1. The 4th Railway Package – Key Lessons from the Experience of the UK and Sweden in Liberalising Their Rail Markets
Jon Tindall, Atkins, Craig White, Atkins
Key words: 4th Railway package, domestic passenger market opening, functional separation, network manager, railway undertaking, operator, franchising
European Railways have gone through significant restructuring and changes over time. The main goal of these changes is to enhance competitiveness in the railway sector and provide better, safer and interoperable railways in Europe. The 1st, 2nd and 3rd Railway packages led to a significant progress in this respect. The 4th Railway package of proposed new regulations and directives has been announced exactly a year ago. By December 2019 railway undertakings (TOCs) must be granted access to provide all services - including, for the first time, domestic passenger services - in all EU Member States. Two countries, the UK and Sweden, have already progressed with opening up their markets, but have followed different models in doing so. The experience in these two countries over the last 20 years can therefore provide valuable lessons to different stakeholders involved in the railway sector in Europe as they look to liberalise their markets in line with the 4th Railway Package.
This paper focuses on the regulatory changes in the railway sector in Europe over the last twenty years, examining the experience of the UK and Sweden in particular and looks whether, and to what extent, liberalisation has driven a sustainable growth of patronage, delivered economic benefits and incentivised investment. At first, the paper provides a very brief introduction into the 1st, 2nd, 3rd and 4th railway package. Secondly, it provides an overview of the current level of liberalisation, functional separation between the network manager and operator, and competition for Public Service Contracts in the UK and Sweden. Subsequently, it examines the performance of the railways in these two countries over the period in which they have liberalised their markets. Finally, the paper draws lessons from the two quoted examples for different types of stakeholders in Europe, examining key issues to consider as they look to liberalise their own rail markets.
Association for European Transport