October 19 2016 0Comment

National Bus & Rail Union submission to the Oireachtas Committee on Transport on Wednesday 19th October 2016

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Cathaoirleach, Members of the Committee.

On behalf of the National Bus and Rail Union I wish to thank you for this opportunity to speak on behalf of Transport Workers and the Communities they serve, it is they along with fellow ordinary decent workers who keep the wheels of the economy turning.

As the foremost Front-line Trade Union in CIE with the largest membership across the Public Bus Transport Sector we make no apologies about having prosecuted a dispute at Dublin Bus in furtherance of a long overdue and well deserved pay rise after eight years of austerity.

The NBRU is very proud of our history, a history which has seen us very much at the Vanguard of significant improvements terms and conditions for successive generations of transport workers.

However we now find ourselves facing into a doomsday scenario that Bus Eireann may attempt to impose unilateral changes to terms and conditions of its own staff, a situation which has been brought to bear by a policy driven at Department level and implemented it would appear with zest by the NTA.

This situation if allowed to develop unchecked will inevitably lead to Industrial Action, potentially across the Public Transport Sector, the notion that Unionised Workers in the CIE Group of Companies would stand idly by and allow one of those Companies to ride roughshod over fellow Workers by unilaterally reducing Terms and Conditions is simply untenable.

Those politicians who are minded to, as it were mind their business, or wash their hands of the problems at Bus Eireann would be well advised to think again, Rural Ireland has a way of making the dog bark, its called Election time.

As the recession hit and revenue declined due to falling passenger numbers the three CIE Companies engaged in impactful rationalisation plans which streamlined services, eliminated some terms and conditions and subjected staff to pay cuts.

CIE subvention from the State was reduced from €321.10m in 2008 to €188.9 m in 2015, i.e. a reduction of 41.2%. At the same time payroll costs were reduced by 12.6%.

In the case of Dublin Bus it is worth noting that the 2015 subvention level should have been €60 million but €2 million was deducted because the NTA deemed that profits made from Public Service Obligation business were unreasonable.

The formula used by the NTA to calculate reasonable profit is an anachronism in the modern financial world in that the NTA use return on equity and not turnover as is common practice. The more salient point here is that there would not have been any unreasonable profit if workers were not enduring a pay cut at the time.

As members may be aware, the previous administration initiated the tender process to privatise 10% of Dublin Bus and Bus Éireann.
The tender documents which surfaced this summer have a criteria of 65% cost. The only variable in bus transport is labour costs.

The NBRU had to resort to initiating a High Court challenge against the Minister and the Department as a vital component of our anti-privatisation campaign in 2015.

We were with the support of Trade Union colleagues relatively successful in our challenge to this anti-worker policy by having the principle of Social Clauses (namely an REA and SEO) agreed as part of the LRC brokered Settlement Proposals.

We await publication of the Legislative changes promised by Government in response to the NBRU highlighted flaws which exist in the current Act.

However, it appears that those in Government are determined to pursue a policy which will inevitablty will lead to conflict.

The trouble at Bus Eireanns Expressway can be directly linked to the Department led, NTA implemented policy of issuing and amending licences in the commercial bus market.

The NTA will of course contend that the customer has more choice, more options, what it will not say is that:

• They have increased seat capacity on Dublin/Limerick by 111%
• Dublin/Cork by 128%
and
• Dublin/Waterford by 55%.

Over supply of Seat availability does not equate to market demand.

Saturating the market to unsustainable levels with a plethora of operators is not a Visionary Transport Policy, all it achieves is the eventual demise of some of those operators, ending up with either a monopoly or at best a duopoly.

Here are some noteworthy facts:

• There was capacity in the market post recession, most if not all of this capacity would have catered for the market growth.
• instead there has been an additional 100% plus services added, with larger coaches.
• There has been a doubling of service capacity on most routes and a tripling of available ’empty’ seats.
• Waterford-Cork and Limerick-Tralee/Killarney more than doubled, competition not going into Rathkeale/Limerick Hospital.

One other point worth mentioning is the fact that Bus Eireann stayed in the towns and villages during the recession, it would of course been disloyal to disadvantaged customers to do otherwise, the competition targeted larger population centres through new licences and amendments to others.

I mentioned earlier about barking dogs, Rural Ireland can be unforgiving when it comes removing or threatening its vital social and economic providing services, Rural Post Offices, Bank and Garda Station closures being a case in point.

Here is another stark reality, Bus Eireann have now, under pressure from this over supply in capacity and in order to attempt to compete, come out of 200 towns/villages

The NTA are now placing an extra burden on the taxpayer by introducing extra PSO services into some of those areas. The most recent example of this is an €880,000 contract to M & A coaches in June this year to areas once served by Bus Éireann.

The NTA, aside from being the Authority are also the Transport regulator. This is a function that is not being carried out in relation to commercial bus licences.

According to the 2009 Act, the following obligation is on the NTA when awarding commercial Bus licences:
“10. — (1) in considering an application for the grant of a licence the Authority, having regard to the general objectives established under section 10 of the Act of 2008—

(a) shall take account of the demand or potential demand that exists for the public bus passenger services to which the application refers having regard to the needs of consumers and any existing public bus passenger services on or in the vicinity of the route to be served by the proposed public bus passenger services”

, and section (b) 3 which states;
“(iii) The impact a proposed public bus passenger service would have on public passenger transport services that are subject to a public transport services contract under Part 3, Chapter 2 of the Act of 2008 on or in the vicinity of the proposed route”

Bus Éireann have for years cross subsidised the underfunded PSO services with profits from their commercial Expressway operation to the tune of approximately €40 million plus Euro as per table 1.

This option is now longer available to Bus Éireann because of the non-regulation of the commercial bus market, as a result the transport network built up by decades of hard work is fragmenting before our very eyes leaving the less densely populated portions of rural Ireland without public transport.

The subvention levels at Bus Éireann have decreased from €49.4 million in 2009 to €33.1 in 2015.

The third company in CIÉ Group Irish Rail perhaps has the most difficult task in trying to maintain 1673 KM of active track, 362 KM of other track, 147 stations while also carrying approximately 40 million passengers on a widely dispersed network in 2015. The Government subvention provided to operate the trains, maintain track and locomotives has reduced from €189 million in 2007 to €98 million in 2015.

For the record Irish Rail received €98 million in subvention but contributed €112 million to the exchequer. Similarly Bus Éireann received €33.7 million in subvention but contributed €59 million back in taxes. Dublin Bus is a similar story.

Yet another myth that requires to be challenged, is this notion that Transdev is a Private Company and is a shining example often peddled by the privateers of how a Public Transport System can be operated.

Here are some startling facts, Transdev is actually owned by the Consignment and Deposits Fund, the French equivalent of our NTMA. Transdev Ireland Ltd, a holding company returns a dividend to the French State every year, paid for by the Irish Taxpayer.

Interestingly the previous CEO of the NTA, Mr Gerry Murphy stated before this very Committee in January 2013 that Public Transport is underfunded in Ireland.

Whilst Public Transport is most certainly underfunded, the NTA which does not physically operate any Transport services, (they act as Regulator and Authority) does not appear to have problem sourcing funds for its own budget, staff and administration costs, according to their latest accounts was, including defined benefit pensions, approximately €8 million.

Incidentally the modest DB pension of bus most workers, €125 per week after 40 years’ service and contributing nearly €40,000, is under grave threat due to funding cuts and Government rules on bond allocation.

Some of the consultancy spending of the NTA, which is sucking money from the transport funding envelope is questionable;
• KPMG €808,000 July 2016 Public Transport advisory services
• €1,376,000 March 2016 compliance support services
• €285,000 December 2015 event management solutions
• €810,000 August 2015 finance services
• €2,843,000 April 2015 event management
• €1,973,000 April 2015 enterprise service solutions
• €1,310,000 January 2015 project management
• €374,000 August 2014 legal services
• €472,000 July 2014 consumer research
• €828,000 June 2014 data management systems
• €490,000 March 2014 information support services
• €317,000 September 2013 cost management services.

The above are just some of the examples from the NTA accounts of where vital transport funding is being spent, additionally the NTA have spent approximately €2 million on new London Transport style bus stops which have yet to be erected.

The NTA Quango, or as we refer to it, the HSE on Wheels is being facilitated in Empire Building to the detriment of Front-line Transport Services.

Furthermore the NTA see themselves as a replica of Transport for London, which it should be noted has led to soaring costs for the British Taxpayer to the tune of a 5108% staggering increase in Subsidies.

At the same time Subvention to the CIE Group has been cut from €321.1 million in 2008 to €188.9 million in 2015. That’s a 41.2% decrease. That is an unsustainable reduction.

Remember that transport is a public service, routes that service remote estates, towns, villages and counties are under threat.

The safety of the rail is second to none but in future years we will only avoid catastrophe by blind luck because the State is not investing enough money to maintain current rolling stock, vehicles, stations, depots and lines, never mind increasing services.

All of the reports over recent years, commissioned not by CIE, but by the Department itself has shown that both Dublin Bus and Bus Eireann are among the lowest subsidised Transport Companies in Europe, and this before the recent reductions.

In the meantime it is well known that no railway in the World makes money, save those Dutch, German and French Companies who themselves are heavily subsidised inside their own borders, but suck Taxpayers money from other States on the pretence that they are ‘Private’ Companies Tendering for State Contracts.

Semi-State transport workers are not overpaid by any means. Their average salary hardly justifies working early mornings, late at night, Saturdays, Sundays, Bank Holidays and everything in between.

The heroes of the private sector would like to see their horses entered into the race to the bottom in terms of workers’ wages, see all staff working for agencies, on short term contracts on zero hours or the minimum wage.

The CIE companies are fully compliant and stringently observe all aspects of the Organisation of Working Times Act and driving regulation, unfortunately some (not all) private operators infringe and ignore the rules giving unfair competitive advantage and potentially putting lives at risk.

Unlike CIE, who return more to the State in terms of tax than is given in subvention, staff at some private companies receive FIS while the shareholders live a jet set lifestyle.

Sean F. Lemass, Tánaiste and Minister for Industry & Commerce in 1958 inserted into section 7 of the Transport Act that year that CIE shall ensure “Reasonable conditions of employment for its staff”

Let not the vision of the past be destroyed by the blindness of neo-liberal champions of Privatisation.

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