Bus Market Opening

Media Briefing22nd April 2015

Anne Graham

Contents

• Public Transport Services legislative context

• Short history• Public tendering• Next steps• Legal Challenge• Economic environment• Terms & conditions

Commercial Licensed service (no state subsidy)

or

State Contracted service Direct Award Contract (without tendering)

Publicly Tendered Contract Both in receipt of subsidy

• €60m Dublin Bus; €32m Bus Éireann in 2014• €90m capital investment in 2014

Public Bus Transport Services

Short History

2009

• National Transport Authority established.

• Function to secure the provision of public transport services

• The Authority entered into two “direct award” contracts in December 2009 on the first day of Authority’s establishment with Dublin Bus and Bus Éireann for subsidised services for five years duration.

• Continual improvement in efficiency and customer service undertaken with operators e.g. Galway services

Short History

2013

• Authority had to decide by 30th November 2013 on next PSO bus contracts– which services (if any) will be directly awarded without

tendering– which services (if any) will be competitively tendered

• Authority carried out statutory consultation commencing in September 2013 and made its decision in November 2013. Two notices were sent to European Journal on 30th November 2013– One announcing ‘follow-on’ direct award to be entered

into on 1st December 2014– One announcing competitive tendering to commence in

December 2014.

Short History

2014/2015

• Authority entered into subsequent Direct Award contracts with Dublin Bus and Bus Éireann on 1st December 2014. These contracts included for the competitive tendering of 10% of the services to be operational by end of 2016.

• The approximate value of these direct award contracts to Dublin Bus is approximately €1 billion over the period to 2019 and Bus Éireann €0.5 billion over the same period.

• Authority published notices on etenders and in OJEU in January 2015 seeking expressions of interest from public transport operators to pre-qualify for tender competition for the tenders for the Operation of Public Bus Passenger Services on:– Certain Outer Dublin Metropolitan Routes – closing date 27th April– Certain Dublin Commuter Routes – closing date has passed– Waterford City Routes – closing date has passed

Publicly Tendered Contract

Examples:

LUAS light rail services (Operator Transdev managed by RPA on behalf of NTA)

orNTA contracts: Cashel – Portlaoise with M&A Coaches Cavan – Longford with Whartons Coaches Door-to-door, on demand rural transport services

About to procure Kilkenny to Dublin replacement services caused by changes to Bus Éireann Expressway Route 7 (Cork to Dublin) and JJ Kavanagh services

Why it is not privatisation of services

Nothing is being sold

Services not being deregulated

Control of services remain with Authority

Fare Revenue to NTA (Gross Cost contract)

Operator paid a fixed fee for providing the prescribed services

Public Transport services contract

In the services to be tendered as part of the Bus Market Opening, these features will remain the same :

• Vehicles• Routes and stops• Frequencies• Fares• Free Travel Pass & Leap Card• Real Time Passenger Information, Journey

Planner

Why tender 10% of services

Comparator to assess value to taxpayer

Introduce competitive tension

Reduce costs of services – can reinvest savings in additional services or improved quality of services

Next Steps

STAGES IN PROCUREMENT PROCESS INDICATIVE TARGET DATES

Publication of Contract Notice in Official Journal ofEU

January 2015

Deadline for receipt of Pre‐qualification Submission April 2015

Evaluation of Pre‐qualification Submissions April‐May  2015

Issue Invitation To Tender to Pre‐qualifiedTenderers

June 2015

Deadline for receipt of completed Tenders October  2015

Best and Final Offers (BAFO) documents Issued(should the Authority consider a BAFO phase to beappropriate or desirable)

November 2015

Deadline for receipt of completed BAFO January 2016

Evaluation of BAFO Submissions February 2016

Contract Award April 2016

Legal Challenge

• Confirmation that Leave to take a Judicial Review of the Authority’s decision to subject the three routes to tender process has been granted by the High Court

• Authority’s solicitor has not been served with the papers

• Authority satisfied that its decision is legally robust and is in accordance with the legislation that governs us and will defend vigorously

• Not in a position to discuss any further

GROWTH IN PUBLIC TRANSPORT DEMAND

Change in Passenger Journeys 2010 -2014

% Change in Passenger Journeys 2010 to 2014

Passenger Journeys (PJs) 2014 v 2013

Operator 2014PassengerJourneys

2013PassengerJourneys

Difference

(m)

% Change

Dublin Bus 116.3 112.5 3.8 +3.4%

Bus Éireann 30.8 29.7 1.14 +3.8%

IarnrodÉireann 37.8 36.74 1.06 +2.9%

LUAS 32.6 30.5 2.1 +6.9%

Total 217.5 209.4 8.1 +3.8%

PSO Passenger Journeys alongside General Economic Data, 2008 -

2014

Economic Activity 2012 to 2014 and forecast to 2016

2012 2013 2014 2015f 2016f

Consumer Price Index (CPI)CSO 1.7 0.5 0.2Central Bank 0.1 1.6ESRI 1.0 n/aDepartment of Finance (HICP) 1.0 1.4IMF (HICP) 0.9 1.2

Gross National Product (GNP)CSO 1.1 3.2 5.2e

Central Bank 3.3 3.5ESRI 4.6 n/aDepartment of Finance 3.3 2.5IMF 3.1 n/a

Gross Domestic Product (GDP)CSO -0.3 0.2 4.8e

Central Bank 3.7 3.8ESRI 5.3 n/aDepartment of Finance 3.6 3.0IMF 3.3 2.5

Unemployment rateCSO 14.7 13.1 11.3Central Bank 10.4 9.3ESRI 9.7 n/aDepartment of Finance 10.2 n/aIMF 10.7 10.1

Growth in demand

• Authority confident that the projected growth in demand for services over next few years is such that a number of Dublin Bus and Bus Éireann staff that would be eligible to transfer would actually be required to run additional services for those companies rather than transfer to a new operator

PROTECTING TRANSFERREDEMPLOYEES

Terms & Conditions for Employees

• If staff transfer to new operator:– Protection of Employees on Transfer of

Undertaking Regulations (TUPE)– Minister confirmed that concerns over pension

status will be dealt with– Authority open to putting additional protections

in place for transferred staff• Observance of terms & conditions for duration

of contract for transferred staff

Questions