The German political parties SPD and CDU have come to a coalition agreement, forming the basis of their government during the next legislative term. The agreement is also a window into the future: which policies will Germany pursue in the near future? The answer for rail: probably nothing to be enthusiastic about.
The coalition agreement is not entirely void of positives, but they mostly remain a lip service to the industry. Rail freight association Die Güterbahnen came out with an analysis of the agreement, pointing out that there are no quantitative targets, clear priorities or binding commitments on the part of the incoming government.
From money…
CDU and SPD want to increase funding for rail. Part of that money is supposed to come from Germany’s special infrastructure fund. From it, the federal government can spend 150 billion euros until 2029. Yet, how much of that will go to rail, the two parties won’t say.
Either way, it “is likely to lead to rising construction prices and an imprecise prioritisation of measures […] due to a lack of short-term capacities in construction, but also in planning and approval”, comments Die Güterbahnen. In short: no commitments and no solutions for potential drawbacks.
The association also heavily criticises the coalition’s plan to return to user financing for rail: track access charges (TAC) are supposed to cover part of the modernisation and expansion works on the German network. The road sector does not carry that same burden to the extent that rail does. On top of that, a reversal of a programme through which the road finances rail infrastructure is planned. That could shrink funding for rail by 5 billion euros.
And when talking about those same track access charges, the incoming government says that they want to reform the current system. It has led to skyrocketing prices for rail operators, but they do not specify more than that. The continuation of TAC subsidies also remains uncertain.
…to infrastructure…
Apart from the fact that there is no fixed amount of funding for infrastructure, there is seemingly no commitment to infrastructure expansion. Die Güterbahnen calls the priority for modernisation understandable, but not sufficient.
On the upside, CDU and CPD want to go ahead with further electrification on the rails. In the past, an obstacle has been its low prioritisation, and the incoming government provides no solution for this. Once again, there are no quantitative targets set for the electrification of Germany’s rail network.
…to Deutsche Bahn.
The new coalition wants to review how to restore DB Cargo’s market viability. The German rail freight industry also reacts to this with skepticism: CDU and SPD do not make any mention of competition on the rail market. But they should, says Die Güterbahnen, because DB Cargo is still heavily loss-making and currently under EU oversight.
Interestingly, CDU and SPD explicitly name the single wagonload (SWL) business as a focal point. They want to develop it with “strategic partners” through an undefined “hub system”. How exactly they aim to do so remains unclear, especially in light of the EU’s ban on state subsidies for DB Cargo. The freight operator recently announced that it could even shut down its loss-making SWL business altogether.
Lastly, there is the question of infrastructure manager DB InfraGO. During the election campaign, CDU made clear that it is a proponent of separating InfraGO from Deutsche Bahn – a plan much-desired by the rail freight sector. “When cutting the ‘coalition agreement’ wedding cake, the SPD clearly had the upper hand on the topic of railway reform”, comments Managing Director of Die Güterbahnen Neele Wesseln.
Rather than a commitment to separation, the coalition agreement only contains a declaration of intent for a “medium-term, fundamental railway reform.” Wesseln continues: “Instead of another round of reforms with fake solutions, what is needed is DB InfraGO to be established as a federally owned GmbH and separated from the DB parent company. This is the only way to truly operate independently of the parent company’s profit claims.”
In short, much uncertainty remains for rail freight in Germany. There are no clear-cut commitments to much-needed improvements. Whether or not words will turn into deeds remains to be seen in the coming years.