The FIF at the heart of discussions on the future of French railways

Since 2010, there has been no end to the discussions and questions about the future of the French rail system and about the future of the French rail industry in particular.

The collapse in rail cargo, the constant increase in the system’s debt, the ageing of the railway network, the difficulties in securing funding for rolling stock investment and infrastructure investment: there are so many issues that, in spite of the context of the launch of the national election campaign, appear foremost in the concerns of political decision-makers, unions and also the sector’s socio-professional stakeholders whether they are railway operators, managers or manufacturers.

This situation might seem even more paradoxical given that France has not prioritised railway transport and projects since post-war times.

There are currently no less than 19 highspeed line projects in the new national infrastructure and transport plan, in addition to the large-scale ‘Grand Paris’ project while orders for urban transport materials (metro, tramways, etc.) are sustained or even growing at a fast pace.

This context with such sharp contrasts has led the public authorities and the major stakeholders in the French rail sector to seek a full overhaul of the French rail system and the way it is organised with a view to carrying out the needed reforms to ensure that the targets set within the context of the 2008 ‘Grenelle des transports’ (Public Conference on Transportation) are met.

Indeed, since October 2010, in light of the seriousness of the situation, Louis Nègre, the President of the FIF, has been calling on the French government to establish a special Conference on railways which would lead to real reform in the French railway system.

The French railway agenda witnessed a spectacular dynamic in the months that followed with the successive launch of:

• A parliamentary enquiry committee in the national assembly on the future of the rail sector (January 2011)
• A report on the condition of the French railway system published by the Inspection Générale des Finances (Inspectorate General of Finances) and the Conseil National de l’Environnement et du Développement Durable (National Council on the Environment and Sustainable Development) (April 2011)
• A report by Boston Consulting Group on the competitiveness of the railway industry sector (May 2011)
• Since mid-September 2011, ‘Assises nationales sur le Ferroviaire’ (National Conferences on Railways) at the instigation of Nathalie Kosciusko-Morizet, Minister for Ecology, Sustainable Development and Transport.

The FIF has been at the beginning and is more than ever heavily involved in all of these discussions which must clearly follow the example of railway reforms launched in certain major European countries (Germany, the UK, Switzerland, Sweden, etc.), leading to the necessary reorganisation and restructuring.

It is within this same context, where the urgent need for reforms and large-scale goals for the rail system combine, that the FIF is called upon, alongside its partners in the sector, to make proposals that will lead to stable and lasting results. The following aspects are notable among the essential points in the ongoing proposals:

• Make the organisation of the French rail system more coherent, particularly between the tasks and means assigned to the major public stakeholders in the system
• Speed up the implementation of the conditions of opening up to competition in a controlled context
• Establish a schedule for the transport infrastructure investments planned for 2012-2030 as well as a reasoned ranking of the priorities in the Schéma National d’Infrastructures de Transport (SNIT) (National Transport Infrastructure Plan)
• Draw up a French railway network renewal plan combining new processes, new procedures and new organisations, thereby giving rise to highly significant productivity gains
• Promote the growth of short-liner cargo carriers according to an SME-SMI style economic model in order to reinvigorate French railway cargo.

Other measures and proposals are currently being prepared in order to breathe new life into the French railway system.

In this regard, the British example should lead France to a discussion guided by voluntarism, optimism and also realism.

Recognising that the French railway system is currently at risk, not to say running out of steam, we need to completely overhaul the system to start anew with pragmatism.

Within the same context, there is a fundamental element that must not be forgotten, and that is our ability to put in place financial engineering that is tailored to our goals.

This imperative is made even more complex – but without doubt also necessary – given that the monetary, financial and budget crisis the European Union is currently undergoing makes the implementation of massive financial solutions unlikely, especially for a sector like railway.

Beyond the proposals that the FIF can come up with concerning the organisation of the French railway system, it is also in a position to make proposals for the industrial sector. Among the areas these proposals concern is that of Management Planning of Jobs and Skills.

The technological and economical changes that characterise the rail industry in France, in Europe and around the world mean that we need to be a step ahead and be able to forecast future needs in terms of skills.

This means identifying these skills and relevant needs as well as the training and teaching available in France in universities, grandes écoles, institutes of technology and in the companies themselves, and to build gateways between the world of teaching and railway training, companies and research laboratories, etc. in order to ensure that railway sector development is supported by hiring skilled engineers and technicians.

A first step forward consisted of the creation, alongside other partners in the sector, of a masters degree in railways and guided transport in 2009 that is also open to foreign students, with the end result of producing toplevel executives and engineers with a global vision of the railway system every year.

Other training courses must be created or developed in order to lay the groundwork for the future (architecture, IT, welding, painting, composite materials applied to the railway sector). The FIF is endeavouring to do so with its other partners in the sector.

Another advance involves the FIF and its members signing a best practices charter in December 2010 under the aegis of the Ministry of the Economy, Finance and Industry. This charter establishes principles whose application is highly desirable if we consider that relations between major principals / major suppliers and subcontractors should change in the sense of greater cohesion and solidarity and, more generally, in the sense of setting up ‘win-win’ partnerships.

Today, the projects and challenges the FIF is facing are numerous, including:

• To be the creative driving force in coming up with proposals in the context of a necessary reorganisation of the French railway system
• To also produce proposals to make the rail industry more efficient by always bearing in mind that there is constant demand for improvement arising from the globalisation of markets and also from intermodal competition
• To be a driving force in the technical and regulatory harmonisation of a European railway system that is still too Balkanised, in order to create both a large homogeneous market and an interoperable network.

Discussions – from our point-of-view – with the other European stakeholders in the system are more important than ever in order to achieve goals that cannot but promote the growth of rail transport volumes and, by extension, business growth for the sector’s manufactures and engineers.

Therefore, 2011/2012 is one of the most challenging and exciting for the FIF which finds its expression in a commitment and a dayto- day involvement in all projects whose successful outcome will be a synonym of prosperity for the profession and beyond that, for rail transport as a whole.

About the Author

Jean-Pierre Audoux is a Doctor in International Economics and is also a graduate in Macro-economics. In 1996, Mr. Audoux was appointed the new Delegate- General of FIF after a 15-year career in various governmental departments including the Ministry of Industry, the Defence Ministry and the Prime Minister’s office. Mr. Audoux is also the author of books on geoeconomics and of numerous articles on the railway sector. For many years he has also been an Associate Professor in economics in advanced studies at colleges such as the Paris College of Commerce, the Saint-Cyr Military Academy and the International Public Administration Institute.