Public Transport

121. Deputy Ciarán Ahern asked the Minister for Transport if he will provide the €70 million in funding that the NTA says is required to avoid the increase in public transport fares; and if he will make a statement on the matter. [68009/26]

This is a simple one for the Minister of State. I am glad to hear from Deputy Buttimer that the budget negotiations with the Department of public expenditure are ongoing because my question is whether the Minister will provide the €70 million in funding that the NTA says is required to avoid the increase in public transport fares.

I thank Deputy Ahern for his question. As the Minister of State, Deputy Canney, and I have said, the recently announced change in fares were the first revision in eight years. The change is aimed at supporting not just the continued expansion but also the improvement of public transport, while maintaining affordability. Any overall increase in revenue generated will go straight back into investment in public transport services, delivering better connectivity, capacity and reliability for passengers and commuters. This investment will also form part of the Department's engagements with the Department of public expenditure as part of the annual Estimates process, which has not yet concluded, for next year. On an overall basis, fare revenue only covers approximately 38% of the cost of operating the PSO services nationally, with the remaining costs funded by the Exchequer. It is, therefore, imperative that there is a rebalancing of the critical equation in how we fund PSO public transport nationally, ensuring that fare revenue continues to make a sustainable contribution alongside significant levels of subsidy, while maintaining the affordability and accessibility of public transport. I would also highlight that this level of fare recovery is largely consistent with European averages, with our actual fares set at much lower rates. I appreciate the concerns expressed by people about the recent fare increase and many of them have contacted me. However, in line with international best practice and to bolster the State’s capacity to invest in service expansion, network improvements, and operational resilience to encourage continuous passenger growth, it is essential we prioritise this reinvestment of fare revenue, ensuring that we can maintain a well-funded, reliable system and deliver greater long-term benefit rather than reducing fares to unsustainable levels. It is fair to say that achieving this requires a careful balance between delivering high-quality, reliable services and ensuring the network is adequately resourced to meet growing demand. We saw a record 363.5 million journeys undertaken just last year.

I thank the Minister of State. Often when I ask a question of the Minister for Transport, I am fobbed off to the NTA because I am asking about operational matters but this is a funding matter. It is a hugely disappointing decision from Government and a baffling decision in the middle of a cost-of-living crisis and a climate crisis. The current policy has been working for the Government. It is a really popular policy with the public, it is politically popular and I am baffled as to why the Government is doing this when we know that the low-fares policy is incentivising people to use our public transport. It is just so disappointing and hard to understand. We can support, rightfully, one cohort of transport users, namely people who drive and are reliant on their cars and of course, we should be supporting them with reductions on VAT and excise, but at the same time, we cannot be pitching public transport users against these other users of transport. We have to be supporting everyone, which is why this decision is so disappointing.

The Deputy and I speak the same language. It has been a success story and to keep it that way, there has to be an honest conversation around fare structures. To be fair, we must consider the volume of people using public transport. I know that some Deputies will dismiss the €940 million but that is a significant investment by Government in public transport. I would make the point that we have maintained a fare freeze for eight years, along with targeted affordability measures of which we are all aware. Those measures compare favourably internationally. I take the point that there are people who are unhappy and who are being affected. They have communicated with all of us and I have met them but it is important to make the point that we have implemented one of the most significant fare reforms in recent decades through the introduction of the 90-minute fare and substantial discounts for young people and students through the young adult card. Our commitment, as a Department and as Ministers, is to ensure that we have a reliable and accessible public transport system.

I certainly will not dismiss the very significant investment in public transport which is really welcome. The problem with the PSO is that it is not keeping pace with the volume of users now and the demands. The Minister of State talked about 38% of the costs of the PSO being covered by fares but public transport pays for itself in other ways through reduced congestion, safer roads and lower carbon emissions. The idea that fares need to cover costs is not entirely correct. Talking about international comparators and Ireland being relatively lower or higher compared to elsewhere does not really butter any parsnips for people who are impacted by these fare increases. AMLÉ, the association of student unions in Ireland, has come out in recent days looking for free fares for everyone under 25. If we are going to be increasing fares elsewhere, I would love to see us focusing on a group like that.

The significant point is that our PSO programme funds public transport services, both bus and rail, and as we know, it is composed of Exchequer funding and fares. The Deputy is right and the priority for us, working with the NTA, is to deliver on BusConnects so that it takes people out of their cars and onto the bus network. I have seen it in my own city of Cork. In the past couple of weeks, with colleges and schools back open, there has been an increased volume of traffic on our roads. That emphasises the importance of BusConnects. The Deputy will agree that we must continue to prioritise public transport, which is what the Government is doing, and the PSO element of that is very important. Discounts for young adults and students are critically important. For my Department, this is an important part of our budget negotiations. As Minister of State with responsibility for rural transport, I am acutely aware of the need to enhance the offering across the whole country. Deputy O'Shea, who is in the Chair, has spoken to me about different bus services in his area, Deputy Pa Daly referenced the town bus in Tralee, and other Members will be speaking this morning about other bus services. We are committed to investing but there is a need for honest conversations.