Ivor Callely (Dublin North Central, Fianna Fail)

I thank Deputy Boyle for raising this issue. Along with the Deputy, Deputy Cooper-Flynn has concerns regarding the freight business and she is concerned about the implications this has for industry in the Border, midlands and western region.

Deputy Boyle mentioned the rail service in Cork where Kent Station is located. As a Minister of State at the Department of Transport, I am delighted to inform the Deputy that we have good news for him about the refurbishment and redevelopment of Kent Station into which we are happy to invest a considerable amount of money. It is a station to which I frequently travel and I recognise the need for its redevelopment.

The Deputy mentioned the western rail corridor and Deputy Cooper-Flynn has also raised that issue with me. I hope we will have good news for her under the rolling out of our ten year investment strategy.

It is my policy that Iarnród Éireann should remain in the rail freight business and I am aware that it has made great strides in restructuring this element of its operations. The Strategic Rail Review, commissioned by my Department and published in 2003, contained a comprehensive examination of the rail freight business and its realistic potential to support economic development and contribute to a sustainable environment. Iarnród Éireann, in responding to the challenges contained in the review, held wide-ranging consultations with business interests throughout the country, including the west, to identify those freight activities which are best suited to rail transport. The company has developed a business plan based on a strategy with regard to freight which is to break even by 2006, increase the profitability of existing profitable business, withdraw from those businesses that are heavily loss-making and target trainload traffic.

Approximately 50% of the overall freight deficit incurred during 2004 was as a result of the transport of small numbers of containers per rail movement. To place matters in perspective, this business accounts for less than 10% of freight revenues.

Iarnród Éireann remains keen to provide economically viable container transport by rail on the basis of full trainloads, point-to-point. In this context, further effort is being made to reinstate a point-to-point Ballina to Waterford trainload service, which initially promised carryings of three trainloads per week but which has not operated since August 2004 owing to lack of available traffic.

The company has made significant progress in growing the rail freight business in areas where it holds a competitive advantage over road haulage. I support some of the comments made by Deputy Boyle in that regard. Investment has recently been approved for a wagon modification programme and delivery of a new railhead at Milford, County Carlow, in the context of an agreement to increase beet transportation by providing growers and Irish Sugar with extra services. Volumes will more than treble from the 2005 season onwards. An extra mineral ore train per day will commence for Tara Mines at the end of the year. Coillte pulpwood traffic remains buoyant with a year-on-year increase in volumes of pulpwood by rail from the north west to Waterford. Although some market pressure is growing in respect of Iarnród Éireann's keg distribution service, the company is committed to continuing to provide this service.

Iarnród Éireann continues to pursue a policy of growing its rail freight business where opportunities present. I hope there are Members who may be able to assist in some of those opportunities. However, as in all businesses, the company must adjust the freight business from time to time to reflect market realities. I support the position which has been conveyed by Department officials to Iarnród Éireann.

Since 1999, Iarnród Éireann has invested more than €1.5 billion in rebuilding the railways, with Government and EU support for the investment programme delivering improvements in new trains, upgraded infrastructure and customer facilities. While such investment has focused on improving passenger services, the investment in improving rail infrastructure also has a direct beneficial impact on freight activities. It remains the Department's priority that any additional Exchequer subvention should focus on expanding passenger services to meet the continuing unmet demand for such services in seeking to address the adverse social and economic impacts caused by traffic congestion.

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