| 12.4°C Dublin

The break-up of Irish Rail may not be too far-fetched

The strike at Irish Rail, which has seen travellers inconvenienced yesterday and today, raises serious questions about the future of the company.

Staff are on a two-day strike in protest at the company's decision to press ahead with cost-cutting plans designed to save €17m a year. These cost-cutting measures include temporary pay cuts.

These pay cuts range from 1.7pc for staff earning up to €36,000 a year - three-quarters of Irish Rail's workforce - to 6pc for those earning more than €100,000 a year.

Irish Rail is part of the CIE group. Staff at the two other CIE operating companies, Dublin Bus and Bus Eireann, have already accepted similar cost-cutting plans, including pay cuts.

Both the Labour Court and the Labour Relations Commission have also ruled that cost cuts are unavoidable at Irish Rail.

And it's not difficult to see why. While all of the CIE companies have been hit by the economic downturn with passenger numbers falling and the level of state subvention being cut, Irish Rail has suffered most.

Passenger numbers have fallen by a fifth, from 45.5 million in 2007 to 36.7 million in 2013, while the level of state subsidy has dropped by over a third, from €203m to €127m, over the same period.

pumped

The CIE trade unions, the NBRU and SIPTU, have sought to portray the dispute at Irish Rail as being over the level of state subvention to the company, one that could be quickly resolved if the Government could be persuaded to increase the amount of taxpayers' money being pumped in. There are several reasons why this would be a very, very bad idea.

Unlike both Dublin Bus and Bus Eireann, where the state subsidy is only a modest percentage of total revenues, Irish Rail is utterly dependent on state handouts for its very survival.

Even at its reduced level, the state subsidy accounted for almost two-fifths of Irish Rail's revenues in 2013. Irish Rail, not to put too fine a point on it, is a financial basket case.

But the fall in passenger numbers and the cut in the state subsidy aren't even the most serious of the many problems facing the company. Far, far more serious is the threat which our new motorways present.

For example at present the journey time between Dublin and Cork, Irish Rail's busiest route, is about two hours and forty-five minutes.

When the time it takes to get from your home or office to Heuston Station and from Cork's Kent Station is added on, your journey time will have risen to at least four hours.

By comparison, the same journey takes about three hours by car outside of rush hour and will fall even further when the Newlands Cross junction outside of Dublin is sorted out.

DART

For most intercity journeys Irish Rail can no longer compete with the car, or the bus (where tickets can be a third of the regular railway fare).

But what about the DART in Dublin? Well the running of this service could be contracted out to a private-sector contractor - as is already the case with LUAS.

As minds are focused this weekend maybe it's time to start thinking the unthinkable. Maybe the time has come to close most of Irish Rail.


Privacy