Creating an efficient system for financing public transport in Brandenburg
Topic of the practice
Financing Public Transport
Good Practice Information
Brandenburg shows a good example of creating an efficient system for financing public transport. In 2005 Brandenburg rearranged public transport funding at district level. Districts and district-free municipalities became in 2004 responsible authorities for road-based public transport (bus, tram) without being given the full financial responsibility. So far Brandenburg added own funding to the funds provided by the federal state and partly awarded them to operators and to transport authorities. This situation was unsatisfactory. Thus the earlier transfer of tasks was followed by a full transfer of financial responsibility. From 2005 onwards funding sources were combined and awarded only to transport authorities. So the jungle of public funding sources was disentangled and funding concentrated.
The related Public Transport Act codifies a dynamic distribution key for the yearly payments to the 18 transport authorities, based on the area concerned (30 %), the passenger-km (20 %) and passenger numbers (20 %) and the amount of co-funding of the respective transport authority (20 %).
The aim was to link the responsibility for the task (providing public transport services) with full financial responsibility. Additionally, more flexibility in spending to meet local and regional needs was aimed for. Additionally the introduction of the dynamic distribution key provides an incentive to secure high passenger-km, passenger numbers and high own contributions. It supports a client-centered approach of the transport authorities.
The main stakeholders involved are the federal state of Brandenburg and the 14 districts and 4 district-free municipalities in Brandenburg. Beneficiaries of the practice are the public transport authorities, passengers and the federal state of Brandenburg. Extra funding was not needed, since the nature of the practice is just the revision of the legal framework. Key success factors are a well-functioning public administration and a well-organised implementation process. For transfer the practice has to be adapted to the respective funding system.
Evidence of success
According to the principle of subsidiarity the responsibility for the task and the financial resources are now combined at the level which can best provide the required services. Additionally the transfer of financial resources increased the possibilities of local authorities to act, since funds are at least partly at free disposal. Furthermore, the transport authorities were enabled to act in accordance with EU regulation 1370/2007. Now public service contracts are regularly closed after a competitive tendering procedure.
Success might be measured by the observed general increase of passenger numbers (or the avoidance of decreasing number in areas with population losses and the benefits of beneficiaries: more flexibility and reliability of the funding system for transport authorities, better customised services for passengers and less administration and staff costs for funding management at the level of the federal state.
Contact details to obtain further information on the practice
Ministry of Infrastructure and Agriculture of Brandenburg, Department of Transport
Annex completed on: 04-30-2012