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CENTRAL GOVERNMENT

Expenditure Cuts With Government finances in severe difficulties, the ‘Report of the Special Group on Public Service Numbers and Expenditure Programmes’ was published on 16 July. It recommended savings in Government expenditure of the order of €5.2bn. Transport expenditure reductions of €127m or 18% of total gross current expenditure were proposed. The report noted ‘The Exchequer current allocation to CIÉ for the provision of non-commercial public transport services (PSO payments) has already been reduced in 2009 by €10m (3%). This reduction is on the back of a number of years where the allocation was held level (a reduction in real terms) ... The Group is of the view that this cost-cutting programme can be more extensive and recommends that over the next three years the company focuses on reducing its annual operation costs of €1bn to allow it to pass on €55m in full year savings [annually] to the Exchequer by means of reduced PSO payments’.

‘The Group is concerned by the overall upward trend in the level of public service payments per passenger journey although it notes that Irish Rail has achieved a small reduction (Irish Rail still has the highest PSO payment per passenger journey of the three CIÉ transport companies). This indicates poor service delivery. Accordingly, the Group recommends a scheme of targeted reductions to services across all three CIÉ companies, focused in the first instance on off-peak, low patronage services’.

‘As part of this undertaking, the Department of Transport and CIÉ should jointly review the application of PSO payments to low patronage transport routes and explore how such payments can be best targeted/applied to provide the most economical service levels that meet customer needs and demand patterns. For example, lightly used rail lines should be closed and replacement bus services provided. It is more than likely that more regular and reliable bus services could be provided on such corridors at less cost to the Exchequer. Among the most lightly used rail lines that should be examined in this light include:

	- Limerick Junction to Rosslare
	- Limerick to Ballybrophy;
	- Manulla Junction to Ballina.

In addition, the Group recommends that there should be no further development of the Western Rail Corridor’.

The Group also recommended:

‘1. Consider creating a single transport safety body. At present the transport safety remit is spread across several bodies organised, broadly, on a sectoral basis: the Road Safety Authority, the Railway Safety Commission, the Maritime Safety Directorate, and the Irish Aviation Authority. While the different bodies operate in distinct transport fields, the work of these agencies has several common themes including risk analysis/risk management, safety inspectorates, safety licensing/authorisations, development of national and EU standards’.

‘Consequently, the Group considers that the creation of a single transport safety body comprising existing separate bodies should be examined’.

‘2. Merge the Railway Procurement Agency and the National Roads Authority. These two State agencies are responsible for delivering major transport infrastructure projects, some of them on a Public Private Partnership (PPP) basis. It is clear that there is a significant level of overlap in terms of the type of service they deliver for the State and the skills and experience of the staff - capital project management, procurement processes, PPP’s, contract management. Merging these two bodies will create a single entity responsible for the procurement of all major network infrastructure in rail and national roads. In addition to pooling of expertise in areas like project delivery, archaeology, PPP’s, the merger of these agencies should also yield savings in support areas e.g. finance, corporate services. A minimum saving of €3m should be targeted on this basis. This should generate a reduction of 30 in staffing levels for the new organisation’.

Reaction to Proposed Cuts The Irish Exporters Association (IEA) said that ‘major Irish-based employers’ such as Coca-Cola, CRH and Coillte look set to be hit by rising transport costs if the proposal to shut three "lightly used" railway lines is implemented ‘especially as oil prices increase, because road-freight prices are more susceptible to fluctuations than railfreight ones ... Another issue is that many of these companies produce high-value products, which can't stand up to a battering from Irish roads. If they couldn't use rail, they would have to spend significantly more on extra packaging to avoid damage to those products.’ The IEA is now lobbying the government to retain the railway lines, arguing their closure will threaten future multinational investment in the western region. The three lines under threat each carry freight for at least one major employer.

Ballina Chamber of Commerce also invited one of the town’s biggest industries, Ballina Beverages, a Coca Cola subsidiary, to assist it in making a submission on the recommendations. The Chamber said “It seems the report has classified the line as a light rail service but they have not taken account of the freight side”. Ballina Beverages said “The closure of the rail head would be of concern to the company as this is the preferred method of transport.” IÉ said Ballina was one of the most important rail freight centres in the country. The company would be making it clear in any discussions with the Department of Transport that the Ballina service is very viable and generates a commercial return for IÉ.

 

The remainder of this article appears in IRRS Journal number 170, published October 2009.