The vote for the recast of the first railway package, announced for the autumn of this year, brings hopes to the European rail sector concerning the improvement of railway infrastructure investment planning. An aspect of the much-debated recast refers to the set-up of multi-annual contracts for the infrastructure maintenance.
Forced to choose between using the funds and losing them, managers usually plan most of the maintenance activities for the end of the year. According to the public financing principles, budgets tend to be reduced if they were not entirely used in previous years. Likewise, grouping of maintenance activities in the end of the year leads to several delays and affects the provided service. Abandoning annual planning to the benefit of a multi-annual system thus reduces general interruptions since the maintenance activities may be planned with the least possible disturbance to traffic. Once efficient performance systems have been implemented everywhere, this strategy will have even better results as the infrastructure manager will have to compensate the users for any incurred prejudice.
More specifically, the European railway sector waits that the recast of the first railway package impose the conclusion of multi-annual contracts for the rail infrastructure maintenance, these provisions being only optional for the time being. In particular, the association of European Rail Infrastructure Managers (EIM) shares the Member States concerns “about the mismatch of finance and maintenance needs as it exists in some parts of the EU and the need to avoid increasing maintenance backlogs which may result in excessively high infrastructure access charges”.
In 2006, EU Member States reported maintenance expenditure of EUR 13.9 Billion, without the funding from public-private partnerships. By adding the revenues from the charges, rail infrastructure maintenance costs reach approximately EUR 35 Billion per year. The revenues from the charges only cover 30-50%, the extreme values being 10% and 100%.
In many cases, Member States have the main role in ensuring the financial stability for their rail infrastructure managers. Rail infrastructure managers must bear a significant part of the maintenance expenditure from their own revenues or from funds transferred by the state. This leads to the issue of the relationship between the state and the infrastructure managers as far as these transfers of funds are concerned.
The situation regarding the use of multi-annual contracts varies considerably across Member States. About half of the States neither use nor plan to make use of them. Some Member States provide no finance for rail infrastructure maintenance in the first place, some are in the process of negotiating contracts for the first time, and some are preparing to extend them for a new multi-annual period. At the same time, an increasing number of Member States plan to introduce them, having put in place the requirements under the first railway package.
Since most infrastructure managers are not able to recoup full maintenance costs from access charges, the transfers made through multi-annual contracts will supplement access charges to achieve the necessary financial stability.
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