Government wants to liberalize the railway; NS to lose monopoly on international routes
The Dutch government is taking another step in liberalizing the rail market. In the new concession, NS will lose the exclusive right to international destinations like London, Paris, and Berlin. The Cabinet is also giving the Dutch rail company permission to introduce a rush hour charge in 2025. That is the outcome of negotiations between NS and the Ministry of Infrastructure and Water Management on the main rail concession, the permit to use most of the track, insiders told the Volkskrant.
In the new concession, the Cabinet accommodated NS on almost all points except for the international rail. NS is currently the only company allowed to run trains from the Netherlands to London, Brussels, Paris, Frankfurt, and Berlin. From 2025, however, NS will lose the exclusive right to all those destinations except for Brussels.
Other transport companies will widely celebrate that point. Arriva and Qbuzz have already submitted applications to run trains to Paris and Berlin, among others.
The most controversial decision in the new contract is the permission to introduce a rush-hour charge. NS has been pushing for that for years. Last month, NS CEO Wouter Koolmees again pleaded to make rush hour tickets much more expensive and decrease the price for traveling outside the rush hours.
“In the morning rush hour, the occupancy rate is much too high, sometimes over 100 percent,” Koolmees said in an interview with the Volkskrant in July. “Then all the seats are occupied, and people have to stand. It’s packed. But over the whole day, the occupancy is less than 30 percent. So we transport warm air for large parts of the day.”
The concession does not yet state which conditions the rush hour charge will have to meet.
The Cabinet also took two other measures in the concession to increase the rail company’s income. The first is allowing NS to increase ticket prices by 7 percent on top of the annual increase based on estimated inflation.
The second is converting the concession fee NS pays into a subsidy. NS has been paying 80 million euros per year for the concession, which has a turnover value of around 2 billion euros. From 2025, NS won’t pay a fee. Instead, the company will receive an annual subsidy of 13 million euros.
NS could certainly use the extra income. The company has been running at an operational loss since the coronavirus pandemic, mainly due to passenger numbers not recovering to pre-pandemic levels.
The new concession will run from 2025 to 2033. State Secretary Vivianne Heijnen of Public Transport promised to send the concession to parliament by the end of this month. The MPs will then debate it at the end of September. The rush hour charge will likely be a point of contention. Train travelers are vehemently against it, and parliament rejected previous proposals for such a charge in 2010 and 2017, according to the newspaper.
The fact that the Dutch Cabinet is awarding NS the concession at all is controversial. The rail company’s competitors have filed various lawsuits against the award, accusing the government of violating European Union competition rules. The European Commission agrees and has started criminal proceedings against the Netherlands.
