JOINT COMMITTEE ON TRANSPORT díospóireacht -
Wednesday, 11 Jan 2006

Scrutiny of EU Proposals.

Chairman

The first item on the agenda is the scrutiny of EU proposal COM (2005) 319 concerning new rules for the granting of subvention to public transport operators. The proposal was referred to this committee for further scrutiny by the Sub-Committee on European Scrutiny.

I welcome Mr. Dermot McCarthy, Ms Orla Corrigan and Mr. David Garland from the Department of Transport. I draw the witnesses attention to the fact that members of the committee have absolute privilege but that this same privilege does not apply to witnesses appearing before it. Members are also reminded of parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable. Members are also reminded that civil servants, while giving evidence to a committee, may not question or express an opinion on the merits of any Government policy or policy objectives or produce or send to a committee any document in which a civil servant, a member of the Defence Forces or a member of An Garda Síochána questions, or expresses an opinion on, the merits of any Government policy or policy objective.

An opening statement from the delegation has been circulated. The committee would appreciate if Mr. McCarthy could brief it on the proposal.

Mr. Dermot McCarthy

I wish to make a brief opening statement covering the background to this draft regulation, which has a long history, and raising some issues that will be discussed when the issue comes before a working group at the end of this month.

EU regulation of state support for the public transport sector dates back to 1960s and predates Ireland's accession to the Union. Two EU regulations, 1191/69 and 1107/70, set out the framework under which state support can be given to public transport. This framework essentially provides that it is only permissible to provide state support where a public transport operator is performing a public service obligation. A public service obligation is defined in EEC 1191/69 as an obligation which an operator, if it were considering its own commercial interests, would not assume or would not assume to the same extent or under the same conditions. State payments to public transport operators in accordance with the rules contained in these EU regulations are not subject to the requirement of prior notification to and authorisation by the EU Commission. Generally, payments of this nature are deemed to be state aid and require prior Commission authorisation.

This framework has remained largely unaltered in the past 35 years. In July 2000 the EU Commission published a draft regulation to put in place a new legal framework for state payments for public transport. The EU Commission argued that the new proposal was aimed at addressing legal uncertainties affecting the sector and establishing a more competitive regime, which would lead to more efficient and attractive services for passengers. The core principles of the EU Commission proposal in 2000 were: where state payments are made for public transport services or exclusive rights granted to operators it required public service contracts to be put in place between a competent authority acting on behalf of the state and an operator or operators responsible for providing such services; such contracts to be subject to renewal; and such contracts to be open to competitive tendering, except in specified circumstances such as to ensure the safety of railway operations or where the contract was below a certain financial threshold.

The EU Commission encountered significant opposition to the proposal at the Transport Council. The European Parliament tabled over 100 amendments. In mid-2002 the Transport Council agreed to suspend discussion of the draft regulation pending the outcome of the Altmark case, which was awaiting judgment in the European Court of Justice at the time. The Altmark case involved the grant of exclusive rights to a bus operator in Germany with associated public service payments. In July 2003 the European Court of Justice, ECJ, delivered its judgment in the Altmark case. It confirmed that payments to operators in accordance with the provisions of EEC regulations 1191/69 and 1107/70 did not constitute state aid. In addition, the ECJ set out four principles, compliance with which meant state payments did not constitute state aid and, as a consequence, did not require prior notification to and approval by the EU Commission.

The four Altmark principles are: the undertaking or recipient must actually have a public service obligation to perform and this obligation must be clearly defined; the parameters on the basis of which the compensation is calculated must be established beforehand in an objective and transparent manner; the compensation must not exceed what is necessary to cover all or part of the costs incurred in discharging the public service obligations, taking into account the relevant receipts and a reasonable profit for discharging those obligations; and where the undertaking which is to discharge public service obligations is not chosen in a public procurement procedure, the level of compensation needed has been determined on the basis of an analysis of the costs which a typical undertaking, well-run and adequately provided with means of transport so as to be able to meet the necessary public service requirements, would have incurred in discharging those obligations, taking into account the relevant receipts and a reasonable profit for discharging the obligations.

The EU Commission, having considered the Altmark judgment and reflected on the discussions — which took place during the period 2000-02 at the Transport Council — published a revised proposal in August 2005. The EU Commission argues that the existing EU regulatory framework for public transport no longer reflects the economic realities of the sector where significant competition has emerged since the early 1990s. The EU Commission has strongly supported such competition, arguing that it delivers increased passenger numbers and reduced costs. The EU Commission estimates that approximately 25% of the public transport market in the EU is now subject to regulated competition. In addition, the Commission has argued it is very difficult to verify compliance with the Altmark criteria. It has argued that a new regulation is still required to establish a transparent framework for the granting of compensation for public service obligations. It continues to argue that a new regulatory framework for public transport is required given the emergence of an EU-wide market for public transport provision.

The revised draft regulation represents a significant amendment from the original proposal of the EU Commission in 2000. The key elements of the revised proposal are: that state payments for the performance of public service obligations by transport operators may only be made in accordance with a contract; and that there are two ways of granting such a contract, namely, tender competition and direct award. A direct award contract can only be made in two circumstances, namely, for regional and long-distance rail services or where a local competent authority that does not have a national remit awards a contract for services within its own geographic area to an internal operator over which it exercises control, with control being essentially defined as ownership. There are two other minor criteria where a direct award contract can be offered, namely, where the contract is below a financial limit of €1 million or where a distance of fewer than 3,000 km is involved. These are very small contracts.

Other key elements of the revised proposal are that operators who have received a direct award contract will be prohibited from competing in tender competitions in other geographic locations, that contracts must clearly define the public service obligations with which an operator must comply and that contracts can be for a maximum of eight years in the case of bus and coach services and 15 years in the case of rail services.

Preliminary discussion on the draft regulation took place under the UK Presidency in 2005. The Presidency initially proposed that the draft regulation be taken together with the proposal under the third EU rail package on the liberalisation of international rail passenger services. However, given the complexity of the issues involved, member states sought separate consideration of the draft regulation. As such, only preliminary discussions have taken place on the proposal to date and these have tended to focus almost exclusively on its impact on the rail market.

The core concerns raised by member states to date relate to: the potential consequences in the different regulatory approach proposed for long distance regional rail services and urban local rail services; the fact that the draft regulation appears to make no provision for international public service obligation rail services, such as the Dublin-Belfast enterprise service; and that the maximum permissible length of contract for rail services might adversely impact on public private partnerships contracts involving investment in infrastructure, such as building a new rail line, as well as operating services as part of a design-build-operate contract.

The December 2005 Transport Council agreed a joint statement of the Transport Council and EU Commission under which the Council committed itself to finding political agreement on the draft regulation as soon as possible in 2006, with significant progress in the first six months of 2006. The work programme of the Transport Council for 2006 submitted by the incoming Austrian and Finnish Presidencies on 22 December 2005 states, "The Commission has adopted a proposal for revision of the regulation on public service obligations and depending on the state of play the presidencies will examine possibilities to work on the proposal."

In discussions to date, Ireland has supported the broad thrust of the proposal to increase the transparency of state payments for public transport. However, we have also indicated that we will seek amendments to the draft regulation. The latter would have potentially significant implications for the institutional arrangements relating to public transport in Ireland. As currently drafted, it reflects the institutional arrangements for public transport of the larger EU states where transport services are procured or operated by local authorities and we intend to seek an amendment to allow a national body grant a direct award contract. This does not undermine the fundamental principles of the draft regulation but would allow Ireland the flexibility to construct our institutional arrangements as appropriate to our circumstances. We have also supported the concerns in respect of the absence of a provision on subventing international rail services, public service obligations services and the maximum permissible duration for operating contracts.

The draft regulation is due for detailed discussion at working group level at the end of January under the auspices of the Austrian Presidency.

Chairman

I thank Mr. McCarthy. In the case of Ireland, does the reference to a competent authority acting on behalf of the State mean Iarnród Éireann and CIE?

Mr. McCarthy

It could be CIE but it might not be Iarnród Éireann. In continental European models, local authorities such as Transport for London or HUR in Copenhagen have responsibility for organising and procuring public transport but they might not directly operate transport services. These authorities controls entities which provide the services. The definition of a competent authority would apply to CIE. However, the term "local competent authority" clearly could not apply to CIE.

Chairman

Yes, however, I asked the question regarding the competent authority because Iarnród Éireann or CIE could tender for the work. They would receive payment, as is the case at present, from the State for carrying old age pensioners. They would not be independent bodies, as such, when it came to dealing with this.

Mr. McCarthy

There are two circumstances under which a procurement could take place. The competent authority may not necessarily be required to put the work out to tender. That is the essence of the fundamental change in the Commission's position since 2000. A competent authority can directly award a contract to an operator under its total control. If CIE came within the remit of a competent authority, that authority would not necessarily be required under this EU regulation to tender that work. However, if it chose to tender the work, other EU regulations requiring transparency and fairness in competition would come into play and some institutional reorganisation would have to occur within CIE to ensure fairness and transparency in the process.

Chairman

In certain parts of the country CIE operates in conjunction with private operators. If it does not allow the private operators the same relevant position regarding subsidy, it is unfair competition. Ulsterbus operates in parts of the country. Where would it stand vis-à-vis this situation if CIE, Iarnród Éireann or Bus Éireann were to be left in control of this?

Mr. McCarthy

There would be a number of different situations. This regulation only applies to where the State procures services, such as PSO payments. The expressway routes where Ulsterbus provides some services are commercial services and are not covered by the regulation. They are commercial services outside where the State makes a payment to an operator to provide——

Chairman

If that is the only service available to people in the area, is it unfair to those people if Ulsterbus does not receive the same subvention as that given to Bus Éireann?

Mr. McCarthy

That is almost a separate issue. If a service can be provided on a purely commercial basis to a locality under a licence or an international licensing regime, it is clearly not a PSO service. A PSO service can only be characterised as one which the State requires an operator to provide, which it could not provide on a commercial basis. The classic example used to describe PSO services is peak-hour services in Dublin. We introduced a huge number of additional services to carry people to and from work. A commercial operator having regard to its own commercial interests may not provide that level of service. We subsidise accordingly.

Rural services are also subsidised in circumstances where, if we did not provide a subsidy, no one would operate them. Even under this EU regulation there would be a problem with EU law under State aid if a situation existed where a commercial operator not in receipt of a subsidy operated side by side with a PSO operator in receipt of a subsidy. The problem that would arise is whether a PSO that cannot be provided by a commercial operator existed. This is only on the basis that a clearly defined PSO is placed on the operator.

Chairman

Yes, that is what I am getting around to discussing. I am referring to an area where services are provided by Ulsterbus and nothing similar is provided by Bus Éireann. Will that be subvented?

Mr. McCarthy

That would be a decision to be made by the competent authority or the State where it wanted to continue to subvent those particular services.

Chairman

Following from that, the competent authority will be the competitor.

Mr. McCarthy

No. Under the current definition, CIE could be assumed to be the competent authority. That is not to state that it would be the competent authority. If a decision were taken to make CIE the competent authority and tendering of services within the area took place as opposed to a direct award contract, various articles of the EU treaty regarding transparency and separation must come into play.

To take the Chairman's example, if Ulsterbus or a bus company operated by Dermot McCarthy provided services within an area and they were unhappy with the procurement process, the EU procurement rules would come into play. The competent authority would have to demonstrate that it had complied with all EU procurement rules regarding procuring that service. However, the only difference between this and the general EU procurement rules is that it envisages a situation where no tender competition would take place.

Chairman

That is where there is no tender competition.

Mr. McCarthy

Yes.

Chairman

Mr. McCarthy gave the example of Iarnród Éireann as the competent authority. We all know of the liaison between Iarnród Éireann and Bus Éireann. While they operate as separate companies, there is a close relationship between them. Is either of them capable of being a competent authority or should a totally independent authority be appointed?

Mr. McCarthy

There could be. That would be a decision for the State to make once the EU regulation was introduced. To answer the question, CIE could potentially fall within the definition of a competent authority contained in the draft regulation. If the State decided at the time, due to the issues raised by the Chairman, that it did not want to go down that route, it could establish its own independent regulator. As the Chairman knows, the Minister indicated his intention to examine the issue of independent regulation. There is nothing to stop us establishing an independent regulator. It is possible that CIE will fall within the definition as it stands. If it does so, it raises all of the issues mentioned by the Chairman regarding transparency, fairness and whether fair competition would take place under EU procurement rules.

Chairman

One can assume that a number of groups entirely independent from the State might be able to take on the role of a competent authority. Would they be allowed to tender for this position or will it be by closed selection? I can think of several groups that would be quite capable of fulfilling the role. Several business organisations within the country would be quite capable of doing so. How would one carry out a tendering process that would allow everyone a fair crack of the whip?

Mr. McCarthy

I do not know if one would tender the competent authority position. It is more envisaged that it would be an appointment by the State to independently regulate or supervise how public transport is organised. It returns to the issue I raised earlier that the continental European organisation of public transport is more reflected in the regulation. In most cases, the competent authority is the local authority, in some European countries it would be part of the equivalent of Dublin City Council.

Chairman

London Bus or something similar.

Mr. McCarthy

Yes, and that is more the scenario envisaged for this role. It is meant to be an authority appointed on behalf of the State to supervise the State's intervention in public transport to ensure fairness and transparency in how it is organised. The only difference under this is, for example, if Dublin City Council owned Dublin Bus, it would be allowed under those circumstances to give a direct award contract to Dublin Bus. If it did so, the issue of tendering would not arise.

Chairman

On point 9, the position of Ireland, Mr. McCarthy stated, "The draft regulation would have potentially significant implications for the institutional arrangements for public transport in Ireland". Does that return to the point we are discussing?

Mr. McCarthy

It is potentially wider than that because the draft regulation reflects the continental European model of public transport, where local authorities own public transport operators. Under the regulation in its current form, in Ireland one could not have a direct award contract to Dublin Bus, Iarnród Éireann or Bus Éireann in respect of local public transport services. It would have implications for the structure of Iarnród Éireann, for example, in terms of DART services as opposed to mainline rail services. Under those circumstances CIE or a regulator appointed at a national level on behalf of the State could not operate and give direct award contracts. Everything would have to be tendered. It would have a significant effect on institutional arrangements for us because we are a small country. Other small EU countries are organised on a different basis and it reflects more the local authority type structure. It would give rise to issues. Under the current structure of the regulation, a national body could only have a tender competition. There could be no direct award contracts.

Chairman

It would have to be tendered?

Mr. McCarthy

It would have to be tendered under the way it is awarded at the moment. Even if we were to establish a local competent authority, it would have to have direct control of the company, for example, Dublin City Council would have to own Dublin Bus. That is more reflective of local government structures in continental Europe, where the local authorities of certain cities, such as in Austria, own the bus companies. The proposed structure could have significant institutional implications. Our objection is that the principles which have been set out do not take account of the particular structures of smaller EU countries like Ireland. It allows flexibility to other member states but gives none whatsoever to us.

Deputy Shortall

It is certainly a complex area and it strikes me that unless significant amendments are made, we will end up with a very costly regime in this country. The issues Mr. McCarthy raised highlighted the centralised nature of Government and the weakness of local governments. I am concerned that many of the positive elements of public transport, especially in terms of bus services in Dublin and nationwide, will be lost through the strict enforcement of this proposal.

Can Mr. McCarthy explain how he defines a PSO? He referred to the decision of a transport company to put on more buses at peak times but that would not seem to be a PSO, insofar as buses are filled with paying passengers. I had in mind the under-utilised rural services required for social reasons or services for outlying housing estates in the greater Dublin area. There will never be private operators in these areas because they are not profitable and are sometimes dangerous. There are regular instances in my constituency and in other parts of Dublin where bus drivers are stoned by local youths. A private operator would pull out immediately in such circumstances, whereas Dublin Bus works with the Garda to deal with the situation because it has made a commitment on social grounds to maintain services in those communities. Is that not the real nature of the public service obligation?

What mechanism currently exists within the Department to measure the obligation? I presume the Department deals with global figures for Dublin Bus and Bus Éireann but how can these be brought down to the local level in order to make estimates of the level of subsidies for unprofitable elements of each route? If this is to go ahead, it could end up in extremely complex and costly regulation.

The difficulty with the idea of an independent regulator is that it would be likely to lead to the pursuit of a purely business model by the transport regulator. I note the Minister has plans to establish an independent regulator. While the people charged with that responsibility may be able to do the sums, they may not necessarily have expertise in terms of operating networks. At what point does somebody say that certain services are necessary, even if they are costly and who is to make the decision? Will a business model be introduced whereby unprofitable services are discontinued? That is my concern with regard to moving toward the kind of regulatory regime being discussed by the Minister. A strong public service ethos exists within the CIE companies. They meet with public representatives and local residents on a regular basis and, irrespective of the cost, are committed to providing services in rural and outlying urban areas. Is there not a danger this public service ethos will be lost?

Mr. McCarthy described the position Ireland is taking in terms of seeking to have a national body with power to grant awards rather than the local bodies currently proposed. How confident is he this approach will be acceptable? What kind of timescale does he envisage for the process and is it likely to be completed this year?

Mr. McCarthy

With regard to the PSO, the example I supplied was an illustration rather than the sole basis. The scenario described by the Deputy with regard to social services also potentially falls within a PSO.

Deputy Shortall

Can Mr. McCarthy explain how that would be a PSO?

Mr. McCarthy

The peak hour issue with the PSO is that a significant demand exists to move people in mornings and evenings, for example, in Dublin. As the demand is not as high during the day, buses may not be required in the same numbers. The classic example involves buses that run in the morning but do not necessarily do so during the day because they do not have passengers. The cost to the State of each peak hour bus in Dublin is €100,000 per annum in subventions. Clearly, a commercial operator, having regard to his or her own interests, would only put on buses which were potentially profitable during the day.

The other characteristics mentioned may also fall within a PSO. Fares can also be a PSO, in that they may be set at a non-commercial level. A variety of PSOs could exist, the essential definition being that if somebody was to have sole regard to commercial interests, he or she would not provide a service but, because it is of benefit to the State, we purchase it.

Deputy Shortall

Would Mr. McCarthy agree that the vast majority of current services fall within that category?

Mr. McCarthy

No, I did not say that.

Deputy Shortall

Would he say that?

Mr. McCarthy

There is a significant PSO on Dublin Bus, which is the reason it is paid a significant subvention. Dublin has a large peak hour capacity associated with shifting commuters in the morning and evening peaks and a significant excess capacity over the off-peak is provided by Dublin Bus in order to transport people in the morning and afternoon. That is a classic PSO.

A PSO also exists in Dublin in terms of providing all day and social services to certain communities, which might not be provided by a commercial operator. A combination of all those factors are at play and similar obligations apply to Bus Éireann in places such as Cork and Limerick, as well as in terms of rural community services.

The mechanism being used by the Department with regard to providing greater clarity to the payment of subventions consists of a memorandum of understanding which tries to explicitly identify what services are being purchased by the State from the three co-operating companies of CIE and what is being received for its payments. We have identified certain targets in respect of those PSOs and have asked the companies to meet them. That is an ongoing process. The PSO imposed on CIE, which is statutory under the Transport Act 1950 and Transport Act (Reorganisation of Córas Iompair Éireann) Act 1986, requires it to have regard to these social obligations. While the obligations may not necessarily be route specific, there are variety of ways by which they can be measured.

Although independent regulation is almost a policy issue, there are successful examples where business models were not closely followed and social obligations were met. TFL in London, for example, provides similar social services to Dublin's in terms of peak hour capacity and services to social communities. There are further examples in Scandinavian countries which demonstrate that such a system can be effective in terms of meeting PSOs.

With regard to my level of confidence that these objectives will be met, I will not know until the end of January. Two issues arise, the first being the position of other member states on this proposal. Given that discussions are only at a preliminary stage it is difficult to assess the potential reaction. When this was discussed previously there were strong divergent views among member states. Some were totally opposed to it and others did not think the previous proposal, which had been significantly amended, went far enough. We will not know how the draft regulation will be received or how successful we will be until the end of January when discussions start.

In the past the Commission has been amenable to the idea that small member states like ourselves are in a different position to the larger ones. As long as we do not undermine the fundamental principles underpinning the draft regulation the Commission tends to take our size into account and not impose something disproportionate in terms of its objective. I am hopeful we will be successful but until negotiations proceed it is extremely difficult to ascertain the position because the first discussion will be on whether the proposal is even viable, and it is open to question whether the Austrian and Finnish presidencies can get any purchase on it during 2006.

Senator Morrisey

This is a complex and very interesting area. Can Mr. McCarthy identify the PSO routes in Dublin or elsewhere? If there are such routes have they ever been the subject of a tendering process?

On the question of the subvention to CIE what guarantees can he give that there is no cross-subsidisation? He said it is difficult to be route-specific but private operators applying for a licence must be route-specific, because the Department sends their applications to Dublin Bus for advice on whether a route competes with one of its own or is a completely new one. That amounts to a route-specific approach. Considering the amount of money being given to Dublin Bus we are entitled to have transparency on the subject of routes.

Mr. McCarthy mentioned Bus Éireann services to Cork and Limerick. What guarantees can he give that there is no cross-subsidisation of the Dublin-Cork route by Bus Éireann given the fact that it now offers journeys for €10 or €12 to compete with Aircoach, as well as many other services that were not available before?

Mr. McCarthy

I will correct the point about licensing first. The Department does not send applications from private operators to Dublin Bus. The Department administers the provisions of the Road Transport Act 1932 as independently as a Department can. It has a statutory obligation to have regard to the public interest, which involves an adequacy of demand test, and makes its assessment as best it can on each individual application. It does not ask Dublin Bus to comment as to whether it is a good or bad application.

Senator Morrisey

What does Mr. McCarthy mean by "independently"? If the Department does not send applications to Dublin Bus does it discuss applications with Dublin Bus?

Mr. McCarthy

The Department does not discuss prior applications with the company. An application might be supported by local documentation from businesses or local people who state there is a need for a particular service. That would constitute evidence in its favour. The Department also sends officers out to certain routes to ascertain the demand and seeks supplementary information. An operator making an application for a business licence puts forward its business case and all the information to support its viability as a valuable commercial service to the State and the Department then makes an assessment. In the case of Dublin, which is a very dense network, it considers whether that need is already met or whether there would be head-to-head competition on a particular route which would not necessarily be in the interest of the consumer and may not be safe. The Department operates as independently as it can in the granting of licences and does not discuss applications with Dublin Bus prior to approval.

The PSO can be a variety of things. A classic PSO is fares control which applies to the entire network. The fares of Dublin Bus, Bus Éireann and Irish Rail are controlled by the Minister. The bus fare in Dublin might be much higher were it not for the control exercised by him. We also have significant peak hour capacity across the network. In its deliberations on the PSO in Dublin the Department has heretofore taken a network view of public transport rather than a route-specific view. The danger of a route-specific view is that operations start to disaggregate rapidly, particularly in an urban transport environment. The memoranda of understanding, MOUs, are an attempt to describe some of those things but it is a very complex area.

On cross-subsidisation, each of the CIE companies, in its annual report, makes a statement of compliance with the EU transparency directive which requires separate accounts for commercial and non-commercial services. That is a statement that commercial services, which in the case of Bus Éireann in Cork means expressway services as opposed to city services, operate almost on a stand-alone basis, and that there is no State cross-subsidisation. Bus Éireann has made the case that there is cross-subsidisation the other way, namely from commercial into PSO services, giving an advantage to the State which would otherwise not accrue.

Deputy Shortall

Could Mr McCarthy provide the joint committee with a separate note on the memoranda of understanding as we have not had any information on it? Does the fact that unprofitable routes are often subsidised by the few profitable ones not amount to cross-subsidisation at the taxpayers' expense? Does Mr. McCarthy accept that if bus services were operated on a purely business model, private operators would not come forward to provide services to the outlying parts of the city, especially where large numbers tend to have bus passes?

How and to what extent are the costs of the various services such as PSO broken down? It is difficult to see how the Department can carry out any costings.

Mr. McCarthy

Dublin Bus has indicated in the past that there are few, if any, profitable routes and that is because of peak hour demand. A route using ten buses might be profitable on its core services throughout the day, but if another ten buses are required in the morning and afternoon to meet demand, while no people are travelling during the day, it will make a significant loss. The Department, in dealing with Dublin Bus, has attempted to focus on the issue of peak hour demand and the type of supplementary services which it gets from Dublin Bus in meeting and responding to the demand. Much of the subvention which has been put in place in recent years has been a response to this issue. Under the national development plan, the expansion of bus services in Dublin has come at a cost in the increase in subvention. The memoranda of understanding have attempted to focus on the types of supplementary capacity received from Dublin Bus across the network, rather than being route-specific.

Chairman

Having considered this proposal, the joint committee wishes to be kept informed by the Department with regard to the proposal. Is that agreed? Agreed. The Joint Committee on Transport has now completed its consideration of EU proposal COM (2005) 319. In accordance with Standing Order 814, a report will be laid before both Houses of the Oireachtas and a copy of the report will be sent to the Joint Committee on European Affairs Sub-Committee on EU Scrutiny and the Department of Transport. On behalf of the joint committee I thank Mr. McCarthy, Ms Corrigan and Mr. Garland for attending and for their forthright answers to queries raised.

For the information of the committee, will the witnesses send a note regarding Iarnród Éireann, as queries have been raised relating to the company? These queries relate to the company's operation of its freight business. What is the procedure with regard to opportunities that may come about for the private sector to use Iarnród Éireann lines in providing freight services in future? The issue has been raised by members of this committee, and the witnesses may be able to detail the Departmental position.

Deputy Shortall

Is that issue more relevant to a separate regulation? We have received a briefing on it.

Chairman

Yes, it is a statutory instrument.

Deputy Shortall

Will we be going back to that issue?

Chairman

I hope we can get information before discussing it. We must discuss the issue with Iarnród Éireann as well as other parties. We received letters in the past week relating to withdrawal of freight services for cement, for example, in parts of the country. It is imperative we ensure that if Iarnród Éireann leaves the freight business, any opportunity for another operator should be made available.

The joint committee went into private session at 3.33 p.m. and adjourned at 3.35 p.m. sine die.