[Article] EC to probe Government aid to CIÉ

Victor

http://www.rte.ie/news/2006/0320/cie.html

EC to probe Government aid to CIÉ
20 March 2006 08:40

RTÉ News has learned that the European Commission is to examine a complaint made by private bus operators against the Irish Government.

The Coach Transport and Tourism Council claims unfair State aid is being given to CIÉ.

Private bus companies have been lobbying to get a bigger slice of the market of providing public services.

There has been significant debate regarding how much of that cake they should have access to.

Unions have opposed a significant increase in commercial involvement but the private firms say it is unfair CIÉ can receive public funds to buy buses which can run on routes competing with commercial firms.

That, they claim, can distort competition.

A report on the issue says 300 buses have been bought since 1999 by Dublin Bus and private operators have made an official complaint to the European Commission on the matter.

A spokesperson for Dublin Bus said it invested funds as directed to by the State.

A spokesman for the Minister for Transport, Martin Cullen, said the department was always keen to invest to improve public transport.

Chris_533976

Good. Competition in the Bus sector is badly needed here. The current monopoly is a joke. Bus Eireann get away with murder.

Transport21 Fan

They really need to forget how buses work in Ireland and start again. Subsidies should be only given to companies operating minor and unprofitable routes. Apart from that, the bus network should be opened to anybody who has the right buses and fully qualified drivers.

BendiBus

Transport21 Fan wrote:

They really need to forget how buses work in Ireland and start again. Subsidies should be only given to companies operating minor and unprofitable routes. Apart from that, the bus network should be opened to anybody who has the right buses and fully qualified drivers.

I think a fully working integrated ticketing system should be a precondition of further expansion of competition. Otherwise separate operators are a disincentive to using public transport.

Transport21 Fan

BendiBus wrote:

I think a fully working integrated ticketing system should be a precondition of further expansion of competition. Otherwise separate operators are a disincentive to using public transport.

No argument from me there. Include an integrated timetable and map showing all major routes regardless of bus operator and how it connects with the rail network.

Lennoxschips

yeah, they privatised the bus services in holland a few years ago, but besides the colours of the different buses i didn't notice any changes. the same integrated ticket system was used, the same route numbers were kept, all lines were included on route maps etc.

shltter

Transport21 Fan wrote:

They really need to forget how buses work in Ireland and start again. Subsidies should be only given to companies operating minor and unprofitable routes. Apart from that, the bus network should be opened to anybody who has the right buses and fully qualified drivers.

Of course that scenario will actually cost the tax payer more as operators will keep all the profit from profitable routes and be fully subsidised on any unprofitable routes they operate unlike at the moment where profitable routes cross subsidise unprofitable ones and the government makes up the difference.

shltter

Minister Cullen has actually approached the unions with his proposals

100 new buses for DB

DB holds onto all of its current network

New routes totalling 15% of the market will be tendered out to private operators

After the 15% DB can apply for any further routes

No head to head competition

CIE will not be broken up

New legislation to replace the 1932 transport act

aliveandkicking

shltter wrote:

Minister Cullen has actually approached the unions with his proposals

100 new buses for DB

DB holds onto all of its current network

New routes totalling 15% of the market will be tendered out to private operators

After the 15% DB can apply for any further routes

No head to head competition

CIE will not be broken up

New legislation to replace the 1932 transport act

To me that sounds like a very well thought out plan. Nobody loses out.

Dublin Bus keep their network and get 100 additional buses.
The private sector gets new routes. 15% is a sizeable chunk.
Passengers get more buses and bus routes to choose from.

Aidan1

Of course that scenario will actually cost the tax payer more as operators will keep all the profit from profitable routes and be fully subsidised on any unprofitable routes they operate unlike at the moment where profitable routes cross subsidise unprofitable ones and the government makes up the difference.

Was not, and is not how the franchaising system operates.

All routes are costed as per their profitability. Then then the amount of the subvention is tailored for each route. Then operators, private or public, would tender for each route. The winner of each route would get the subvention (assuming there was one - and so long as they continue to meet quality standards) plus the fares for that route only. How much 'profit' they make would come down to the efficiency with which they run their operations.

The problem at the moment is that the degree of the cross subsidy is not clear, hence there is no way of knowing how much of the Govt subvention is subsidising 'unprofitable' routes, and how much is being swallowed by inefficencies within the CIE group. A franchaise system would have made that clear, and ensured that the taxpayer could get value for money from the subvention, and their fares.

The unions didn't like that idea though - guesses as to why?

monument

Chris_533976 wrote:

Bus Eireann get away with murder.

?

Transport21 Fan wrote:

They really need to forget how buses work in Ireland and start again. Subsidies should be only given to companies operating minor and unprofitable routes. Apart from that, the bus network should be opened to anybody who has the right buses and fully qualified drivers.

This isn’t about trying to stop route subsidies. They are trying to stop the government from funding new buses.

Links added:

Private firms critical of Dublin Bus funding 11 Mar 2006
Dublin Bus plan ‘breaches EU rules’ [Says the same firms] 19 March 2006

Victor

Chris_533976 wrote:

Bus Eireann get away with murder.

What murder? The intercity routes have quite a bit of competition between Bus Eireann, private operators, rail, air and car.

Bus Eireann is the largest buyer in the country from the private bus / coach operators (on behalf of the school bus scheme).