Martin Cullen (Waterford, Fianna Fail)

I propose to take Questions Nos. 1, 2 and 5 together.

The Government yesterday made a number of significant decisions that will provide a solid basis for expanded and improved bus services throughout the country over the coming years, while ensuring better value for money for both passengers and taxpayers.

In the case of the greater Dublin area, there is a requirement for an expansion of the number of buses providing scheduled services. This will require an increase in the total number of buses to approximately 1,800, under Transport 21, with a requirement for at least 200 extra buses over the next two years. The Government has decided to meet this initial requirement by providing up to €30 million immediately to enable Dublin Bus to buy 100 additional buses for delivery over the period 2006-07 and by mandating the proposed Dublin Transport Authority, DTA, to procure the additional 100 buses from the private sector to provide services on new routes.

The 100 buses procured from the private sector will form part of an initiative to facilitate the entry of new, private operators by awarding franchises to operate routes accounting for 15% exclusively to such operators by way of competitive tendering. Following this period, all new routes will be subject to a competitive tendering process open to all operators. The precise arrangements will be approved by Government on the basis of proposals from the DTA. This approach will encourage new investment and innovation in the Dublin bus passenger market.

In the interests of stability and integration of the bus network, the legislation establishing the DTA will allow the DTA to enter into a direct contract with Dublin Bus, in accordance with EU law, on the basis of its continuing to operate without a diminution in the size of its current bus fleet. The DTA will also enter into contracts with other operators in the Dublin market. All subvention payments, both to Dublin Bus and to new operators, will be made on an objective, transparent and even-handed basis to maximise value for public money.

The integrated nature of the Dublin bus market will be underpinned through the DTA having responsibility for traffic management strategy, which will prioritise public transport, and for integrated ticketing, fares and information systems. The DTA will also be empowered to organise the allocation of routes to operators in such a way as to maximise the prospect of efficient operation and the coherent development of the bus network. It will also be responsible for monitoring the quality and cost of services by all operators and ensuring value for money on all routes.

The Government has also decided to invest up to €50 million in Bus Éireann for the delivery of up to 160 buses in the period commencing in 2007 for non-commercial services outside of Dublin.

As part of the Government decision, new legislation will be brought forward to replace the Road Transport Act 1932 by a modern regulatory and licensing regime in line with commitments in the programme for Government. This will be designed in a manner consistent with EU law on public service obligations and State aids and in such a way as to create new opportunities and a level playing field for private operator involvement in the bus market.

The combination of immediate investment in new bus capacity and structural reform to introduce competition and enhance incentives for efficiency represents a balanced strategy to benefit bus passengers and taxpayers alike. It follows extensive consultation with interested parties and a study of mechanisms used internationally to achieve efficiency and effectiveness in bus markets. The Government's strategy will deliver immediate benefits and secure steady and continuing progress into the future.

The demand for bus services is set to grow substantially over the coming years. Ongoing economic, population and employment growth, the growth of urban areas and the significant role of bus-based public transport in a sustainable transport system will all drive growth in the bus market.

The Government's transport investment programme, Transport 21, has already recognised the critical role that an expanded bus service will have in meeting transport needs, including new and expanded feeder services to support a substantially expanded rail network. In total the programme provides approximately €770 million for upgrading bus services, with €530 million being provided for the greater Dublin area and €240 million for the rest of the country. The Government has now taken significant steps towards delivering on its commitment.

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