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US firms to challenge Bus Eireann's €150m annual school contract

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Bidder IC Bus Corporation makes US school buses.

Bidder IC Bus Corporation makes US school buses.

Bidder IC Bus Corporation makes US school buses.

TWO US transport companies are trying to bid for a share of the €150m-a-year school bus transport contract, the Irish Independent has learned.

Trailways and the IC Bus Corporation -- makers of the iconic yellow school buses favoured by US schools -- are part-funding a legal bid aimed at forcing the Government to open up the contract to private companies.

Bus Eireann has been given the contract automatically by the Department of Education since the late 1960s.

It is currently responsible for taking more than 110,000 children to school each day.

But the US companies claim that under EU law the contract should be put out to tender. They argue this would result in lower costs to the State and a more efficient system.

The legal challenge will come before the Commercial Court in June. The US firms are part of a consortium called Student Transport Scheme Ltd (STS), which includes businessman Tim Doyle and Galway solicitor Brian Lynch.

"This contract should be put out to tender under European law," Mr Doyle told the Irish Independent.

"There's tens of millions of euro being wasted. Bus Eireann frequently quotes a valuefor-money report, saying they're the only organisation in the country which can do this."

STS has promised to build a bus manufacturing facility if it wins the legal challenge and is awarded the school bus contract. It is understood it would require a 10-year contract to justify the costs of investing.

Fortune

The STS consortium is headed up by Mr Doyle, a Dublin-based management consultant, who has no previous experience in running major transport systems.

Trailways has more than 8,000 student buses, which operate across the US, while IC Bus Corporation is part of Navistar International, a Fortune 500 company which has revenues of $14bn (€10.7bn) a year.

Navistar confirmed it was providing "financial support" and "assistance" to STS, while Trailways said the matter was being dealt with by its board of directors.

"Trailways and this consortium have been in Ireland three times, including last month when we met with up to 60 operators to gauge their interest," Mr Doyle said.

"These (operators) included existing contract holders, non-contract holders and people who lost their contracts (with Bus Eireann). Our proposition is we build a school transport scheme and incorporate a rural transport system into it."

The contract is worth €150m a year, with more than €100m of the state funding paid to private companies which are sub-contracted by Bus Eireann.

Almost one-third of the total funding is used to provide door-to-door transport arrangements for almost 8,000 children with special needs.

Bus Eireann said it could not comment on the court case, but noted that an independent 2011 report commissioned by the Department of Education found that the "significant" and "complex" scheme was being managed efficiently by the company.

"It also found that Bus Eireann is the only organisation in Ireland with the skills, experience and capability to operate the scheme in an effective manner," a spokesman said.

Irish Independent