Bus Éireann has warned that it could face insolvency by May and difficult decisions will have to be made urgently to avoid that prospect.

Speaking at the Workplace Relations Commission after the breakdown of talks with unions, Acting CEO Ray Hernan said that losses had continue to increase in January by €1.5m.

If that continued, he said, the company would be insolvent sometime during the month of May.

He acknowledged that the company had sought €12m payroll savings as part of an overall plan to achieve long-term competitiveness but stressed that immediate savings were required.

He said he was sorry to say it but that there was going to have to be pain taken by Bus Éireann staff.

Mr Hernan said that apart from the three route closures announced yesterday, no other closures are currently planned, though he warned that all routes will kept under review regarding profitability.

He said the Department of Transport had not been privy to all the proposals the company had put on the table, saying it was up to management to manage the organisation. 

Asked whether the company would now implement the cuts unilaterally, Mr Hernan said it would now be seriously considering its position as to what steps needed to be taken to avoid insolvency. 

He said he did not believe Bus Éireann would need shareholder approval to unilaterally implement the cuts. 

Asked about a timeline, Mr Hernan said time was now against them, and decisions would have to be made urgently. 

He also warned that there was also a danger of losing customers to competitors, leading the company into an even more precarious position.

The collapse of the talks raises the prospect of strike action if the company moves to implement payroll savings without agreement.

Union representatives have blamed management for the breakdown of the talks while Bus Éireann has said the unions "have no intention of reaching an agreement" that will address the company's financial crisis.

Unions set to go ahead with all-out strike

National Bus and Rail Union General Secretary Dermot O'Leary has said if the company's management implement cost-cutting proposals, unions will go ahead with their all-out indefinite strike.

Speaking while leaving the talks, Mr O'Leary said people in Government, instead of occupying themselves with the leadership of Fine Gael, should get engaged with the dispute.

He said that it was going to cause untold misery for people who travel and who need the transport system of the country, as well as for bus workers.

Speaking on RTÉ Six One, Mr O'Leary said that everyone recognised that there is a crisis in the Expressway service to the extent that there are losses of €9m, adding that the NBRU is willing to get involved in resolving that crisis.  

He said that this crisis is about the Government supporting public services similar to the way it supports health and education services.

Earlier while speaking on RTÉ's Drivetime, he said the collapse in talks could also mean potential problems for Iarnród Éireann.

Mr O'Leary said there will be no direct threat to school bus services.

He said unions were prepared to talk about efficiencies today, but the company was not prepared to negotiate.

He said the ball is now in Bus Éireann's court.

SIPTU Sector Organiser Willie Noone said despite the engagement over the last number of days, "management has never actually put a plan to the trade unions which would achieve the savings sought without driving conditions of employment into the ground.

"This is totally unacceptable and would never be entertained by our members," he said.

Unite Regional Officer Willie Quigley said management and the Minister for Transport bear joint responsibility for what he termed "a crisis of commitment" to the company's future as a public transport provider.

Unite represents craft workers at Bus Éireann.

Mr Quigley said Unite members are now preparing "to take immediate and indefinite strike action if and when Bus Éireann moves to unilaterally implement the threatened cuts".

NTA says it will step in to ensure local demands for transport met

Meanwhile, the National Transport Authority described the breakdown of the talks as "disappointing" for passengers.

It said that if some Expressway services are discontinued, the "NTA will, as we have done on previous occasions, step in and ensure that local demands for public transport are met."

"This will involve assessing the impact of any changes, establishing transport needs at local level, and working with bus operators to ensure connectivity is maintained. We will not leave any rural communities behind."

Yesterday, Bus Éireann told unions in a document that its financial situation is worsening, with losses for last year now estimated at €9.4m.

SIPTU rejected the document, which proposed job losses, pay cuts and changes to terms and conditions, saying it spreads more fear and uncertainty among staff.

This evening Bus Éireann has said the unions "have no intention of reaching an agreement" that will address the financial crisis.

In a statement, the company said immediate reductions in cost and improved efficiency are absolutely necessary to address the financial crisis.

It went on to say that it will "now seriously consider" its position and advise staff in due course of "the necessary steps that must be taken to avoid insolvency."