Italian passenger rail operators to receive €687m in aid

ITALY. The Italian government will be able to implement its aid scheme to compensate commercial long-distance passenger rail operators for the damage caused by Covid-19. The European Commission has just authorised it, on Wednesday 2 March 2022, considering that "it was justified for the Member States to take exceptional measures to grant compensation for damage linked to the pandemic" and that "the measure was proportionate, as the compensation envisaged does not go beyond the amount necessary to remedy the damage".

The €687 million package will compensate for the loss of income suffered between 1 July 2020 and 30 April 2021 as a result of the pandemic, but also of the restrictive measures taken by the Italian government to limit the spread of the virus. In particular, Italy has introduced a mandatory staggered seat reservation system which has reduced the number of available seats by 50%. It has enacted strict limitations on face-to-face business meetings and travel, as well as the cancellation of events. Between the end of December 2020 and April 2021, it even banned inter-regional travel throughout the country.

All these measures have significantly reduced the mobility of Italians travelling for pleasure or business, and have had a heavy impact, particularly on long-distance rail transport. Between 1 July 2020 and 30 April 2021, the number of rail passengers fell by 90% compared to 2019. This has resulted in a very significant drop in revenue for operators who have continued to meet various costs, while incurring additional expenditure to strengthen health and hygiene measures.

Compensation will be paid by the Italian government in the form of direct subsidies.

Already on 10 March 2021, the European Commission had granted a similar scheme compensating the same rail operators for the financial damage suffered between 8 March and 30 June 2020.