Tendering of regional railways in Helsinki

How to organise a first tendering of regional railways? What should be kept in mind? What are potential pitfalls? What should be included in the contract? Didier van de Velde and Eduard Röntgen advised the public transport authority of Helsinki (HSL) in answering these questions.

Helsinki’s regional railways transport about 50 million passengers each year. The number of travellers (as well as new infrastructure) is increasing. These railways fall under the responsibility of HSL, which currently has a negotiated contract with the Finnish State Railways. HSL has much experience with competitive tendering in public transport by bus in the Helsinki region and expects positive outcomes from tendering the regional railways as well, resulting in lower costs and improved quality. HSL intends to contract the operations, excluding the management and maintenance of the infrastructure and trains. The authority will own the rolling stock.

Using case studies and workshops Didier and Eduard provided HSL with information on comparable cases in Europe. These cases focused on the advantages of tendering and awareness for pitfalls. During the workshops several topics have been discussed including: incentives, division of responsibilities between actors, distribution of ownership, and the management and maintenance of the rolling stock.

Although the tendered franchise was expected to start in 2018 the current contract with the Finnish State Railways has now been extended until 2021 (including efficiency improvements). HSL now prepares for tendering the next contract.

The study illustrated the importance of a good preparation time to ensure a successful transition to a tendered regime. It showed what could be learnt from best-practices but also that each particular situation remains different and requires a fine-tuning of solutions.