Varadkar says cuts inevitable as CIÉ's deficit hits €750m

THE STATE public transport company CIÉ lost about €50 million last year and has a “deficit of €750 million” when annual government subsidies are taken into consideration, according to Minister for Transport Leo Varadkar.

“The losses for last year aren’t as bad as they were for the previous year but they are still about €50 million, so there are big challenges ahead, we’re going to have to bring down costs probably down to where they were in 2005,” said Mr Varadkar.

As a result, fares across a range of public transport are set to increase and there will be a reduction in services.

“But I suppose I’d prefer to see the emphasis on reducing costs rather than increasing fares or reducing services,” he said.

Mr Varadkar said with passenger numbers falling and a big pension deficit in CIÉ, government subsidies of €700 million per annum will have to be reduced over the coming years.

He said the company faces big challenges in the years ahead to bring costs down to 2005 levels.

"There will probably have to be some level of fare increases unfortunately and there is going to have to be some reduction in services," Mr Varadkar told RTÉ's Morning Irelandradio show.

The level of fare increases has yet to be determined but will depend on cost reductions and getting more people to use public transport, he added.

Yesterday, the Minister named four new chairs of CIÉ and its constituent companies in an overhaul of the old system where there was a single executive chairman. Vivienne Jupp, a former executive with management consultants Accenture takes over at CIÉ while Kevin Bonner (Dublin Bus), Paul Mallee (Bus Éireann) and Phil Gaffney (Iarnród Éireann) fill the other roles.

The Minister said over the next few months the new chairpersons will make some changes to the boards and begin the process of cost reductions.

Mr Varadkar also denied he had plans to privatise any part of CIÉ, saying it is not on the “Government’s agenda” and was not included in the programme for government.

He said he would be naming a new chairperson for the Dublin Airport Authority in the coming months.