Democratising freight railways prices. A criticism of the recent UE proposal on infrastructure charges

Abstract

The recent growth of rail haulage prices has brought new life to the debate on the ideal price level for this kind of transport. On the one hand, a higher price could be considered necessary to allow higher proportion of the costs to be covered, therefore reducing the burden on the taxpayers, on the other hand the rise in price could entail a loss of competitiveness to road haulage, thus endangering the social objectives connected to the protection of the environment. There is a fundamental ambiguity in the situation describe above, that could not be solved even by an economic approach, to attempt to asses the different impacts on society of the two approaches. In this uncertainty it would therefore seem appropriate to suggest politicians (representative chosen by the public) as the most appropriate judges of welfare as far as rail prices are concerned. The point of view put forward by this article is that the rigid approach expressed in recent UE papers (July 1998) - aiming at keeping rail prices low according to the concept of marginal-cost pricing - does not allow the scope of a political decision to single member state on the value of rail transport, thus allowing for different prices in all members state. The approach put forwards by the UE, furthermore, for sees heavy subsidies for the infrastructure rather then for the rail service and does not allow the clear and democratic assessment of the cost sustained by society for each service; public subsidy of services would be more transparent and democratic.