Theoretical And Methodological Issues Regarding Subsidies For Urban Public Transport Operators

Until the effective application of “REGULATION (EC) No 1370/2007 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on public passenger transport services by rail and by road in Romania, the existing policy of subsidizing public transport companies generally consists in covering the difference between the total cost (usually higher) and revenue (usually lower) of the operator that are obtained by provisioning the public passenger transport. In this manner, by subsidizing the overall cost of public transport companies has led to a constantly growing financial effort for the local authority, in particular because there are no clear policies regarding the destination, volume and socio -economical effects of this subsidy. Likewise, in the absence of clear methodologies and procedures for correct identification and quantification of the volume and destination of the subsidy needed for operating the public passenger transport services, it`s financing is done in a relative subjective manner. In this paper we propose to bring to the fore a number of conceptual and procedural elements regarding “a more correct approach on the volume and destination of operational subsidies granted to the public transport companies. The aim of the research is to demonstrate that urban transport system development is conditioned by the need to amend the regulatory mechanism for according operating subsidies.