Unions at Irish Rail have pledged to strongly resist proposals by the European Commission to liberalise the State rail market - which they believe will drive down pay and conditions for employees and could undermine the service. 

Traditionally the contract has been awarded to the State monopoly Irish Rail - but the current 10-year contract is due to expire in 2019.

The Commission has proposed that from then, the contract should be put out to international tender in a bid to liberalise the market under a programme known as the Fourth Railway Package.

It envisages the establishment of a single rail area across Europe with rail markets open to competition - and regulated by a central regulator with EU-wide jurisdiction. 

The Government is to seek an exemption from the liberalisation move on the grounds that the market here is so small - as it represents less than half a percentage of the overall European railway market. 

The Department of Transport has voiced concerns about the proposals, but stresses that discussions are still ongoing. 

SIPTU said it would support the Government in seeking a derogation from the Fourth Railway Package. 

Construction and Utilities Division Organiser, Owen Reidy, described the proposals as a clear and naked attack on Irish workers which would lead to a severe erosion in employment terms and conditions at Irish Rail. 

He said the EU proposal would do nothing to assist rail users - but could undermine the operation of what he described as "our coherent and integrated transport system".

General Secretary of the National Bus and Rail Union, Dermot O'Leary, said the argument for privatising the already underfunded Irish rail services did not stand up - and that it would sound a death knell for a large portion of Irish railways. 

He claimed that privatisation in the UK had failed miserably in terms of value for the taxpayer, with the subsidy trebling since privatisation. 

He said the notion that privatisation and competition would drive down fares was a misnomer. 

He noted that in the UK a worker on the average industrial wage would spend 18.5% of his average industrial wage on his annual commute from Milton Keynes to London - while the same worker in Ireland would spend 8% of salary on a ticket from Portlaoise to Dublin. 
 
Unions stress that staff have already experienced a significant cost reduction programme with pay cuts to address its financial difficulties. 

It is understood that one possible compromise could see the Government permitted to award the contract to Irish Rail, provided the company was subject to performance indicators monitored by an independent regulator. 

The only rail service in the country not operated by Irish Rail is the Luas, which is run by French company Veolia.