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'There might be a tightening of the belt': What's the future for Ireland's public transport post-Covid?

With fewer people commuting to work, how will public transport finances and services look in future?

AT THE BEGINNING of 2020, Ireland’s public transport providers were looking into a future of continued passenger growth, increased revenues and further investment in the network to ensure it was environmentally sustainable. 

Things were looking good. The previous year had been a record-breaking one for public transport in Ireland. Figures released by the National Transport Authority (NTA) at the time showed some 290 million passenger journeys had taken place in 2019 across all the main providers -  Dublin Bus, Bus Éireann, Iarnróid Éireann, Luas and Go-Ahead Ireland bus services.

This marked an increase of 24 million journeys (or 9%) on 2018. Revenues had risen across the board, and providers had every reason to believe they would continue to do so. As Ireland’s economy kept growing, and with rent and the price of housing pushing people out of urban centres, more people were commuting to work every year. 

Of course, the sector was not without significant problems. Anti-social behaviour on the Luas and Dart services in Dublin was highlighted frequently in the media, as well as significant overcrowding, increasing fares, and a lack of adequate disability access on rail services.

But with sustained growth in the sector, the mood at the beginning of 2020 was positive.

“There is no doubt that when there is a reliable, high quality, value-for-money public transport offering that customers will respond positively to it,” Anne Graham, CEO of the NTA said at the time. 

And then everything changed, almost overnight, with the onset of the Covid-19 pandemic and the restrictions that followed. From March 2020, passenger numbers on all public transport plummeted as travel for non-essential reasons was banned.

CSO figures show that in just over a month, passenger journeys dropped 10-fold, from more than 5.6 million on 1 March 2020, to just 514,000 in April. 

While passenger numbers have fluctuated since then, in line with the easing and imposing of government restrictions over the past 16 months, in general they remain far below pre-pandemic levels. 

To make up the resulting shortfall in revenues, hundreds of millions of euro is being spent by government to support the sector.

With both unions and State officials acknowledging that these payments can’t go on indefinitely, what will the future hold for Ireland’s public transport?

The hit

Latest accounts for Ireland’s three main State-owned public transport providers (Dublin Bus, Irish Rail and Bus Éireann) show huge drops in revenue in 2020. The three are part of the CIÉ Group.

For Irish Rail, total revenue fell from €297.4 million in 2019 to €143.7 million last year, a drop of €157.7 million. Bus Éireann brought in €366.5 million in 2019 which dropped to €284.8 million last year, while Dublin Bus had revenues of €263 million in 2019, which dropped to €125.1 million last year.

In total, then, operating revenues at the three State-owned companies fell by €377 million in a single year.

To make up for this shortfall, payments from central government increased significantly in 2020. The amount paid under the Public Services Obligation (PSO) fund jumped hugely.

The PSO is usually paid to operators to run transport on routes that may not be financially viable, but are necessary from a public standpoint. But last year, as passenger revenues plummeted, the PSO was used to make up the balance.

In total, government support for all services in 2020 more than doubled to about €620 million, compared to €300 million the previous year. 

A spokesperson for the Department of Transport confirmed that the 2021 allocation for PSO is just under €659 million to ensure the continued operation of services.

While public transport recently increased from 50% capacity to 75% capacity, a greater change to commuter habits brought on by the pandemic may affect providers long into the future. 

Working from home

The shift to remote working en masse for tens of thousands of workers across the country disrupted years of continuous growth in commuting numbers into cities and other urban areas. 

For John Murphy, transport sector organiser at Siptu, the question is not only when will restrictions be lifted, but when, if ever, passenger numbers will return to the level they were at pre-pandemic:

“I know from talking to all the operators, they all have concerns going forward. Firstly, when are we likely to see a full reopening of public transport services and reopening of society?

“And then, even when things do come back to some form of normality, whether there will still be the passenger levels there. Because some people will obviously work remotely where they can, they’ve got into that habit and it’s worked for them, it’s worked for their employer.”

In January of this year, the government launched its National Remote Work Strategy, which aims to ensure that “remote working is a permanent feature in the Irish workplace in a way that maximises economic, social and environmental benefits”.

Last month, Tánaiste Leo Varadkar launched the government’s #MakingRemoteWork campaign, and the government has committed to introducing new laws which would give employees the right to request remote working.

“We need to make sure we do not drift back to the office and the old normal just because it’s safe to do so. We need to seize this opportunity to create a new normal, a better normal,” said Varadkar. 

John Murphy questioned what this will mean for the future revenues of public transport providers:

“There’s concerns going forward from all operators that the level of passengers will take a long time, if they ever get back, to where they were in 2019,” he said.

He pointed out that if passenger numbers don’t come back to the level they were at pre-pandemic, then continued funding will be needed to ensure obligations are met:

“If the revenue streams are dropping at the fare box then it’s up to [government] to ensure that the operators are being paid the necessary funds to make sure they keep operating,” he said.

Making up the shortfall

The increased government payments during the pandemic have been welcomed and supported by workers’ representatives, but there is an awareness that they cannot last indefinitely.

There is serious concern among operators over what the future will hold, John Murphy says. 

“At some stage the finances are going to have to be balanced so that’s Dublin Bus’ concern,” said Murphy, who deals primarily with Dublin Bus on a day-to-day basis.

“Particularly [the concern is], that when all the bills have to be paid, will the level of finance still be available for the passenger services and the public transport service?

“I would expect… there might be a tightening of the belt coming down the line for some of the operators, which we’ll have to deal with.”

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Murphy said that the government has committed to supporting operators going forward on a rolling basis.

“They haven’t been given an endless guarantee, but presently, at least to my knowledge, they are being supported financially for the drop in revenue,” he said.

A Transport Department spokesperson said that it was working closely with operators to continue to monitor the impact of the pandemic on the transport sector. They said that in order to support services during the pandemic, “the Government is spending considerable additional Exchequer funds on the public transport sector.”

They said that supports had been rolled out for the bus sector for routes where a “clear public interest justification supports such intervention” and that these supports were being reviewed on a monthly rolling basis.

“The Department and the NTA, working closely with operators, continue to monitor the impact of the crisis on the public transport sector,” the spokesperson said.

A spokesperson for Dublin Bus said that Covid-19 has had a “significant impact on Dublin Bus and our operations” and that as a result customer numbers and revenue was lower. They said that the support of the NTA and managing the service’s costs has helped to reduce the impact. 

“The company has also delivered a range of cost savings wherever possible which has reduced the overall cost to the Exchequer,” the spokesperson said.

A Bus Éireann spokesperson said that the company was being supported by the NTA on an ongoing basis for both its public service and commercial routes. The company has cut its commercial Expressway routes between Dublin and Belfast, Cork, Galway and Limerick as they were no longer financially viable. 

“We have indicated that recovery to pre-pandemic levels may be expected to take between 18-24 months,” the spokesperson said.

“Bus Éireann will continue to work with the National Transport Authority and the Department of Education to provide the best services possible for PSO and School Transport, as per specified delivery.”

The future of commuting

The questions around the future of public transport and commuting, how the pandemic has changed people’s behaviour and how these changes affect communities, are some of the issues being explored in a recent research project from the International Centre for Local and Regional Development (ICLRD).

Focusing initially on three towns across Ireland and Northern Ireland over two years that had varying levels of commuting pre-Covid, the InPLACE research looks at the impacts of commuting to work on people and places both before and after Covid-19 hit. There are plans to include a further three case study towns in phase 2 of the study.

“The focus is on communities as places to live. There’s a lot of emphasis now in planning on trying to develop a sense of place in our towns and villages and a strong sense of community,” explained Professor Des McCarthy of Mary Immaculate College, project leader.

“So we want to see how that sense of place and the quality of our towns and villages as living environments has been impacted both prior to the pandemic and then again during the pandemic.”

The researchers will then put forward recommendations around future planning for housing, transport, community development and other areas. 

This work is co-funded by Journal Media and a grant programme from the European Parliament. Any opinions or conclusions expressed in this work is the author’s own. The European Parliament has no involvement in nor responsibility for the editorial content published by the project. For more information, see here

About the author:

Cormac Fitzgerald

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