Varadkar rules out another bailout for struggling CIE
Transport Minister Leo Varadkar is insistent that the "constantly struggling" CIE will not receive any more State bailouts, despite it posting significant losses last week.
Mr Varadkar said the reason the company received a bailout totalling €36m last year was that it had lost the confidence of the banks, but he said that confidence was slowly coming back.
Speaking to the Sunday Independent this weekend, Mr Varadkar said that even having the annual figures posted last week represented progress, as they had been "very slow to come out in the past".
"Now we have the figures, we know what the situation is. The reason for the bailout last year is because the confidence of the banks was lost. We are addressing that and it is coming back," he said. Last Tuesday, CIE, a statutory company, posted losses of €281m for 2012, down from €285m.
Despite the dire state of the company's finances, Mr Varadkar said it would not be possible to shut down the company, nor were there sufficient private sector providers to fill a gap, if it were to happen.
"We have changed the management and the boards, we are working on cost restructuring but no, there will be no further bailout of CIE. That is not going to happen," he said.
Addressing the "unsustainable" pension deficit, which according to the annual report stands at €492m, Mr Varadkar said a proposal would be sent to the Pensions Board by the end of June, but he wasn't aware of the details.
"As with other companies with defined benefit pension schemes, the deficit on CIE pension schemes is a matter of deep concern to the board. At the end of 2012, the schemes show a deficit of €492m, an unsustainable position," the annual report stated.
"The CIE Group with the relevant stakeholders is committed to finding a sustainable way forward on pension matters in 2013."
However, company sources have indicated that staff could be looking at reductions to their benefits, as is happening in many other companies struggling to address huge deficits in their pension funds.
State grants to the company rose by €13m to €292m. Each year, CIE receives massive taxpayer grants to ensure it can provide transport services across the country.
The company's chairman Vivienne Jupp said in the report that "2012 was extremely difficult for the CIE Group, from a financial perspective".
"The cumulative effect of five years of reducing demand for public transport, reductions in exchequer-funded public service obligation payments, the increased cost of fuel and other economic factors led to a serious cash shortage in the group early in the year," she added.
Revenues at CIE rose to almost €725m, the report showed. The company was also granted price hikes by the National Transport Authority during 2012.
According to the annual report, staff costs dropped by about €40m to €558m. Staff numbers fell by 315 to 10,083. The company's directors were paid a combined €432,000.