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Railway Reform: Toolkit for Improving Rail Sector Performance

This Railway Reform Toolkit aims to provide an easy-to-use resource on the rail industry- what it is and what it does best- and to provide an experience based set of best practices to aid in the planing and execution of railway reforms. This toolkit is based on international experiences with railway reform under a range of organizational forms-state agencies, state owned, or private enterprises. T... view more

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This chapter will provide you with an introduction to the toolkit as well as useful background information for both the toolkit and sector as a whole. Topics touched on include: the role of transport and economic development, railway costs and cost of alternatives, environmental and land use benefits, as well as a what and why explanation of railway reform.

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In this chapter you will learn about the fundamental building blocks of the railway and how these are organized to serve the transport market. Railway markets are discussed first in this section followed by the technologies that railways use to best serve these markets. Topics covered in this section include: transport market characteristics, passenger services, freight services, what railways do best, railway technology and terminology, and infrastructure.

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In this chapter you will have the chance to learn about railway economics and pricing. Topics covered in this section of the toolkit include: economic features of railways, Railway cost structures, infrastructure network costs, train operating costs, costs and comparative advantage, costing railway services and traffics, financial contribution analysis, commercial management actions, and railway pricing.

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This chapter explains the fundamental drivers of railway financial sustainability and the tools used to analyze it. A railway achieves financial sustainability when it has sufficient longer-term financial resources to cover operational costs, to invest and meet debt service and other financing requirements. Topics covered in this section include: drivers of financial sustainability, determining financial sustainability, data availability and quality, financial analysis tools, and economic analysis.

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In this chapter you will explore the main alternatives for railway industry structure including the roles of the public and private sectors. Sections 5.1-5.5 discuss structuring core railway functions- the railway infrastructure network and passenger and freight transport services. Section 5.6 addresses the many non core activities that have accrued to railways over time. Lastly section 5.7 introduces case studies to illustrate examples and features of the structures discussed.

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This chapter of the toolkit explores the roles of government in the railway sector. Collectively, the execution of these roles is referred to as sector governance. Topics covered in this section include: Government, railways and the public interest, national transport strategy, railway industry structure, purchase of transport services, industry regulation, transnational railway agreements and treaties, administrative apparatus and ownership

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In this chapter you will learn about options to segregate decision making and oversight duties between government and state-owned railway enterprises. This section of the toolkit covers the following topics: the new relationship between state and railways, implementing new governance principles,the and the state as the owner.

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In this chapter you will learn in detail about ways in which governments retain influence over railway passenger services and fares particularly using a model in which governments use a contract to purchase the services and fare concessions they want. This chapter first will introduce the public service obligation (PSO) concept, underlying the two primary contracts-PSO contracts (Section 8.3) and public services contracts (PSC)(Section 8.4). Second, the chapter will explore the possibility of introducing competitive bidding for such contracts (Section 8.5) and introduce (in Section 8.6) examples, which are also described in the annexes.

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In this chapter you will learn about economic regulation as well as regulation regulations needed for railway safety, environmental protection and harmonization of technical standards. Additionally you will learn about the institutional and organizational aspects of regulation. Topics covered in this chapter include: the public interest, forms of regulation, regulatory instruments, and institutional issues.

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In this chapter you will learn about good practices for how corporate governance processes should work for state-owned railways. Topics covered in this section include: structure of state-owned enterprise governance, statement of corporate intent, general shareholders meeting, the board, the enterprise management, and incentive structures.

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In this module you will learn about what is meant by commercial railway operations, why railways operate commercially, and how commercial railways are organized. Sections covered in this module include: non-commercial structures and commercial railway structures.

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In this module you will learn basic concepts and techniques in commercial railway management that improve railway performance, including developing a business strategy and management plans for investment, financial performance, marketing, and human resources. Managing railways requires a sound business strategy based on all of these elements.

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In this module you will learn about encouraging private sector participation in the railway sector. The module covers the following topic areas: typical forms of private sector participation, public private partnership, private investor perspectives, and government perspectives.