Pre-Nationalisation

Foundation of State

The railways came under government control at the outset of World War I.  The Irish Railways Executive Committee was established in 1916 and managed all Irish railways until 1921.  It was already clear by that stage that railways would no longer be profit making.

The Provisional Government took over control of the railways and appointed a Commission to  to enquire into the position of the railways.  It recommended, state ownership of  the railways with an independent railway board.

By the foundation of the State in 1922, motor transport was making significant inroads into the viability of the many railways that existed throughout Ireland.  The Viceregal Commission published in 1910, had recommended that a single Irish authority be constituted to acquire the railways and usable as a single unit.  The Commission proposed an annual grant to the railway authority.

By 1923, the effects of civil strife,  particularly in the south and west  of the country was that, many hundred incidents had  damaged and destroyed  railways, bridges, locomotives and infrastructure.  This exacerbated further the railway’s economic problems.

Railway Act 1924

The Free State Government’s  Railway Act 1924 provided for the merging of all railways wholly situated within the Free States.  This included initially the Great Southern and Western Railway, The Midland Great Western Railway and The Dublin and South Eastern Railway.

They merged to form the new Great Southern Railway Company, which remained a privately owned company.  This company in turn absorbed or agreed voluntarily terms for the acquisition of 22 other railway companies. A transport tribunal was established to arbitrate on the terms of acquisition. The tribunal published schemes for the absorption of the other companies.

The baronial guarantees ceased under the terms of the 1924 Act. The legislation provided compensation for Great Southern Railways for running loss making services payable from public money.  The intention was, that a sum will be payable for 10 years after the legislation was passed, after which no public subsidy would be paid.

CnaG Transport Policy

The Railways (Road Motor Services) Act, 1927 gave railway companies the right to operate road services subject to ministerial approval of routes and charges.  Another piece of legislation gave the Dublin United Tramways Company, power to operate bus services.

GSR established an agreement with the major operator Irish Omnibus Company in 1927 and obtained control of it 1929.  At that stage, road transport was virtually unregulated.

The Road Transport Act, 1932 prescribed that all scheduled passenger services must operate under a licence by the Minister for Industry and Commerce.  Licensees must publish timetables and charges.  Legislation did not prohibit  independent scheduled bus services.  They could operate within the terms of licensing.

The Railways (Miscellaneous) Act, 1932 provided for discontinuance or reduction of rail services on lines constructed out of public monies, effectively the narrow-gauge lines built with baronial guarantees.

FF Transport Policy

The new Fianna Fail government quickly introduced two pieces of legislation, the Road Transport Act, 1933 and the Railways Act 1933.  The Road Transport Act restricted the carriage of goods for reward to operators who had been operating at the time of the Act.  Restrictions were imposed on their area of operation.

Railways were given powers to compulsorily acquire road competition both in the passenger and freight sphere on terms that would be determined if necessary, by arbitration.  The policy was deliberately monopolistic intending to provide a single provider of transport services, rather than allow the railways to be underutilised.

The value of the shareholding in the Great Southern Railways decreased greatly.  The shareholders complained of not being allowed to liquidate the breakup value of the company which was prevented by legislation.

First Branch Closures

The first significant number of branch line closures took place in the 1930s, including those from Edenderry, Castlecomer, Killalla, Killaloe, Muskerry, Tralee and Dingle, Clifden, Westport to Achill.

Freight declined severely due to the depression in the 1930s.  Meanwhile, the number of motorcars and motor haulage vehicle increased dramatically.  Passenger and freight operations for reward, declined by reason of the acquisition of by the Great Southern Railway and the Dublin United Transport Company and many independent bus and freight company.  Rail traffic continued to fall and the finances of the GSR deteriorated.

The government appointed a tribunal of enquiry on public transport in 1938.  The majority Beddy Report recommended this establishment to a National Transport Council to review all modes of transport.  In the meantime, Great Southern Railways would include a government nominee. Increase duties on vehicles operated by non statutory companies  were recommended to cross subsidise public rail services.  It  recommended a government guarantee issue of debentures for Great Southern Railways.

During the fuel shortages of World War II, petrol rationing drove passengers and freight back to public transport. Great Southern Railways was taken over by the government under the Emergency Powers Act.

CIE & Rationalisation

The Transport Act, 1944 established Córas Iompair Éireann and CIE and dissolved the Great Southern Railways and Dublin United Transport Company Limited.  Their undertakings were transferred to CIE. Later, in 1945 following the fall of the previous minority government and the Transport Bill (due a pending investigation in on stock market irregularities) legislation was passed to compulsorily acquire the Great Southern Railways.

CIE also acquired the Royal Canal which is the property of The Midland Great Western Railway since 1845.  CIE became the largest employer in the state with a staff of over 21,000.  At that point in time, there existed the Great Northern Railway and four other railways across borderlines mainly to London and Lough Swilly Railway.  The County Donegal Joint Railways Committee, the Sligo, Leitrim and Northern Counties Railway and the Dundalk, Newry and Greenore Railway.

CIE a Private Company

The legislation provided for government  appointments to the board of CIE, but it remained a private company.  There were provisions to ensure that there was adequate control by the authority over charges.  There were provisions to procure that there were transport services in all parts of the country.  There were provisions against discriminatory treatment between different industries. There were provisions regarding  conditions of employment.

Subject to the above, the  intention of the government was that the board should be left to free to run the business as it thinks best.  Restrictions imposed by earlier legislation on transport undertakings were relieved. Special tariffs might be established for protector industries.  Ministerial approval was required for branch cline closure.

Finances & Milne Report

Despite a favourable early start, CIE lost money in several sectors including in particular, those referable to branch lines.  The last dividend was paid in 1946.   1947 saw extraordinary difficulties including the worst winter in record and inability to access fuel across Europe. CIE incurred a £900,000 loss.

The board request government permission for increased charges and staff reductions together with line closures.  It had become apparent that it was  impossible to reconcile public policy while preserving uneconomic services in the context of the private company.

The government commissioned a report under Sir James Milne, general manager of Great Western Railways in Britain prior to his absorption by the British Transport Commission to examine into the position of rail, road and canal transport in  Ireland, and report to the Minister on the steps necessary or desirable to secure the greatest coordination of rail, road and canal transport,  restoration of the financial position of public transport and the most efficient and economical  transport system.. The report recommended direct financial assistance and envisaged that in the longer term, a dividend would  be paid to the State for its investments.