Bus Éireann – is crisis the policy?
Sir, – I tend to agree with earlier letter-writers on the need for Minister for Transport Shane Ross to take a more active role regarding the future of Bus Éireann. The elephant in the room, surely, is the slashing by previous governments of the public service obligation (PSO) contribution from the exchequer since the economic collapse circa 2009.
A look at the Bus Éireann annual accounts from 2007 shows that the PSO contribution from the exchequer was on an upward trajectory (increasing year on year from €36.5 million in 2007, to €41.8 million in 2008, to €49.3 million in 2009). Thereafter, the PSO subvention was reduced (to €45 million in 2010, €43.4 million in 2011, €36.9 million in 2012), and the trajectory continued on a downward spiral to a €33.7 million allocation in 2015.
Whatever one may say about the merits of the PSO contribution from the exchequer, the fact is that once it began to be seriously reduced, this had dramatic consequences for the day-to-day finances of the company. To put it in context, had the economic collapse not happened, and the PSO subvention continued to rise incrementally from 2009, it is probable that the annual PSO subvention would be somewhere in the region of more than €60 million in 2017, whereas it is down to half that in present terms.
It is therefore no wonder that Bus Éireann is in serious financial trouble, and this does not take account of the accumulated losses down through recent years when the continuous reduction in the PSO subvention led to a deficit year on year.
The current impasse in Bus Éireann is not merely an industrial relations dispute, as Mr Ross would have us believe. The Minister does need to ride into town with his cheque book and redress some of the financial deprivation wrought on the company through the continuous reduction of the PSO subvention on an annual basis since 2009. And no, I do not think that this is a time for arguing whether the PSO subvention is necessary or not – that argument has been already been put and universally accepted; similarly there is no EU state aid issue since this will already have been cleared with the European Commission. The fact that successive governments did not keep up the payments in the meantime is not a matter of concern for the European Commission.
There has been a lot of talk recently (obfuscation really, at this point) on the need for a coherent and comprehensive transport policy for rural Ireland which takes account of both private and public bus operators, and would address the issue of how best to serve the transport needs of the people of rural Ireland. This would be developed by the National Transport Authority, the Minister and the Department of Transport Tourism and Sport, Bus Éireann unions, private bus operators and public consultation, etc.
This is all eminently sensible, except for one glaring issue. Bus Éireann will cease to exist in the very near future unless its financial position is urgently addressed! So we need to get the priorities right! The Government needs to get behind Bus Éireann financially, and only then can we look at transport policy in rural Ireland and the inevitable report which is sure to follow.
A future rural transport policy might include such ideas as a portion of the PSO exchequer subvention going to private operators on the basis that they take over some of the less profitable (non-profitable) routes currently served by Bus Éireann. A situation where private operators were or are allowed to cherry-pick the profitable routes while leaving non-profitable routes to the public operator is morally wrong and ultimately unsustainable.
As we now head inexorably towards a chaotic all-out strike in Bus Éireann, followed by further strikes in the other two CIÉ group of companies – Dublin Bus and Iarnród Éireann – one could be forgiven for taking a cynical view that the ultimate aim of the Minister and his Government is to close Bus Éireann as a public entity and the subsequent putting out to tender of all routes to private operators. – Yours, etc,