Hildegarde Naughton (Galway West, Fine Gael) | Oireachtas source

I thank the Chairman and the committee for this opportunity to present details of this Supplementary Estimate for the Department of Transport on behalf of the Minister, Deputy Eamon Ryan. The Supplementary Estimate is a substantive Estimate, voting additional funds to the Department. In total, €114.861 million in current expenditure will be allocated.

A shortfall is forecast in the public transport public service obligation, PSO. The potential shortfall is an issue that has been monitored carefully since the start of 2022. In March, an average fare discount of 20% was applied to public transport fares. The NewEra report, published on 5 May forecast a deficit including 20% discount and the introduction of the young adult card, of circa €154 million. Due to more rapid recovery in passenger numbers than forecast, which were partly spurred by the incentive of the discount, the forecast deficit has fallen. Some €9 million has been vired from savings in the aviation travel package and travel tour operator funds, to reduce the net requirement to €82.515 million.

As stated, passenger numbers have steadily recovered on most networks. However, the introduction of the discount, the 90-minute fare and the move of passenger traffic from cash fares to more competitive Leap card fares, mean that fare recovery patterns post-Covid are taking a different shape to pre-Covid patterns. In addition, €8 million will be allocated to PSO to support the roll-out of the young adult card to commercial bus operators, following its extension to this sector in September. This will assist in ensuring a level playing field in the bus operator market in the provision of discounts.

A total of €2 million will be allocated to rural transport services. The provision of emergency public transport services is mainly focused on improving connectivity for Ukrainian refugees housed in remote parts of Ireland. On 21 April 2022, the Minister for Transport announced that the Department of Transport and the NTA would be providing emergency public transport services to Ukrainian refugees housed in isolated locations across Ireland. This is being implemented via a three-pronged approach: acceleration of elements of the Connecting Ireland plan; additional services, routes and trips; and a once-off community transport fund, managed by the 15 LocalLink offices.

In March, the Government approved a licensed haulage emergency support scheme to assist the licensed haulage sector to address high fuel costs arising from the Ukraine crisis. Supports totalling €15.654 million were paid out through the scheme. It was a temporary, targeted measure for the licensed haulage sector, taking into account the sector’s national strategic importance in enabling a functioning economy. The Government recognised that fuel represents up to 40% of cost inputs for road haulage operators. The sector is highly exposed to fuel price fluctuations and is more limited than others in its ability to absorb such cost shocks. In that regard there is ongoing engagement on another haulier support scheme the details of which will be announced shortly.

An additional €1 million will be allocated to the Department’s driver licence and computer services division, based in Shannon, which manages the national vehicle driver file. This is to cover the increased cost of postal charges, banking charges, customised envelopes and licensing costs for the national vehicle driver file.

A total of €2.092 million will be allocated to address a matured liability arising from the 2021 liquidation of Stobart Air. Stobart Air contacted the Department on 12 June 2021 to advise that its plans to secure a new buyer had failed. This action resulted in Stobart Air commencing a process of voluntary liquidation. This had implications for the PSO contract, with PSO services on both the Donegal and Kerry routes immediately ceasing. A court order dated 5 July 2021 appointed liquidators for Stobart Air Unlimited Company. The Department engaged extensively with the liquidators in resolving the outstanding issues with the airline’s overdue audited accounts. These issues were finally resolved by the liquidators in quarter 2 of 2022 resulting in outstanding payments totalling €2.092 million being made by the Department to Stobart Air Unlimited Company during June and July 2022.

A total of €3.6 million will be allocated to the Coast Guard, the bulk of which relates to contractual and cost increases. Additional safety training costs were also incurred.

I am now happy to take any questions that the members may have.