Back on track
1 February 2013
It was the last bastion to hold out against liberalisation, but by 2019, it will finally be brought into line.
The free market has been introduced into the air and sea travel. Now it is the turn of the domestic rail industry to be opened up to competition. Users — or rather customers — will be able to choose between national operators (which currently control 90 per cent of EU passenger traffic) and foreign competitors for domestic rail journeys. And foreign operators will also be allowed to take part in calls for tenders for internal services in 25 EU member states (Malta and Cyprus do not have railways).
The “Fourth Railway Package” presented on January 30 by the European Commissioner for Transport, Siim Kallas, provides for the complete opening of markets and an end to national operators’ monopolies by the end of the decade. Among other developments, it will also foster greater standardisation of signals and regulations.
The package is expected to save rail passengers and companies €40bn over the next 15 years, and offer some breathing space to a sector of the economy which employs 800,000 people in Europe and represents sales of €70bn. However, it is also a sector that is in decline: in recent years, the historical operators in Belgium, Bulgaria, Portugal and Spain have all demanded state aid to help them cope with their difficulties.
So as to ensure that current public monopolies like SNCF in France, Deutsche Bahn (DB) in Germany and Trenitalia in Italy do not take advantage of their position to block competition, the Commission is advocating the “institutional separation of infrastructure management and transport operation”.
As it stands, this is a recommendation and not an obligation. Both activities can be undertaken by entities in the same holding company, on condition that their accounts are kept separately. This was one of the concessions that was demanded by Berlin on behalf of DB, which has been accused of using public funds to develop infrastructure in Germany — the subject of a legal warning issued by Kallas in 2012.
We can only welcome Brussels’ initiative if it really succeeds in relaunching rail transport in Europe. The decline described by Kallas is quite real, and was recently deplored in a letter addressed to the commissioner by the World Carfree Network (WCN). According to the NGO which promotes alternatives to cars, a growing number of national and international services have been discontinued in recent years, most notably links between Brussels and Amsterdam, Madrid and Lisbon, Paris and Rome, Vienna and Sofia, and Berlin and Kiev. As for Greece, last year it suspended rail services to foreign destinations, in response to pressure from creditors. Some of these “conventional” services have been replaced by high speed links, which are more profitable for operators and more expensive for passengers, who often do not have any other choice.
As WCN has pointed out, if the EU wants to attain its objectives with regard to the reduction of CO2 emissions from transport, and to establish the “rail network of the future” which it has promised to do, it should actively discourage policies that cut services, and put Europe back on track.