Government to push ahead with CIE break-up

The Government is to push forward within the next two weeks with plans for the break-up CIÉ, when it sets up a special group to oversee the process. The Minister for Transport, Mr Brennan, is expected to appoint a committee to implement break-up plans developed by PricewaterhouseCoopers (PwC), which were presented to a specially convened CIÉ board meeting yesterday.

The group is expected to include senior Government officials in addition to executives from CIÉ and its three bus and rail companies, and a number of change management consultants. Trade union officials representing CIÉ staff are not expected to join the committee.

Last night the National Bus and Railworkers' Union expressed disappointment at the PwC plan, which calls for a three-step break-up of the ailing State transport group.

Its general secretary, Mr Liam Tobin, said: "We're shocked at the way the Minister is going about this business. He promised us bilateral talks. This will cast a dark shadow over those meetings before they even start."

Completion of the initial, intermediate and final stages of the process is likely to take a number of years.

While the break-up of CIÉ is planned in tandem with the opening of 25 per cent of bus routes in Dublin to competition, deregulation will be pursued by the Government as a separate strand.

CIÉ's spokesman said its board would study the PwC document and return to Mr Brennan once it had reached a conclusion. The board is expected to discuss the matter at its regular monthly meeting next Thursday.

The 114-page PwC document, which was delivered last August to the Government, was published yesterday on the internal CIÉ intranet service for its staff.

Seen by The Irish Times, the report says that the shareholder in Dublin Bus, Bus Éireann and Iarnród Éireann should in future be the Minister and not CIÉ. With the three companies operating independently in State ownership, it is thought that Mr Brennan believes they may compete against each other in certain markets.

The report also calls for the creation of a new group services company to offer certain services that CIÉ provides jointly to the operating companies.

In addition, it says Government should ask the CIÉ Group and Dublin Bus, Bus Éireann and Iarnród Éireann to prepare a detailed implementation plan to effect the restructuring.

"A restructuring of CIÉ Group will be driven, amongst other things, by the treatment of the key areas of property, debt, claims and subvention," it says.

The report says the group and its companies are not efficient because the services are provided at a high level of State support without detailed specification "and lacks performance measurement or incentivisation".

The report states: "In combination with the absence of benchmarked financial objectives, there is no tangible process for measurement of value for money for the taxpayer."

It adds: "This is not in accordance with the objective of public transport policy, which is to ensure the provision of a defined standard of public transport at reasonable cost to the customer and the taxpayer. The process of restructuring must address these issues."