Bus Eireann is to brief staff members about cost-cutting measures that include alterations to its Expressway routes.
The country’s largest bus operator has been involved in a dispute with the National Bus and Rail Union (NBRU) after a report, commissioned by Bus Eireann, recommended that it should cut its Expressway service if it could not turn a profit.
The company claims that the changes need to be made as soon as possible to prevent it from becoming insolvent.
The semi-state body will look to get rid of overtime payments believed to cost between €11 million and €13 million per year and is expected change its annual policy which would stop staff members being able to carry unused holiday into the next year.
The company is due to announce a ban on recruitment and will tighten the rules on chartering buses from outside the business.
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Bus Eireann is also seeking more funding from the government to reduce the burden of those using the free travel scheme. At present the Department of Social Protection funds about 40 per cent of the cost of an Expressway journey when a passenger travels on the free travel scheme.
Bus Eireann said the Expressway will remain part of the business but that changes were required urgently to address its financial situation.
“This may result in alterations to the operation of some routes, but the National Transport Authority have advised that they will ensure local demands for public transport are met and that no rural communities will be left behind,” the company said in a statement.
“We are making all efforts to ensure that no passengers are inconvenienced as we introduce vital cost savings and necessary efficiencies.”
The NBRU said that Bus Eireann was “conditioning staff into accepting cuts to terms and conditions”.
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“Turning the spotlight on staff is a sad reflection on the new management structure at the company,” Dermot O’Leary, the union general secretary said. “It demonstrates quite clearly for us that they are being puppeteered into providing an escape route for the shareholder whose responsibility it is to provide and support essential transport links for all of the citizens of the state.”
Bus Eireann had losses of €5.6 million in 2015 and the company’s contribution to the exchequer fell to €59 million. The Grant Thornton report, leaked last week, warned that severance packages could cost anywhere between €36 million and €85 million if the company opted to close Expressway.
Losses were expected to rise to €8 million last year.
The company serves about 3,000 schools nationally, carrying about 113,000 children every day.
Robert Troy, the Fianna Fail transport spokesman, said that the management team at Bus Eireann and the union were on a “collision course” over cost-saving measures.
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“Steps must be taken to ensure that smaller towns and villages do not lose out on essential bus services if routes are overhauled. Rural areas, which have already suffered vastly reduced services, must be protected. A full range of cost-saving measures must be considered, but any examination of overtime payments cannot result in cuts to services,” he said.
Ray Hernan, the acting chief executive, said last week that the threat of the company becoming insolvent within the next year and a half was very real.
He said that the company was “facing losses which are not sustainable” and that the business must act decisively to prevent it becoming bankrupt.
The Expressway service incurs the greatest proportion of losses for the business but only accounts for about 19 per cent of its overall number of passenger journeys.