Bottlenecks in the Introduction of Competition in Public Transport in the Netherlands



Bottlenecks in the Introduction of Competition in Public Transport in the Netherlands

Authors

P Hilferink, NEA Transport Research and Training; F Savelberg, Ministry of Transport (AVV), NL

Description

Abstract

The project MARETOPE (Managing and Assessing Regulatory Evolution in local public Transport Operations in Europe) was commissioned by the European Commission and had the objective to assess bottlenecks in the introduction of competition in urban and regional public transport in Europe as well of instruments to overcome these bottlenecks. Using the results of this European study an assessment was made of the situation in the Netherlands. This paper describes the results of this Dutch study.

In the Netherlands the Passenger Transport Act 2000 obliges the use of competitive tendering in all urban and regional transport after 2008 and sets intermediate objectives for parts of the markets at earlier dates. On the basis of the results of an extensive research programme the process of implementation of this Act will be assessed by parliament next year. This study on bottlenecks is one of the key elements of the programme. At present, tendering of services in rural areas and smaller cities is well under way. However, the development of the markets in the large cities with municipal owned companies with integrated bus, tram and metro services is heavily under discussion. Key question here is the choice between one concession for an integrated network or separate concessions by mode. And for the rail sector (tram and metro) a vertical separation between infrastructure and service operations is a further option. Various elements like the division of roles between operator and authority, the optimal level of integration, the market imperfection and the quality of services are included in the analysis.

The MARETOPE study identified bottlenecks of various natures. The main barriers are:

Cultural barriers
*opposition against tendering from various sides like operators, staff and unions
*lack of political support
*lack of experience and knowledge
*Juridical barriers
*lack of a clear legal and juridical structure
*lack of financial stability
Barriers in the market structure
*lack of sufficient interested operators
*barriers of entry
*unfair competition
Barriers on the organisational side
*Unclear division of roles between authorities and operators
*Lack of cooperation between authorities and operators
Barriers in contractual procedures
*Unclear contracts leading to different interpretations
*Loss of quality due to inadequate contracts
*Bottlenecks identified in the Netherlands are:

Few newcomers on the market
*Dispute on the optimal size of concession areas
*The division of functions between authorities and operators, in particular related to the planning function
*Coordination between different concession areas
*The relation between the central government and the regional transport authorities
*Quality aspects
*Lack of transparency in the system of operating subsidies
*The position of the municipal owned companies
*The obligation to take over staff from the previous operator

Each of these problem areas is handled in the study. Instruments identified in MARETOPE as applied in other countries are further analysed and linked with the specific Dutch situation. The overall conclusion is that many of the bottlenecks on the way to reform can be overcome in one way or another.

Publisher

Association for European Transport