UNIFE presses for more support for rail

6 September 2011, Europolitics

UNIFE, the European association that is the voice of manufacturers of rail material and equipment (Bombardier, Alstom, ArcelorMittal, etc), wishes to see investments under European Structural Funds geared more to rail transport.

For the 2007-2013 programming period, of the €82 billion programmed for transport projects, only €23.6 billion will go to rail, compared with €41 billion for road (European Commission’s figures). “This trend has to be reversed,” notes UNIFE, in order to achieve the targets set out in the white paper on transport for reducing greenhouse gas emissions. For the same reasons, the organisation also considers that it should not be possible for funds allocated to rail to be reallocated to road projects during the programming period. This is a thinly veiled reference to the reorganisation of the Polish operational programme for infrastructure development, whose management committee approved a reallocation to a road project of funds initially earmarked for rail (see Europolitics 4194).

To promote rail investments, UNIFE also stresses the need for a revision of Structural Fund co-financing rates and of rules on eligible expenditure. States are currently free to determine the co-financing rate applicable to each mode of transport and often opt for lower co-financing for rail than for road projects, which puts rail at a disadvantage. “Road investments, in particular in motorways, have the potential to attract more private capital than rail investments and should therefore not be given more advantages in terms of EU funding,” explains the association. On eligible expenditure, it argues for revision of the rule whereby revenues generated by infrastructures are deducted from expenditure eligible for fund co-financing. In practice, this rule results in lower EU co-financing for rail projects since network access charges paid by railway companies to infrastructure managers are deducted from the initial project cost. Since access charges are generally higher in the Eastern European countries (where infrastructure is not sufficiently state-subsidised), EU co-financing ends up being lower, thus creating further difficulties for supplementing EU allocations from national funds, public or private. For the future, UNIFE calls for this rule on eligible expenditure to be abolished or only to be allowed for rail if similar provisions exist for road (concretely, in cases where road tolls are put in place). With the European Commission’s forthcoming proposals strengthening aid conditionality, the organisation suggests that, to be eligible for Structural Funds, member states should be obliged to draw up strategic plans for the transport sector that give clear priority to sustainable transport.

CEE Bankwatch Network study

These demands come simultaneously with the release by the non-governmental organisation CEE Bankwatch Network of a study analysing, at mid-term, the implementation of Structural Fund operational programmes for transport in Bulgaria, the Czech Republic, Poland and Estonia. One of the study’s findings is that road receives the bulk of Structural Fund support.

The study is available at www.europolitics.info > Search = 299021