I move:
That a sum not exceeding £234,864,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of December, 1980, for the salaries and expenses of the Office of the Minister for Posts and Telegraphs and of certain other services administered by that Office, and for payment of certain grants-in-aid.
The net Estimate for my Department for the year ending 31 December 1980, is £234,864,000. The corresponding figure for 1979 was £185,888,000, including an amount of £8.3 million provided by way of Supplementary Estimate. All but two subheads show increases and substantial extra provisions have had to be made in a number of subheads on which I will now comment individually.
The amount being provided for subhead A—Salaries, Wages, and Allowances—is £160,827,000 as compared with £126,962,000 in 1979. Part of the increase of £33,865,000 arises because expenditure on pay in 1979 was below normal due to the postal dispute. The balance is needed because of additional cost of pay increases granted under the 1979 national understanding; additional staff requirements; increased cost of standard increments and of remuneration to scale-payment postmasters; higher cost of social welfare employers' contributions and fees to An Bord Poist and An Bord Telecom.
The provision of £6,267,000 for subhead B—Travelling and Incidental Expenses—represents an increase of £1,048,000. This is required mainly to meet increased travelling and subsistence costs by engineering technical staff; higher costs of agency services performed for the Post Office by other Government Departments; and extra expenditure under a number of miscellaneous headings.
Under subhead C, Accommodation, £26,500,000 is needed. The increase of £9,237,000 is required to meet the cost of additional accommodation, mainly for telephone development purposes; additional provision for rents and rates; and higher costs of light, heat and power.
Under subhead D—Conveyance of Mails—an extra £1,014,000 is required mainly to meet higher contractors' charges for the conveyance of mails by rail and extra costs of conveyance of mails by air because of increased traffic.
An additional £1,827,000 is provided for subhead E—Postal and General Stores—mainly to meet increased mechanical transport costs for postal purposes and higher contract price for the telephone directory.
Under subhead F—Engineering Stores and Equipment—£67,576,000 is being provided. The increase of £13,817,000 is needed to cover the extra cost of engineering stores and equipment and contract work for the development and maintenance of the telecommunication services.
Under subhead G—Telephone Capital Repayments—£47.8 million is needed. The extra £9.1 million is required for increases in telephone capital repayments because of the continuing investment of capital in the telephone service.
The increase of£1,122,000 on subhead J—Superannuation—is required to meet the higher cost of pensions and lump sums because of increases in pay under the 1979 national understanding and other pay increases granted to engineering and postal grades.
The provision of £18.0 million for subhead L1—Broadcasting Licence Fees—represents an increased grant-in-aid of £2.0 million to Radio Telefis Éireann in respect of increased net receipts from television licence fees. The increased grant-in-aid will be offset by a corresponding increase in the amount payable to the Exchequer as Exchequer Extra Receipts in respect of the sales of television licences.
The estimated receipts of £115,216,000 under subhead T—Appropriations in Aid—show an increase of about £24.0 million. The increase is due to higher expenditure on telephone capital development; this expenditure is recoverable from telephone capital funds.
The figures in Appendix C to the printed Estimates Volume show the commercial results of the Department as a trading concern for 1977 and the three preceding financial years. They also show a provisional deficit of £19.4 million for 1978 made up of deficits of £2.9 million on the postal service, £1.1 million on the telegraph service and £15.4 million on the telephone service.
Present indications are that the Commercial Accounts for 1979 will show an overall deficit of about £29 million made up of deficits of £12 million on the postal services and £17 million on the telecommunications services. It is estimated that £4 million of the overall deficit in 1979 was due to the postal dispute which resulted in a drop of about £22 million in revenue, offset by a reduction of £18 million in expenditure.
The deficits would be still higher in 1980 and 1981, as costs are continuing to rise, and it was therefore decided to increase postal and telecommunication charges as from 1 July 1980. As a motion on these increases was discussed in the Dáil recently it is hardly necessary for me to say anything further about this matter.
As Deputies know, the Department have experienced in the last few years very difficult and protracted disputes in pursuit of higher pay involving many of the staff in both the telecommunications and the postal services. There is no point in conducting any sort of an inquest here into these difficulties. Since the resumption of work following the strike by members of the Post Office Workers' Union last year considerable and sustained efforts have been made to restore good staff relations at all levels and a significant measure of success has been achieved. There have been isolated instances of unofficial industrial action or of withdrawal of co-operation by certain groups of staff, but these cases of difficulty were either settled in consultation with the staff representatives or are being pursued with the unions concerned with a view to having them resolved.
Deputies will have seen media reports of pay offers being put to ballot by the Post Office Workers' Union. The pay increases being offered represent very substantial improvements and there is considerable retrospection attaching to them. I am sure I do not need to remind the House that pay increases have to be paid for and I should perhaps point out again in this connection that higher costs due to pay increases already given are mainly responsible for the recently announced increases in post office charges. There have been references in the media to productivity conditions attaching to the pay offers and I am aware that a good deal of misleading propaganda about these conditions is being circulated. In fact, the pay claims were based in part on productivity aspects and these were argued strongly in support of the claims. The pay offers would only be justified on the basis of staff co-operation in improving efficiency and standard of service to the public. We should stop codding ourselves, our workers and the public now about these matters. Either the Department must move with the times and give the community the service to which they are entitled, or else see the services stagnate with all the consequences which that would have for the future of the services and the staff. Let me add categorically that nothing unreasonable is being sought from the staff by way of productivity, simply the co-operation and flexibility in coping with change which has traditionally been expected and given. There is, incidentally, no question of staff redundancies arising from the proposed agreements and there has never been any question of this.
The public deserves a return to the long tradition of loyal, reliable and unbroken service by Post Office staff. With industrial harmony and staff co-operation, 1980 can be a year in which really significant progress will be made in telephone development in particular and in the modernisation of the Department's services in general. I believe that the Post Office can surmount the difficulties of recent years. I have spoken to many people at all levels in the Department since I became Minister and I have met no one who thinks that the task is beyond us or who is less than anxious to get on with the job. I was greatly encouraged by these discussions with staff and I am fully satisfied that management and staff, working together, are well capable of restoring public confidence both in the postal service which they have traditionally provided so efficiently and in the telecommunications services which face an explosive growth in demand. It is one thing to say this, however. It is up to the Department and their staff to show that they are equal to the task in practice.
I will not pretend that, in an organisation as large as the Post Office, there will not be problems. I accept that, if unrealistic expectations are encouraged, if there is an absence of realism in formulating demands or a failure in industrial negotiations to take account of community as well as of sectional interests, then progress will not be made. But strikes and interruption of services are not inevitable. Negotiating structures are available which provide a means by which problems over pay and other matters can be resolved in a sensible and reasonable way without industrial strife. I make no apology for asking and expecting that these agreed procedures should be used by all parties. Success will depend on there being a will to compromise and to settle differences peacefully.
Last year was one of unprecedented difficulty for the postal service, because of the industrial action taken by staff catered for by the Post Office Workers' Union in pursuance of pay claims. The strike lasted from 19 February to 28 June and it is greatly regretted that the public generally and businesses largely dependent on the postal service were caused inconvenience and in many cases hardship during that period and for some time afterwards.
When the strike ended, a massive backlog of mail had built up in Britain and other countries. Thanks to the special efforts of management and staff it was possible to clear this backlog and to resume acceptance of new postings earlier than had been expected. However, this presented a further challenge as the level of new postings was substantially above average for a long period The task of dealing with these postings would ordinarily be a formidable one but it was made particularly difficult because staff numbers had been depleted mainly because recruitment had to be suspended during the strike and staff leave had to be compressed into a shorter period than usual. Delays, some of them considerable, arose and my Department quite understandably experienced a great deal of criticism on this account. However, special measures were taken which brought about a significant improvement in the service. Recent checks by my Department indicate that over 80 per cent of first-class letters are now being delivered on the working day after posting and we are striving to get up to the 90 per cent which was the traditional figure down through the years.
The postal service is highly labour-intensive and is vulnerable to industrial action not alone by its own staff but by staffs of other organisations engaged in the conveyance and handling of mails. In fact there have been quite a number of in tances in recent years of industrial action outside the Department's control which disrupted or delayed the mails.
Normally the postal service can rely on a steady if unspectacular growth in traffic and this was the trend in recent years up to 1978. The volume of traffic handled that year was 480 million letters and over 9 million parcels. Because of the strike, comparable figures are not available for 1979 but there are current indications of a reduction in both letter and parcel traffic. It is to be hoped that, with an improvement in the standard of service, lost traffic can be recovered.
Since 1971 the quality of service for mails to and from County Donegal has been adversely affected by the discontinuance, because of the security position, of the movement of mails across Northern Ireland. The Cross-Border Communications Study drew attention to the disadvantages this presented for postal users in County Donegal. The question of restoring the former mails conveyance arrangements which would improve both the services in County Donegal and the service generally with Northern Ireland is under active consideration at present between my Department, the Northern Ireland Postal Authority and the staffs concerned.
Motorisation of rural delivery services, which commenced in the sixties, has slackened and will probably be slow for the next year or so because vacancies which would otherwise provide opportunities for motorisation are being absorbed in schemes for giving postmen a Monday to Friday working week. At present there are approximately 970 motorised delivery services in operation covering about 70 per cent of the total mileage travelled on rural postal delivery daily and they have replaced largely part-time jobs with good full-time employment. Further motorisation of services may also be affected by the petrol situation. Indeed the need to conserve energy may necessitate a review of some existing mails services and other auxiliary functions which this Department could operate.
A settlement reached on a staff claim for extension to postmen generally of the Monday to Friday working week which postmen in the Dublin area have enjoyed for some years will result in the eventual cessation of Saturday deliveries throughout the country.
In fact the scheme is already operating in about three quarters of the country. In order to avoid redundancies or cuts in pay, the five-day week arrangements are being introduced area by area as normal staff wastage occurs. Advance notice of the introduction of the changes is given to the public in the areas affected.
Cessation of Saturday delivery has the effect of heavier mail arrivals at delivery offices on Monday with the result that deliveries commence on that day generally a half an hour—or sometimes more—later than on other days. Deliveries are spread over the postman's working day which means they finish somewhat later than when the six day week applied, although the aim is to preserve delivery times as far as possible, and, in particular, to maintain early deliveries to business users and the more populated areas.
The Department have been expanding their philatelic activities. Special stamps are being issued on a greater number of subjects, giving scope for more varied designs which can better depict the country's history, culture, national heritage, activities and achievements. They are attracting growing public interest at home and abroad, which is well reflected in philatelic sales, now approaching £700,000 a year. The recent appointment of philatelic agents in North America, Britain and continental Europe should help boost sales further. The special philatelic sales office in the GPO Arcade in Dublin is proving most successful, and the Department have been conducting sales stands at major philatelic shows abroad with encouraging results.
This year's programme of special stamps includes stamps on Irish music and dance and the centenary of the birth of Sean O'Casey, as well as other noteworthy subjects. The popular fauna and flora series, which featured Irish wild flowers in 1978 and birds in 1979, will be continued this year with animals of particular Irish significance.
I am pleased to record my thanks to the members of the committee who advise me on ways of promoting interest in Irish stamps and postal history and to the committee who advise me on stamp design, for the time and expert advice they unselfishly give to the public interest.
A decision has been taken recently to establish a philatelic museum in Dublin and my Department are at present in consultation with the Office of Public Works about the suitability of two premises which are being considered for this purpose.
Postal authorities all over the world are becoming increasingly concerned about the future. They fear that the competition which is inevitable from the increasing development of new telecommunications technology will eat into postal revenue, creating difficult financial problems. Postal authorities in other countries are already beginning to gear themselves to face this challenge, and we have to commence appraising our own position. Inter alia, special consideration will have to be given to the prospect of attracting new business, whether in existing activities or by developing new services, not only to replace lost business but also to make more extended use of the postal services' unique network. However, the main task for the postal service in the immediate future and over the next few years is envisaged as restoring and maintaining the traditional high quality of mails service, achieving a greater cost effectiveness and development of a greater orientation towards a marketing approach.
The staffing of the postal service has recently been strengthened by the appointment of an additional principal officer who will be responsible for marketing, planning and considering the possibilities for new business.
The number of money orders issued in 1979 was 780,000 as compared with 1,000,000 in 1978 but the total value of £120 million was approximately the same as in the previous year. The number of postal orders issued was five million and the value was £15 million, as compared with 8,000,000 and £23 million in the previous year.
The reduction in remittance business was mainly due to the postal dispute but a further factor was the break in parity between the British and Irish currencies. Neither the British nor the Irish Post Office operate a currency conversion service at the counter, but formerly each accepted the other's monetary documents at their face value. My Department still cash British postal orders at their face value in Irish currency but as the British pound is now more valuable than the Irish pound there has been a substantial drop in this traffic. On the other hand the British Post Office would incur a substantial loss if they were to continue cashing Irish postal orders and money orders at their face value in British currency and they have, therefore, discontinued this service.
Agency service payments made by the post office, mainly on behalf of the Department of Social Welfare, amounted to £430 million in 1979 as compared with £396 million in 1978. The total would have been higher if departmentally staffed offices had not been closed during the postal dispute. Agency service payments were also affected by the break in parity between the British and Irish currencies. Revised arrangements had to be made for the payment of British social security pensioners living in Ireland and Irish social welfare pensioners living in Britain who formerly were able to cash their pension orders at their local post office. They are now being paid by means of payable orders encashable at banks.
Development of the telecommunications service requires the provision of new buildings and extension to existing buildings on a very large scale. In most cases it is necessary also to acquire a site for individual buildings. For many years past lack of sites and buildings has been one of the main constraints on the development of the telecommunications service. A major effort to tackle this problem was initiated by my Department early in 1979 when an accelerated building programme was launched. Radical changes in structures and procedures designed to achieve a substantial increase in the output of buildings and more rapid provision of indiviual buildings were introduced in co-operation with the Office of Public Works and special steps were taken to expedite the acquisition of sites.
The accelerated building programme provides for the erection or extension of more than 500 buildings over the next few years at an estimated cost of nearly £100 million. It includes buildings to accommodate and train an increased intake of staff, buildings for telephone exchanges, stores, transport and so on. The result of the steps taken under this accelerated programme can be judged from the fact that while something over 100 new telephone exchange buildings or extensions to existing buildings were completed in the period since July 1977, work is now in progress on a further 100 buildings or extensions and it is expected that work will commence on a further 200 projects during this year. It is expected that contracts will be placed for some 150 projects during 1981. The progress achieved to date is a credit to the staff of my Department and of the Office of Public Works who have devoted themselves to the task with great energy and dedication.
When this programme has been completed one of the major constraints on more rapid development of the telecommunications service will have been eliminated. The list of buildings to be provided or in course of construction is very extensive and I do not propose to give details of them here. However, if any Deputy wants information about buildings planned for a particular area I will be glad to have the information supplied.
A special effort to meet the building requirements of the postal service is also needed. While there has been an ongoing programme for the provision of new post offices and for improvement of existing post offices the scale of the programme has not been sufficient to keep pace with the requirements of the service. Many of the existing buildings are inadequate for a modern postal service. A detailed examination is under way to determine the precise requirements and how these can be met in the shortest time practicable.
Turning to telecommunications, demand for telephones continued to be buoyant last year and despite the five months' postal strike, when few applicants could be processed, a total of 50,000 applications were received. Although the figure was somewhat short of the record 58,000 in 1978, it was nevertheless substantially higher than in previous years. Over 60 per cent of the applications were for residence telephones. Telephone density here about 17 telephone per 100 population is still one of the lowest in Europe and is substantially the lowest in EEC countries. All the indications are that the demand for telephones will continue to grow for many years ahead and planning is proceeding on the basis that it will do so.
Only 32,000 connections were made last year, compared with 39,000 in 1978 and over 41,000 in 1977, which was the highest figure ever achieved. The relatively low connection rate last year was due primarily to the non-availability of stores which could not be distributed during the strike by postal and warehousing staff. With a demand of 50,000 and a connection rate of only 32,000 the waiting list for telephones continued to grow and at the end of last year stood at 80,000.
The value of stores being issued for works carried out by departmental staff is now over £2 million per month and the value of stores on order is over £15 million. The increase in the rate of issue will help to improve the connection rate and ensure continuity of supply. The prolonged steel strike in Britain in the latter portion of last year delayed deliveries of some supplies but I am glad to say that the position in this regard is now greatly improved.
The target for telephone connections this year is 60,000 and it is planned to increase the rate progressively in the following years. Increases of the order required to reach a situation where in about five years' time it will be possible to meet applications for telephones promptly will not be achieved easily; the whole infrastructure of the service, in terms of accommodation for both equipment and staff, telephone exchanges, trunk circuits, local cabling and the necessary skilled staff must first be built up. I will return later to these matters.
I know that in general there are many non-believers and many people who criticise the target of 60,000 telephones as being totally unrealistic and non-achievable. I should like to put on record that at the conference of the post office engineering staff in Sligo last night I received a very positive response from that union to the effect that my target of 60,000 telephones this year was realistic and realisable. I was told that if the stores supplies continue to flow out to them and if small minor hurdles are overcome they have no doubt, as I had no doubt, that the target can and will be reached.
With demand continuing to be buoyant and likely to be well in excess of 60,000 this year, no reduction in the size of the waiting list can be expected in the short-term. Indeed, it is likely to grow for the next two years or so, but with an increasing installation rate, the average waiting time should fall gradually from now onwards. Measures are being pushed ahead to reduce and eventually eliminate the waiting list. It would not, however, be realistic to expect that this can be done in any short time or, indeed, in one week as Deputy Kelly suggested recently. There have been particular difficulties in meeting the greatly increased demand for telephones in Dublin. For many years the underground cable network serving the city and suburban areas has been inadequate. Work programmes undertaken to remedy the situation have been hampered by shortages of skilled engineering staff, particularly jointing staff. Over the past two years special measures taken to increase the numbers of staff on this work have been interrupted by the necessity to divert a large proportion of the underground jointing force employed on new cabling work to maintenance work for long periods following industrial action and flood damage to old cables. The resulting arrears of work added to accumulated previous arrears and the need for new cables to meet the exceptional growth of extensive housing and industrial estates on the perimeter of the city have aggravated an already serious shortage. The problem has been tackled in two ways—by accelerated training of departmental jointing staff and by the employment of contractors on a greatly increased scale. Both of these measures are now producing good results but the arrears of work to be done are still formidable.
In the provinces the principal difficulties are congestion in the trunk network, which must be cleared before big numbers of applicants can be given service, and inadequate staff. I will refer later to what is being done to improve the trunk network. Substantial numbers of extra staff are being recruited this year—the figure we expect to reach is 600—and this will be continued according as the accommodation to house them becomes available.
Last year over 80 telephone exchanges were extended, 15 manual exchanges were converted to automatic working and some 1,300 additional trunk circuits were provided mostly on major routes within the country, but also to Britain and to a number of continental countries. If the Deputies wish I will have a tabular list made available of the exchanges extended and converted.
The quality of the trunk service within the country and to Britain has been less than satisfactory. This is due basically to the capacity of some of the key trunk exchanges and trunk routes being inadequate to handle the volume of call traffic. The international service and the local service in most centres is by comparison reasonably good. The shortcomings of the services generally have been described by the review group in their report of last year and I do not propose therefore to dwell on them here. Instead I will outline what has been and is being done to correct them.
Last year the Government approved an accelerated telecommunication development programme estimated to cost some £650 million. Action was taken quickly to implement it in various ways such as a major drive to provide all the sites and buildings required, and the placing of massive orders for extra stores, transport and equipment. Many of the measures taken are referred to elsewhere in this statement. The capital allocation of £75 million for the year was spent in full and an allocation of £100 million was approved for this year.
Needless to say, it is too early to obtain the benefit of much of this investment because of the long lead-times required, but work has been going ahead on hundreds of development schemes already in the pipeline and I shall refer only to some of the larger ones here.
The Dublin trunk exchange system is the hub of our telecommunications network and shortages or inadequacy of equipment here affects the whole national system. The first phase of a multi-million pound exchange is nearing completion at Adelaide Road, Dublin; the in-service date is expected towards the end of the year. When in operation it will enable thousands of badly needed trunk circuits on routes to and from Dublin to be brought into service. The second phase will be the installation of further trunk switching equipment of digital electronic design which is on order and due to be in service in 1982.
It is of course also important that the trunk exchanges in the main provincial centres and the main trunk routes be designed on a scale which will remove once and for all the danger of further congestion in our time. The buildings, equipment and trunk schemes now being provided will ensure this. A major exchange complex at Churchfield, Cork, is in course of installation and should be in service next year. In Limerick a building to house a major extension to the existing trunk exchange building is almost completed and the exchange is on order; buildings for new exchanges are in progress at Galway, Sligo, Drogheda, Dundalk, Athlone, Tralee and Kilkenny, to name but some of the new bigger centres, and the exchange equipment is on order for most of them; these exchanges should be ready for service within the next two years or so.
The first phase of a new exchange at Portlaoise, another key centre in the national network, was opened a few months ago and the second phase is to be in service later this year. An interim extension of the Waterford exchange is being carried out. What I have said will give some indication of what is being done to improve the trunk exchange system. The provision of an adequate and reliable trunk circuiting system is also well under way.
Work on the installation of a new microwave route to Britain is in progress. This will have an initial capacity of 2,700 circuits and can be extended several fold. The link is expected to be brought into service later this year, when the new trunk exchange at Adelaide Road, Dublin, to which I referred earlier is in operation. These two schemes will provide major relief on the cross-channel routes.
A microwave link is also being installed between Dublin, Sligo and Letterkenny. The installation work has, regrettably, been seriously delayed by a dispute between staff in the Department and in RTE over certain rigging work. This dispute has now been resolved and work is commencing today. In that event the link should be in service later this year, and should provide additional circuits to and from the north west on a scale that will improve substantially the general quality of the trunk service in this area. It will also enable the Dublin-Sligo co-axial cable to be withdrawn, overhauled and increased substantially in capacity.
Other major trunk schemes in progress which are expected to be completed within the next year include 1,800 circuits systems between Dublin and Athlone, Dublin and Galway and Dublin and Waterford, 960 circuit systems between Enniscorthy and Dublin, Macroom and Cork, Tralee and Limerick, Waterford and Cork, Wicklow and Dublin and Carlow and Kilkenny and a co-axial cable link between Sligo and Manorhamilton. The capacity of the Navan-Drogheda-Dublin co-axial cable route is being upgraded threefold. In all, over 5,000 additional trunk circuits are programmed for provision within the next year.
Completion of the new trunk exchanges and additional trunk works that I have mentioned will bring about a marked improvement in the trunk service within the country and to Britain: Indeed, with the opening of the new trunk exchange in Dublin, there should be a noticeable improvement towards the end of this year. In the meantime and particularly during the summer peak traffic period, difficult conditions resulting from overloading and congestion will, unfortunately, continue. Every effort will be made to reduce these difficulties as much as possible by special maintenance attention and other measures. It is understandable that callers who experience difficulties in making calls via an operator tend to blame the operator for the delays. In practice, the delays are outside the control of the operators and I should like to take this opportunity to pay tribute to telephone operators generally for their efforts and co-operation often in very trying circumstances.
During the year the planning functions carried out in a number of sections in the telecommunications services were concentrated in an expanded new branch to ensure as far as practicable that medium and long-term planning work will not in future be neglected in favour of pressing current work.
As Deputies will be aware, there were problems recently with the trunk service to certain parts of Britain following a rearrangement of numbers of traffic routes in Britain, problems which were accentuated by a general shortage of circuits between here and Britain. The service is now much improved. When this matter was raised in the House earlier this month, I said that we had made certain suggestions to the British Post Office which would ease the position considerably. We received total co-operation in this matter from the British Post Office and I should like to place on record now my appreciation of the speed with which they responded. Adequate circuits to the various routes in Britain will be available when the new microwave link to which I have referred earlier is brought into service.
Despite the general shortage of circuits on certain routes to Britain, the cross-channel service was greatly improved last year by the extension to all automatic subscribers in this country of direct dialling to six major centres there. Until then this facility had been available only to subscribers in Dublin and some of the bigger provincial centres. Subscriber trunk dialling to Belfast was similarly extended. This extension benefited some 60,000 subscribers. The problems involved in extending subscriber dialling between all automatic areas here and in the British Post Office system are being studied with a view to making the most rapid progress practicable in this regard.
Some 10 per cent of subscribers are still served from manual exchanges and one of the objectives of the current accelerated development programme is to provide an automatic service for all subscribers by the end of 1984. Providing automatic service for the remaining 10 per cent may seem an easy task. The position is however, that this 10 per cent are served by nearly 500 manual exchanges, or almost half the total number of exchanges in the country. last year, as I have already mentioned, 15 exchanges were converted to automatic working; these include Letterkenny and Roscrea. Arrangements have been made to convert a further 20 exchanges and to increase sharply the pace of conversion from next year onwards. Equipment for over 200 further automatic exchanges is on order. This part of the accelerated programme is, therefore, well under way.
The volume of traffic on international routes continues to increase rapidly, the annual growth over the past five years being around 30 per cent. The number of international circuits in use is now almost 460, including 48 satellite circuits.
Our international circuits are broadly provided either via submarine and underground cables or through the earth station at Goonhilly, Cornwall, in which we have an investment share. Within the next few years it will be economical for the Department to have its own telecommunications earth station for the requirements of the North Atlantic routes. As I have indicated in the House recently, my Department has taken the first step in this regard by acquiring a 60-acre site near Midleton, County Cork. The first installation there will cater for transatlantic telecommunications traffic, but the site is large enough for extensions to meet satellite circuit requirements to Europe and elsewhere. The proposed station will enable us to have direct communication with overseas countries without having to rely, as at present, on transit facilities provided by other telecommunications administrations. Until last year subscriber dialling to countries abroad was available only to subscribers in Dublin and Shannon. In the course of the year international dialling facilities were extended to Cork city, Limerick city, Waterford city, Galway city and Drogheda. This year they have been extended to Dundalk and they will be made available to Athlone and Sligo subscribers later this year. At that stage about 70 per cent of subscribers will be able to dial international calls. The number of countries to which calls can be dialled is being increased gradually and is now 49. They include all the countries with which we have any significant volume of trade so that this service is a highly valuable one from a commercial viewpoint.
Telecommunications technology is changing rapidly. It is now generally accepted that the merging of telecommunications and computer technology will have far-reaching consequences affecting the distribution and processing of information and the control and monitoring of commercial, industrial and so on, operations over long distances.
Last year for the purpose of making long-term arrangements for the procurement of computer controlled digital electronic exchanges for our system and, at the same time encouraging the manufacture of the exchange equipment here, my Department sought tenders on a worldwide basis from leading manufacturers and at the same time invited them to make industrial proposals to the IDA. As a result of the competition two firms were selected to supply these exchanges and to manufacture the equipment in this country. The first such exchanges are due to be in service next year.
The type of equipment to be provided by one of these firms was designed in France and is more extensively used than any other kind of digital electronic exchange. In connection with its introduction here my Department has entered into a technical co-operation agreement with the French PTT Administration covering the loan of technical experts, the training of Irish engineering staff, the transfer of know-how on an extensive scale and so on. The other supplier is L.M. Ericsson Ireland Limited who have been manufacturing telephone exchanges of a different technology for quite some time past in this country.
The provision of telephone kiosks has always been a matter of interest to Deputies and to the public generally. The stage has now been reached where a kiosk has been provided in practically every rural area in which receipts from the local sub-post office telephone indicated that a kiosk would be used to a fair extent. In areas where there is no local post office, there have been practical difficulties in estimating to what extent kiosks would, if provided, be likely to be used and in determining an order of priority among competing centres. A study was carried out to help in establishing criteria for the provision of kiosks in such areas and a method has been devised which will, it is expected, overcome these difficulties. The method takes account of social and demographic factors such as the number of houses in the catchment area, the distance from existing public telephone facilities, the density of private telephones in the area and so on. It has already been used to select 22 areas for the provision of kiosks. It is proposed to provide over 50 more this year. The position will, of course, be kept under review.
The need for kiosks in rapidly expanding urban areas has also been reviewed. A special examination of new housing estates is being carried out in the Dublin area and it is proposed to provide some 50 new kiosks in these areas including 25 in the Tallaght area. My Department will have discussions with local community groups in these areas and with the Garda Síochána on the measures that can be taken to safeguard the kiosks against vandals so that they will be available to the public to the maximum extent practicable. Similar schemes are being planned for other major housing estates. In general only local calls can be dialled from coinbox telephones in automatic areas at present. It is proposed to commence later this year the replacement of these coinbox telephones by multi-purpose coinbox telephones enabling callers to dial trunk and international calls directly without the assistance of an operator.
Damage to telephone kiosks by vandals is estimated to have cost the Department over £100,000 last year. It is not of course practicable to make kiosks fully vandal-proof and measures taken to reduce its incidence, include reinforcing coinboxes by special steel construction, replacing glass by specially strengthened plastic and the use of specially armoured cords and handsets in kiosks.
About 473,000 telegrams were handled in 1979. There was a drop of 43 per cent on the previous year's telegram traffic attributable mainly to the effects of the strike in the first half of the year.
The number of telex subscribers at the end of 1979 was over 4,800 an increase of almost 10 per cent on the corresponding number on the previous year. Demand for telex service continues to be buoyant. To provide for continued growth a third telex exchange is being installed in Dublin and will be brought into service in the course of the next year. Automatic telex service is now available to 80 countries, including 16 added during the course of the past year.
The number of data transmission terminals connected to the telephone network is over 1,000 and growing rapidly. A new data control centre was opened in Dublin during the past year.
New major trunk switching exchanges are at present in course of installation at Dublin, Cork, Mullingar, Kilkenny, Navan, Arklow, Tuam, and Midleton. Commitments recently entered into with L.M. Ericsson and Telectron—in association with C.I.T. Alcatel—will provide for new digital trunk exchanges at Dublin, Athlone, Galway, Naas, Limerick, Sligo, Dundalk, Drogheda, Ennis, Longford, Mallow and many other centres. The necessary buildings for these exchanges are already available or well advanced.
Commitments have already been entered into with equipment contractors for the conversion to automatic working of over 270 exchanges including new digital exchanges at such places at Bantry, Ceanannus Mor, Kanturk, Ballymote, Manorhamilton, Donegal, Carrick-on-Shannon and Enfield.
That information is available on a separate sheet to anybody who wants to read it.
My Department are participating with other telecommunication administrations in bringing into service specialised data networks giving rapid access to a computerised library information service. In March last, a service of this kind, called EURONET, was made available here and in other EEC countries. Arrangements are in train to introduce a similar information service from this country to the US and Canada later this year. These services are particularly useful to those engaged in research in technical, medical and allied fields.
I turn now to the proposed reorganisation of the postal and telecommunications services. A Green Paper containing proposals about the reorganisation of the services was laid before both houses of the Oireachtas on 14 May. A copy was also made available to each Deputy and Senator. Before dealing with the Green Paper, I would like to mention something of the background to it.
In July 1978 my predecessor set up the Posts and Telegraphs Review Group. The group submitted their report at the end of May 1979, that is, within 10 months of their appointment. This must be a record. I know of no other enquiry of this kind which was completed so speedily. I would like to take this opportunity of having formally recorded in this House the debt of gratitude owed by the community to Dr. Michael Dargan and the other members of the review group for the amount of time they devoted to producing their most valuable report and the speed with which they completed it.
Their sense of urgency was matched by the Government. A little over a month after its receipt, the Government decision on the basic recommendation in the report was announced, that is, that both the telecommunications and postal services should be taken out of the civil service and set up as two separate State-sponsored bodies.
The Government also decided to set up two interim boards, one for the telecommunications service as recommended by the Review Group, and one for the postal service. The decision to appoint an interim board for the postal service reflected the Government's concern that the postal service should be put in as favourable a position as the telecommunications service in tackling the challenges facing it.
Within three months of the decision to set them up, the two interim boards were appointed. As Deputies are, I am sure, aware, Mr. Fergal Quinn, Chairman and Managing Director, Superquinn Limited, is Chairman of An Bord Poist, and Mr. Michael Smurfit, Chairman and Chief Executive Officer, Smurfit Group Ltd., is Chairman of An Bord Telecom. They and the many other eminent people who agreed to act on the two boards have taken on formidable tasks. I am sure this House joins with me in wishing them every success.
It was considered desirable that, from the outset, there should be an input from the staff at board level. Two of the directors on each of the boards are persons nominated by recognised staff associations and unions. They are not, of course, appointed to the boards in a representative capacity.
The functions of the interim boards are to participate in the arrangements to reorganise the two services as separate State-sponsored bodies, formulate comprehensive and integrated plans for development of the services, and develop the management structures needed to exploit the new freedoms and opportunities which the reorganisation will provide. Up to now the boards have been engaged primarily in familiarising themselves with the two services and examining the problems and opportunities they offer. An Bord Telecom has selected a chief executive and I have approved his appointment. He is Mr. T. Byrnes, formerly Managing Director of IBM Ireland Ltd. An Bord Poist are still in the process of selecting their chief executive.
It would be unrealistic to expect quick results from the appointment of the two interim boards. Their research and the plans they formulate will be crucial to the success of the reorganisation of the postal and telecommunications services to which the Government are committed. The scale and complexity of this task which is unique in the history of the State should not be under-estimated. We are talking about moving roughly half of the civil service into the State-sponsored sector. At the same time an accelerated telecommunications development programme at a rate matched by very few telephone organisations must be pushed through and the postal service revitalised to enable it to survive and flourish in an increasingly competitive market.
Turning now to the Green Paper, I would like to stress that it is a discussion document. Basically it is about structures, about the form of organisation which would provide the most favourable environment for development of the postal and telecommunications services.
It is generally recognised that the structures, the form of organisation, the environment within an enterprise operates, can determine whether it will succeed or fail. The Posts and Telegraphs Review Group considered that the civil service is not a suitable type of organisation for the postal and telecommunications services both of which are large commercial type operations. In coming to this conclusion they did not intend to criticise the Department of Posts and Telegraphs or their staff. Indeed, they specifically said that the shortcomings and inefficiencies that they found were primarily structural and that they found the officials of the Department to be dedicated and able. They recommended that the postal and telecommunications services should be taken out of the civil service and set up as separate State-sponsored bodies. The Government agreed with this conclusion.
The Green Paper sets out proposals about how this might be done. I have sent a copy together with a personal message to each member of the staff of the Department. The Green Paper is intended to provide a basis for discussion and for consultation with staff unions and associations and other interested bodies.
When this consultative process has been completed, the Government will consider in depth the views and comments received. They will then make the necessary decisions on all relevant issues and publish these in a White Paper. Draft legislation providing for the setting up of the two State-sponsored bodies on the lines indicated in the White Paper will be introduced in the Oireachtas at the same time or as soon as possible afterwards.
I would like to be in a position to give Deputies a forecast of how long the reorganisation is likely to take. Unfortunately, this is not practicable at this stage. All I can say is that it took about three years from the date the decision was made to carry out somewhat similar reorganisations in the USA and Britain. However, in these two cases only one State-sponsored body was being set up; for the postal service in the USA and for both postal and telecommunications in-the case of Britain. I understand that the legislation dealing with the setting up of the British Post Office as an independent corporation took longer in its passage through Parliament than any previous piece of legislation. That is indicative of the task facing us.
I will, of course, welcome the views of Deputies on the Green Paper and the House may be assured that these views will be taken fully into account before the White Paper containing Government decisions has been issued. Meanwhile of course, the responsibility for the day to day affairs of the Department rests with me.
With the growth in the telephone network work will increase in volume for most grades in the service; technology in telecommunication is developing at an unprecedented rate and unless the structure of the service is flexible enough, it will be difficult to adapt and utilise this new technology; the expectation of the public not alone for a wider range of services but for ready availability and for high quality of service will grow.
To ensure that we are in a position to meet the expectations of the public in this regard I am at present considering possible approaches towards reorganisation of the Department in the interim period. This reorganisation would of course be undertaken in full consultation with the staff associations. I am considering appointing district managers and second line district management to whom certain responsibilities for administration of their respective areas could be devolved.
I am considering the feasibility of appointing district managers, who could have full responsibility for day to day administration within their districts and who could also have responsibility for budgetary matters having regard to the overall budgetary position in the Department. This approach to reorganisation, I would hope, would enable the Department to respond quickly to consumer needs.
I should like to mention, just very briefly, some of the computerisation developments within my own Department. It is expanding its use of computers in areas where this can clearly lead to greater efficiency. Several large blocks of clerical work have been converted to computer processing over the past five years, including: savings bank accounting, national instalment savings, investment and index linked bonds, payroll, telex and telephone accounting and billing work. At the moment computerised systems are being developed for stores accounting and general Post Office accounting work which will be implemented over the next couple of years. A new system of processing operator assisted trunk call tickets by the use of optical character recognition equipment has been developed and will begin implementation shortly.
A new computer system for handling the maintenance of Telephone Directory information and for providing a much-improved directory inquiries service will be installed in the latter half of this year. Development of a computer system to handle television licence recording is under way at present, and it is hoped to begin implementation of the system on a phased basis during 1981.
A major study of the practicability of developing an integrated telecommunications information system has just been completed, and work has commenced on the development of the first stage of this system.
In 1979 there was an estimated shortfall of about £700,000 in net TV licence fee receipts due to the postal strike. It is hoped to collect the greater part of this sum in 1980 in addition to what would normally be collected, and the provision of £18 million in RTE's ordinary grant for 1980 has been calculated accordingly.
A nationwide campaign to tackle the problem of television licence evasion was conducted recently. The campaign was quite successful. More than 36,000 unlicensed or incorrectly licensed television sets were detected and sales of television licences during the campaign were almost double the normal level. Despite the good results achieved during the campaign I am satisfied that there are still people in possession of unlicensed or incorrectly licensed sets. My Department will continue to do everything in their power to remedy this situation.
Under subhead L.2 provision is being made for a grant-in-aid of £495,000 to RTE equivalent to net receipts from licence fees on cable television systems.
The Broadcasting Authority (Amendment) Act, 1979, which was passed in December 1979, provided for an increase of £10 million to £25 million in repayable advances that the Minister for Finance may make to RTE for capital purposes. The previous limit of £15 million was exhausted earlier in 1979.
RTE's capital programme for 1980 amounts to £5.667 million, of which £2 million will be financed by Exchequer advances. The 1980 programme provides for expenditure on production facilities for RTE 1 and RTE 2, the improvement of television reception in various parts of the country and other general broadcasting works.
RTE's report and annual accounts for the year ended 30 September 1978 recorded a surplus of some £1.23 million. I am informed that RTE's accounts for the year ended 30 September 1979 will indicate a deficit of about £0.5 million. This is due in part to the fact that (1) because of the low television licence sales during the strike the grant paid to RTE during the first nine months of 1979 was less than normal and (2) additional expense over and above planned expenditure arose from the unanticipated need for extensive radio and television coverage of the Papal visit.
This return to a deficit situation is regrettable. RTE have applied for an increase in licence fees and this is being examined in my Department. This application will require very careful consideration particularly as this year's budget strategy was based primarily on curtailment of growth in public expenditure.
The past 18 months have seen an unprecedented expansion in RTE broadcasting services. RTE 2 television, which was inaugurated in November 1978, is available to approximately 90 per cent of the population. I expect that RTE will be devoting a considerable amount of effort this year and for the next few years to extending coverage to those areas of the country where it is less than satisfactory or not available at all at present.
On the radio side the second national radio service, Radio 2, has been in operation for 12 months. There has also been an extension in the hours of broadcasting of Radio 1 and Radio na Galetachta. Deputies will be well aware that the establishment of the second radio service has given rise to certain problems. Radio broadcasting transmitters operate on frequencies and at powers agreed internationally. This country has sufficient VHF frequency assignments for two national radio networks. Prior to the advent of Radio 2 the national radio service was broadcast on VHF as well as on medium wave from the high power station at Tullamore and from low power stations in Dublin and Cork. The second VHF network was used by Radio na Gaeltachta. RTE decided to allocate the VHF network formerly allocated to the national radio service to Radio 2 and to provide Radio 1 VHF transmissions on the Radio na Gaeltachta network when Radio na Gaeltachta is not broadcasting.
This decision has drawn much criticism. It has meant that in parts of the country satisfactory reception of Radio 1 is no longer available at certain times of the day because medium wave reception from Tullamore is subject to interference from foreign medium wave stations. It is unlikely that international agreement can be secured for the use of a new set of VHF frequencies for a third national VHF network before 1985. Accordingly, any early solution to this problem will have to be found within the framework of RTE's existing frequency allocations.
I would like briefly to mention future broadcasting developments. In recognition of the demand for independent local community radio the Government decided last year to proceed with the preparation of new legislation to provide for the establishment of an independent local radio Authority. I expect that the necessary legislation will be circulated to Deputies before the end of the current session.
The Broadcasting and Wireless Telegraphy Bill, 1979, the primary purpose of which is to give my Department stronger powers to suppress illegal broadcasting stations, was circulated some time ago. It is not proposed to debate this Bill until after the enactment of the Independent Local Radio Authority Bill.
Finally, I would like to say a few words about citizens band radio. Deputies will be aware of my statement in the Dáil on 20 March 1980 in which I indicated that I was sympathetic to the idea of citizens band radio provided unacceptable interference is not caused to other users of the radio spectrum. My Department's investigations to date show that one of the main concerns of every country where citizens band radio on 27 MHz has been licensed is the interference problem it creates.
At the recent meeting of the CEPT Radiocommunications Group in Palermo the question of authorising a form of personal radio service in the small part of the 862-960 MHz band was considered. European administrators took the view that the 27 MHz band is unsuitable for a CB Radio Service which is intended for short distance communication only and that as the United States Federal Communications Commission and the Canadian Department of Communications have expressed an interest in the use of CB Radio in the 862-960 MHz band it would be desirable if worldwide agreement could be obtained on a common part of the spectrum and on harmonisation of equipment specifications and licensing conditions. The preliminary views of certain CEPT countries were that combined 27 MHz/900 MHz equipment should be prohibited; 900 MHz equipment should be used for short distance communication only and that 27 MHz equipment should be phased out over a period of not less than ten years from the introduction of 900 MHz CB equipment. My Department are about to carry out extensive tests using various types of equipment so that a recommendation based on practical experience can be made to me on the matter.
European countries are actively pursuing the question of authorising a different slot of the frequency spectrum for this service. I have not taken a final decision on the frequency band to be used here. However, it is obvious that there will be difficulties in arriving at a decision, given the developing European attitude. In the light of the foregoing I would sound a note of warning. The recent upsurge in advertising for citizens band equipment of a type which is not generally licensed elsewhere in Europe is causing me concern. I can say at this stage that it is most unlikely that much of the equipment being advertised will be licensed here even if it is decided to go for the 27 MHz band. Therefore, I would advise all concerned to be patient. I will be licensing a form of personal radio service but I hope that the service I license will meet the wishes of people genuinely interested in such a service as well as affording protection to other users of the radio frequency spectrum.
Before I conclude my speech there are some points which Opposition Deputies asked me to cover when we were discussing Post Office charges recently.
Deputy Enright wanted information on how the £650 million which is to be spent on the five-year accelerated Telephone Development Programme affects the Department's financial position. The £650 million will be drawn on as required and £100 million is being provided this year. Under the Telephone Capital Acts, the Minister for Finance is authorised to make advances out of the Central Fund for telephone development and to borrow for that purpose. All advances made for telephone development are repaid with interest to the Central Fund by annuities extending over a period of 25 years and provision for these annuities is made under subhead G of my Department's Estimate.
In addition to the ordinary annual Estimates and Appropriation Accounts, which are prepared by all Government Departments and are on a receipts and payments basis, my Department prepare commercial accounts which set out their position as a trading concern. These are used to determine financial policy including the fixing of charges for the various Post Office services. The commercial accounts show expenditure incurred and income due. Part of the expenditure consists of depreciation and interest on capital invested in the services. These provisions naturally go up according as more and more money is invested under the accelerated Telephone Development Programme and, therefore, they affect the size of the surplus or deficit on the Department's services.
Deputy Deasy said that the increase from £60 to £100 in the connection charge for a telephone would be hard on old age pensioners and asked that it should not apply to them. While I can sympathise with old age pensioners in this matter, any question of subsidising them further would be a matter for the Department of Social Welfare who already pay my Department the appropriate rental in every case where a pensioner benefits under the free telephone rental scheme.
Deputy Deasy maintained that it should be possible to have a new charge for local calls from coinboxes between 5p and 10p sinces there are 1p and 2p slots in coinboxes. I can assure him that it would be very difficult to arrange for a charge between 5p and 10p. In fact, that is the reason why this particular charge was not increased last year when other telephone charges were increased by 20 per cent.
Most coinboxes can take 2p coins and some can take 1p also, but these slots are used only for trunk calls where the operator can check on the coins inserted. The mechanism of the coinboxes would have to be adjusted extensively to accept 1p or 2p coins for a local call dialled automatically. All 30,000 or so coin-boxes would have to be altered. This would be a major and time-consuming task and it is doubtful from tests carried out if the coinbox mechanisms could be adjusted in a way which would discriminate effectively between certain combinations of coins other than 5p coins.
