Luxembourg’s free public transport sounds great, but it won’t help people get from A to B
January 16, 2019 10.15am EST
......Luxembourg is a small sovereign state, comprised of its capital city, small towns, and countryside – an urban region with a dispersed urbanisation around the main centre, spreading across the borders with Belgium, France and Germany. Having benefited from sustained growth, Luxembourg likes to present itself as a haven of stability and prosperity.
Luxembourg’s thorny problem
Luxembourg’s economy is supported largely by the financial sector, the European Union, and the booming industries of technology and innovation. It is home to more than
140 banks and has become a hotspot for specialised investment services. Luxembourg city is a European capital, home to the European Investment Bank, the Parliament Secretariat and the Court of Justice. Luxembourg has also attracted major players in the digital economy: Amazon, Skype and PayPal have headquarters there, and Google is considering
establishing a data centre in the countryside.
As a result of these strategies, Luxembourg is a small but unusually international state; an economic engine that requires – and attracts – massive influxes of labour from neighbouring countries. Currently, roughly
422,000 people work in Luxembourg, while the country itself has a resident population of just over
600,000. Many of these jobs are located in the business districts in and around the capital city.
Almost half of the labour force (
192,000) are cross-border commuters. Due to substantial immigration (Luxembourg’s population grows by
2.3% every year) and the immense supply of office space, housing inside Luxembourg is scarce and costly.
Too many offices, not enough houses.
Shutterstock.
The government is intent on
continuing economic growth to preserve living standards and maintain the social security system at current levels. And so far it has succeeded: GDP grows steadily by
2% to 4% anually. Indeed, Luxembourg’s per capita GDP is among the
highest in the world.
Yet this growth has also put a lot of pressure on the transport system. Roads, rail tracks and stations are in a dire state, and government funding has not caught up with current demand and delayed investments from the past. It is precisely this growth pressure that makes the problem really thorny and
economic sustainability rather difficult to achieve.
During rush hours, trains coming in from the border regions are standing-room only – and are often late or cancelled – causing passengers to miss connecting services. Customer service and information is relatively poor. Ironically, the massive infrastructure investments recently initiated by the government have only generated more construction sites, bottlenecks and road blocks – at least for now.
If only it worked
Making public transport free looks set to make the situation worse. Fares are already
heavily subsidised; a single fare between any two points in the country is €2, day passes are €4, and minors already ride free. So a further reduction is not likely to have a significant impact.
In this context, the notion that free transport is a means of wealth redistribution and social inclusion doesn’t square. It’s already cheap – and far outweighed by exploding housing costs – the country’s real inequality challenge. And, price is
only one factor in an individual’s choice of transport. This means that pricing alone won’t likely trigger major changes in travel behaviour.
