The structural reform programme that lasted 13 years has determined significant changes in the Russian railway sector and it has resulted in a transition towards the market of railway services made of several thousand private companies representing shipping firms, transport and logistics operators, passenger transport operators, as well as suppliers and repair companies.
T he reform implementation has focused attention of preventing the irreversible negative effects for both consumers and the economy, a series of measures planned, but also adjusted to market requirements being implemented. All changes have been discussed with the executive authorities of Russian and the market players and have been approved by the government as part as action plans. However, the railway passenger segment in Russia needs support and the implementation of development programmes to face the challenges imposed by the other transport modes. According to IPEM (the Institute of Natural Monopolies Research in Russia), the volume of the financial state aid is lower than in other developed countries. Around RUB 30 Billion (over USD 850 Million) are allocated every year to support the regulation of the railway passenger segment, which means RUB 0.43-0.45 per passenger-km. By comparison, in the US, the volume of subsidies is of around RUB 5 per passenger-km, while in the EU countries it is RUB 2 per passenger-km. Moreover, the elimination of state subsidies will affect this segment (especially the economic class and day carriages – the most popular segment, 70%), the price increase will reduce the mobility of vulnerable groups as they will no longer permit to use air transport or the most expensive railway transport.
As a result, for the development of the passenger transport system, IPEM proposes “the development of a system of measures to supply mobility to vulnerable groups depending on this transport mode, the elaboration of comprehensive analyses on the traffic flows on different routes. This will help selecting directions/routes and the transport modes which need state aid, the optimisation of the costs of the federal budget for subsidies and the identification of elements and state aid volume”.
The lack of a long-term policy on the financing of transport of selected passenger groups “will make it almost impossible for transport operators to develop their strategies on the long-run. The incertitude of state regulation will not allow companies to plan traffic flows within a regulated segment, nor the value of investments for rolling stock acquisition”, said IPEM.
In order to solve the problem, it is important to change the approach paying more attention to the passengers’ preferences and, at the same time, a fair policy of transport modes will encourage competitiveness and will increase the quality of supplied services.
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