Dublin Bus is likely to be privatised under a package of measures aimed at introducing regulated competition in the capital's bus market, outlined yesterday by the Minister for Public Enterprise, Ms O'Rourke.
In a 50-page paper presented to the Cabinet sub-committee on infrastructural development, she also recommended setting up a new regulatory body, the Greater Dublin Area Passenger Transport Authority.
The PTA would design an integrated bus network to respond to Dublin's public transport needs and organise tender competitions to procure services on the network from bus operators, allocating subsidies where appropriate.
Following the examples of competitive tendering in London, Helsinki and Stockholm, the PTA would also monitor the service provided by bus operators and enforce compliance with minimum quality standards and ensure equitable treatment of all operators.
In time, the Minister intends that the PTA would be given a much wider remit to regulate all public transport services in the greater Dublin area, including rail and bus services, and to take over responsibility for transport planning in the area. The Government would continue to have a role in defining policy for the public transport sector, setting overall targets in terms of passenger numbers, and laying down an overall budget for Exchequer support.
Ms O'Rourke's paper recommends that the Government should give "immediate priority" to the drafting and enactment of new legislation within 12 months to allow for the establishment of a "shadow" PTA to begin the process of franchising bus routes.
The early establishment of such a body "would send a very clear signal that the Government is intent on moving to a more competitive market model in Dublin, even though it may take some years before the full franchise model is put in place", she said.
Its duties would include prohibiting Dublin Bus and Bus Eireann from extending their services in the greater Dublin area without prior written consent, monitoring the activities of all bus operators and taking action to ensure that none of them abused a dominant position.
In parallel with the drafting of the legislation to establish the shadow PTA, Ms O'Rourke said, the recruitment of staff and putting in place an administrative structure should be urgently put in hand so as to enable it to begin operations immediately the legislation is enacted.
Immediately following its establishment, the shadow PTA would negotiate public service contracts with Dublin Bus and Bus Eireann covering the services they provide on their existing core network in the greater Dublin area for a transitional period of three years.
This would give them time to "hone their costs in preparation for a competitive environment". Simultaneously, the shadow PTA would organise "a maximum number of tender competitions" for new bus routes, with a preference for smaller operators. Following enactment of the first Bill, work would commence immediately on drafting legislation to set down the final regulatory framework for Dublin, with the aim of transferring full franchising powers to a statutory PTA "by late 2002".
The three-year transitional period would also allow time for negotiations to take place regarding the transfer to private ownership of one of the two State-owned bus operators by April 2003, after they had been established as independent companies. "Allowing Dublin Bus and Bus Eireann, the two dominant operators in the GDA, to compete with each other under the new franchising regime would be a very effective way of developing real competition in the Dublin bus market," the Minister's paper says.
In order to achieve this, she has recommended that the State divest itself of its shareholding in at least one of these companies, with Dublin Bus being "the most obvious choice for an early sale, as the regulatory framework for its core market is much clearer".
It is likely that the new PTA would start franchising the core network in 2003 or 2004. With a quarter of the network franchised each year, the whole process of farming out bus services in Dublin would be completed by 2006 or 2007.
In the meantime, with agreement from the trade unions, Dublin Bus is to be encouraged to subcontract its services, thereby allowing private-sector operators to gain some experience on the streets of Dublin. A policy of one operator per route would continue to apply.
