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Dáil Éireann díospóireacht -
Wednesday, 22 Oct 2003

Vol. 573 No. 1

Rail Services.

I thank the Ceann Comhairle for allowing me to raise the important matter of container freight services between Sligo and Dublin. Last Friday, the Sligo and north-west region was devastated by the news that Iarnród Éireann had decided to discontinue the provision of container freight services on the Sligo-Dublin railway line. It is incomprehensible how such a decision was made as the spatial strategy designated Sligo as the gateway of the north-west. A railway service to Sligo has existed for over 100 years.

In the past, there has been substantial under-investment in this line. However, both the previous and present Governments have rectified the trend and the first stage of upgrading of the line with the provision of a continuously welded rail track is almost complete. Yet the board of Iarnród Éireann has now made the ludicrous decision to discontinue the provision of a container freight service on the Sligo-Dublin line.

We are witnessing a significant increase in road traffic and a considerable component of that increase is due to lorries carrying containers. Apart from the increased wear and tear on the road surface, the risk of major accidents increases exponentially with such traffic. It does not require a genius to work out that transferring some of this container traffic to rail would result in a substantial saving on road surfaces and would also result in an increased level of road safety.

As a frequent traveller on this railway, I have witnessed at first hand the significant increase in the number of container lorries on the road. This is happening at a time when there is an excellent railway line running alongside the road. This railway line is lying unused for most of the day.

It surely makes sense for some of this road traffic to be transferred to the railway but in its misplaced wisdom, Iarnród Éireann has decided to cease the operation of container freight to Sligo at a time when all over Europe railways are investing in and expanding freight services.

It is becoming increasingly obvious that Iarnród Éireann is incapable of managing its freight service. There is a school of thought that believes the responsibility and development of rail freight should be removed from Iarnród Éireann and set up as a separate business. Railways must be allowed to compete and take some of the traffic back from the roads.

I suggest to the Minister of State that since it is apparent that Iarnród Éireann is unable or unwilling to develop its freight services, open access to a rail network might be considered. Competition is the life blood of commerce and both the Minister, Deputy Brennan, and this Government have demonstrated repeatedly the success of this philosophy. Iarnród Éireann has shown that it wishes to control the monopoly of rail usage but by its actions in depriving the north-west of container services, it seems determined to kill the railways. How can one have faith in this organisation when it decides on such a course of action?

Everyone in Sligo is angry and upset with this decision. Despite Iarnród Éireann's determination to abolish its freight business, the people of the north-west will not allow this to happen. We do not want our region to suffer either commercially or industrially because of the autocratic decisions of Iarnród Éireann. If it is allowed to persevere with this decision, it will make it harder for industry in Sligo to compete on the national stage.

I ask the Minister of State to demand a reversal of the appalling decision by Iarnród Éireann and to investigate the opening up of the railways to competition. I ask the rail regulator to ensure that safeguards are put in place so that no major infrastructure such as freight yards or potential land banks on railway-owned property are disposed of. Container rail freight between Sligo and Dublin must not only be continued but requires further development.

I thank the Deputy for raising this issue and giving me an opportunity to set out the present position regarding Irish Rail's plans for its freight business. Irish Rail is not exiting the rail freight business. The business strategy is to develop the profitable traffics such as bulk cement, mineral ore concentrates, sugar beet, pulpwood kegs and express parcels.

The collapse of Irish Fertilizer Industries in 2002 dealt a severe blow to the freight element of Irish Rail's operations. This traffic contributed significantly to this aspect of the company's bottom line. The company has indicated that it has now decided, from a business point of view, to shift the emphasis to point-to-point operation of unit load trains.

As I outlined recently, Irish Rail is currently in the process of reshaping its freight business to reduce the losses of recent years and focus the business more closely on customer needs. Due to the need for ready access from train to ship and vice versa, this will necessarily be concentrated around the existing facilities available to Irish Rail in the ports of Dublin, Cork and Bellevue in Waterford. In the north-west Irish Rail has significantly upgraded its freight handling capabilities at Ballina and it makes economic sense to exploit this asset as much as possible.

I am happy to note that as a result of the new approach being taken by Irish Rail, the company has already had some success in securing suitable traffic including the Coillte contract to transport raw timber from the western region of the country direct to Waterford for processing. Other similar types of traffic are being targeted for the future and the company believes it has a marketable service to offer. Among the initiatives being pursued are exploring the scope for joint ventures and private sector participation.

In pursuing this course of action, Irish Rail is confident that it can transform the business from a situation where it has lost €16 million in 2002 to one which turns a modest profit before exceptional items, by 2004. With regard to the specifics of the Deputy's concerns, Irish Rail has informed me that it is not withdrawing freight services from the Sligo to Dublin line. In order to improve the profitability of its freight business in the west of Ireland, it decided to rationalise its depot operations at Sligo and to move other operations onto the Dublin to Westport-Ballina line.

Only keg traffic will be withdrawn from the Sligo depot at the end of the year. This traffic is to be relocated to the Longford depot. Rail-based container traffic in Sligo has already been relocated to Ballina arising from the closures on the Sligo line occurring during the recent upgrade of track work.

The current Esso oil and pulpwood traffic will continue to be handled in Sligo. As a result of withdrawing the keg traffic, six staff will be offered redeployment or voluntary severance according to their preferences. In terms of the future of the Sligo depot, Irish Rail is confident that pulpwood traffic will double from early next year. The two trains per week for diesel and central heating oil are continuing.

Irish Rail is constantly looking at ways to improve the efficiency and competitiveness of its freight operating business as it believes it has a marketable service to offer to customers. Opportunities to develop its business through joint venture arrangements will continue to be pursued. Ultimately the company's financial strategy is to bring its freight business to viability within the shortest possible timeframe.

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