Mr. Fintan Towey:

I will deal with the first issue raised, which is modal shift. The thrust of the Commission's approach in proposing these reforms is that there is enormous scope to drive greater efficiency in the provision of rail services and this is the basis on which rail can regain market share and stem the decline to which it has been subject for quite a long period. With regard to tendering specifically, in the material the Commission states significant efficiencies are to be gained through mandatory tendering and gives examples in Germany, Sweden and the Netherlands in particular of savings in state expenditure on public service contracts of approximately 20% to 30%. In its background analysis and impact assessment, the Commission has presented evidence that mandatory tendering drives efficiencies in the railway business.

I take the point made by the Deputy on the potential benefits of these reforms being reduced somewhat by virtue of the fact that Ireland is an island which does not have a rail link to the Community rail network. It is clear the major benefits to be obtained from these reforms will arise on the European mainland where there is a very extensive network and there are major opportunities to develop new services. The potential benefits are somewhat reduced for an isolated small network. I do not believe this means there are no benefits to be gained. The background to our decision to bring our derogation to an end was that there are benefits to be gained from the application of the European model.

With regard to access to rolling stock, very high fixed costs are associated with the infrastructure of the railway business and with the rolling stock. Accessing the market is only possible where new entrants are able to readily access rolling stock. In markets with more developed competitive structures, such as the UK, leasing companies exist from which railway rolling stock can be obtained by new entrants and competitors. This issue must be addressed in other member states where such structures do not exist. With regard to ownership of the rolling stock in Ireland, some of it is owned by Irish Rail. Some of the rolling stock which has been procured using Exchequer funds in recent years has been subject to a condition that ownership can revert to the State, although I cannot put specific figures on the proportion of the rolling stock to which these provisions apply.

The Deputy's final point on safeguards was more a comment than a question.