CIE is seeking a rise in fares of up to 10 per cent and says it is confident that it will be granted by the Government in the second half of this year. The company, which yesterday announced profits of £5 million, has been awaiting approval for the fares' rise for more than a year.
The company also strongly defended the safety of its rail services. A report by consultants, Arthur D Little, is reported to have warned that acceptable safety levels are likely to be breached within two years on certain rail tracks. CIE chairman, Mr Brian Joyce, said that rail was the safest form of transport in the country and the company was embarking on an intensive programme of track renewal over the next eight years. Mr Joyce said CIE hoped the fares increase would be approved for implementation on a phased basis, possibly 5 per cent at first. He again said that there had been no general fare increase since 1991, although other costs such as wages had risen significantly.
It is unclear what services would be affected, but increases on DART and city bus services are likely. The company said that, thereafter, it would seek increases in line with inflation.
Mr Joyce said CIE had spoken to the Minister for Public Enterprise, Ms O'Rourke, and she was "well-disposed towards what the company was trying to achieve".
CIE carried 302.5 million customers last year - the highest number in more than 20 years - and made a £5.1 million profit. That compares to a loss of £56.5 million in the previous year, when provisions were made for substantial cost savings plans across CIE's three subsidiaries. Mr Joyce said the viability plans, which include payroll savings through voluntary redundancies and work practice changes as well as other cost efficiencies, were close to completion. They entail savings of £42 million in Dublin Bus, Bus Eireann and Irish Rail.
Group revenue increased by £6 million, or 1.8 per cent, to £341.2 million. This includes the State subvention of £104.9 million for providing non-economic services or socially necessary services. The group used £64 million on capital expenditure, compared to £37.5 million in 1996. This included improving rail track, investment in bus and rail stations, and new DART stations at Clontarf and Drumcondra.
All three subsidiaries made a small profit. Dublin Bus made £1.5 million. This compares with a loss of £11.6 million in 1996, of which £9.5 million relates to a provision for restructuring. Bus Eireann made £3.4 million, compared with a loss of £9.3 million the previous year, when the company provided £10.5 million for restructuring. CIE said passenger numbers declined on city bus services around the country and blamed traffic congestion for this. The exception was the high frequency Imp service in Waterford, which showed growth. The company plans to introduce similar services in other cities as soon as possible. Passenger services were static on its Expressway services and declined slightly on other rural services.
The rail company earned a profit of £1.8 million compared with losses of £37.7 million in 1996. Of the £37.7 million loss, £37.1 million was due to exceptional provisions. CIE said the improved performance was due to mainline and suburban passenger revenue growth and further reductions in the company's cost base Total customer revenue was £129 million, of which the mainline and suburban rail division generated £95.9 million. The Exchequer contribution was £92.4 million. Mr Joyce warned that the £5 million profit was nowhere near what the company needed for reinvestment. For example, the total investment needed in railway infrastructure is £650 million.
