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Flabby CIE Puts Cost On You

Posted on: December 18th, 2011

So you will be hit by the household tax? Your VHI premiums are about to rocket? You have a child at university? You drive a car?

You ain’t seen nothing yet. Worse is to come. And worse could have been prevented.

The coalition cannot blame the troika, burn effigies of the IMF’s AJ Chopra or beat up on the last government for this one. This is their own handiwork.

The mother of all stings is waiting for you in January.

On December 5, Minister Brendan Howlin announced that he was cutting the state subsidy to CIE by €21m.

Not a bad idea as CIE has in recent years been exposed as a swamp of waste and skulduggery.

Quangos like CIE and its three subsidiaries — Dublin Bus, Bus Eireann and Iarnrod Eireann — are in dire need of efficiencies. There is plenty of fat hidden in the darker corners of these bloated bodies.

On December 9, just four days after Brendan had taken his brave step, a friendly quango rode to the rescue of CIE and its three little quango babes.

The National Transport Authority quietly announced that it was giving the go-ahead for a whole range of rises in bus, train, Luas and Dart fares. Dublin Bus was given the green light for 15 per cent increases in cash fares. This little grenade was lost in the budget furore and European crisis.

In one leap the three quangos had beaten the cuts. The reduction in the subsidy was neutered. There would be no need to take the axe to the wasters in the quangos. Ordinary commuters could make up the shortfall.

Travellers on Dublin Bus and other routes had been picked off. They have no alternative but to travel on the monopolist’s buses. Those who spend as much as €20 a week on bus fares will pay an extra €150 next year — more than the €100 household tax. Many punters will pay both.

It was a wonderful comradely gesture of the National Transport Authority quango to give such an uncharacteristically speedy response to the minister’s attempt to put manners on CIE. Barely 72 hours waiting for a lifeline, CIE can continue to do what it does best: presiding over the overpriced shambles that affects to offer a public transport service. One good quango helps another.

The friendly quango issued an explanation for its decision. It read like an apologia for CIE.

Incredibly, the first paragraph offers the eight per cent cut in the state subsidy to CIE as the primary excuse for letting fares rip.

Quango logic at its best. The response to Howlin’s cutback to a spendthrift quango is to crucify the masses. Switch the burden on to the vulnerable. Spare the upper echelons at CIE. The apologia went on to list the economic downturn, increased fuel costs and earlier subsidy cuts as justifications for the punitive price increase.

The NTA even blames emigration, immigrants returning home, unemployment, and lower tourist numbers. The NTA fingers everybody but CIE for the problems at the company, even boasting that it has not yielded to Dublin Bus’s application for fare increases of between 25 per cent and 36 per cent!!

The statement goes on to admit that the revenue from the increased fares will exceed the reduced subvention. So Dublin Bus was a net winner on the week. Quite a neat piece of sleight of hand.

The Transport Authority frantically tried to shield itself from criticism by announcing the launch of the new Leap Card. This gimmick is public transport’s belated gesture to the high-tech age, an integrated ticketing system to allow some commuters to soften some of the price hikes on some of the routes.

A mysterious tortoise, this Leap Card creature. It suddenly appears on the platforms a few weeks before the January fare rises. Amazing how these things can be done so quickly in the slovenly semi-states. Especially as the Leap Card has taken nine years to create!

Is the Leap Card value for money? The National Transport Authority did not tell us how much the Leap Card cost to develop.

Guess: Was it €50,000 of taxpayers’ money? €500,000? €5m? €55m?

You got it in one. The total cost of developing the Leap Card, after nine years, was €55m.

Most of the revenue from the fare increases in the first few years will be spent paying for the Leap Card. This little project must rank with E-Voting machines as one of the most reckless wastes of taxpayers’ money in the last decade.

Nevertheless CIE and its fellow quango are brazen enough to parade it as breakthrough.

The NTA should have refused all fare increases, demanded an explanation why the Leap Card took nine years from start to completion and cost the taxpayer €55m. They should have satisfied themselves that all the malpractices at Iarnrod Eireann had ended before even considering a price rise for any CIE company.

Instead they peddled the CIE line, supported by its downtown office — the department of transport.

The National Transport Authority is a captive, a quick learner of the quango culture. It was set up in 2009 to supervise Ireland’s public transport shambles. It went native immediately. It has been highly politicised from Day One. Its board is picked by the minister for transport and includes at least one real Fianna Fail peach.

Its annual report buries the names of its directors at the very back on the final page in the last appendix. It fails to give a single line about its well-paid board members (apart from their names) but we know they were chosen by former minister Noel Dempsey, a man who was never shy about promoting Fianna Fail favourites for quango gigs.

The Fianna Fail peach is a Donegal FF councillor. Daithi Alcorn was appointed to the NTA board in the dying days of the last FF/Green coalition after already being a director of the National Roads Authority (NRA).

Other NTA directors are beneficiaries of the quango merry-go-round.

This NTA quango deserves recognition. It serves a real purpose. It shields the government from the political charge that it was the villain that put up public transport fares. Last week in the Dail, Tanaiste Eamon Gilmore answered a question about the fare hikes with the same NTA/CIE/ Department of Transport line: after brandishing the Leap Card he insisted that the government was detached from such a sensitive decision. It was not the government’s business. The NTA set the bus fares!

Not strictly true. The government has the power under legislation to issue guidelines or policies to the NTA. What better use of these powers than to freeze fares.

Alternatively, they could require the political appointees on the board to stop the rises.

The political appointees on the NTA board have already earned their five-figure fees. They are being shoved out there in the front line to take the flak for the Government.

The Government has made a virtue of leaving income tax untouched. They did not need to. If you live in a house, you are clobbered. If you take a bus, you are impoverished. If you drive a car, you are crippled. If you save money, you are punished. If you have VHI cover, you may be mugged.

There is still an alternative: we could burn the bondholders and throw the quangos on the same bonfire.