Mr. Martin Nolan:

I will summarise my contribution. I was here in October when I gave a comprehensive briefing of the company’s financial position and an overview of the national coach and bus market.

I am happy to update the committee on those matters. Everyone will know that Bus Éireann not only provides a public service in provincial cities but also provides the school transport system and the inter-city commercial services. Last year we had more than 77 million passenger journeys across 6,300 routes in the State. In recent years, due to the efforts of all of our employees, we have improved our services, which has resulted in a high level of customer satisfaction and a return to growth in customer numbers. Our financial situation reflects the reduction in State funding, continued economic stagnation, increased fuel costs and growing inter-city competition. We recorded a loss of €6.2 million in 2012.

It is important to note that in 2009 the Government’s value for money report said that we were as efficient as our European counterparts. Since then our subvention has been reduced by 30%, passenger numbers have dropped by more than 20% and fuel costs have increased by €14 million. We have reacted to the situation by reducing our cost base by more than €35 million while managing to largely protect service levels. We are implementing a plan to save a further approximately €20 million, including our recent agreement with the trade unions. That will bring ongoing efficiencies which will result in us breaking even by the end of the year. Separately, we have also delivered more than €25 million in savings to the Department of Education and Skills on the school transport scheme. That has been reinvested largely in services, particularly for special needs.

We have seen improvements in Wi-Fi, and new vehicles on city, commuter and inter-city services. We have rolled out networks in the provincial cities, resulting in greater passenger usage, and introduced the RTPI in provincial cities. We started our Leap card journey in the greater Dublin area and we will roll it out to Cork. Our apps and social media are up and running and we also have a large loyalty scheme that offers regular discounts to encourage travel.

I will quickly go through the inter-city market. It is important to note there is no State funding in the inter-city market, which is subject to significant competition. The competitors operate a limited-stop service that bypasses locations served by Bus Éireann. In response, the company has had to continue to make changes on those routes to meet the demand from the majority of our inter-city customers for shorter journey times and a limited number of stops. We have kept commercial services going in many locations for many years despite the low levels of use, but given the economic situation in the country, the new motorway network and cherry-picking of the profitable element of routes by competitors, unfortunately, that is no longer possible in some cases. We are working with the NTA to offer alternatives but there is limited State funding available for such services.

As a result of the work outlined above, we are starting to see more and more people using our services. In 2012, overall passenger numbers were up. City usage was up 2% and inter-city customer numbers increased by 4%. So far this year the growth in customer numbers has continued. We will meet all performance targets for the NTA and we will also deliver on all of the value for money review findings for the school transport scheme.

There is no doubt the past few years have been challenging for the company, with reduced State funding, increased costs and greater competition. However, despite that, we have maintained as many services as possible, particularly in areas where there is no alternative for people. While we are still facing significant challenges, with our cost agreement now in place, a continued strong focus on reducing costs and increasing passenger numbers and greater commercial freedom to make the necessary changes on our inter-city services, the company is now in a much stronger position and its target is to come close to breaking even by the end of the year and returning to profitability in 2014.