Wednesday, April 17, 2024
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Finland discusses future passenger market


FINLAND’s Ministry of Transport and Communications has begun consultation on the future shape of the national passenger rail market, when PSO operating contracts are put out to tender after the current direct award agreement with national operator VR expires in 2030.

VR currently provides services at a cost of €39.4m a year under the direct award contract, which under the provisions of the European Union’s (EU) Fourth Railway Package cannot be renewed after 2030.

To provide a knowledge base to inform decision-making on future rail policy, the ministry is inviting comments by May 19 on a report setting out the necessary steps that will need to be taken by the new government that will be formed imminently following the general election on April 2.

In order to move to regulated procurement in a controlled manner, the next government will have to set down its policy guidelines by the end of 2024.

The ministry says that its report has not been subject to political consideration. It proposes that preparations should be carried out in 2023-2025 to enable competitive tendering to take place in 2026-2028.

The new contracts would commence in 2031, with the precise timetable and staging for the introduction of the new tendering regime to be refined as the reform programme moves forward.

Before tendering, the government must specify the passenger services to be provided. The report, based on a review of experience elsewhere in the EU, recommends that the tendering should be organised centrally under the leadership of the Ministry of Transport and Communications.

The report says that PSO services could be tendered as one or more packages, by service type or on a geographic basis.

Commercial services could be tendered separately, integrated with regional PSO services or operated on an open-access basis. Tendering could be conducted at regional or national level.

The report says that open access would not be a strategic option to rely on, given the small size of the Finnish market and the crucial issue of rolling stock.

Rolling stock built to the Finnish gauge of 1524mm would not be suitable for operation elsewhere in the EU and, as the ministry points out, would for all intents and purposes be available only in Finland.

To date, no open-access operators have entered the Finnish market to compete with VR, despite legislative provision being in place to enable this.

To foster open access, a rolling stock leasing company would have to be established in Finland alongside the other restructuring required for the competitive tendering of PSO services.

Source: railjournal

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