Vol. 551 No. 4
10 Mr. M. Higgins asked the Minister for Public Enterprise the financial penalties which can be imposed if the company awarded the contract to run Luas does not operate the service satisfactorily; and if she will make a statement on the matter. [10517/02]
The commercial contract for the operation of Luas is under negotiation at present between CGEA Connex, which is the preferred bidder, and the Railway Procurement Agency. Accordingly, it would be premature to make any comment in that regard.
It would have been the decent thing for the Chair to refuse the question. Is the Minister saying she cannot give information on this matter?
I have further information. Would the Deputy like to hear it?
Perhaps the Minister should have given it in the first place.
The contract for the operation of Luas provides for an operating fee and incentive bonuses for issues such as patronage etc. Deductions will be made from the fee payable to the operator if it fails to meet specific set standards. For example, if the level of cleanliness and service reliability is not up to the standard set in the contract, deductions can be made. In the event of continuous under-performance the contract will allow for the Railway Procurement Agency to terminate the contract.
How long will the contract be for and how many dirty trains would have to be put up with before it would be terminated? Is the Minister aware that the operator who is being granted the contract has a very mixed reputation in the areas where it is already operating? This has been well and publicly verified. Is the Minister concerned, as I am, that the Luas will be operated by something less than a top class operator?
I read, as did Deputies Stagg and Jim Higgins, various newspaper reports about Connex. Indeed, Deputy Higgins brought these reports to our attention. As this was prior to the contract being allocated I attributed these to a dirty tricks campaign by people who feared they would not get the contract. Since then, officials in my Department and in the Rail Procurement Agency have gone to London and Sweden to look at how Connex is doing business there. In parts of the UK the outcome is not very desirable but in those places the company did not take over a greenfield operation. In Sweden and another Nordic country the company's operations have received accolades. The reports on Connex are mixed, as Deputy Stagg says. I did not allocate the contract to Connex. That was done by an independent outside group.
(Mayo): I am glad the Minister followed up on the issue raised on the last occasion and checked out the company for herself. How many bidders were there for the service contract? Will she answer Deputy Stagg's question about the duration of the contract and when will we see Luas working?
There were 16 initial bidders for the contract. I remember this number very well and I recall Deputy Olivia Mitchell saying no one would bid for it. This number was whittled down to five and finally to one. The initial contract is for five years, to be renegotiated if matters are satisfactory. Luas will be operating by the end of 2003. I did not see another contract which was realised in the time originally planned for. I am glad the Deputy asked me that supplementary question.
Has the Minister any regrets about the fact that when she came to office five years ago she found a finished Luas project which was ready to go and then examined it to death? Does she agree that if she had not done so, the Tallaght—
This supplementary is outside the terms of the question.
I will be glad to answer it.
I am talking about Luas. Does the Minister agree that the Tallaght, Sandyford and Broadstone branches of the Luas could have been in operation and we could be constructing the airport line? Luas has been reduced to a minor line from Tallaght to St. Stephen's Green, with no connection.
No, there are three lines, A, B and C. Unfortunately, members of the Labour Party and Deputy Noonan continue to claim that the Tallaght line was ready to run. I intend to write to Deputy Noonan to explain to him that Deputies Lowry and Dukes held no public hearings on the project.
The Minister killed the project.
Public hearings under Mr. Justice O'Leary took a year and a half. No public hearings had been held when I came to office and I was glad to re-engage Mr. Justice O'Leary, a very good person. The project was not ready to roll. The Opposition proposed one line and I proposed three, but we can compare our lines on another occasion.
