Germany pledges multi-billion investments in rail, concerns remain
The German Ministry of Transport (BMDV), led by Volker Wissing, recently approved an injection of around 27 billion euros to dedicate to the country’s rail sector for the period between 2024 and 2027. On the other hand, rail trade union EVG pointed out that at least another 18 billion euros are urgently needed by 2027. The trade union also expressed its worries about state support for single wagonload.
The BMDV stated that 11,5 billion euros were already earmarked for in the financial planning. At least part of these funds will be financed through the ‘road funds rail’ scheme approved by the German Federal Government in mid-June. An extra 12 billion euros will come from the Climate and Transformation Fund (KTF). This is because the country’s executive recently decided to use these funds to boost the rail sector in Germany.
To these 24 billion euros, 3 more will be added by Deutsche Bahn (DB) which will be financed through a loan on the capital market, as BMDV claimed. EVG, on the other hand, highlighted that such an initiative must be thoroughly thought through since it would mean further debt for the German national railway holding. The German Ministry underlined that it is “also examining whether additional funds can be made available to DB via an equity increase to reduce the investment backlog”.
‘Investment backlog is at more than 90 billion euros’
EVG welcomed the BMDV’s initiative to significantly increase investments to improve the rail infrastructure in Germany. According to them, the 11,5 billion euros included in the financial planning will be dedicated to “grid maintenance and digitisation”. However, the trade union stressed that decades of neglect and an increase in construction costs created a hole of 90 billion euros. “At least another 18 billion euros are needed by 2027”, said EVG Chairman Martin Burkert.
Another important point raised by EVG is the implementation of the 70 measures presented by the so-called Rail Acceleration Commission in December 2022, which must be done “immediately and in full”. In June, the BMDV said that over 80 per cent of the measures were already being implemented or prepared, with 13 that still needed to be reviewed. Finally, EVG showed concerns regarding investments in the rail freight sector, especially for single wagonload which “is to be given significantly more support”.