Insufficient investments behind the sluggish train speeds in Romania, as per union claims.
Sluggish Romanian Railways Face Criticism Over Government Cost-Cutting Plans
Railway unions in Romania have voiced their concerns over the government's plans to reduce costs for the national railway operator, CFR, in a press release published on July 23. The unions claim that the current government's actions could lead to chaos in Romanian rail transport due to a lack of understanding and adoption of best practices from the European railway industry.
The average speed at which passenger trains travel in Romania is a mere 44 km/h, while freight trains do not exceed 17 km/h. However, no information was provided about the current speed at which private operators' passenger and freight trains travel in Romania.
The unionists did not provide specific solutions or proposals to address the financial struggles of CFR Călători or the rail industry in Romania. They argue that the state operator is not adequately protected by the government. Deputy prime minister Dragoş Anastasiu did not specify which seven companies account for RON 2 billion in losses, but he stated that 266 state-owned companies generate losses worth RON 2.5 billion annually, with seven accounting for RON 2 billion. Among these companies are railway operators CFR and CFR Marfă, as well as Termoenergetica, Metrorex, Electrocentrale Craiova SA, and Unifarm SA.
The representatives of the National Railway Federation argue that investments in rail infrastructure have never matched the plans for the revival of railway activity. Sufficient amounts have never been allocated for development, maintenance, and compensation in Romania. Private operators in Romania are receiving state compensations that exceed 83% or even 108% of their turnover, while the state company CFR Călători receives annual compensations that do not exceed 56% of its turnover.
Comparative compensation for railway operators in Europe vs Romania varies significantly. While specific direct comparative figures for operator compensation are not readily available, several insights can be drawn. For instance, Germany, with the longest railway network in the EU, allocates substantial resources for both conventional and high-speed rail. In contrast, Romania, with a rail network significantly smaller than large EU states, typically spends less in absolute terms, although it also benefits from EU cohesion and recovery funds aimed at enhancing rail infrastructure.
Compensation for railway operators includes salaries, operational subsidies, and public service contracts. Larger operators in countries like Germany (Deutsche Bahn), France (SNCF), and Spain (RENFE) tend to have higher absolute compensation due to the size and complexity of operations. In Romania, where the rail system is smaller and generally less modernized, operator compensation and state subsidies are correspondingly lower but must balance lower operator productivity and higher maintenance needs in some areas.
Overall, EU countries follow a model where infrastructure is state-controlled and financed, while operators receive compensation tied to operational efficiency and public service obligations. Variations occur depending on national transport policies and market liberalization levels.
In comparison, the compensation in Germany is EUR 239/km, in Spain EUR 98/km, in Italy EUR 131/km, in France EUR 298/km, in Hungary EUR 58/km, and in Austria EUR 202/km. The unionists' comments come after deputy prime minister Dragoş Anastasiu highlighted the financial struggles of state-owned companies in Romania.
- The National Railway Federation contends that the Romanian government's lack of investment in rail infrastructure might negatively impact public-transit and transportation industries, given Europe's best practices in the railway industry are not being adopted.
- The financing for rail transportation in Romania seems to be significantly different from EU countries, such as Germany, Spain, Italy, France, Hungary, and Austria, where infrastructure is state-controlled and operators receive compensation based on operational efficiency and public service obligations.
