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Siim Kallas

Vice-President and Commissioner for Transport

Europe's railways: on track to the future

European Railway Awards

Brussels, 8 February 2012

Minister, ladies and gentlemen

It is an honour to be invited back to this important award ceremony. Many congratulations also to this year's laureates – Karel Vinck and François Lacôte.

As you know, the European Commission's vision for the future of transport, set out both in the Europe 2020 strategy and last year's Roadmap to a Single European Transport Area, lays down important objectives for the railway sector.

Today, many of Europe's railways are not achieving their full growth potential, especially for freight and passenger traffic over medium to long distances.

This is something we are keen to change, while making Europe's railways better and easier to use. They can, and should, be doing a lot more for Europe – they need to be faster, more punctual and more efficient.

This should be a real European railway to join up east and west, north and south – and not the collection of national railways we have today, struggling with technical differences in track gauges, electrification and signalling.

If passengers are to have a real alternative, we must create a European railway area, where railway operators are able to provide their services across borders. Rail entities which one could call "pan-European".

Rail can, and should, offer a high-quality service at competitive and reasonable prices. It should be provided economically and efficiently, and be attractive to business and passengers.

It is already clear that the demand for mobility will continue to grow in the foreseeable future. Our forecasts are for overall passenger and freight traffic in Europe to rise by 50% and 80% respectively by 2050.

At the same time, we need to reduce our dependence on oil – for reasons of fuel security and to help combat climate change. For longer-distance road freight at least, we cannot rely on reliable non-fossil fuel alternatives to oil being available. Even if we could, capacity would be an issue: there is little appetite for building vast amounts of new roads, in western Europe at least.

Rail is, however, a challenging sector and changes do not come without a fight.

For clear historical reasons, it is Europe's most fragmented transport mode and market. Standards, both technical and of service, vary widely.

We need more innovation, new ideas and a great deal more private investment in the market if rail is to achieve its full potential.

And also more research: into areas such as locomotive construction, brake design and technology, signalling, energy efficiency – just to name a few. These should increase capacity, reliability and reduce environmental impacts.

Later this year, the Commission will present proposals which will build on the work done over the last decade. They will provide more stimulus for creating the single rail area and for some much-needed changes to the EU rail sector.

For such a fragmented transport mode to thrive, rail needs to become a real single market as we continue the process of building a unified European transport area by 2050.

We will of course listen to the views of all interested parties as we carry out impact assessments on possible options. Let me stress now - nothing has yet been decided.

Today, some major technical barriers make it difficult to produce and certify trains to run them across EU internal borders.

Regarding the domestic passenger rail market, only a few EU countries have so far opened up to competition. Market access conditions are generally still skewed in favour of the incumbents. This is particularly true where incumbent railway operators also control the railway infrastructure.

In this way, we can encourage a shift away from more polluting means of travel, such as roads, onto cleaner alternatives such as rail and waterways.

We will also have to address the issue of tendering out public service contracts. This will allow the quality of passenger services to be improved and railways to be properly compensated for the services they provide.

Experience in those Member States which already use competitive tendering shows that it will also save the taxpayer money.

Lastly, if market opening is to benefit passengers and encourage greater use of rail, we must remember that railways are a network.

That is why integrated ticketing systems, passenger care and coordinated network operation are very important. We will work to ensure they are preserved and enhanced in the railway of the future.

Ladies and gentlemen

In rail, we have historically powerful politico-national organisations which have strong links to political decision-makers and other lobbies – perhaps closer links than in any other European transport sector.

Every other sector – aviation or shipping, for example - has more aspects which qualify it as cross-border, international or global. These exist much less for rail.

From a competition perspective, there are difficulties today with the relationship between the infrastructure managers that run the network and the rail service operators that use it for transporting passengers or goods.

We are looking into whether a further degree of structural separation is needed, to create more equal conditions for competition.

At the same time, that would have to be balanced with operational concerns and other day-to-day practicalities. We are continuing to study this vital issue.

Ladies and gentlemen

I am not pretending that we have all the solutions today. We will listen to all ideas from all parties as the months progress.

We do, however, recognise that railways are a network. But we need the innovation and efficiency that only a proper opening of rail markets, services and infrastructure can deliver.

As I said at the start, any changes will aim to increase efficiency, punctuality and reliability for rail passengers. The idea is to unleash rail's true potential, to raise the quality of service so that it becomes a real and attractive alternative.

To conclude: rail can certainly solve a lot of problems. But in many areas, we have allowed ourselves to languish in the 19th century and in short, rail deserves better. European citizens also deserve better.

Thank you for your attention.

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