Rail traffic in Germany is becoming an increasing annoyance for passengers in view of massive delays and train cancellations.
In the guest article, Professor Justus Haucap, Director of the Düsseldorf Institute for Competition Economics (DICE) at Heinrich Heine University Düsseldorf, describes why a split into infrastructure and operations and partial privatization is overdue.
Düsseldorf - The recent rail strike has once again led to numerous train cancellations and delays - annoying for many rail passengers, but actually not a particularly unusual situation.
The punctuality rate in long-distance transport was only 65.2 percent last year anyway, with the train only counting delays of six minutes or more for the statistics.
This statistic does not take train cancellations into account at all, because a train that does not come at all is not late.
In this way, Deutsche Bahn can improve its punctuality statistics, even if it doesn't get any better for travelers.
Last year, Deutsche Bahn had to pay the record sum of 92.7 million euros in compensation to train passengers due to delays.
Politicians call for the Deutsche Bahn to be split up
Politics seems to be slowly enough now.
In order to combat the ongoing problems at Deutsche Bahn, the CDU/CSU parliamentary group in the Bundestag proposes a split of the railway in a reform paper.
The infrastructure areas of travel routes (rails), train stations and energy (traction power) are to be separated from the transport areas of regional transport, long-distance transport and freight transport and combined in a state-owned infrastructure company.
The Greens and the FDP have also been in favor of a strict unbundling of the railway company for a long time, but were unable to assert themselves in the coalition negotiations.
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In fact, the opposite is actually envisaged there, namely a further merger of the rail and station divisions and no further separation from the transport divisions.
However, in a special report for the Bundestag, the Federal Court of Auditors recently also called for infrastructure and operations to be separated at Deutsche Bahn, and the Monopolies Commission has been calling for this like a mantra since its first report on rail traffic in 2006.
Separation of DB infrastructure and transport: boosts competition
What is the effect of separating infrastructure and transport divisions?
Firstly, such a separation will boost competition because the current conflicts of interest in the railway company will be resolved.
On the one hand, a separate infrastructure operator has a strong interest in getting as much traffic as possible onto the rails, regardless of whether Deutsche Bahn AG runs the trains or a competitor.
For an independent infrastructure company, it will be important to use the infrastructure as much as possible.
Deutsche Bahn AG, on the other hand, is naturally primarily interested in the well-being of its own transport divisions - discrimination against competitors can in fact hardly be prevented even through regulation, because this can often be very subtle.
On the other hand, the maintenance and further expansion of the railway infrastructure in an integrated group is of particular interest if this primarily benefits the company's own subsidiaries.
However, there are now competitors, especially in freight and regional transport, who would also benefit from an expansion of the rail network.
However, the latter is not in the interests of an integrated group.
The better solution, because it is more competitive, is therefore a neutral infrastructure operator that prefers neither one nor the other railway company.
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A division of the railway would advance Germany's transport policy
Secondly, unbundling should also sharpen the focus of rail management.
The Group Board of Management is currently responsible for infrastructure, long-distance transport, regional transport, freight transport and also international logistics, which are based at DB Schenker.
DB Schenker's turnover last year was more than 27 billion euros, which is almost half of Deutsche Bahn's total group turnover.
Turnover in the rail and train station areas was around 6.6 billion euros, while long-distance traffic was less than 5 billion euros.
It is only too understandable if, in view of these relations, the focus of the management is not solely on rail transport in Germany.
However, in order to advance transport policy in Germany, this is exactly what is urgently needed.
A strict organizational and ideally also legal separation of the areas of infrastructure, transport and international logistics is therefore urgently required.
The infrastructure sector can remain in state hands, also because this is required for the rail sector by Article 87e Paragraph 3 of the Basic Law.
The transport areas and above all the international logistics of DB Schenker - which, by the way, has absolutely nothing to do with public services - should be privatized.
This would promote competition on the rails and the railways would be well prepared for the future.
About the author: Prof. Justus Haucap is director of the Düsseldorf Institute for Competition Economics (DICE) at the Heinrich Heine University in Düsseldorf. From 2006 to 2014 he was also a member of the Federal Government's Monopolies Commission, four of which as chairman (2008-2012). Haucap has been campaigning for the legalization of cannabis for years.
