Timmy Dooley (Clare, Fianna Fail)
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1. To ask the Minister for Transport, Tourism and Sport the actions he has planned to ensure that Bus Éireann, Iarnród Éireann and Bus Átha Cliath have a viable future; and if he will make a statement on the matter. [23304/13]

Dessie Ellis (Dublin North West, Sinn Fein)
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2. To ask the Minister for Transport, Tourism and Sport the efforts he is making to work with CIÉ and its subsidiaries to develop a plan to ensure adequate funding for public transport services into the long term avoiding further run down of service and protecting the pay and conditions of ordinary workers. [23296/13]

Leo Varadkar (Dublin West, Fine Gael)
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I propose to take Questions Nos. 1 and 2 together.

These questions are about the viability of the CIE group. In the three years from 2009 to 2011, CIE as a group suffered a total loss of €137 million after exceptional items. Clearly, this level of loss cannot be sustained and must be addressed. While progress has been made over recent years in reducing costs and headcount, these reductions have not been sufficient to eliminate the deficits in the operating companies.

While additional funding of €36 million was provided by the Government to CIE last year to ensure companies could continue to operate public service obligation, PSO, services for the rest of 2012, the funds are not available to do so again. Instead, the board of CIE is pursuing a range of measures such as the sale of non-core assets and reductions in cost base, including payroll reductions. At the end of 2012, a significant voluntary severance programme was implemented in Irish Rail and the group generated cash of €20 million by selling its interest in the ground lease in Spencer Dock. CIE will also benefit from the introduction of a fuel rebate in July and, in addition, the group has benefitted from fare increases approved by the NTA. The group is also in negotiation with its banks on refinancing and I understand these discussions are progressing well.

Any refinancing will rely upon the delivery and implementation of a credible business plan. CIE has undertaken a rigorous business planning process with the aim of returning to a break-even position and achieving a sustainable debt. The implementation of a credible business plan will be essential to CIE's financial recovery in the period ahead.

In addition to PSO subvention, the Exchequer also makes a very substantial contribution to the companies' capital costs. Despite the constraints on the Exchequer, capital funding of more than €440 million has been provided to all three companies in the past two years and continued investment in the region of €170 million has been allocated for 2013. The objective of this investment is to get a better return from the existing public transport network through targeted improvements, better use of existing resources and the use of modern technology to make public transport more responsive and user-friendly.

I am conscious that I am addressing these questions at a time when Bus Éireann is engaged in critical negotiations with its staff. Management and staff in all of the CIE companies must continue to focus on cutting costs, which can help to address the serious financial position in which the CIE group finds itself.

In contrast to some of the rhetoric we have heard in recent days, it is important to remember that neither party opposite in its pre-budget submission proposed any changes to the level of subvention for public transport. Fianna Fáil’s pre-budget submission went further and proposed to reduce funding for the free travel programme by 5% in 2013. If this proposal had been implemented, it would have resulted in a further reduction in funding to CIE of more than €3 million and in particular would have cost Bus Éireann approximately €1.6 million. Given the party’s desire to represent constructive opposition, Deputy Dooley may wish to enlighten the House as to how he expected the CIE group, and Bus Éireann in particular, to bear the additional cost reduction he proposed.

Timmy Dooley (Clare, Fianna Fail)
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I thank the Minister for his clarification and outline. The Minister was given an opportunity, through the questions posed by Deputy Ellis and me, to enlighten us as to what efforts he is making to examine the provision of an adequate and appropriate public transport service, but he has failed to do so. We are well aware of Fine Gael's position on this matter. In the past the Minister has expressed a desire to see a greater level of involvement from the private sector and perhaps he has a view on privatising the service. Under questioning from me in the past he indicated that while this may have been the Fine Gael position, he accepted the fact that he was in government with the Labour Party. I am delighted his colleague from that party is also present. Perhaps he will be able to enlighten us further as to the Labour Party's stance on the maintenance of an adequate and appropriate interconnected transport service.

Ann Phelan (Carlow-Kilkenny, Labour)
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I thank the Deputy.

Timmy Dooley (Clare, Fianna Fail)
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May I conclude?

Ann Phelan (Carlow-Kilkenny, Labour)
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You are over time.

Timmy Dooley (Clare, Fianna Fail)
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Will the Government put in place a strategic review of the entire transport network to ensure all regions of the State are adequately connected by way of a public transport service? The Minister is aware that private operators provide a level of inter-city service, but county towns are an integral part of our country and their bus services need to be maintained.

For clarification, how are we on time?

Ann Phelan (Carlow-Kilkenny, Labour)
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You are well over time.

Timmy Dooley (Clare, Fianna Fail)
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I thought because questions were being shared-----

Ann Phelan (Carlow-Kilkenny, Labour)
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You have one minute.

Timmy Dooley (Clare, Fianna Fail)
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Does the Government intend to conduct a strategic review of the transport network to ensure the appropriate level of subvention is provided to maintain a properly connected integrated transport service? I will deal with the political issues at another time when the Minister has time, and I will outline Fianna Fáil's position. The Minister must that accept when the fundamental facts change, as they have with regard to the reduction in the level of fare intake, the matter must be reviewed, and we will happily do so as part of the-----

Ann Phelan (Carlow-Kilkenny, Labour)
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The Deputy will have another chance to speak.

Leo Varadkar (Dublin West, Fine Gael)
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Lest there be any confusion, it is not Government policy to privatise any of the CIE companies; nor was it proposed to do so by my party in opposition. The issue of allowing more private licences for bus operators is a different one, but is not pertinent at present. It is something to be considered in due course.

I have no difficulty with doing a strategic review, but Deputy Dooley knows as well as I do that such things take many years. What we need to do now is to deal with the public transport system as we find it. We are engaging in reform of rural transport, led by the Minister of State, Deputy Kelly; reform of the taxi sector; capital investment in projects such as the Luas link-up; and investment in integrated ticketing and real time passenger information to improve the quality of public transport.

It is not all about subvention and it is important that people know the facts. Last year Bus Éireann's subvention was €36.882 million. In 2007, at the peak of the boom, when Deputy Dooley's party was in power, the subvention was €36.595 million. The subvention for Bus Éireann last year was higher than it was in 2007 when the economy was at its peak. We must bear in mind that since then the Government has been put under major pressure to reduce spending, and this must happen. There must be a mix of measures, including more efficient services, lower costs and, unfortunately, higher fares and a lower subvention.

Ann Phelan (Carlow-Kilkenny, Labour)
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For clarification, only one minute is allowed for supplementary questions.

Dessie Ellis (Dublin North West, Sinn Fein)
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I thank the Minister for his response. It is important to point out that the cut to the subsidy last year was approximately €5 million. The cost-cutting measures being sought in the company at present are to the value of approximately €5 million. Our subvention is one of the lowest in Europe and I do not understand what the Department has done in the negotiations with Dublin Bus.

Has the Minister been involved? Has he made a proper analysis of the cuts and the effects they will have on services? We have already seen some of those effects. In addition, Bus Éireann ticket prices have risen, which is defeating the purpose. The idea is to try to get more people to use Bus Éireann and thus increase passenger numbers in that service. The Minister, however, is deterring people from doing so. Is that his policy? He is driving a privatisation agenda instead of working on behalf of a service that is there for people, young and old, including the disabled. Is it all about profit? We cannot work everything on the basis that it will, and must, be profitable. The State has to take a hit in some way.

Leo Varadkar (Dublin West, Fine Gael)
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I remind the Deputy that while Sinn Féin's alternative budget did propose additional funding in a number of areas, it did not propose any additional funding for public transport. I can only conclude from that, therefore, that the Deputy supports the levels of subvention that the Government is currently giving to the CIE companies.

If a privatisation agenda is being pursued by this Government, we would not be trying to save these companies. There is no privatisation agenda here. We are trying to save these companies so that passengers can continue to rely on the services they provide and so people who work hard in those companies for modest wages can keep their jobs. We do not want these companies to fail. Even if one wanted the private sector to take over, it would not be possible; it does not have the capacity to do it. The Government's policy is to try to save these companies' services and jobs.

It is important to keep the subvention issue in context, so I will give two sets of figures. The subvention Bus Éireann will get this year is just over €34 million. It was €36.5 million in 2007 and €26.4 million in 2006 when the economy was roaring ahead. At the peak of the boom, the company was receiving a lower subvention that it does now.

The same applies to Dublin Bus. Its subvention last year was €74 million, but was only €69 million in 2006.

Timmy Dooley (Clare, Fianna Fail)
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The Minister is making a big play of the fact that the subvention was lower when times were better. He also said that other Opposition parties did not allow for a greater level of subvention. When the fundamentals of the company's viability changed on the Minister's watch last year, he was required to reallocate €35 million from other areas of his Department. It is clear that, at the outset, the Minister did not know the group of companies was going to run into the difficulty it did at the end of 2012. Is the Minister suggesting that the Opposition should have a greater knowledge than he does? The facts changed during the course of last year with a reduction in usage and therefore a drop in fares' intake. Of course, the Minister had to look at what sort of service he wanted and he provided the appropriate funding at a later stage. I welcomed that at the time. However, I still believe that a strategic review is needed to decide what kind of national service he intends to have.

The Minister will also have to review the licensing issue. If he brings in more private services, they will have a greater impact on the ability of Bus Éireann to survive.

Dessie Ellis (Dublin North West, Sinn Fein)
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There are alternatives. There are people on higher pay in Bus Éireann and other companies, including the CEOs who are paid an awful amount. Something like €4 million extra is paid in fuel for Bus Éireann so what about the fuel rebate? We could look at those areas.

The chairman of Bus Éireann is sitting in Abu Dhabi and appears to be more dedicated to Etihad than to Bus Éireann. Does the Minister have an opinion on whether the chairman should be here in the middle of a crisis? Is he involved in the chairmanship of other boards? This is a farce. Some chairpersons are appointed to five or six different boards and are getting €15,000, €20,000 or €25,000. Was the Minister involved in this man's appointment? Does the Minister have an opinion as to why he has not taken the time to come here and deal with a very serious issue?

Leo Varadkar (Dublin West, Fine Gael)
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I really do not buy Deputy Dooley's point. His proposal to cut the free travel scheme and take another €3 million off CIE and over €1 million off Bus Éireann was made in December 2012, which was after the announcement that CIE was in serious financial trouble and required a bailout of €36 million. Therefore, even after the Deputy knew all that, and it had been in the newspapers - I know he reads the papers - he still proposed a further cut of €3 million in CIE and €1.5 million in Bus Éireann.

As regards Deputy Ellis's point, the fuel rebate is being reinstated in July, but it will only make a small difference. It will not make the big difference that people think it will.

Dessie Ellis (Dublin North West, Sinn Fein)
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Pencil it in.

Leo Varadkar (Dublin West, Fine Gael)
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We have to bear in mind that the money for a subvention comes from people's taxes. Taxes have gone up dramatically and people really cannot afford many more tax hikes. That is the truth of it. If the Deputy wants the subvention to go back up to record levels - even higher than in the boom - then one needs to have record taxes. People cannot afford very many more tax hikes, or fare hikes, imposed on them. That is what is happening. Taxpayers are paying higher taxes and passengers are paying higher fares. Cost savings are needed to mitigate that.

Dessie Ellis (Dublin North West, Sinn Fein)
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Will the Minister answer the question about the Bus Éireann chairman not being present in all of this?

Leo Varadkar (Dublin West, Fine Gael)
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I would be happy to.

Ann Phelan (Carlow-Kilkenny, Labour)
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We have to move on to the next question.

Dessie Ellis (Dublin North West, Sinn Fein)
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Can I get the Minister's answer on that point? I would like to know why the chairman has not come back in the middle of a crisis where people will lose €4,000 or €5,000 from their wages. That is what is being imposed on ordinary workers. As a matter of courtesy, we need to find out about the chairman.

Ann Phelan (Carlow-Kilkenny, Labour)
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Thank you, Deputy. We are now moving on to Question No. 4 because Deputy Donnelly, who has proposed Question No. 3, is not here.

Dessie Ellis (Dublin North West, Sinn Fein)
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For God's sake.