Róisín Shortall (Dublin North West, Labour)
Link to this: Individually | In context

Question 5: To ask the Minister for Transport the way in which he proposes to open up the rail freight market to competition; his policy in relation to the subsidisation of rail freight operations; and if he will make a statement on the matter. [36251/05]

Martin Cullen (Waterford, Fianna Fail)
Link to this: Individually | In context

The rail freight market is to be opened to competition from 1 January 2006, in the case of international freight, and from 1 January 2007 for domestic freight operations. Liberalisation is in accordance with the terms of Directive 2004/51/EC on the development of the Community's railways. Significant progress has been made on the transposition of this directive and I will be finalising the matter in the coming weeks.

My Department has already transposed a number of EU directives as preliminary steps for the liberalisation of the rail freight market. These include mechanisms for the licensing of rail operators and the allocation and charging for track access. While no formal applications have yet been received for a railway undertaking licence or track access, my Department has received a communication from an operator stating its intention to establish itself as a freight operator in Ireland. I welcome this development.

In respect of the subsidisation of rail freight, my policy priority remains that additional Exchequer funding should be focused on the expansion of passenger services. For example, a significant additional subvention will be required to expand bus services in Dublin and provincial cities under Transport 21. Expanding public transport passenger services to address increasing travel times and relieving road congestion provides better value for Exchequer funds. However, I am open to considering proposals for interested parties on any innovative or new approaches to rail freight which offers value for money, where a real and tangible return on Exchequer investment can be demonstrated and which compares favourably with investment in passenger services.

Tommy Broughan (Dublin North East, Labour)
Link to this: Individually | In context

Is it a fact that the 2003 strategic rail review set out four policy options for the development of rail freight? Is it also the case that throughout the time the Minister has been in the Department he steadfastly refused to set out which of the policy options he favours? Is it also a fact that less than 2.5% of the country's freight is transported by rail, even though rail freight is four times cheaper in its overall impact on the economy than other modes of transport? The Minister has been lethargic in this area. He said that he wants to put resources into passenger rail transport but he has no plans for freight.

Is there a percentage target for rail freight transport in the future because it is time to take a proactive approach in this regard? The Minister said there is one expression of interest in this area. Given that Iarnród Éireann is the operator of the network — this refers to my Fine Gael colleague's comments on Dublin — how does the Minister see this operating? Is he considering the establishment of a transport regulator? Is this what Professor O'Mahony suggested? Is there a conflict of interest between the incumbent operator and any new operators?

How will charges for rail freight and the pricing framework be worked out under SI 643 on liberalisation? Will we end up in the same boat as bus licensing? The Minister said there has been an expression of interest in this issue. How can he avoid the danger of an operator getting a profitable piece of network or a slot in a busy network, selling his or her interest and making a pot of money and the operation ceases? The Minister of State, Deputy Callely, who represents the north side of Dublin will be aware of a major bus company which got valuable road space, disappeared off the network and no longer operates a transport service.

The Minister who has a grave responsibility to the House to provide a dynamic policy in this area has been incredibly lethargic. Up to now his policy has been a message in a bottle policy to the industry. He has not been proactive and he is not doing his job in this regard.

Martin Cullen (Waterford, Fianna Fail)
Link to this: Individually | In context

While the Deputy made a great speech, I am not sure what he asked me.

Tommy Broughan (Dublin North East, Labour)
Link to this: Individually | In context

I asked five difficult questions.

Martin Cullen (Waterford, Fianna Fail)
Link to this: Individually | In context

The Deputy misunderstands how rail freight operates. There is a problem in this country in this regard. In terms of freight going onto rail, it usually works over long distances carrying heavy bulk, which is not Ireland. This is part of the problem.

I will give the Deputy an example. In the past 12 months, a major shipping company persuaded Iarnród Éireann to put on extra rail journeys to carry a substantial amount of cargo to a port. In fairness to Iarnród Éireann, it decided that as it was a very innovative and excellent request it would provide the service in a cost-efficient manner. This was all said publicly by the private operator. However, the private operator had to admit that the project was an entire failure because the private sector companies were not interested. They could not persuade private sector companies to put their product on rail freight, even though Iarnród Éireann provided the service at great cost. We must not say that Iarnród Éireann has not been innovative in trying to provide new services.

Tommy Broughan (Dublin North East, Labour)
Link to this: Individually | In context

I am talking about the Minister.

Martin Cullen (Waterford, Fianna Fail)
Link to this: Individually | In context

By EU agreement and under law, the market is being deregulated. In 2006, the international services carriages will be deregulated, and from 2007, the Irish market will be deregulated. A significant player has already indicated that it is interested in entering the Irish market, which I welcome. My role is as a regulator. I would not like to have that role in the future, whereas Iarnród Éireann has control of the access to the hard infrastructure. This must be and is being worked out well in advance of deregulation.

I would be pleased to see an increasing amount of goods off roads and being transported on rail. However, it is not as simple as it is presented and international experience confirms this.