The chairman of CIE, Mr Brian Joyce, said yesterday that the scale of the crisis at the company is not adequately understood. The reason is that politicians have downplayed the inherent weaknesses of the group for decades and have shirked sanctioning necessary remedial action - usually over fears of industrial action. But as Mr Joyce emphasised, push, has now come to shove. The company can no longer; proceed on a relatively non competitive basis, accumulating huge losses and even larger debt. As a high cost operator it is already losing out to low cost; private companies which will grow in numbers as European transport deregulation gathers pace. in addition, CIE can not expect the EU to fund capital programmes and the Government's ability to underwrite losses will be severely curtailed.
Put simply, CIE must invest heavily in its operations or gradually shrink into irrelevance and it must reduce its operating costs in order to come up with the investment funds. The aim is to cut operating costs by £44 million a year. Given that the company's labour costs amount to 60 per cent of the total, this target is likely to unnerve employees. There can be little doubt that the savings target was arrived at after close analysis by management and by the various consultants employed by the company. It has not, however, involved sufficiently detailed discussions with the workforce or their trade union representatives. it should have, of course, but industrial dialogue at CIE has a reputation for time wasting and downright obstructionism which is unparalled. The interminable discussions on One Person Operated buses were shameful.
There are valid questions which should be asked of the CIE plans. What exactly will it cost to achieve these savings, especially if much reliance is to be placed on voluntary redundancies? What is the period in which the costs will be repaid through greater efficiencies? Will a substantial number of employees opt for voluntary redundancy when so few do under the existing scheme, which there are no plans to improve?
CIE has demarcation lines and work practices which would be indefensible in any company never mind one which takes £100 million a year from the taxpayer and still loses £31 million. it has a culture which appears to be anti commercial and less then customer focused. it does, admittedly, operate some routes which are uneconomic. If the Government deems, as part of a co ordinated national transport policy faced with social obligations, that these routes should be kept in operation then a clearly defined subsidy for so doing should come from the Exchequer. Other CIE routes are called uneconomic when the fact is that they are operated uneconomically.
The time has come for CIE employees to face up to inevitable changes that the marketplace has wrought. The company cannot remain cocooned in funding from the taxpayer. The parallels with Aer Lingus are remarkable. CIE jobs can only be secured if CIE is able to equal its private sector rivals on cost. Better to bite the bullet now and give their company a real future.