A realist transport policy
Minister for Transport Leo Varadkar set out his priorities for the sector in his address to Transport Ireland, including reducing the cost base of Iarnród Éireann and setting a 20-year vision for aviation policy.
Transport policy must be determined by realism rather than idealism, Minister Leo Varadkar told delegates as he addressed the Transport Ireland conference for the fourth year in a row.
He remarked: “A Governor of New York once said that politicians can campaign in poetry but must govern in prose and I suppose the same could be said about how we must live our lives. There’s always a tension between romance and idealism – of what we would like to do – and the realism of what we can actually achieve.”
Transport had undergone incredible change since the 19th century when it took Daniel O’Connell five days to travel from Kerry to Dublin: “You can now do so in just under five hours.” It was now generally quicker for Varadkar to travel from his home to his French counterpart’s office in Paris than to certain parts of Ireland.
“It’s no wonder that transport and its advances have pre-occupied some of our poets,” Varadkar noted.
An unpublished poem by Seamus Heaney illustrated his point:
In terms of tourism and aviation, The Gathering had contributed to the highest visitor numbers since 2008 (up 7 per cent over the year) and also record numbers from North America and the long-haul markets.
This trend was also driven by the Government’s decision to reduce VAT to 9 per cent and to introduce a fuel rebate for transport operators. The tourism industry “has been one of the key drivers of our economic recovery” and it “depends critically” on the range and competitiveness of air and sea access routes into Ireland.
The Minister was “very optimistic” for tourism in 2014 due to new air and sea routes, confidence among hotel and tour operators, and an 11 per cent increase in visitor numbers between December and February.
He was speaking a day after the Government abolished the travel tax, in keeping with a Fine Gael election commitment. “Over 20 new routes have been announced since it was signalled on Budget Day,” Varadkar remarked, “and I’m pleased to say that the newly independent Shannon Airport halted its decline in passenger numbers last year and actually recorded modest growth.”
Dublin Airport saw a 6 per cent growth in passenger numbers last year and this has accelerated in early 2014.
Safety
Severe limits on Exchequer funding have constrained spending on roads, hence the priority placed on maintenance and renewal. However, last year, construction began on the first road public-private partnership in five years (Arklow-Rathnew and Newlands Cross). The Gort-Tuam PPP will be started in 2014 and the New Ross and Enniscorthy schemes are at the planning and procurement stage.
“As recent events have shown, I take a particular interest in road safety,” he stated, “and I have to say last year it was very distressing to see an upturn in the number of road deaths after seven years of successive decline.”
A total of 190 people died due to road collisions in 2013, compared to 162 in the previous year. This was much lower than the level in 2005 (396) and the number of fatalities was falling again in 2014.
“However, there is certainly no cause for complacency,” the Minister added. “Only ever-vigilance.”
Varadkar and his officials had worked closely with Bus Éireann and Dublin Bus to stabilise their finances. He continued: “Some of these measures, as we know, gave rise to strike action last year in the bus companies but the reality is, as we all know, that reductions in the cost base are essential – and they’re an essential element of what’s required to secure the future of both companies.”
Relying solely on fare increases was not sustainable and with at least one more difficult Budget to come, there is “no scope for increased Exchequer subvention.”
The companies also had to grow their business again and the department had set a target of a 2 per cent increase in passenger numbers: an additional 5 million journeys.
Ten per cent of bus routes were to be opened up to competition from 2016, starting in Dublin, Waterford and the Midlands: “This isn’t about saving money and I don’t anticipate any significant savings to the Exchequer from this policy. What it is about is providing a better service for the passenger at the same cost to the tax-payer.”
Aviation
The first national aviation policy for Ireland in two decades would be completed in the coming months. With a 20-year timespan, this would make Irish aviation more competitive and tackle the remaining barriers to growth and entry into the market.
“In many ways, we’re more constrained in aviation policy than we are in other areas,” he noted. A large amount of aviation policy is determined by the International Civil Aviation Organization and the European Union. Ireland would, in many cases, be stating existing policy but some changes and “interesting decisions” would be made around funding for regional airports, the future of regulation, access, and the ownership of existing State assets.
The Government, Ibec and ICTU have nominated an expert panel to examine the industrial relations and financial complexities of the aviation pensions dispute. Varadkar added: “Ultimately, though, the companies are going to have to put in more money and the beneficiaries will have to accept that they’re going to receive less from the scheme than they were promised or expected.”
Planning
Varadkar was “strongly considering” a major change in the funding model for regional and local road maintenance. Local authorities have been given more flexibility in this area and, in principle, he would like to give them “even greater or perhaps even full discretion” for how they spend State grants for non-strategic roads from 2015.
The councils could receive 80 per cent of local proceeds from the property tax and also a considerable block of funding from motor tax: “Now, it’s a big risk but if we’re serious about local government and local democracy, that’s the kind of thing we should be doing.”
Planning for the long-term public transport needs of the Greater Dublin area was “one of the most important issues” in transport policy.
The National Transport Authority’s integrated implementation plan would set out its plans for Greater Dublin over the next five years. Key capital investment priorities included the completion of Luas Cross City, the purchase of new buses, and the re-opening of the Phoenix Park tunnel. A technical consultancy would assess the long-term needs of the North Dublin-Fingal corridor.
Varadkar wanted to see preparatory work on the next National Development Plan to be done this year so that the Government could start its new investment framework next year. He warned that traffic bottlenecks would return alongside economic growth and projects were needed to tackle those constraints.
“Right now,” he remarked, “we’ve no visibility on what we might be able to invest in beyond 2016, which now is 33 months away.” The current spend of GDP on transport capital investment (0.5 per cent) was “clearly too low” and he indicated that this should be doubled.
Rail
The Minister rejected the idea that the Government would “protect and fund existing rail services at any cost.” He spoke of his own affection for railways and noted that Seamus Heaney was inspired by them.
Todd Andrews, CIÉ’s Chair in the early 1960s, was “the villain of Irish railways at least in the popular imagination” for closing a dozen lines. Varadkar retold the story of a delegation from Kerry who visited Andrews to complain about a local line closure but who were embarrassed to admit that they had travelled up to Dublin by car.
Andrews was “a flippant man who speaks his mind, a man after my own heart perhaps” but most of his decisions were proved right over time. The decline of the railways was a “cause for concern” but – to use an analogy from ‘Murder on the Orient Express’ – “we all did it.”
The public found cheaper or faster ways of travelling: “We all admire the romanticism of the train but choose the realism of other forms of transport.” The train journey from Cork to Dublin was only 25 minutes faster than the bus and, in many cases, much more expensive.
“The romantic in me would like to invest in high speed trains to make the journey faster,” he added, “but the realist in me recognises that that investment cannot be justified especially when there is no guarantee that it would make a difference. And we all know the political difficulties that would arise in Ireland in having high speed trains between our cities that didn’t stop in any of the stations along the way.”
Rail receives 50 per cent of Public Service Obligation (PSO) subsidy but generates only 15 per cent of the passengers. The cost base “remains too high” and there is “little scope” for fare increases and “no scope” for an increased subvention.
“I am genuinely worried that the employees and maybe even the company itself does not appreciate what’s at stake here,” he stated. “The purpose of our public transport system is not to move buses and trains around the country. It’s to get people from A to B and whether it’s bus or train or taxi, it shouldn’t really matter.”
Rail services, especially inter-urban rail, had to be competitive with other modes of transport if they were to survive. If current policy failed due to industrial unrest or falling passenger numbers, Varadkar predicted that funding would have to be transferred to other modes, thus resulting in closures.
The Minister concluded: “That’s going to sadden the romantic in me but the realist in me knows that we’d be left with no choice. I look forward to the discussion.”
Manifesto pledges
Fine Gael’s general election manifesto pledged “additional rail services” as part of a shift from private cars to public transport along with electrification: both commitments were subject to cost-benefit appraisal. Labour, Fianna Fáil and Sinn Féin had no firm commitments on rail. Varadkar’s Minister of State, Alan Kelly (Labour), has campaigned to keep tracks open in Tipperary.
