Question on the Financial Position of the CIE Group

-   Alan Farrell TD

To ask the Minister for Transport, Tourism and Sport the financial situation of the CIE companies and the Government funding that will be required to protect public transport operations in 2013; and if he will make a statement on the matter.

Answered by the Minister for Transport, Tourism and Sport
Leo Varadkar

I propose to take questions 12 and 70  together.
These questions relate to the current  financial position of   the CIE Group.
Since 2008 , the financial performance of CIÉ has been severely affected  by the economic recession which has resulted in a significant reduction in passenger numbers. CIÉ recorded total losses in the three years 2009 to 2011 of over €137m. The current CIE business plan 2013-2017 provides for almost break even by 2015 and a return to profitability of the Group thereafter.
To compensate for the reduced passenger revenues and PSO subvention, CIÉ have engaged in a cost recovery programmme over recent years. Further cost saving measures have now been agreed with Bus Éireann unions and the Labour Court has recently issued a recommendation in relation to the proposed cost reduction plan in  Dublin Bus.  The Labour Relations Committee has also  facilitated  discussions between unions and management at Irish Rail on further cost saving measures and recently issued its proposals.
In July 2012 the Government approved an increase in the 2012 subvention to CIE by €36 million to €278 million to ensure that the companies could continue to operate PSO services for the rest of 2012. Given the pressure on the public finances there  will be no additional funding  from the Exchequer in 2013. The implementation of a credible business plan will therefore be essential to CIE’s financial recovery in the period ahead.
The Board of CIÉ are pursuing a range of measures to address the financial position.   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.   CIÉ 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 has recently negotiated improved  bank facilities  in relation to refinancing of the Group, which will ensure that the Group has sufficient funding into the future.

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