Dublin's planned Luas light rail system could be operated by the private sector in line with the recommendations of a consultancy report considered by the Government yesterday , according to the Minister for Public Enterprise, Ms O'Rourke.
The report, compiled by Arthur Andersen and Steer Davies Gleave, also recommends that the proposed underground link from St Stephen's Green to Broadstone, and on to Ballymun and Dublin Airport, should be designed, built and operated privately.
In the meantime, the report says, CIE should press ahead with work on the planned lines linking Tallaght and Sandyford with the city centre, as well as the connection to Connolly Station. The whole system, once completed, should be run privately.
The consultants say private sector operators should be invited to bid for the franchise to operate Luas. Such an operator for the first three lines should be selected by spring 2001 to allow for staff recruitment, operational planning and marketing.
The report says franchising Luas would raise only a "limited amount" of private sector funding for the project, which is likely to cost at least £500 million. However, there would be "considerable interest" in the building and operation of a rail link to Dublin Airport.
The consultants cite the experience in Britain where public transport services, such as Manchester's Metrolink, have been developed by the private sector under what are known as DBFOM (design, build, finance, operate and maintain) contracts.
"The practice of letting concessions for the operation of rail transit systems is well-established, most notably in France," they say. "The view internationally that public transport services can be developed and provided more efficiently by the private sector."
There would be "a degree of regulation" of fares and services but with some flexibility for the operator to offer concessionary fares, according to the consultants. They also see merit in the establishment of an independent transport authority.
Referring to the city centre tunnel, they say the key objective is to "deliver a solution that offers the best value for money" when the contract is signed. However, since this would be some time away, the position "will need to be reviewed in the light of Government priorities".
According to the report, the principal concern of the Department of Public Enterprise on the extended Luas project is "to optimise risk transfer and cap costs in relation to the proposed underground section", effectively by getting the private sector to carry the can.
"This is a most valuable report and illustrates how private and State money can help provide and operate much-needed transport infrastructure," Ms O'Rourke said.
Because the Luas project was now running ahead of its revised timetable, she said the issue of private sector participation would be addressed "urgently" by a project group representing her Department, the Department of Finance, CIE and "key advisers".
She said all interested parties would be given an opportunity to respond to the report. "Following this evaluation, I intend to return to Government with proposals for continued development of the light rail project in the context of a public-private partnership".
