P J Sheehan (Cork South West, Fine Gael)
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Question 87: To ask the Minister for Transport if he is satisfied that all State-funded transport operators are acting within the terms of their service agreements with his Department. [39978/08]

Noel Dempsey (Meath West, Fianna Fail)
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CIE and its subsidiary companies have a broad statutory mandate under the Transport Acts of 1958 and 1986 to provide a range of loss making but socially and economically necessary public service obligation, PSO, services. The compensation paid by the Exchequer to CIE in respect of these PSO services, €308.6 million in 2008, is administered through annual memoranda of understanding on service levels and targets between my Department and each of the CIE companies. The memoranda require the submission of quarterly reports to confirm compliance with the terms of the memoranda. These reports are subject to an independent review process. In addition, the annual report and accounts of CIE certify that the Exchequer grants paid to CIE are deployed in accordance with EU regulations governing state aid to transport undertakings.

If Dublin Bus or Bus Éireann wishes to initiate or alter a bus service the companies must give advance notice to my Department. Where proposed services by either company are deemed to be in competition with services that are the subject of a licence held by a private bus operator issued under the Road Transport Act 1932, Dublin Bus and Bus Éireann are required to obtain my consent under section 25 of the Transport Act 1958 before the services can be introduced.

I am satisfied that the CIE companies comply generally with the terms of the MOU and with the bus licensing requirements. Nevertheless, issues have arisen regarding competition with private sector operators in a number of areas. In this regard, the Competition Authority, the European Commission and my Department are investigating complaints against Dublin Bus and Bus Éireann. It would be premature at this stage to make determinations as to the outcome of these matters.

Funding is also provided for regional air services and rural transport services. I am satisfied that the recipients of this aid are acting within the terms of their service agreements.

Fergus O'Dowd (Louth, Fine Gael)
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The key point is that the Minister says he is satisfied generally. However, he is not completely satisfied. Private bus companies who were providing commuter services, such as Circle Line, have gone out of business because of what they claim to be unfair competition from Dublin Bus. There are serious issues in this area. One of the problems is that there is no transparency about the routes that are PSO and those that are not. The allegation is made, and I appreciate it is being investigated by the European Commission and the Competition Authority, that State funding is being used to keep a private bus operator from operating competitive services. That is unfair and unacceptable.

Noel Dempsey (Meath West, Fianna Fail)
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I agree with the Deputy, and I have made it clear since I took office, that any anti-competitive behaviour by Dublin Bus or Bus Éireann will be investigated and followed up by me. We have lived by that rule. I do not wish to comment specifically on any case because most of them are ongoing at present. However, I can assure the Deputy that where there is a PSO an audit is carried out on it.

Fergus O'Dowd (Louth, Fine Gael)
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We do not have the information. That is my point. We do not know what are the PSO routes. Would the Minister be happy to give us that information?

Noel Dempsey (Meath West, Fianna Fail)
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I do not think there is a difficulty with that; I will check for the Deputy and try to get that information to him.

Tommy Broughan (Dublin North East, Labour)
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Can the Minister report on the outcome of the case taken by Swords Express — I believe Digital Messenger Limited is the company name — against the Department, given that public money is involved? Second, why are we still waiting for legislation on this matter? There have been serious complaints from Swords Express, Circle Line, the Dublin tour bus operators and so forth to Deputies. My colleague Deputy O'Dowd asked about PSOs. We know, for example, that the nine o'clock bus to Finglas or the nine o'clock bus to Dundrum is the type of service that will in all probability have to be supported. Given this fact, why does the Minister not simply publish legislation, pass it through the Houses and move on to a playing pitch that everybody understands in terms of good standards of public transport?

Noel Dempsey (Meath West, Fianna Fail)
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I look forward to the Deputy's support for the legislation. I am not sure if he is advocating that the legislation should open up the Dublin bus market and other bus markets to everybody. That has not been——

Tommy Broughan (Dublin North East, Labour)
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I am not. I am asking the Minister to publish the rules for licensing.

Noel Dempsey (Meath West, Fianna Fail)
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——the case up to now; there has not been open competition. The Dublin Transport Authority Act allows for competition on any new PSO routes in the future. From 1 December next year, new PSO routes will be open to competition from the private sector as well as from Bus Éireann and Bus Átha Cliath. The legislation the Deputy asked about is the reform of the 1932 Act. The heads of the Bill are in circulation and will go to the Government shortly. I will bring that legislation forward as a matter of urgency.

Fergus O'Dowd (Louth, Fine Gael)
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Is it the case that a senior official in the Department of Transport when examining complaints on the matter formed the view that Dublin Bus was abusing its "dominant position", but the Minister has no real powers to deal with infringements by Dublin Bus, other State operators, or other organisations and cannot discipline such organisations?

Tommy Broughan (Dublin North East, Labour)
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The Minister did not answer my question about Swords Express. Is the Minister prepared to publish the report? I am a strong supporter of public transport, but why is the sector operating under an Act from 1932, at which time most of the country used bicycles and horses to get around? The situation is laughable and it is another indictment of the Minister and the Government.

Noel Dempsey (Meath West, Fianna Fail)
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I do not wish to repeat myself every time I answer questions in the House but, as the Deputy is aware, I am keen to table the necessary legislation. We introduced part of the required legislation, namely, the Dublin Transport Authority Bill 2008, with the co-operation of Opposition Members including Deputy Broughan. We are now concentrating on amending the Road Transport Act 1932 as quickly as possible. I expect to discuss this in the House early next year.

The case involving Swords Express was settled in the High Court on 28 October 2008. The principal element of the settlement provided for an inquiry created under section 25(2) of the Transport Act 1958 to deal with a decision to authorise rerouting of the 41X bus service in Swords. The inquiry will produce a report which will be submitted to me for final determination and this will be pursued within a defined timeframe. In addition, the High Court settlement allows the Department to give early consideration to outstanding applications for express bus services from Swords. We await a submission from Digital Messenger consultants, the receipt of which will trigger the inquiry.

Regarding Deputy O'Dowd's point about penalties, if a bus operator is in breach of the terms of its private bus operator's licence under the 1932 Act it is a matter for the Garda which is supposed to pursue the matter.

Fergus O'Dowd (Louth, Fine Gael)
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My question referred to Dublin Bus. The point is that the Minister has no powers to deal with the company.

Noel Dempsey (Meath West, Fianna Fail)
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The Minister has powers, which I used as recently as today, to direct Dublin Bus, Bus Éireann or any public company to desist from acting in a manner I regard as outside the terms of the licence.

Fergus O'Dowd (Louth, Fine Gael)
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What if the company does not desist?

Noel Dempsey (Meath West, Fianna Fail)
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I can impose a sanction by way of a reduction in the company's subvention and I intend to do that.