Julie O'Neill, head of the Department of Transport, will play a crucial role in implementing ministerial decisions in a climate of budgetary cutbacks, writes Arthur Beesley

Julie O'Neill doesn't understate the challenge she faces as head of the Department of Transport. But with pressure in the public finances likely to squeeze her €2 billion budget, she sees an opportunity to make wiser use of expenditure.

Though not in charge of the political choices that will govern policy during her seven-year term, she will play a crucial role implementing decisions made by the Minister for Transport, Séamus Brennan.

His first weeks in office have been marked by an appetite for change in transport and infrastructure. But with projects in these areas necessarily of a long-term nature, political drive alone will not achieve results without an efficient administration behind it.

This is where Ms O'Neill comes in. A civil servant since 1972, her original plan was to stay for a year before study. It was not to be, although she attained a Master's Degree at Trinity College Dublin and a B.Comm. at UCD through part-time study.

Thus, 30 years into her career, and long committed to the ideal of public service, she became general secretary of one of the most politically sensitive departments.

From Wexford, she comes across in conversation as a woman with a positive disposition, with a mind convinced of the merits of competition, and comfortable with detailed discussion of the large range of areas in the Department's remit.

Her previous jobs in the Civil Service include leadership of the Office of the Tánaiste when Dick Spring was the incumbent. After a short stint in charge of the Department of the Marine and Natural Resources, she says many of the areas in the current job are new to her.

Mr Brennan is in a similar position, she says, adding that this has helped them develop a positive working relationship. A good thing, no doubt, for with the exception of health, no other area will be watched more closely when the Government's peformance is measured. In addition, she has to manage the Department's 500 staff.

If the Programme for Government identified the policy objectives and priorities, plans for delivery will be embraced in statements of strategy soon to be published by all Government departments. In the case of Ms O'Neill's department, these are already clear.

Years into the boom, road, bus and rail networks are still bursting at the seams. These areas - with airports and the troubled State airline Aer Lingus - will be central to Ms O'Neill's efforts. With discussion about quality of life in vogue, there will be little tolerance of excuses if the Government goes the distance until 2007.

Indeed, Ms O'Neill is keen to adopt a long-term view, emphasising that decisions must be taken with an outcome in mind years down the line.

Here, she says the education strategies of successive Governments since the 1960s and the development of social partnership underpinned the boom.

Fixing the State's transport and infrastrucure systems should be seen in the same light, she says.There is, however, the matter of the tightening of Government finances, which this week saw the Western Health Board faced with 200 job cuts.

Overall objectives embrace the necessity to underpin competitiveness in the economy and foster balanced regional development. In urban areas, she wants to persuade people to use public transport as an alternative to the car.

Outside cities, the concentration will be on developing the road network, on major inter-urban routes in particular.

Managing a smaller pot will be crucial, with responsibility for roads newly integrated into the Department for the Environment. Ms O'Neill believes this provides an opportunity to see greater "value-added" returns from funds deployed, though she is conscious that the roads programme in particular is not proceeding as quickly as planned.

It has been beset by difficulty, with rampant inflation far in excess of the already-high domestic rate. So while the €1 billion allocated to the programme this year is sufficient to maintain current projects, no new roads will be started. Though reasonably confident that additional funding will be released for next year's programme in the Budget estimates process, this will not bridge an emerging funding gap.

"With the best will in the world there are going to be constraints," she says. Two possibilities are being looked at to tap additional sources to bridge the funding gap. These are "hard-tolling", where motorists pay to use particular stretches of road, or "soft-tolling" options, such as a levy on petrol.

Citing planning process difficulties and higher-than-expected land-acquisition costs, she says greater certainty is required in the forward-costing of programmes.

With longer stretches of road likely to be built, the Government is considering the "financial envelope" concept with a fixed cost on contracts.

"We have to be certain we are getting the best possible deal, paying fair and reasonable prices so there aren't windfall gains," she says.

On transport in the National Development Plan, Ms O'Neill is confident that the Luas light rail system will be introduced next year.

While there were "inevitable" cost slippages on the margins, "I don't have the same problem that I have with roads".

Luas will bring a new transport experience to Dublin, introducing a new player in a market long dominated by the CIÉ companies.

With CIÉ's €245 million subvention under scrutiny, Mr Brennan has linked its application for a 20 per cent fare rise to reform in the organisation. For reform, read regulation and competition.

Ms O'Neill sees new regulation of bus markets as a possibility, in concert with a gradual move towards competition.

"It's hard to get in-built pressure for cost-efficiencies," she says. "To whatever extent you introduce competition into that market it tends to improve that market."

Public transport is the final major area in the Department's remit in which it acts for the shareholder, as regulator, and is responsible for pricing.

Ms O'Neill sees the development of a regulatory framework more than deregulation per se as the objective. This would introduce greater transparency into the manner in which the subvention is dispersed, to the bus and rail companies.

She asks: "How can I be satisfied with the quality of service? The focus has to be on the effective delivery of service."

While reports suggest the overall Metro project might cost some €1 billion a year for 20 years, Ms O'Neill says she is "uncomfortable" with such figures because they are preliminary and says the plan is "not off".

The Railway Procurement Agency, which oversees Luas, has been asked to carry out a detailed cost-benefit analysis.

"There is certainly an agreement in principle that is is the right way to go," she says. Cost considerations aside, she adds: "In the long run, if the thing is worth doing then it is worth doing, even if it takes time."

The Government's priority at present is to develop a Metro link with Dublin Airport, she says.

The airport itself is likely to see considerable change if all Mr Brennan's plans are implemented. With preparations already under way for the introduction next summer of temporary "low-cost" facilities for the speedy turn-around of planes, Mr Brennan surprised many observers by seeking expressions of interest for the development of an independent terminal at the airport.

The plan is "very much the Minister's idea", Ms O'Neill says, and should not be geared towards the interests of Ryanair or the businessmen Ulick and Desmond McEvaddy, who have long sought to provide such facilities.

If adopted, the object would be to provide a competitive stimulus. "The requirement for an island nation is to ensure adequate and good value access," she says. "There's no point in over-investing in facilities that airlines won't use."

On the future of Aer Lingus, she says any requirement for long-term investment will be addressed only further into its recovery.