• In the final days of the previous Polish government – before Donald Tusk took over – the outgoing Infrastructure Minister signed an annex to the long-distance passenger rail Public Service Obligation (PSO) contract, ensuring that state-owned rail incumbent PKP Intercity received an increased subsidy of 1,5 billion euros until 2030.

• Increasing funds for public transport should, in theory, lead to more and better quality of services, but we notice that the sudden increase in subsidy for PKP Intercity will not translate into any new benefits for the passenger.

This sizeable increase in taxpayer funding for PKP Intercity took place merely three years following the PSO contract’s initial signing. It confirms that granting a long-term, direct award has just encouraged the incumbent to lobby for even more subsidy, turning Poland’s long-distance rail system into a bottomless pit.

The justification for the increase cites COVID, the war in Ukraine and inflation, but this is hard to believe. Contrary to these reasons, PKP Intercity has recently announced record passenger numbers. Additionally, the incumbent already received extra financial compensation for transporting Ukrainian refugees, and electricity prices have reverted to levels seen before 24 February 2022.

Moreover, the increase in inflation does not necessarily cause an increase in subsidy, as the example in the Czech Republic shows – even with higher inflation than in Poland, transport authorities there are securing lower prices in tendering procedures than anticipated.

This is where, once again, market opening stands out as the way forward, to at least halt the increase in subsidy for long-distance passenger rail. Examples from all over Europe show that opening up the market to new operators leads to lower ticket prices, lower expenditure for transport authorities, more and better quality of services.

Katarzyna Dekeyser, ALLRAIL’s Policy Coordinator says: “This increase in subsidy was not necessary. If PKP Intercity struggles to manage service connections based on terms agreed just three years ago, then it is time for other operators to service some of these connections through competitive tendering. This would ultimately benefit PKP Intercity itself as well. Otherwise we face a bottomless pit”.