Annual Report 2005 Contents Delivering the railway 3 About Jernbaneverket 6 Who are we? 6 What do we do? 6 How do we operate? 7 Organizational structure 8 Key events in 005 0 Competitiveness and Socioeconomic Benefit 1 Capacity and utilization of the national rail network 3 Operating parameters of the rail sector 9 Railways and the environment 0 International activities Jernbaneverket’s image 3 Safety, Punctuality and Information 4 Safety 5 Punctuality 9 Productivity and Process Quality 3 Improved productivity 33 Efficient use of capital expenditure 36 Human Resources and Organizational Development 38 Skills development in the rail sector 39 Management development 39 Human aspects of restructuring 40 Management and monitoring systems 4 Personnel and working environment 4 Financial Statement 44 Income Statement 47 Contact details 63 Delivering the railway 005 was an eventful year in more ways than one. Jernbaneverket completed the project for a new Sandvika–Asker line within the budget of NOK 3.7 billion. Steinar Killi, Director General Norway and Jernbaneverket led Europe in installing the GSM-R rail communications system. What was more, punctuality in 2005 broke the record set the previous year, proving that the 2004 figures were no fluke but the product of determined efforts by Jernbaneverket and the train operating companies. The result has been continued growth in freight and passenger traffic. Meanwhile, Jernbaneverket can look back on a year of demanding changes on both the operational and the administrative side. I am therefore pleased to report that the restructuring processes were carried out without affecting the product we delivered to our train operating customers and the travelling public. For Jernbaneverket, it is important to have a reasonably sized in-house production business, so that we have the necessary control over day-to-day maintenance of the rail network. When the newly elected Norwegian Parliament decided last autumn to halt active down- sizing and outsourcing of production activities, this gave us an opportunity to examine our own resources and the external contractor market in context, in order to achieve the most productive and effective maintenance arrangements. The upshot is that we shall continue to put projects out to tender where it makes financial sense to do so, while taking care of day-to-day essential maintenance ourselves. It was therefore a cause for concern that the majority of the employees who opted to leave Jernbaneverket with a severance package in 2005 did not move into rail-related activities – which was one of the assumptions under- pinning Parliament’s earlier decision in 2004 to contract out the entire production business. In the longer term, this could have created a very difficult situation for the rail industry. However, the fact that Parliament has called a halt to active reductions in the workforce does not mean that Jernbaneverket is facing reduced demands from our owner – quite the opposite. Our owner has very clear expectations of what we must deliver. We must under- take to make efficient use of our own resources and demonstrate that we are doing so. What this means is that we now have a business model where the owner sets out the requirements but largely lets Jernbaneverket decide which tools to use. This model is commonly described as freedom with responsibility, and we in Jernbaneverket must prove that we can be trusted. I am confident that we can, but, going forward, an ability to think outside the box and a willingness to change will continue to be required. 3 In 2006, the senior management of Jernbaneverket will reach a decision on the future structure of our operations and maintenance activities. The future organizational structure will be designed to promote good productivity and effective use of skills and resources. Inherent in this will be initiatives to enhance the working environment and the oppor- tunities for individual employees to play their part. The ultimate objective, of course, is to provide train operating companies with an even better rail system in terms of safety, punctuality and public information. The city of Hamar, a long-established railway centre, saw the arrival of new rail-related activity in 2005 when Jernbaneverket relocated its Shared Administrative Services unit. The co-location of these services will ensure greater operational efficiency while creating new public-sector jobs outside of Oslo, as does the decision to locate the GSM-R operations centre in Trondheim. However, we must not overlook the fact that restructuring processes such as the relocation to Hamar also cause difficulties for those affected. I believe never- theless that Jernbaneverket deserves credit for its restructuring process and the measures that were put in place to protect the interests of employees. The new majority in the Norwegian Parliament has given clear signals that it wishes to follow up Parliament’s decision of July 2004, when a majority voted to increase the capital expenditure ceiling in the National Transport Plan by NOK 1 billion annually until 2015. It is crucial that this decision is followed up, given that the current rail infrastructure lacks the capacity to meet the future requirements of growing passenger and freight traffic. The national budget to be presented this autumn will therefore be absolutely critical. In the meantime, a number of important projects are under way. Jernbaneverket has started construction work in connection with a new freight terminal at Ganddal and a new station at Lysaker. The freight terminal is the first stage in developing a new double-track line between Sandnes and Stavanger, while starting work on the new Lysaker station is pivotal in ensuring that upgrading of the western corridor into Oslo is not delayed. It is also vital that the new station, a key hub for businesses in the Lysaker area, is designed to be user-friendly and meet the expectations of train operators and passengers. A great deal of resources have been devoted to studies of this project, and many stakeholders have been 4 Hamar station. The Oslo–Eidsvoll main line crosses the Level crossing at Stange station. Photo: Sven Goll Gardermoen airport line. Photo: Sven Goll Photo: Øystein Grue involved in the consultation process. I am therefore confident that the finished project will meet current regulatory standards and satisfy the underlying intentions. The fact that the scheme has been the subject of debate is, I believe, a positive expression of involvement that we can put to constructive use in our ongoing work on the project. Jernbaneverket’s safety record is consistently improving. Unfortunately we again failed to avoid accidents at level crossings in 2005, which serves as a reminder that we must, in the years ahead, continue to pursue a program of physical improvements and public education in connection with railway crossings. Meanwhile, improved analysis tools and technology are constantly providing us with new insights into the human and technological factors that can cause accidents. Jernbaneverket has a zero-tolerance policy on accidents – in other words, a contract with rail users that we are not allowed to breach. We are excited about the prospects for 2006, and I am looking forward to tackling the challenges we face along with our owner, our staff and the train operating companies. We can and must improve, not least in delivering our day-to-day product in terms of station environment, public information and train punctuality. Both Jernbaneverket and the train companies have shown over the past few years that we can deliver results. In autumn 2006, we shall see whether this is rewarded with a change of track in the national budget. Steinar Killi Director General 5 About Jernbaneverket Who are we? meets social and market requirements Jernbaneverket, the Norwegian National in terms of safety and quality (punctual- Rail Administration, reports to the Min- ity, train frequency, public information, istry of Transport and Communications. etc.) Jernbaneverket’s operations are funded • Railway stations and terminals, includ- through annual grant allocations in the ing public spaces, information facilities, national budget. The Ministry monitors access, car parks and other public facili- Jernbaneverket’s activities through ties necessary for users of rail services regular departmental meetings and • Entering into track access agreements periodic reports from Jernbaneverket. with train companies running services The longer-term financial parameters are on the national rail network set by the Norwegian Parliament in the • Allocation of infrastructure capacity National Transport Plan. (train paths) to train operating companies The former Norwegian state railway • Traffic management on the national rail undertaking, NSB, was split with effect network from 1 December 1996 into a train oper- • Studies and planning in the rail sector ating company, NSB BA, and a national • Training railway staff, including locomo- rail administration, Jernbaneverket. tive drivers Jernbaneverket comprises a central Directorate reporting to the Director Jernbaneverket’s product is described in General and two divisions, Infrastructure detail in the Network Statement, avail- Management and Traffic Management, able on Jernbaneverket’s website: each of which has regional units. www.jernbaneverket.no What do we do? The table below summarizes the scope Jernbaneverket’s mission is to help the of the infrastructure. country achieve its transport policy objectives and to