Abstract
The paper deals with the importance of the risk in financing public passenger transport. The first part analyses the risks affecting financing public passenger transport. These risks can be divided into two basic groups: cost risks and revenue risks. The second part describes the ways of dividing risks between contractual parties. The risk determination in financing public passenger transport is discussed in the last part of the paper
Highlights
Under current conditions in terms of general economic interest, the public passenger transport services cannot be provided on a commercial basis
The level of reasonable profit is set in range from 3.5 to 5.0 % of economically justified costs in all contracts concluded in the Slovak Republic (SR) to 2011 [4]
Operator bears no cost or revenue risks – the risks associated with providing transport services are borne only by authority; and the level of reasonable profit should relate only to the capital used by operator when providing transport services
Summary
Under current conditions in terms of general economic interest, the public passenger transport services cannot be provided on a commercial basis. In Hungary, public service contract concluded between the authority (Budapest city) and public service operator contains the provisions according to which the level of reasonable profit is a maximum of 4 % of the economically justified costs [5]. The reasonable profit must depend on level of risk-taking In practice, it is determined as a percentage of economically justified costs. Public funding should be dependent on the risk that is borne by the public service operator From this reason, the objective of the paper is to determine the relationship between the risk existence and financing public passenger transport from the position of public authorities
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