PKP heads for profit

PKP has halted the trend of declining passenger numbers and the company is set for a financial shot in the arm.

At a conference last week, summing up the activity of Polskie Koleje Państwowe (Grupa PKP) in the first seven months of 2006, Jerzy Polaczek, Minister of Transport and Construction, said that passenger numbers had increased 1.5 percent compared to the same period in 2005.

Next year the Ministry is planning to increase investments in the railway infrastructure and modernization of carriages by 20 percent, strengthen the investments in Polskie Linie Kolejowe (PKL), and have all their estates appraised.

"The better financial conditions within the PKP Group is a result of the Ministry of Transport's work as well as the increased effectiveness of the management of companies within the group," said Polaczek, adding that next year the group should not make any losses.

PKP has yet to make a profit. In 2002 it lost as much as zł.2.6 billion, in 2004 some zł.2.1 billion. This year the loss was lowered to just zł.410 million. The government has not accepted a strategy for the restructuring the railway system, whose draft included a one-off debt redundancy. The Ministry of Transport is now proposing that the debt be covered by the Railway Fund, which was set up this year.

According to the Ministry of Regional Development, only 0.7 percent of the total EUR 1.16 (zł.4.61) billion allocated within the Operational Program Transport has been paid out in the 2004-2006 financial period. The Ministry of Transport says  sum should be spent by the end of the year.