Ms Anne Graham:

I welcome this opportunity to address the committee on some recent developments in the provision of public bus passenger services. I am accompanied by Mr. Hugh Creegan, director of transport investment and taxi regulation at the National Transport Authority, NTA.

One the primary functions of the authority is to secure the provision of public bus passenger transport services across the State. Public bus passenger services are provided in three forms. The first relates to commercial public bus passenger services which are licensed by the authority under the Public Transport Regulation Act 2009. These services are not in receipt of a State subsidy but are available to the public. Examples include Bus Éireann Expressway services, Aircoach, Citilink, etc. It is important to note that commercial bus service variations are entirely at the discretion of the service provider. There is no legislative provision to enable the authority to refuse an amendment to services unless we consider the change will impact on other services locally. Second, public bus passenger services which have a public service obligation, PSO, are provided throughout Ireland under contract to the authority, primarily by Dublin Bus and Bus Éireann. These services are in receipt of a State subsidy. Third, public bus passenger services in rural areas are provided under the rural transport programme. Many of these services are demand-responsive services, that is, the route can be varied to pick up customers. These services are in receipt of a State subsidy.

In 2009, the authority entered into public service contracts which incorporate public service obligations with Bus Éireann. A further direct award contract was granted to Bus Éireann in 2014 for five years. The new contracts contain higher performance standards for the services supplied by each operator with regard to the reliability, punctuality and quality of services provided. The Act and the contracts allow for changes to be made to the contracts - unilaterally by the authority if necessary - to amend the specifics of the public service obligation network of services provided, the performance obligations specified and the reporting and monitoring arrangements. Any proposed changes by the operators to the services are subject to approval by the authority before they can be implemented.

The authority is now managing the rural transport programme on behalf of the Department of Transport, Tourism and Sport and is in contract with a large number of operators across the State providing transport services in remote rural areas. These services are managed by the transport co-ordination units across the country as the authority's agents. This allows the authority to examine all public bus passenger services together to ensure that the greatest coverage and efficiency is achieved across the country for the subsidies that are being paid for those services.

The authority has undertaken service reviews in a number of regions throughout the country and has implemented many changes in partnership with Bus Éireann. In the regional cities, these changes have resulted in growth in passenger numbers and revenue in Cork and Galway in particular. Further amendments have been made in Sligo and in the Dublin commuter belt with changes to PSO services in Kerry and Mayo being planned for implementation shortly

The licensing of commercial public bus passenger services is controlled by the Public Transport Regulation Act 2009 Act. These bus services are those that are available to members of the public on a commercial basis, that is, they do not receive any compensation from the State. The statutory guidelines for the licensing of public bus passenger services explain how bus licence applications and amendments will be handled and the criteria under which they will be assessed in order to serve the transport customer and enable competition within a structured framework. The guidelines are available on the authority’s website at www.nationaltransport.ie. Examples of commercially licensed bus services include those provided by Aircoach, Bus Éireann’s Expressway services, Citilink, Matthews and Swords Express among others.

The economic climate over the past number of years has been challenging for passenger transport companies generally as they have been experiencing falling passenger demand resulting in reduced revenues while simultaneously experiencing increases in costs. These conditions have begun to change with a better economic outlook, improved passenger journeys and a significant reduction in the price of oil now on the horizon. The improvement in road infrastructure between major towns and cities has had a variety of impacts. Car journey times between town and cities have fallen substantially and this has posed a challenge for the public transport alternatives. A number of operators have reacted by taking greater advantage of the improved road infrastructure to reduce their journey times and offer more direct services. This has resulted in a more attractive offer for end-to-end travellers. However, it has also meant that some operators have sought to withdraw from locations along the route so as to keep journey times short or because the level of demand at these locations is low.

The licensing system manages the commercial responses of operators to ensure that a more comprehensive and better public transport service is created for citizens through the issuing of licences alongside the contracted and subsidised services. This is achieved by examining services in an integrated timetable to maximise service coverage. There is nothing to prevent any licensed operator from applying to the authority to amend the times and-or routings of commercial services. Such amendments are considered in accordance with essentially the same criteria used for issuing licences. Bus Éireann’s branded Expressway services fall into this category. There is also nothing to prevent an operator from terminating a licensed service at any time for their own business reasons. However, where an amendment proposal relating to a commercial service would have no impact on any other commercial or subsidised service, the current legislative provisions require the authority to grant that service amendment even if it considers that it would adversely impact the area served. This reflects the fact that these licences are for commercial services where the operator is taking all the financial risk.

We are acutely aware of significant concerns at the loss of certain commercial services in rural towns and villages. In particular, the largest commercial operator, Bus Éireann, has sought and been granted amendments to its Expressway licences throughout the country and in particular on the route 5, Wexford-Dublin, and route 7, Cork-Clonmel-Dublin services. JJ Kavanagh through its Avalen and Kenneally companies has also sought and been granted amendments to its licences on the Waterford to Dublin corridor, which has resulted in a significant reduction in services in some towns along that route and some towns with no services.

The authority is now faced with finding some way to fill gaps in public transport at a time when the available subsidies may not be sufficient to meet the public need despite having stabilised this year after many years of reduction. We are actively examining the re-configuration of nearby PSO services and also the services provided under the rural transport programme as an in-fill option but these possibilities all have to be within the budgets that are available.

We will procure services if the gaps cannot be filled by reconfiguring existing subsidised services, subject to the funding being made available. Tender documents are being prepared in parallel to reduce the delivery time for any new services. A working group of representatives of all the communities affected along route 7 has been set up. The authority will actively engage with that group on any proposed replacement services. The replacement services for route 5 have been finalised and the local representatives will be briefed in the next week on those proposals.

The authority is obliged to complete a review of Part 2 of the Public Transport Regulation Act 2009 on the licensing of public bus passenger services and related guidelines this year. We will be seeking both the public and key stakeholders’ views prior to reporting to the Minister for Transport, Tourism and Sport.

The provision of public bus passenger services in a dynamic environment is challenging. The authority is best placed to review all existing services and to provide an integrated bus and rail services more effectively throughout the State. We remain committed to ensuring that State subsidies are deployed to optimal effect across the country to maintain as many services as possible and to plan for growth in those services.