical handling facilities and so on have been provided. The emphasis is on bulk haulage and unit load movements including the handling of sundries traffic in containers. Under the new sundries system, traffic is loaded in such a way that we have a much more efficient system than we had heretofore. This arrangement was adopted because of the flexibility it provided in the interchange between rail and road and the greater mechanisation in handling arrangements which it allows.

While there was an overall increase in rail freight tonnage in 1978 over 1977, the result was disappointing particularly because some of the operations were severely disrupted by external problems involving some of the major traffic flows such as cement and fertilisers. The results of the introduction of the new sundries system have, so far, also been disappointing. There has been a significant reduction in the amount of sundries traffic. I would hope that this is only a temporary phase representing transitional problems in the change-over from the old to the new system and that CIE will not only recover traffic lost but will be successful in their objective of attracting a greater share of the freight market.

Mr. Enright

What does the Minister mean by sundry services? Is this the change-over to the new freight system?

Mr. Faulkner

Yes. The Development of rail passenger services is also continuing. This development includes the upgrading of the permanent way for faster travel and I am glad to record in this area that the pattern of increased passenger carryings on the railway is continuing. On the mainline service the increased business can be mainly attributed to the new timetables introduced in 1977, increased frequencies on all routes and a reduction in journey times, together with vigorous marketing activities and other developments. The reliability of mainline rail passenger services was demonstrated in the early part of the year.

Carryings on Dublin suburban rail services also continue to increase. The value of these services has been recognised in the recently announced Government decision on the electrification of the Howth to Bray suburban rail services.

The project will involve electrification of the Howth-Bray railway line, the acquisition of new, modern rolling stock, the provision of new signalling and depot facilities and the opening of new stations on the line. Employment for about 280 persons will be provided during the course of implementation of the electrification project, which will take from two and a half to three and a half years to complete.

Electrification of the Howth-Bray services will bring about a substantial improvement on the existing suburban rail services in terms of frequency, speed and passenger comfort. I do not have to go into the details of that as I have done so already.

While, as I have stated already, the railway accounts for the greater part of the CIE deficit, losses on road passenger services are now giving cause for serious concern. Present CIE estimates for 1979 indicate a doubling of CIE losses on Dublin city bus services over those in 1978 and a trebling of the losses on provincial buses. At the same time the trend in recent years has been for a decline in the number using Dublin and provincial bus services and this trend has been accentuated this year by the effects of industrial disputes. While it is true to say that some of the fall-off in traffic can be attributed to resistance to fare increases, there are quite a number of other reasons for the fall-off. Patronage of public transport services is also dependent to a considerable extent on the efficiency and reliability of the services. I am aware that traffic congestion affects the quality of CIE's services in urban areas and, in turn, this leads to greater usage of private cars, still greater traffic congestion, loss of revenue to public transport and increased Exchequer subsidy. That is why, as I said on an earlier occasion, that I have asked the Transport Consultative Commission which I established in 1978 to give priority to an examination of the arrangements for the provision of urban passenger services with particular reference to the Dublin area.

I am glad to say that the CIE's Expressway bus services are still proving successful. As regards road freight, there was a decline in tonnage carried on CIE vehicles in 1978 due to a number of factors. It is hoped that that traffic will pick up again.

In view of the inevitable attention which the CIE deficit attracts, I would like to record that the board and management of CIE have in recent years made commendable efforts to improve the financial performance of the undertaking. The board's policy has been aimed at solving the problems of rising costs and falling revenue by the reduction of overall manning costs and by providing services which would stimulate growth in the volume of freight and passenger numbers. Some considerable success has been achieved in some areas.

Since over 60 per cent of CIE's total costs is absorbed by salaries, wages and associated costs, the board's efforts to reduce staffing levels are most important. Since the beginning of its reorganisation drive which began early in 1975, there has been a reduction in numbers of 3,593. The financial savings resulting from reductions in staff numbers are, however, not apparent in the years in which they are being achieved, as productivity and bulk severance payments tend to cancel the betterment in the short term. The full benefit, consequently, will not be reflected in working results, especially on rail, where more than half of the savings are being achieved, until the overall reorganisation for each business is complete.

Nevertheless, CIE's financial results in recent years reflected the success of the board's reorganisation programme. A significant increase in productivity was recorded and most performance indicators showed improvements in 1976 and 1977. For two years in succession, the results gave hope that the deficit was being stabilised in real terms. The achievements of these improvements at a time of high inflation was most encouraging. It was all the more disappointing, therefore, that circumstances should have combined this year to cause a serious setback to the progress previously recorded. Many of the factors contributing to the disimprovement this year were not within the direct control of CIE but the net result involves demands on the Exchequer on a scale which is causing the Government considerable anxiety.

It is against this background that the Government had to consider the current increase in fares. One cannot escape the fact where there is a gap between expenditure and income, there are only two courses open—to reduce the one or increase the other. Apart from the productivity measures I have outlined the only way in which CIE's expenditure could be further reduced would be by cutting services. Since the bulk of the board's losses are on the rail services and on road passenger services, one would have to look in that direction. I would remind the House that Governments in the past following an investigation by consultants, decided that the railway system should continue to be preserved subject to concentration and reorganisation in accordance with the concepts outlined in the consultant's report as developed in further studies made by CIE. I hardly think that those who now deplore the increase in fares are recommending a reversal of that policy or a closure of large sections of the railway or drastic reductions in road passenger services. That is what a refusal to face the reality of increased fares would mean. They cannot have it both ways.

If a reduction in services to bring about a saving equivalent to the yield in a full year from the increased fares and rates were contemplated it would mean an immediate reduction in services of the order of 12 per cent. This in turn would result in the loss of revenue earned by the services terminated, which would in effect mean a further reduction in services and staff leading to the disemployment of a large number of people. Is this what the public want? I do not think so. I ask Deputies to take particular note of that.

The other possible way of closing the gap between expenditure and income is to increase income either by way of increased subvention from the taxpayer or an increased contribution from the user. As I have already stated a provision of £35 million is included in the Estimates for my Department this year and a Supplementary Estimate of £10 million will be sought shortly. I feel it would be totally unreasonable to ask the taxpayer to shoulder the full amount of CIE's increased costs in 1979. Therefore, the Government have decided that at least part of the increased costs should be borne by the users of public transport.

While listening to Deputy Enright talking about the size of the increases, a thought struck me. When the Coalition were in office in August 1973 there was an increase of 22 per cent, in July 1974, one of 20 per cent, in March 1976, an increase of 33 per cent and in March 1977 a further increase of 25 per cent.

As I said at the outset, it is no pleasure for me to announce increases in CIE fares. We should, however, see the matter in its wider perspective. The operation of a public transport service involves costs in excess of the revenue which the service can earn. It is essential, however, that we maintain a public transport system as part of our economic and social structure. The State has recognised this need by providing substantial sums to bridge the gap between revenue and costs. Like public transport undertakings in other countries CIE must contend with many difficult problems, including the increasing competition from private transport.

There are, however, limits to the burden which the Exchequer should be asked to bear. In present day circumstances and given the public service obligations which the board must bear, it would be illusory to expect CIE to operate on a commercially profitable basis, but we do expect that they will operate efficiently and economically and at least cost to the taxpayer. The achievement of this objective requires not only a commitment by management and staff but also the co-operation of the trade unions involved.

An efficient transport system is an important element in achieving economic growth and social progress. The Government recognise that it is essential to carry out regular reviews of transport policy so as to achieve the best balance between public and private transport and to secure the maximum benefit from the transport system for the community as a whole. That is why the Transport Consultative Commission was established. The terms of reference of the Commission are comprehensive but are primarily concerned with the problems of road and rail transport, both passenger and freight. The commission's reports will provide a useful basis for reviewing policy in these fields.

The deterioration in CIE's financial position in the current year is a subject which will require urgent consideration in the coming months. Those who are critical of the fares increases have to choose between the alternatives. Either all the burden should be borne by those who use the service or it should be placed on the taxpayer, as appears from this motion. I have no doubt that the people who are so anxious to put the total burden on the taxpayers are the same people who were demanding reductions in PAYE and who supported the farmers' anti-tax demonstrations. The other alternative is to cut back on the services with consequent loss of employment, and I do not think anybody wants that.

The attitude adopted by the Government in this case—and I think it was the proper one—was to spread the burden across as many shoulders as possible, that is, part of the deficit would be borne by the users of the transport system and part by the taxpayer. The fares and rates increases recently announced were clearly necessary and unavoidable and I, therefore, ask the House to adopt the amendment I have tabled.

Mr. Quinn

I speak on behalf of the Labour Party. I cannot help but comment that, while the terms of both the amendment and the motion are concerned strictly with fares, the Minister's contribution would appear to make it open season on CIE. It is sad to see a Minister with the experience of Deputy Faulkner meandering his way for half an hour in this House around the issue of transport policy, being forced to drag in references to what the Coalition did when the Coalition were last last in office, and then to end up more or less pushing the problem that is now on the Government's desk somewhere back into the middle of this Chamber, saying "Do not hit the piano player, he is only doing his best". Unfortunately, too many people in this country depend on the out-of-tune piano playing that this Government are frequently resorting to not only in transport policy but in other areas as well.

The first absurd contradiction and instance of Government disarray is that in half an hour of discussion on transportation and CIE the Minister for Tourism and Transport—even the title indicates the priorities of the Department— did not in my recollection, although the record of the House may correct me, mention the words "energy conservation" once. Yet we had the Minister for Industry, Commerce and Energy on the radio last Sunday giving advice to the Minister for Environment which that Minister will not take and appealing for some sense of energy conservation in relation to transport which obviously is falling on deaf ears with another Cabinet colleague.

This is where the problem begins. It is for the Minister to tell us what his internal difficulties are in trying to decide between the provision of revenue for CIE from either subsidy by way of taxation subvention or increased fares. In the absence of an integrated transport policy for this country, this demonstrates the complete poverty of this Government in relation to transport policy. The tragedy is that the Minister has enormous personal experience in this House in a number of areas. He was well respected by many Deputies in this House, and is a member of a political party who, regrettably, have presided in office over many years. He has not come new to office, nor are the Government party in office for the first time, yet we have the poverty of the Minister's submission in relation to fares.

The increases, sought in February, were not granted prior to 7 June when people went to the polls to determine their local and European representatives but, cleverly enough, were announced afterwards. The consequences of these increased in the area of Dublin, Limerick, Cork and Galway will be to take more people out of the public transport system, put them into their cars or their neighbour's cars, put them on to already congested roads to consume more of the precious black gold of which the Minister for Industry, Commerce and Energy is now traipsing around the world trying to find new suppliers. They will exacerbate further our balance of payments problems and generally upset the already bad situation in relation to the economic prospect of this country. Did we get any adequate reference to that from the Minister for Tourism and Transport to indicate that he did not know that those might be the consequences? Have the Department done any assessment of what the likely displacement of passengers from CIE on to the road system is likely to be? In reply to a supplementary question by me in this House last week or the week before, the Minister, with his pained, doleful eyes, more or less invoked the character of a school-teacher telling Deputies to have some sense and not be bothering him.

But the Minister does not have to come to work in a bus. He does not have to suffer the difficulties of sitting in a traffic jam in a bus waiting for it to get in on time, nor is he docked time if he is in late. Some of his officials might attempt to do the sums regarding the consequences of this governmental decision in the greater Dublin area and the other urban areas where the urban passenger services will be affected. In doing those sums they are going to realise how difficult it is to have a transportation policy if responsibility for transport is split over three separate Government Departments and in reality nobody is responsible for transport. The Department are, in their own terms of priority, titled tourism first and transport second. When we return to office the whole Department responsible for transport will be integrated into the Department of the Environment. You cannot talk seriously about transportation policy and what is happening to your road structure in the absence of integrating the provision of public transport services with the provision of roads.

Tragically for this country and for the people who cannot afford to run a car, the consequences of this prolonged decision—which is over many administrations and the Minister present is not responsible exclusively for it—have been the total schizophrenic split in transport policy between the Customs House and Kildare Street, so much so that when the Minister for Transport used to go to transport council meetings in Brussels it was an assistant secretary from the Department of Local Government who frequently would accompany him because of the integration of roads into transport matters generally. If we had an integration of the Department responsible for transport with the Department of the Environment and if responsibility for CIE was vested in that Government Department we would not have the contradictory nonsense implicit in the Government amendment to this notion which talks about "the form of subsidy" by way of increased taxation. If fares were to be paid at the present level and if the extra deficit was to be met by extra taxation this would result in a subsidy to the travelling passengers.

There is no mention and no recognition of the fact that this Government gave a massive subsidy to the carowning and car-travelling public of this country when they abolished car tax free, gratis and unsolicited two years ago by way of an election gimmick. That was a one-off subsidy designed—successfully as it turned out—to gain some of the 84 seats. There is no mention of a recurring subsidy implicit in the road allocation made each year to people who drive either cars or trucks, or of the implicit subsidy to freight hauliers who drive enormous trucks over our road system and cause considerable damage to that road system in certain areas, which is away in excess of the revenue which we get from the licences for those trucks. There is no mention of that subsidy, again because of the split of governmental responsibility between the two Departments. A vicious circle has bedevilled public transport operators in countries throughout the world, particularly in regard to operations in built-up areas. An increase in fares will result in a decline in passenger traffic because passengers will seek to travel by way of private transport on the same road space as public transport, thus leading to congestion which in turn will decrease the quality and efficiency of the public transport service. That decline in the quality of the service will precipitate a further number of people leaving public transport in favour of private transport, thus causing a drop in revenue; and the whole cycle starts again.

The Minister frequently referred to the deficit funding for CIE, thus demonstrating the inbuilt prejudice of the Government in regard to CIE. Nobody refers to the deficit in the Department of Health or Education but we talk about the deficit in the Department of Tourism and Transport in regard to CIE. The major portion of the subvention given to CIE is for the rail system which many people on that side of the House would like to have killed off entirely but which we are now very glad has been kept. It was bedevilled by exactly the same cycle of increased fares, declining passengers, loss of revenue and further necessity for increased fares until a deliberate marketing decision was taken by CIE about seven or eight years ago when they slashed fares in order to generate passenger revenue. Consequently there was a dramatic increase in the number of passengers carried by mainline rail services. Why is not the same strategy now being applied to the public transport system in congested urban areas? On the one hand we have requests for capital funds for part of CIE's development programme and current account funds to meet their subvention; on the other hand there are requests from the Department of the Environment to build major urban motorways to cope with traffic congestion which is in part a product of the imbalance between public and private passenger movement.

I have repeatedly asked for some degree of professional analysis, as distinct from opinion from a transportation consultative commission, from the Government Departments who are responsible. We are still waiting for the answer. The Ministers have the resources to do these sums and sufficient research and analysis has been done in other countries into the effective social cost-benefit which could result from subventing in a serious way the bus and rail services in the Dublin area and bus services in built-up areas throughout the rest of the country.

In the continued moans from the Government benches one can almost hear the prose of the principal officers of the Department of Finance bemoaning the fact that more money must go to CIE, while at the same time they write cheques for the Department of the Environment to build wider and larger roads to cope with the congestion caused by the effective breakdown of the public transport system in urban areas. When will the Government realise that they cannot widen every street in the towns of Ireland? Listening to engineers and the fashionable exponents of transport solutions in the mid-sixties one would have thought that the only thing wrong with Dublin or Cork was that all the buildings were in the way of the traffic and that if they could be knocked down and the streets widened the problems would be solved. We cannot do that; yet we persist in the belief. Because of that we continue to refuse to give to the public transport system the degree of subvention required.

All this post-election sanctioned increase will do is increase further the decline in passenger traffic using the bus services. I have not the resources to analyse what the likely percentage decrease will be and it would be useful to know if the Government had that figure to hand before they sanctioned the increase. CIE sought £11.6 million which is 80 per cent of what would be considered acceptable by the NPC. Is that 80 per cent considered to be the threshold beyond which there would be a precipitous fall in passenger traffic? Why did they stop at 80 per cent?

The Minister made the misleading suggestion that the taxpayer was subsidising CIE through the social welfare allocation which is in the region of £28 million. That is not a subsidy to CIE; it is a subsidy to the people who are deemed by this House to merit a transport mobility subsidy of their own. It has nothing to do with CIE. It is deliberately misleading to suggest that the taxpayer is being extremely generous to CIE when this amount is added to the subvention.

It is interesting that the Minister, despite his meanderings through the role of CIE and the detailed description of the freight service, was so limited in his description of the electrification-rapid rail proposal for the Dublin suburban area. It took them more than two years to analyse the application from CIE and it was a coincidence that the announcement was made days before the local elections.

Minister of State at the Department of Tourism and Transport (Mr. T.J. Fitzpatrick

, Dublin South-Central): The Deputy said it would never happen.

Mr. Quinn

Did I say that? Perhaps it was during one of my more depressed moments. It would not have happened but for the continued lobbying from this side of the House. If the Minister for Economic Planning and Development had his way we would still be depending on diesel engines. If the local elections had not taken place on 7 June it is possible that this would not have happened because there was no provision for it in the capital budget of this year. Will any of the £10 million which will now be sought for CIE be for capital expenditure?

Debate adjourned.

The Dáil adjourned at 8.30 p.m. until 10.30 a.m. on Wednesday, 4 July 1979.