Public Service Obligation Contracts
Each year funding is provided for socially necessary but financially unviable public transport services in Ireland. Dublin Bus, Bus Éireann and Iarnród Éireann provide these services, known as Public Service Obligation (PSO) services, under contract to the National Transport Authority.
The funding of PSO services is governed by Public Transport Contracts between the Authority and these three companies. The current contracts were signed in December 2009 and are for a period of 5 years, to 2014, in the case of bus services and 10 years, to 2019, in the case of rail.
The contents of the contracts and the basis for maintaining them may be reviewed at any time by the Authority in consultation with the relevant company, however, a full review of the contract must occur at the end of the 5 or 10 year period (as appropriate). In carrying out the review at the end of the period, the Authority must engage in a public consultation process and report on the operation of the services to which the contract relates stating the reasons for amending the contract or entering into a subsequent direct award contract.
The contracts meet the current criteria set down in EU law, setting strict standards of operational performance and customer service and contain penalties for non-performance.
The National Transport Authority monitors the contracted performance of each PSO operator on a quarterly basis.
Legal Basis for Public Service Obligation Contracts
In 2007 EC Regulation 1370/2007 on public passenger transport services by rail and by road was adopted. EC Regulation 1370/2007 creates a framework regulating how Member States award exclusive rights and pay compensation for services deemed to be Public Service Obligations (PSO).
The purpose of the Regulation is to ensure transparency in the award of subvention for public transport services by requiring all PSO transport services to be subject to contracts.
In preparation for EC Regulation 1370/2007 Ireland progressed legislation in two stages, the first involving the enactment of the Dublin Transport Authority Act 2008 and the second involving the Public Transport Regulation Act 2009.