Response to interpellation 2024/25:231 on cost-effective railway maintenance
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
KD argues that the government prioritizes a robust and efficient transport system with historically large investments in maintenance 1. KD believes that Trafikverket must work to break the weak productivity development and that the government has already taken measures to strengthen the implementation of railway maintenance 1 2. KD emphasizes that outsourcing has lowered costs and that the way forward is to include private contractors for innovation 3. KD wants to create a consensus regarding maintenance to create long-term conditions for investments 4. V considers the railway to be a national failure and that deregulation has not led to lower costs or better quality 5. V advocates that maintenance should be brought back into in-house management 6 7.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Statsrådet Andreas Carlson (KD)
Madam Speaker! Malin Östh has asked me if I agree with the Productivity Commission, which argues that it is justified to conduct a review and evaluation of whether the formation of Trafikverket has achieved its objectives and whether the organization of the sector is expedient. Malin Östh has further asked me if I intend to take measures, and if so which ones, so that cost-effectiveness can be achieved in a sector that, according to SOU 2020:18, lacks the conditions to manage maintenance in an optimal way, as well as whether I intend to take measures in the near future to strengthen preventive railway maintenance and thereby reduce the risks of traffic disruptions for passengers and companies.
For this government, it is a priority to shape a robust and efficient system for the transport infrastructure where the advantages of each mode of transport can be utilized in the best way and complement each other. On 3 October, the government submitted an infrastructure bill to the Riksdag with historically large investments. The economic framework for the period 2026-2037 is proposed to be increased by 200 billion kronor compared to the previous planning period, to 1,171 billion kronor. This means a large increased investment in maintenance, which also includes reclaiming deferred maintenance at the level that Trafikverket assesses is maximally possible during the coming planning period.
Maintenance of and investments in transport infrastructure need to be carried out in a cost-effective manner, where as much social benefit as possible is created within a given economic framework. Large parts of Trafikverket's activities are performed by procured suppliers. That the procurement activity contributes to increased productivity in the construction industry is therefore of great importance. The Government can, however, state that the Swedish construction sector, including the infrastructure sector, has struggled with weak productivity development for several decades. Trafikverket must therefore, together with other actors, work to break the development where cost indices for infrastructure increase faster than inflation.
A measure that the government considers urgent is that Trafikverket continues to strengthen its procurement competence on the maintenance side as well as on the investment side. Procurement competence is about fundamentally understanding and being well acquainted with how the current contracting market functions and what opportunities it has, and based on this, being able to carry out the best possible procurements.
Malin Östh has asked me about measures for maintenance and preventive railway maintenance to reduce the risks of traffic disruptions for travelers and companies. I would therefore like to remind that the government already in 2023 tasked Trafikverket to report on measures to strengthen the implementation of railway maintenance and the robustness, reliability, and punctuality of railway traffic.
Regarding cost-effectiveness, the government commissioned Trafikanalys in 2022 to carry out a review and follow-up of Trafikverket's work with cost control and to propose improvement measures. The background was that the government assessed that better cost control needs to be achieved and that the level of knowledge regarding cost development and learning from previous experiences needs to increase. The assignment extends until 2028.
Overall, I can state that several important measures are underway to improve the cost-effectiveness and implementation of railway maintenance. The Government is now reversing the destructive trend of deprioritizing maintenance and is instead prioritizing this central activity—both in terms of more money for maintenance and more maintenance for the money.
Malin Östh (V)
Madam Speaker! Thank you, Minister, for the answer!
The infrastructure bill submitted by the government in October has been given the name: The Road to a Reliable Transport Infrastructure - so that all of Sweden can function. The Road to a Reliable Transport Infrastructure - that means we are not there today. Sweden does not have a reliable infrastructure. That is the reality. Swedish infrastructure has large and serious deficiencies. This applies in particular to the railway, where the situation is extremely serious. It is described in terms of a national failure.
In the government's bill, cost-effectiveness is emphasized repeatedly. Already in the introduction, it is stated that a better functioning transport system shall be achieved in a cost-effective manner. Thereafter, as mentioned, this with cost-effectiveness recurs a large number of times throughout the entire bill.
It is not bad in any way, but the strong emphasis on cost-effectiveness must also be filled with content - concrete measures that address and change what does not work today. Clear answers are also needed from the government on how railway maintenance, which today is very far from cost-effective, can become so.
Swedish railways is one of the world's most deregulated railways. We know why it was done, and we also know how it has gone. The deregulation was supposed to increase efficiency and provide lower costs and better quality, but that has not happened, not on any of the points.
After the deregulation, we have received a fragmented railway system where oversight and overall responsibility are lacking. Trafikverket, which is a commissioning organization that does not perform any maintenance on its own initiative, has successively and over time lost important knowledge about the railway infrastructure.
The productivity and efficiency, which was said to increase, have not increased but decreased. This is a fact, and it is supported by a large number of investigations and also by the government's own productivity commission, which notes a lack of productivity and efficiency.
The Productivity Commission considers it justified to conduct a review and evaluation of Trafikverket and the sector as a whole to analyze whether the organization of the sector is purposeful. This is very interesting, I think, and also important, because here there is an approach to not only manage symptoms but also to conduct a serious organizational review, something that definitely has the potential to lead to increased cost-effectiveness.
Madam Speaker! Here I would like to repeat the first of my questions, which the Minister repeated earlier but which I do not think I have received a full answer to: Does the Minister agree with the Productivity Commission? Is a review of the organization of Swedish railways needed?
Statsrådet Andreas Carlson (KD)
Madam Speaker! Let me begin by expanding on the answer to what the member concluded with.
Trafikverket conducted a comprehensive review of the operations during the autumn of 2023, and a number of areas for improvement were identified: to become more efficient, create better value for those whom Trafikverket is for, and ensure a better road and railway delivery in Sweden.
This has been followed by a mobilization internally within the agency, which involves a long-term effort that will continue over several years. Several different measures will be ongoing in parallel.
There is the answer to the question: Does the productivity in Trafikverket's operations and the railway sector need to be strengthened? The answer is yes. The review that has been conducted has been an important part in addressing some of the problems that exist and in strengthening procurement competence and the ability to place orders and achieving a better functioning railway maintenance.
Trafikverket has pointed out that this can lead to efficiencies in its own administration. The government has already included this in the budget allocation for Trafikverket's administration, which will be reduced by 300 million kronor in 2025 and 600 million kronor in 2026. This is a consequence of seeing that funds can be released by streamlining Trafikverket's organization.
Instead of funds going to internal administration within the agency, they can be used for maintenance of roads and railways or new projects. It amounts to quite a lot of money. The saving results from a purposeful work that Trafikverket has undertaken to streamline its operations. This is one of the initiatives that have been taken in order to strengthen railway maintenance and which the government views very positively.
When it comes to the effects of the then Banverket starting to tender maintenance contracts, it is something that has been evaluated in several different rounds.
Regarding the effects of competition, the Trafikverket investigation attempted in its partial report from 2009 to estimate the cost effects of competition for operation and maintenance, and the conclusion was that the costs were at least 25 percent lower than before competition while the quality was the same and safety remained high.
There are other investigations that point out that competition has lowered the cost levels. It would be interesting to hear more of what the member highlights as the basis for their claim that it has not led to lower costs.
However, the deprioritization of maintenance in both management and appropriations has led to us having a neglected railway infrastructure in Sweden. Two-thirds is over a hundred years old, and the maintenance is neglected. Here, the maintenance needs to be sharpened - that is what I am the first to sign off on. That is why the government has tasked Trafikverket to work, together with the actors and the maintenance contractors, for better reliability on the railway.
The way forward is not to exclude the private contractors, but on the contrary, we need even more innovations, faster execution, and less impact on freight and commuting traffic. In that case, all good forces need to be involved and contribute and not be excluded in advance.
The infrastructure bill is very rightly called The Way to a Reliable Transport Infrastructure. That is not where we are today, far from it. One does not need to travel many miles in our elongated country to see that there are great needs, but now we are turning things around and prioritizing the basics: maintenance first and also new investments. This we do to turn things around and point the way to a reliable infrastructure.
Malin Östh (V)
Mr. Speaker! I shall address some of what the Minister brings up. I asked the question whether the Minister agrees with the Productivity Commission's conclusion that a review of the organization of Swedish railways is needed. What I hear in the answer, Minister, is that you describe that Trafikverket is conducting a review of its operations, but that is not quite the same thing.
You also spoke about reduced administration and the effect of that. I would like to point out that one has rather seen increased administration and also significantly increased transaction costs, which is described in several reports by, among others, the Swedish National Audit Office.
That the costs have increased significantly is due, among other things, to costs linked to the entire procurement system but also linked to the fact that many procurements are appealed. This we have also seen.
The investigation that the Minister refers to, which found that costs decrease when the maintenance of the railway is put out to tender, I would argue is an old investigation. Several later ones have been submitted which are more updated.
The Swedish National Audit Office has, for example, reported that the prices for maintenance measures on the railway increased by 40 percent during the period 2011-2022. This can be compared with the CPI, which was 19 percent during the corresponding period. It is thus 40 percent versus 19 percent, and I think this indicates that the costs have increased.
As has been said, there are important points in the Productivity Commission's conclusions that I hope the Minister will take with him and also reflect a bit further on.
Then I want to say that railway maintenance is unusually poorly suited for outsourcing. What is reasonable, I contend, is instead that the one who manages the railway is also the one who carries out the maintenance in their own name, with their own resources. Then one gets a completely different level of control and oversight. Then, hopefully, the type of problems we see today can also be managed and avoided.
What is it that has happened then? Since Banverket was abolished in 2010, the railway's maintenance debt has increased sharply and is now estimated to amount to 90 billion kronor. It is increasing at a furious pace, at 400,000 kronor per hour. This the Minister knows well.
We also know that at the current pace and tempo, it will take 350 years to address the maintenance debt, but we cannot wait for 350 years to get a railway that works.
The need for time- and cost-effective railway maintenance is truly urgent, and therefore it is important that the government has a clear plan for how this is to be done. That is the purpose of my interpellation.
Many describe today's situation for the railway as so acute that one sees a need for a crisis or failure commission. I share that opinion. That the government's solutions in such a situation - based on the Minister's answer - are to task Trafikverket with sharpening its procurement competence and strengthening its cost control, I perceive as deeply inadequate.
When now also an investigation after investigation shows that deregulated maintenance leads to a lack of efficiency and productivity, I wonder: How many investigations do we need? We see in black and white that the cost-effectiveness that the Minister and the Government are eager to achieve decreases with the current organization of the railway. This must reasonably be taken into account.
Statsrådet Andreas Carlson (KD)
Mr. Speaker! We can agree that the pace and tempo need to be higher. Then we can have an ideological discussion on whether we believe an actor solves it best under state management or if we believe it is important to have good procurement - with reasonable conditions, of course - that stimulates innovation, which rewards precisely pace and tempo, and that one works with maintenance contractors who can provide new perspectives and new ways of working.
There are, for example, Swedish companies that use drones flown over the railway tracks with thermal cameras. In that way, one can see where there is a risk of a contact line failure occurring before it has occurred, and one can then send out maintenance contractors to that specific pole and rectify the fault before it has happened.
The type of measures are exactly what are on the table thanks to the mandate to report measures to strengthen the implementation of railway maintenance as well as the robustness, reliability, and punctuality of railway traffic that the government gave already in August 2023. It is about strengthening railway maintenance and about the cooperation and collaboration being increased, and Trafikverket has a very important role in designing procurements in a way that rewards this.
The right way is not to roll this back to how it was before but to look forward at a faster pace. It must, of course, happen in an efficient manner and with follow-up that it is done with cost-effectiveness and cost control, but time on track is also a very precious resource. If it can take hours instead of days to change a switch, it is worth a lot in our worn-out railway infrastructure, which is over a hundred years old for two-thirds.
This work is therefore underway. It would be interesting to hear how the member views the assignment that Trafikverket has partially reported on, which concerns a number of measures. It has not been up yet, but it is an example of that the government has already taken measures. This occurs in addition to the concerted effort that is now taking place within Trafikverket and which has already led to the fact that efficiencies of 600 million kronor per year can be implemented. This corresponds to 7.2 billion during the infrastructure planning period.
This is also the first step; it is certainly possible to streamline even further. Trafikverket is working on this, and it is something that the government is following very closely in addition to the clear mandates we have given to achieve a better functioning railway market in Sweden. One must be able to rely on the train running on time and that the tracks hold.
Malin Östh (V)
Mr. Speaker! I thank the Minister for the answer and for the debate.
I believe that many of us are concerned about exactly what you say, Minister, that is to say that the trains should run on time and that we should have an infrastructure that we can rely on and that works. But we are very far from that today. In all respects, the 350-year perspective is a dystopia, but it is also a fact: If we maintain the pace and the tempo we have today, it will take 350 years to address the maintenance debt on the railway.
This is also explained by the organization of the railway that we have today. I just want to return to the fact that the Productivity Commission points out precisely that one must dare to look at the organization of the railway and see if there is anything to be done there. But what I hear the Minister say is that one is not interested in doing so, despite emphasizing cost-effectiveness very strongly throughout the entire infrastructure bill.
We have a fragmented organization on the railway, and we have a Transport Administration that has successively and over time lost important knowledge about the infrastructure. We have problems with high transaction costs and distorted incentives - we know that preventive maintenance is deprioritized because it is not considered profitable - etcetera, etcetera. Railway maintenance is therefore unusually poorly suited for market exposure; I maintain that.
If one is to achieve the cost-effectiveness that it is said one wants to achieve, that is the fundamental problem that must be addressed. Just as the Minister touched upon, this is an ideological question, and from the Left Party's side, we say: Take back control of the railway! See the market failure for what it is, and retake the maintenance in your own administration! Only then can we, to quote the Minister, get more maintenance for the money.
Statsrådet Andreas Carlson (KD)
Mr. Speaker! Malin Östh points out that the organization needs to be looked at and says that she hears the Minister say that we are not interested in doing so. I think one should be a bit careful about how one quotes each other in a debate in the chamber of the Swedish Riksdag.
What I have pointed out are issues that actually strengthen the organization right now – which strengthen cooperation and collaboration. A major reorganization of Trafikverket, which is a very large agency, would perhaps take three years of just internal work regarding organizational forms. It is three years that, in that case, would risk being lost when it comes to having high momentum in increasing the pace and tempo and in sharpening the maintenance.
My focus when it comes to organization, coordination, and cooperation will therefore be to strengthen what Malin Östh calls the control, that is, the work and the progress, so that we get more maintenance on the ground - more maintenance for the money. We will also ensure that within the infrastructure framework that the government has presented, the money for railway maintenance is maximized so that it is as much as, if not more than, what those at Trafikverket assess can be converted into practice. This is definitely a priority issue. It is important to strengthen productivity in the maintenance sector.
There is a part of the companies that express concern regarding the risk that there could be a stop for private companies in the railway market. They wonder: Will we be able to continue in two years? That makes them perhaps choose to invest more in other countries, which also have large needs in their railway facilities. Therefore, I have expressed that I believe we need a peace treaty regarding the maintenance in Sweden. It is about having long-term conditions for all those who want to invest in the railway, so that we get a railway infrastructure to rely on in Sweden.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.