ON JULY 25 the Sejm, the lower chamber of the Polish Parliament, passed the formal Act paving the way for the commercialisation, restructuring and privatisation of Polish State Railways. The Act has still to be approved by the Senat (the upper chamber) and signed by the President.
The Act will see PKP transformed into a joint stock holding company, PKP SA, with the state initially owning 100% of the shares. Subsidiary companies will be created to take over various businesses, notably freight, long-distance passenger and local passenger services. Infrastructure will become the responsibility of Polskie Linie Kolejowe SA (Polish Railway Lines). PLK and Cargo are expected to be established first.
PKP’s telecom and power supply sub-sectors will probably be hived off as a separate company, together with three rail operations. These are the WKD suburban line linking Warszawa and Grodzisk Mazowiecki, the Gdansk - Gdynia S-Bahn network and the 1524mm gauge LHS freight line from Silesia to the Ukrainian border in Hrubieszów.
The PKP SA state-guaranteed shares will total 3·9bn zloty, compared to PKP’s historic debt of around 8bn zloty. State subsidies for passenger traffic have been agreed for 2001-03. The state will pay 800m zloty for contracted local services, and up to 500m a year to compensate for concessionary travel. By the end of 2002, PKP will be expected to cut its work force by around 33000 from the present figure of 185000. n
