Subsidy for Luas if passenger numbers are low

The Department of Transport is prepared to give a subsidy to Dublin's Luas system - if the system fails in meeting passenger numbers.

The Department said the subsidy would be a "doomsday" situation in which it would have to step in if passenger forecasts - which currently envisage Luas carrying about as many passengers as the much larger DART system - fail to materialise.

Current forecasts for Luas are for eight million or nine million people on line B, the green line to Sandyford; and 12 or 13 million on the red, or Tallaght line, in the first year of operation.

That is a combined total of 20 million passengers per year travelling on 23km in two tram routes that are not integrated in the city centre.

The passenger forecast is similar to the DART line figure, which was 21.6 million people last year. In contrast, however, the DART line is more than twice as long at almost 52 kms and is not broken in the city centre.

Luas needs to carry the 20 million passengers to collect fares totalling about €20 million in order to achieve a break even position on the €20 million a year it has agreed to pay the system operator, Connex, each year for the next five. Yet, the DART only collected fares of about €24 million. In addition the DART is given an operating subsidy of more than €11 million. The Rail Procurement Agency projections see Luas operating without a subsidy.

While Luas will run up to 12 trams per hour, compared to the DART's 10 trains, the capacity of a 30-metre tram is 235 people, whereas a DART train of six carriages can carry about 900.

The figures indicate that on a kilometre by kilometre basis, the RPA sees the Luas system as being at least twice as effective as the DART.

The RPA said yesterday that this was a start-up position. While a spokesman cautioned the first year figures would be affected by a "ramping up" of services and the fact that only the Sandyford line would be in operation for up to two months following the system's launch, growth in passenger numbers was expected.

A spokesman for the Department of Transport said should passenger numbers fall badly short of target, "there would be some sort of onus on the Government to intervene". The spokesman said that "everything is geared towards breaking even or making a profit" and that while he accepted the figures when compared to DART were ambitious, payment of a subsidy would be a "doomsday situation".

Earlier this summer the British National Audit Office (NAO) reported new tram lines across the UK had failed to achieve predicted passenger numbers - sometimes by 45 per cent.

The NAO found light rail has improved the quality and choice of public transport in the cities served, but the anticipated benefits had been overestimated or were not being exploited fully. Forecasted passenger numbers had been well in excess of those experienced in a number of tram schemes.