The Transport Ministry insisted today that it had a duty to compensate bus owners as part of the public transport reform process because the law laid down that whenever the government took over a business, it had to compensate the owners.

The ministry said that in terms of the deal reached with the Public Transport Association last night, it had raised its compensation to €55 million.

The original government offer would have cost €52.4 million while the bus owners' demands had been €92.9 million.

As part of the deal, the government agreed to give the owners €103,000 for each old bus - up from the original offer of €98,000. For the newer, low floor buses it would be giving €123,000, instead of the original offer of €118,000. Those prices include compensation for the operators' licences, which reaches up to 90 per cent of the sum being paid.

The government is also offering a 10-year job guarantee to drivers who join the new company which will operate the bus service.

The agreement also establishes a timetable of payment. By April 1, the bus owners will be paid 10 percent of the compensation. On January 2, 2011 they will get another 20 per cent and the balance will be paid when the licence is withdrawn.

Based on the agreement, the governemnt has extended the deadline for the bus owners to sign their individual contracts by a day to 8 p.m. tomorrow.

The government still has to submit the details to prospective bidders by Friday at noon.

The ATP has indicated that 204 of the 340 bus owners were willing to work with the new operator.

The committee of the PTA signed the deal with the government this morning. The committee will recommend acceptence during an extraordinary meeting for bus owners and drivers late this evening.