Symposiun on the Social and Labour Consequences of Technological Developments, Deregulation and Privatization of Transport.

This paper has been prepared by the International Labour Office as a background document for the Tripartite Symposium on the Social and Labour Consequences of Technological Developments, Deregulation and Privatization of Transport. It was prepared by Bert Essenberg, Transport Sector Specialist, Sectoral Activities Department, ILO. It is published under the authority of the International Labour Office. This will be the first symposium organized for the transport sector covering civil aviation, railways and road transport. The paper highlights recent developments in technology, deregulation, privatization, employment, working conditions and working environment in air, road and rail transport as a basis for a more detailed presentation and discussion at the Symposium. It is expected that separate sessions will deal with issues such as the following: (i) transport in the twenty-first century; (ii) deregulation or re-regulation; (iii) social and labour consequences of privatization of public transport enterprises; (iv) labour-management relations in a changing industry; and (v) employment, working conditions and working environment in the form of presentations by acknowledged experts, to be followed by a tripartite debate.

1.2. Background to the Symposium

The Governing Body of the International Labour Office decided at its 268th Session (March 1997) that a Tripartite Symposium on the Social and Labour Consequences of Technological Developments, Deregulation and Privatization of Transport should be held in Geneva from 20 to 24 September 1999.

The Governing Body also decided that the Symposium would have 69 participants, and that the following 23 countries would be invited to participate: Argentina, Bangladesh, Brazil, Burundi, Egypt, El Salvador, France, Germany, Italy, Japan, Kenya, Lebanon, Luxembourg, Malaysia, Mexico, New Zealand, Portugal, Slovenia, Sweden, Switzerland, Tunisia, United States and Zimbabwe. It was also decided that the Employers' and Workers' representatives would be selected on the basis of consultations with the respective groups of the Governing Body.

This Symposium is part of the ILO's Sectoral Activities Programme, which is aimed at assisting governments and employers' and workers' organizations to develop their capacities to deal equitably and effectively with the social and labour problems of particular economic sectors. It is also a means of alerting the ILO to specific sectoral social and labour issues. One of the principal ways of doing this is through tripartite meetings and, more recently, symposia, which bring together a cross-section of government, employer and worker representatives from countries that are prominent in a given sector.

2. Transport developments

2.1. Transport trends

The strong correlation between mobility and economic growth is well known. At present trends, demand for freight and passenger transport will continue to grow faster than population and gross domestic product (GDP) in most developing countries. Developments such as the globalization of production and changes in management strategies are increasing the demand for international personal mobility. The rising importance of service sector activities in industrialized countries is also enhancing the demand for air services. Tourism, which already accounts for a large share of air travel, is expected to continue its development towards a global industry, with growth rates well above those for global world output.

Air transport

Growth in air traffic and revenues has continued unabated since 1993, achieving historic levels in the number of passengers and quantity of freight and mail carried. The world's airlines are estimated to have carried 1,448 million passengers in 1997, compared with 1,390 million in 1996. They also transported about 26 million tonnes of freight, up from 23 million in 1996. Airline revenues are estimated to have reached US$291 billion for the first time, resulting in an operating profit of about US$16.5 billion, i.e. 5.7 per cent of operating revenues.⁽¹⁾

Preliminary 1998 traffic figures compiled by the International Civil Aviation Organization (ICAO) point to a 1 per cent increase in tonne-kilometres performed in both total and international scheduled airline traffic worldwide. This represents a substantial decrease in growth compared with the last five years, when traffic rose an average of 7 per cent per year (8 per cent in 1997). The slowdown reflects a small decline in traffic of the airlines of the Asia/Pacific region, which account for more than a third of world traffic and until recently experienced high rates of growth.⁽²⁾ The carriers most affected by the economic turmoil include Garuda Indonesia airlines, Philippine Airlines and Thai Airways International. These and several other airlines have announced or implemented reductions in international services.

Inland transport

The worldwide fleet of road motor vehicles is expected to grow by 34 per cent between 1989 and 2000, from 557 million to 745 million units, notably in countries on the threshold of industrialization. In industrialized countries, demand for freight transport typically grows less rapidly with GDP than does the demand for personal transport. In developing countries, however, the growth in road freight is expected to be similar to that for the movement of people. The highest growth rates for road freight are expected in the former socialist countries of Central and Eastern Europe, where trucking activity is expected to triple within 20 years.⁽³⁾

Rail transport will continue to play a very important role in many countries such as China, India, and some smaller countries with substantial bulk freight movements. In China, rail freight transport rose from 811 billion tonne-kilometres in 1985 to 1,292 billion in 1996, while rail passenger traffic reached its peak in 1994 with 363 billion passenger-kilometres and declined to 332 billion in 1996.

In India, during the same period, freight transport increased from 173 to 270 billion tonne-kilometres, whereas passenger traffic went up from 227 to 342 billion passenger-kilometres. In Japan, the number of passenger-kilometres has more or less stabilized at about 250 billion per year.⁽⁴⁾

The absolute decline in rail transport that has occurred in Central and Eastern European countries since 1993 has bottomed out in some countries, and traffic is expected to recover with economic growth. Given present trends, however, the share of rail transport in transition and developing countries could decline.⁽⁵⁾

A new analysis of statistics on rail freight transport in the 1990s in the European Union (EU) shows no evidence of a consistent trend in total transport in 1990-97. Seen in the context of broader trends in the economy and transport market in the EU, real GDP grew by an average of 1.9 per cent per year from 1990 to 1997, and freight transport by road, measured in tonne-kilometres, increased by an average of 3.4 per cent per year from 1990 to 1996. Thus even as rail freight transport is increasing in absolute terms, its share of the inland transport market is typically declining. From other data, it appears that railways carried about 20 per cent of inland freight (road plus rail plus inland waterways) in 1990, but that this share had declined to less than 15 per cent in 1996.⁽⁶⁾

During the late 1970s, the future of freight railroads in the United States looked bleak. Long-standing government-imposed price controls brought the industry to the edge of extinction. When Congress lifted those controls in 1980, railroads were reinvigorated by the challenges and opportunities arising from market-based competition. Since then, freight rates have fallen, traffic volumes have increased considerably, accident rates have improved and investment in modern locomotives, cars, tracks, computers and communication systems has grown rapidly.

In 1996 the United States freight railroad industry carried a record level of traffic and posted improved financial results over 1995. The total operating revenue for Class I freight railroads was US$32,693 million. Coal continued to be the railroads' top commodity in 1996, accounting for 43.8 per cent of total tonnage, followed by farm products and chemicals and allied products.⁽⁷⁾

The growth in personal mobility (excluding intercontinental air and sea transport) in the 15 Member States of the EU between 1970 and 1996 was 3.1 per cent per year. The private car and the aeroplane have benefited from this growth, with their market share rising by 5.5 and 4.1 per cent, respectively. The growth in mobility of goods was 2.2 per cent per year, with road transport (3.8 per cent growth per year) benefiting at the expense of the other modes.⁽⁸⁾

In Europe transport infrastructure has become even more stretched in recent years and few of the apparent solutions or proposals seem to have produced noticeable results so far. There does not seem to be much prospect of relief in the near future either. For years, politicians as well as the general public have been calling for more freight to be moved by rail and for greater use of combined transport services.⁽⁹⁾

In the industry itself, there is a growing realization that neither intermodal transport nor the railways are the answer to Europe's gridlocked transport system. Road transport remains by far the most efficient and flexible means of moving goods around Europe. At the Intermodal 1998 conference in Rotterdam, a high-ranking government official from the Netherlands challenged the popular perception that intermodalism was the way forward: "Intermodal transport has a role to play, but it is only part of the answer." He even wondered whether the concept of intermodal transport should be abandoned, given the superiority of road transport, which has also made huge strides in reducing environmental damage. Industry leaders think that the time is now right for some fresh thinking, given the seriousness of the problem.⁽¹⁰⁾

2.2. Transport policies

According to the World Bank, to be effective, transport policies must satisfy three main requirements. First, they must ensure that a continuing capability exists to support an improved material standard of living -- the concept of economic and financial sustainability. Second, they must generate the greatest possible improvement in the quality of life, not merely an increase in trade of goods -- the concept of environmental and ecological sustainability. Third, the benefits that transport produces must be shared equitably by all sections of the community -- the concept of social sustainability. Economic, environmental and social sustainability are often mutually reinforcing. A policy for sustainable transport is one that both identifies and implements win-win policy instruments and explicitly confronts the trade-offs so that the balance is chosen rather than accidentally arrived at. It is a policy of informed, conscious choices.⁽¹¹⁾

In a recently published White Paper, entitled "A new deal for transport: Better for everyone", the Government of the United Kingdom advocates a transport policy aimed at integration within and between different types of transport; integration with the environment and land-use planning; and integration with policies for education, health and wealth creation. The Government wants a better public transport system that meets the needs of people and business at an affordable cost; produces better places in which to live and with easier access to workplaces and other everyday facilities for all, especially people on low incomes and the disabled. It wants to cut congestion, improve towns and cities and encourage vitality and diversity locally, helping to reduce the need to travel and avoid the urban sprawl that has lengthened journeys and consumed precious countryside. Moreover, the new system should reduce the fear of, and the level of, crime on the transport system.⁽¹²⁾

In Africa, the Government of Gabon adopted a new transport policy in 1998 with the objective of organizing the transport system as a productive and rational sector operating under market economy rules. The policy recognized the need to strengthen the management capability of the regulatory bodies, to improve transparency and to reduce government support to the sector.⁽¹³⁾

The Czech Republic's transport policy is aimed at achieving freedom of sustainable mobility of passengers and goods as a necessary corollary of implementing the requirements of the Charter of Human Rights and Liberties, while meeting the needs of free business activity and providing optimum support to sustainable development by improving the transport system. The policy is based on the idea that while the State will have to maintain its influence on the transportation system, it cannot impair business activities and the competitive environment created by the market mechanism and the harmonization of the laws with those of the EU.⁽¹⁴⁾ Important changes in transport policies have also occurred in other Central and Eastern European countries (Bulgaria, Lithuania and Romania).

The Government of Thailand was advised by the Thailand Development Research Institute (TDRI) to focus more on developing its rail and water transportation links in view of the fact that the trucking business was becoming overdeveloped and increasingly expensive. Water transport, including coastal ferry services and improved inland waterway systems, was cited as an important means to reduce freight costs. Rail services should also be better utilized under the revised Transportation Master Plan 1999-2006.⁽¹⁵⁾

The shifting focus in transport policy implies a substantial change in the role of government, reducing its functions as supplier, but increasing its functions as regulator -- the enabler of competition and the custodian of environmental and social interests.⁽¹⁶⁾

2.3. Transport and the environment

The relationship between transport and the environment is of growing concern to politicians and the general public, on the one hand, and transport operators and transport workers, on the other.

The aviation sector poses a variety of environmental, safety and security challenges. These include the impact of the aviation industry on the local noise climate, the implications of air travel for air quality locally and at high altitude and pollution and congestion associated with road access traffic. At the global level, commercial aviation has been estimated to contribute about 2 per cent of greenhouse gas emissions. Continuing rapid growth in air traffic is expected to put further upward pressure on carbon dioxide (CO₂) emissions.

Economic development simultaneously generates growing demand for air travel and an increasing expectation of an improved quality of life. One result is lower tolerance of pollution and noise. The environmental implications of airport operations therefore have the potential to increase pressures to restrict air traffic growth. The long inquiries that precede the construction of new or expanded airports show how important the social, environmental and economic issues are and the difficulties in resolving them.

Airports and airlines, particularly in Europe, have invested heavily in identifying and then reducing the environmental impact of the industry. Aircraft noise is an issue of such importance that some airports have noise capacity limits (effectively restrictions on aircraft movements) which are lower than the infrastructure capacity limits for the airport.

Aircraft are already subject to international regulations limiting their environmental impact on take-off and landing and some member States of the Organisation for Economic Co-operation and Development (OECD) are considering emission charges on air traffic. The European Commission has already taken measures, such as the prohibition of the use of older aircraft fitted with special engine mufflers or "hush-kits" from 1 April 2002 unless they were already operating in Europe before 1 April 1999; it is further considering the possibility of imposing rules for limiting night flights at EU airports. The Commission believes that unless it takes tougher measures to reduce noise and other pollution at airports, action by various groups could threaten the expansion of the airline industry.⁽¹⁷⁾

Air quality in major cities in many developing countries is often already as bad as or worse than that in cities in industrialized countries, despite lower levels of vehicle ownership. Road traffic is not the only source, nor often the main source, of air pollution, but it is a primary source of some categories of pollutants. Emissions of lead, carbon monoxide, nitrogen oxides and hydrocarbons and particulates (smoke) damage health, especially that of pedestrians and persons living and working in the open on traffic thoroughfares. For example, in Mexico City high particulate levels contribute to an estimated 12,500 deaths a year, and lead concentrations in some areas of Cairo are five to six times as high as the global norms set by the World Health Organization (WHO). Ground-level ozone accumulation causes major respiratory problems in many cities.⁽¹⁸⁾

The environmental impact of growing road traffic is generally concentrated in urban areas. The impact on health of particulate emissions from diesel motors, tyres and road surfaces is severe in urban areas where noise is a major nuisance as well. However, in response to progressively tighter regulations for passenger cars, better design and fuel quality, together with catalytic converters, have improved emissions control. Noise from individual vehicles has also been reduced in response to standards and market pressures.

Although raising the maximum permissible size of trucks has increased the impact of individual vehicles, fleet growth appears to have slowed somewhat. The expansion of service industries and just-in-time delivery systems has led to a rise in light duty goods vehicle traffic. Deregulation has contributed to heavier traffic, while regulatory barriers, imbalances in trade flows, increasing vehicle specialization and inadequate information systems result in frequent empty runs. There may be scope for reducing empty runs in the future, particularly through deregulation of cabotage and improved logistics. In urban areas, today's advanced logistics can make an important contribution to alleviating congestion through joint deliveries, advanced dispatching systems, multi-functional logistics centres and advanced electronic information and communications systems.⁽¹⁹⁾

Railways have a comparative advantage over other transport modes as far as environmental impact is concerned, but the gap is closing. Rail remains unequalled in its ability to produce high passenger volumes in small spaces, and it is difficult to imagine many larger cities (Tokyo, New York, London, Mumbai, Moscow) being able to function without suburban rail systems and metros. Rail systems do generate noise but, because the impact is localized (and can be totally hidden in tunnels), it can be controlled and minimized.⁽²⁰⁾ The Environment Working Group of the International Union of Railways (UIC) tries to integrate measurement of quantitative indicators, such as energy consumption, noise emissions and herbicide use in order to track the environmental impact of rail transport. In Europe, reducing noise is a main task in railway development.⁽²¹⁾

2.4. Globalization

Globalization has already dramatically changed the way we live and will continue to do so. The transport sector, by its very nature, is an international industry which in recent years has witnessed important moves towards globalization and diversification of ownership and/or management. A striking example of this development is the emergence of airline alliances, which have been described by some as "nothing less than a major transformation of the industry". There are now over 500 alliance deals between individual airlines. Yet the big change is not the accelerating number, but the nature of the deals. No longer are alliances loose arrangements between a couple of carriers to share flight codes and cross-sell tickets; now they are aiming at virtual mergers, despite rules limiting or forbidding foreign ownership.⁽²²⁾

This trend is illustrated by the alliance agreement signed in November 1998 for a period of ten years between KLM and Alitalia, which goes further than any agreement so far concluded between competing companies. The two companies will merge their complete flight operations through the creation of two joint ventures, one for passenger traffic and one for freight transport. The planes will remain the property of KLM and Alitalia, respectively, and the staff will continue to be employed by their present employer.⁽²³⁾

However, it has been argued that alliances do not deliver the consolidation that occurs in other industries such as cars or computers, in which the strongest and fittest companies survive and the weakest go under. Instead, it is pointed out, they allow airlines to collude, protect weak ones from closure and hugely increase barriers to entry for newcomers, which cannot hope to match their global network of destinations.⁽²⁴⁾

At the same time as airlines are establishing alliances, they are spinning off what they consider as non-core activities such as luggage handling, maintenance and catering. Such functions are either contracted out or put into independent companies, which then seek to serve other airlines. A number of specialist transnational service companies (LAGS (now GlobeGround), AMR Services, Ogden, Servisair) have thus been created and are becoming increasingly important in aviation ground handling.

One of the first functions to undergo this restructuring process was airline catering. While ten years ago most airlines provided in-flight meals from their own kitchens, by the end of 1998 there were a few dominant catering groups (LSG-Sky Chefs, Gate Gourmet and Dobbs) which together now control 59 per cent of the global airline catering market.⁽²⁵⁾

In response to the creation of airline alliances, trade unions in several countries are carefully looking into how they can best defend the interests of their members employed by the alliance companies. For example, the International Transport Workers' Federation (ITF) has made union coordination within global airline alliances one of its major priorities. The civil aviation section aims to hold a meeting every year for unions in each global alliance.⁽²⁶⁾

Globalization is attracting airport management too. The British Airports Authority (BAA), Amsterdam's Schiphol Airport, and the United States-based Airport Group International are major global airport operators. BAA for example, which began its international expansion in 1992, is now involved in airport operations, either individually or with consortium partners, in Indianapolis, Newark and Pittsburgh (United States), Naples (Italy), Melbourne and Launceston (Australia). TBI, a United Kingdom-based regional airports and property group, runs airports in Cardiff and Belfast (United Kingdom), Orlando, Florida (United States) and Skavsta (Sweden).

The last few years have also seen a rapid increase in the concentration of rail and road transport companies, as well as in the operation of transport concessions resulting from deregulation and/or privatization. Transport companies are either investing in their own subsector and transforming themselves into multinational companies such as Wisconsin Central International, a railway company with operations in the United States, Canada, New Zealand and the United Kingdom or they are involved in various modes of transport, such as the British group Stagecoach, which runs bus, rail and airport operations. In 1997-98 it acquired bus and ferry operations in Australia and New Zealand and took a 49 per cent stake in the Virgin Rail Group. National Express is another British transport group acquiring interests in other parts of the world. Finally, "outsiders" have also demonstrated considerable interest in investing in transport operations. Virgin, ACCOR and VIVENDI can be cited as examples of this trend.

With the exception of the Netherlands, the road freight sector in Europe consists mainly of small and medium-sized enterprises (SMEs). Out of the 38,000 French freight enterprises, 85.5 per cent have fewer than ten employees and 71 per cent fewer than five employees. In Germany, 92 per cent of the 44,000 enterprises have under ten employees. In Italy, 91 per cent of the 145,000 enterprises employ on average 1.4 employee. A second characteristic of this SME sector is the existence of independent drivers, having nothing but their truck and their labour. Some argue that here workers are often exploited and become trapped by the lure of an illusory freedom within anybody's reach.⁽²⁷⁾ In many other countries, including in the developing world, the road freight sector is also dominated by small companies and individual operators.

1. International Civil Aviation Organization (ICAO): "Annual report on civil aviation", in ICAO Journal (Montreal), Vol. 53, No. 6 (July-Aug. 1998), pp. 10-11.

2. idem: "World airline traffic slows growth in 1998", in ICAO Journal, Vol. 53, No. 10 (Dec. 1998), p. 26.

3. World Bank: Sustainable transport: Priorities for policy reform (Washington, DC, 1996), pp. 24-25.

4. International Union of Railways (UIC): 1997 Annual Report (Paris, 1998), pp. 10-11.

5. World Bank, op. cit., p. 25.

6. "Trends in rail freight transport", in Statistics in Focus (Luxembourg, EUROSTAT), 1998/10, pp. 1-2.

7. Association of American Railroads (AAR): Railroad Facts: 1997 Edition (Washington, DC, 1997), pp. 5-6.

8. Hourcade, J.: "Prospects for the trans-European transport network", in Rail International (Brussels, International Railway Congress Association (IRCA)), Nov. 1998, pp. 2-4.

9. See, for example, Carroue, L.: "La ruineuse maladie du 'tout-routier'", in Le monde diplomatique (Paris), Dec. 1997, pp. 18-19.

10. Porter, J.: "Volvo drives transport debate", in Lloyd's List (London), 12 Dec. 1998.

11. World Bank, Sustainable transport, op. cit., pp. 28-29.

12. Department of the Environment, Transport and the Regions (DETR): A new deal for transport: Better for everyone (London, The Stationery Office, 1998), pp. 14, 28.

13. Ministère des Transports et de l'Aviation Civile: Le Gabon (Libreville, 1998), p. 7. Ministère de la Planification de l'Environnement et du Tourisme: Plan Directeur Intermodal des Transports (1998-2015): Synthèse (Libreville, 1998).

14. Czech Republic, Government of: Transport Policy Resolution No. 413 (Prague), 17 June 1998, pp. 2, 4.

15. Gillotte, T.: "Thai focus on transport" in Lloyd's List (London), 19 Jan. 1999.

16. World Bank, op. cit., p. 85.

17. For more information, see: Airports Council International (ACI) Europe: Creating employment and prosperity in Europe (Brussels, 1998), pp. 22-23. Financial Times: "Noisy jets to be phased out", London, 30 June 1998. Tucker, E.: "EU action on noisy aircraft angers US", in Financial Times, 11 Dec. 1998. Leake, J.: "Aircraft boom spreads noise belt", in Sunday Times (London), 27 Sep. 1998. Meyer, T.: "L'accès aux liaisons aériennes, premier facteur d'implantation en Europe", in Le temps (Geneva), 24 Sep. 1998. Krul, J.: "Amsterdam's fifth runway will alleviate both capacity and noise problems", in ICAO Journal (Montreal), Vol. 53, No. 8 (Oct. 1998), pp. 14-15. Perkins, S.; Stevens, B.; Confavreux, R.: "Transport, economic development and social welfare", in OECD: Sustainable development: OECD policy approaches for the 21st century (Paris, 1997), pp. 108-111.

18. World Bank, op. cit., pp. 50-51.

19. OECD, op. cit., pp. 102-107.

20. Ackermann, R.; Gwilliam, K.; Thompson, L.: "The World Bank, transport and the environment", in Japan Railway and Transport Review (JRTR) (Tokyo), Dec. 1998, No. 18, pp. 31-39.

21. Ellwanger, G.; Lindeke, S.: "Sustainable development: Using environmental indicators", in Japan Railway and Transport Review (JRTR), Sep. 1998, No. 17, pp. 4-7.

22. The Economist: "Airline alliances: Mergers in mind" (London), 26 Sep. 1998, p. 80.

23. Snijders, M.: "KLM et Alitalia mettent en commun la quasi-totalité de leurs activités", in Le Temps (Geneva), 28-29 Nov. 1998. Reijn, G.: "KLM en Alitalia schuiven vliegbedrijven in elkaar", in De Volkskrant (Amsterdam), 13 Nov. 1998. Burlage, A.: "Alliantie Alitalia en KLM is beklonken", in De Telegraaf (Amsterdam), 27 Nov. 1998.

24. The Economist: "One world, few airlines" (London), 26 Sep. 1998, p. 19.

25. ITF News: "The restructuring of airline catering" (London), 1/99 (Jan. 1999), p. 9.

26. idem: "Aviation workers challenge globalization", 6/98 (Dec. 1998), p. 5.

27. Carroue, op. cit.

3. Technological developments

3.1. Civil aviation

Since the publication of the ILO report Structural change in civil aviation: Implications for airline management and personnel in 1990,⁽¹⁾ there has been a continued evolution in aircraft and aviation technology. Some notable developments include the introduction and subsequent generalization of two-pilot cockpits, the launching of new global air-to-ground and ground-to-air data and voice communications service for flight and cabin crew as well as passengers, and the technological advancements in the global navigation satellite system (GNSS).

There have been substantial consolidations and new alliances among aircraft and engine manufacturers. The major event was the merger of Boeing and McDonnell Douglas.⁽²⁾

Both Boeing and Airbus have developed aircraft "families" with a high level of cockpit commonality, which can generate significant productivity and cost benefits for airline operators, especially in the area of personnel training. The Airbus "family" currently features two branches -- single-aisle aeroplanes and the wide-bodied family. Although there are three different aeroplane types, the aircraft have been made as similar as possible, especially for aircrews, by similar on-board systems, instrument displays and handling characteristics.

The Boeing 757 and 767 models have the same technological advances in aerodynamics, avionics, materials and propulsion. Their two-pilot flight decks are nearly identical and furnished with state-of-the-art electronic displays. The Boeing 777 -- the first civil aircraft to be designed entirely by computer -- has retained the Boeing 767 cockpit structure and has been designed to behave like the 767 (thus permitting lower maintenance costs and better utilization of cockpit crews and further facilitating pilot conversion). The two companies differ, however, on how to transport the ever-growing number of passengers.⁽³⁾

The main engine manufacturers are developing new generations of very large turbofan engines with high bypass ratios in order to reduce operating costs as well as emissions of carbon monoxide, hydrocarbons and nitrogen.⁽⁴⁾

ICAO, in close cooperation with the International Air Transport Association (IATA) and the International Mobile Satellite Organization (Inmarsat Mobile), as well as other aviation bodies, has developed a largely satellite-based systems concept designed to meet the future communications, navigation, surveillance/air traffic management (CNS/ATM) needs of civil aviation. Future communications will be increasingly carried out by data links, making use of a number of air-ground systems, including aeronautical mobile-satellite service. The future GNSS may eventually be used as a sole means navigation system to support area navigation operations worldwide. Airspace is a finite resource and with the expected growth of air traffic has to be managed more efficiently. Therefore, in the future ATM, the air space management (ASM) function becomes more important and might extend outside a given airspace.⁽⁵⁾

In-flight entertainment is another area that has developed quickly and extensively, so much so that 80 per cent of the electronics on a new wide-bodied jet are in the passenger cabin, not in the cockpit.⁽⁶⁾

3.2. Railways

The rail mode is undergoing one of the most radical periods of change in recent decades. Technological progress and its application to speed, safety and traffic management have created new, highly efficient rail transport services, synonymous with a renaissance. This is particularly true of the high-speed passenger services in Japan and Europe, and of rail freight transport in the United States, a sector that has captured market shares unmatched in other regions of the world.

Apart from Japan, where the high-speed rail system is mature, the system is evolving, both in highly developed areas, particularly Western Europe and the United States, and in developing areas such as India, China and a large part of South-East Asia, where it is set to play a very important role in the coming century. High-speed trains, teamed with the latest traffic control systems, can guarantee a high throughput under economically and environmentally viable conditions. The railway industry is also working to enhance further the performance, safety and comfort of rail travel with improved environmental impact and cost reductions.

Japan has been developing the next generation of the high-speed railway, with a maximum operating speed of 500 km/h. This superconducting magnetically levitated train, or "superconducting maglev", is fundamentally different from conventional rail-wheel systems. An electromagnetic force levitates the vehicle about 10 cm above the guideway to enable the train to run at a high speed without touching the ground equipment. Since April 1997, more advanced test runs have been carried out on a newly constructed test track and in December 1997, the maximum target speed of 550 km/h was reached.⁽⁷⁾ Researchers at the University of Paderborn, Germany, claim to have developed a train powered by electromagnets without elevation that will use traditional rails, and could reach a speed of 450 km/h.⁽⁸⁾

There are, however, dissenting voices. Fiat Ferroviaria, an important producer of tilting trains, has doubts about the future of high-speed trains because of major structural problems. In order to be able to drive trains at 300 km/h, it is necessary to have dedicated tracks as far as possible in a straight line between destination points. This concept poses environmental problems, demands enormous investments and raises problems with regard to profitability. The increasing protests in France and Italy against the construction of high-speed tracks seems to confirm this. Western European countries are reducing their budgets for railway equipment -- including France, where the TGV programme has considerably slowed down. With the privatization of several operators, following the British example, profits will generally have priority over prestige. "Traditional" and high-speed trains cannot be operated on the same high-speed track, since the big differences in speed would complicate scheduling and make normal use of the track impossible.⁽⁹⁾

As in other sectors, rail operators are increasingly turning to information technology (IT) to improve services and better exploit the existing infrastructure. Railways have a highly regulated traffic process in which every movement is carefully planned and published. Traditionally, this process would take six months. The rail operator in the Netherlands, a country with a particularly dense rail network and an intensity of rail use three times higher than the rest of Europe, has recently started a programme to modernize the planning and management systems with the aim of reducing the planning cycle by 50 per cent by 2001. A key to greater efficiency is the integration of the traffic control systems. A new main traffic control centre has been built in Amsterdam and the number of control sites should ultimately be reduced from the current 15 to eight or less.⁽¹⁰⁾

3.3. Road transport

Technological developments have been enhancing the efficiency and competitiveness of road (freight) transport and this is expected to continue. Advanced logistical systems and information networks (e.g. hub and spoke networks) may further enable improvements to be made in quality of service, minimizing stocks and costs, and speeding up deliveries. Among other technologies, double-stack technology (i.e. containers stacked on two levels) is seen in North America as a technological breakthrough with favourable prospects for traffic growth and performance improvements.⁽¹¹⁾

A group including the Delft University of Technology (the Netherlands) has developed a multi-trailer system (MTS) that can be driven safely on motorways at speeds of 72 km/h, compared with a safe maximum of 30 km/h for standard multi-trailers, such as those in use today.⁽¹²⁾

The most common problem that impedes freight transportation is the difficulty of controlling vehicles and goods once they have left the depot. The solution has been the introduction of computer satellite tracking and a growing number of freight forwarders, including road hauliers, in OECD and other countries now operate such systems. Practical advantages of this approach include minute-by-minute computerized readings that reduce stress, help drivers and enable management to pinpoint current or perceived problems. For example, the supplier can notify customers of probable delays to delivery because it is in immediate touch with its drivers. Computerized tracking enables the journey for the goods to be improved in several ways. The driver can be given clear instructions by e-mail; the control centre can monitor the temperature of the contents of the truck and alert the driver; vehicles deviating from their predetermined route can be identified; alternative routes can be offered if there is a traffic problem; and the time required for additional load pick-ups can also be reduced through tracking.

Another key benefit is the reduction in major accidents once drivers become used to being totally accountable throughout the working day. The extra diligence exhibited by drivers has also resulted in very few unaccountable delays and much improved delivery performance. The operators are also in much better control of drivers' hours and can warn their staff of approaching limits. This obviously helps to promote safer driving and minimizes the risk of a driver inadvertently exceeding statutory hours.⁽¹³⁾

Despite drivers' initial suspicions that satellite tracking meant Big Brother-style surveillance, managers in the United States report that the systems have become a recruitment tool in the fierce competition for truckers. Drivers, and especially their families, appreciate knowing that help is a push of a distress button away.⁽¹⁴⁾

With the imminent arrival of comprehensive networks of Low Earth Orbit (LEO) satellites providing global coverage, it will be possible to develop practical and cost-effective tracking systems that can also be introduced in other regions.⁽¹⁵⁾

1. ILO: Structural change in civil aviation: Implications for airline management and personnel, Meeting of Experts on Civil Aviation, Geneva, 9-17 Oct. 1990.

2. ICAO: The World of Civil Aviation 1996-99 (Montreal, 1998), p. 38.

3. Groenewege, A.: Compendium of International Civil Aviation, Second Edition (Montreal, International Aviation Development Corporation, 1998), pp. 164-165. Vadrot, R.: "Aircraft 'family' concept simplifies conversion training and reduces fleet operating costs", in ICAO Journal (Montreal), Vol. 53, No. 4 (May 1998), pp. 16-17. Skapinker, M.: "Up, up and away -- An ever-growing line of passengers", in Financial Times (London), 18 June 1998. Meyer, T.: "En pariant sur des avions plus grands, Airbus déjuge Boeing", in Le Temps (Geneva), 14 July 1998. Airbus Industrie: "A3XX design is moving ahead with extensive input from the world's leading airlines", in ICAO Journal, Vol. 53, No. 8 (Oct. 1998), pp. 16-17, 26.

4. ICAO, op. cit., p. 37.

5. Groenewege, op. cit., p. 285.

6. Zuckerman, L.: "Airlines jazz up in-flight entertainment", in International Herald Tribune (Paris), 20 Aug. 1998.

7. Goto, H.: "Development status of superconducting magnetically levitated trains", in Rail International (Brussels, International Railway Congress Association (IRCA)), Nov. 1998, pp. 22-26.

8. Ackermann: "Konkurrenz für den Transrapid", in Der Spiegel (Hamburg), 22 July 1998. Vallana, A.: "La nouvelle coalition allemande étouffe le projet de train magnétique", in Le Temps, 19 Oct. 1998. The Economist: "Maglev trains: A permanent solution?" (London), 31 Oct. 1998.

9. Meyer, T.: "Fiat parie sur le déclin des trains à haute vitesse", in Le Temps, 15 June 1998.

10. Nairn, G.: "Radical approach to network operations", in Financial Times (London), 6 May 1998.

11. Suzuki, Y.: Deregulation of road freight transport: Labour implications, Sectoral Activities Programme Working Papers No. 98 (Geneva, ILO, 1996), p. 5.

12. Cargo Systems: "Multi-trailers on the highway?" (London, IIR Publications), Vol. 25, No. 7 (July 1998), p. 6.

13. idem: "Tracking the way ahead", Vol. 25, No. 6 (June 1998), p. 62.

14. Bachman, J.: "A big 10-4 for the Internet", in International Herald Tribune, 27 Aug. 1998.

15. Thomas, R.: "In like a lion?", in Reefer Systems (IIR Publications, London), Aug. 1998, pp. 13-15.

4. Deregulation

Regulation is a broad term for institutional rules governing mixed-market economies, in which governments intervene to modify the market to achieve socially desirable ends. Two broad categories of regulation can be distinguished. First, economic regulation defines the market environment within which industries operate and often establishes government agencies that authorize particular business operations. Second, social regulation bounds the market, establishes limits to competition, and provides social accountability for economic externalities created by the forces of private competition.⁽¹⁾

Deregulation can be defined as a reduction or abolition of the role, involvement and intervention of the government in a given industry. This process is usually accomplished by removing protective legislation and opening the door to greater competition. In some cases, however, new types or levels of regulations or controls are introduced to supplement deregulatory measures.

Privatization is often considered as a form of deregulation and it is sometimes difficult to draw the line where deregulation ends and privatization starts.

4.1. Deregulating the aviation industry

The United States has the longest experience of deregulation, going back to the enactment of the Airline Deregulation Act (ADA) in 1978, providing a model that Europe has since been following. The airlines claim that deregulation has been successful and has attained its objectives. Airlines have become more innovative and responsive to their customers and they compete to offer better services. On the other hand, the deregulation of United States aviation, as well as liberalization within the United States and Europe and the series of "open skies" agreements that have opened up competition from North America to Europe, Japan and much of the rest of Asia, may not have been the great success its champions claim.

The growing number of airline alliances brings with it the risk that the airline industry may be moving from one extreme -- regulation and state ownership -- to another -- global consolidation with limited competition. Two decades after the United States began to deregulate, international aviation remains thoroughly rule-bound. Bilateral government agreements still support flag carriers and decide which airlines can fly where and how often. Over the past decade the system has been gradually becoming less rigid, with more liberal bilateral agreements giving airlines greater freedom to decide their own routes and prices. Yet progress to the Nirvana of "open skies" remains beset by obstacles. One major problem is the limit on foreign ownership, considered as important for national security by its proponents and as old-fashioned protectionism by its detractors.⁽²⁾

In the United States, because of the growing concern that single airlines dominate too many big-city airports, while many smaller airports are getting less airline service than they had before deregulation, bills are now pending in Congress that would, among other things, give more landing slots to new airlines at busy airports. The Department of Justice has stepped up its investigation of how major airlines use reservation systems and pricing to protect virtual monopolies in airports where they maintain hub operations. The Department of Transportation is proposing new guidelines aimed at clamping down on airlines that use unfair tactics to block competition from new, low-fare carriers.⁽³⁾

In Europe feelings about deregulation are mixed. While airline managers (for example at Lufthansa) complain about "irrational" interventions by European Union antitrust regulators,⁽⁴⁾ the Select Committee on the European Communities of the House of Lords in the United Kingdom called for the European Commission to be given greater powers to regulate airline competition.⁽⁵⁾

The impact of deregulation on employment has been mixed. Today, a record number of people work for airlines in the United States: nearly 650,000. On the other side tens of thousands of airline workers lost their jobs over the past 20 years and thousands more gave up wages and benefits to help their airlines survive.⁽⁶⁾

In a 1997 survey throughout the industry, unions representing general support services such as cleaning, catering, refuelling and servicing, baggage handling, and ticketing and sales were far more likely than pilots or cabin crew to report declining employment levels over the previous five years. At the same time, whilst many of these jobs have been outsourced in recent years, airlines have simultaneously sought to improve the quality of "customer service" at key points of customer contact. This, combined with the growth of industry passenger traffic, accounts for the increase in cabin crew employment.⁽⁷⁾

4.2. Railway deregulation

Railway restructuring has attracted increasing attention from national and international policy-makers, railway managers and trade unions. Railways have had a crucial impact on economic development in most countries. With some exceptions, however, their importance has been diminishing since the Second World War, owing to the growth of road and air transport. But the new challenges related to transport needs, energy markets and environmental impact are likely to revive their importance in the twenty-first century.⁽⁸⁾

Nationwide railway monopolies are subject to a step-by-step erosion all over the world because governments can no longer carry the increasing financial burdens from non-profitable, state-owned activities. Restructuring is widely used to improve the railways' market orientation, finances, etc. Restructuring has been carried out in many countries and restructuring models with very different characteristics can consequently be found on all continents.⁽⁹⁾ Restructuring usually has a positive influence on railway efficiency, provided the political influence after restructuring is restricted to the general framework conditions. If it is not, there is a risk that new restructuring measures will be necessary.

One approach to railway reforms and increasing the role of the private sector is "concessioning". Concessions involve continuing public ownership and oversight of infrastructure, but the transfer of operating responsibility and the delivery of services to the private sector. The reasons for the preference for concessioning over privatization are not always clear, but it would appear that governments have been wary of what appears to be total loss of control over "their" railway. Moreover, concessioning can enable them to retain ultimate control over the infrastructure while allowing the private sector to operate the railways and compete for customers in the market. Concessions require continuing government involvement in regulating safety and monopolistic behaviour, and in ensuring adherence to the pricing and service requirements of the concession.

The process of rail concessioning restarted in the early 1990s in Argentina and the United Kingdom, and in the early measures taken by the European Commission. The success of these early attempts, combined with the lack of credible alternatives, has led to its rapid spread in Latin America. Concessioning is also beginning in Africa, the Middle East, and tentatively in Asia. A similar process, partly based on concessioning/franchising, and partly based on privatization, has taken hold in several EU countries.⁽¹⁰⁾

Major railway reforms have been undertaken in Germany, the former socialist countries in Central and Eastern Europe, the Russian Federation and other CIS countries, as well as in Botswana, Kenya, Malaysia and Morocco.⁽¹¹⁾

Railway restructuring has had a severe impact on the level of staffing of the companies involved. For example, following the concessioning of Argentine Railways (FA), employment declined from 94,800 in 1989 to approximately 17,000 in 1997.

In the 20 years to May 1995 the level of employment in the national railway company (RFFSA) in Brazil fell from 110,000 to 42,000, yet labour productivity remained low when compared with North American standards and those of other Latin American concessioned railways. Consequently, the Government decided on the concessioning of six exclusive regional systems. The target employment levels that were developed were a 40 per cent reduction on average from the levels immediately preceding concessioning.

Chilean railway employment fell by 75 per cent between 1973 and 1990. It was more than halved again in 1990-95 as a result of the privatization of most of the system.⁽¹²⁾

In 1994, the Governments of Côte d'Ivoire and Burkina Faso jointly awarded a 15-year concession to SITARAIL to operate the Abidjan-Ouagadougou railway. During negotiations on the terms of the concession it was agreed that SITARAIL would engage 1,815 of the 3,470 employees, choosing those it wished to hire.

Tranz Rail in New Zealand has been reformed from a traditional state-owned loss-making system into a profitable, privately owned, fully integrated railway, with freight as its principal traffic. Before the changes began, the system had 22,000 employees; it now has only 4,600, with greater total output.⁽¹³⁾

An important innovation in railway organization in the EU in the next decades will be Council Directive 91/440/EEC of 29 July 1991 on the development of the Community's railways and its follow-on regulations that enable national networks to be accessible to operations by all qualified carriers. The thrust of the Directive has triggered a clear trend in the EU towards the institutional separation of infrastructure from operations. Infrastructure is seen as a state responsibility while operations (except for social services) are considered commercial. The proposal by the European Commission to introduce private sector competition has met with strong resistance from the trade unions concerned. The EU Transport Commissioner recently maintained that "Half a million jobs have been lost in the rail industry of Europe in the last 15 years, not because of the implementation of strategies to increase competitiveness but because of the absence of such strategies and the resulting loss of customers." The unions, however, say that the changes do not provide adequate protection from Europe's road hauliers, who do not have to meet the same social and environmental costs. A cross-border railway strike held in protest in six EU States early in December 1998 brought chaos to passenger train and freight services.⁽¹⁴⁾

4.3. Deregulating road transport

The deregulation of road freight transport has had important effects on competition within this subsector and between all the freight transport sectors. It also has implications for employment, working conditions and safety, which have been the major concerns of trade unions, employers, several governments and supranational organizations.

Road freight transport in OECD countries has been largely regulated in terms of entry and freight rates since the 1950s. The protection of rail for strategic and long-term economic reasons, as well as safety, has been used to justify regulation. The competitiveness of road transport was believed to erode the profits of the railways. To some extent, however, the road freight lobby also supported regulation for fear that destructive competition would cause instability and bankruptcy of road freight firms while negatively affecting conditions of work.⁽¹⁵⁾

The explicit objectives of deregulation have been to liberalize barriers to entry in order to increase competition among road freight carriers, and to promote improvements in efficiency, overall productivity and quality of service, with a view to strengthening the competitive position of the road freight industry. Reforms have two major features. First, they are mostly economic measures to relax constraints on entry by new operators and to liberalize freight rates. Second, quantity regulations have largely been replaced by quality controls. For example, while relaxing capacity quotas and the number of licences, quality regulations (e.g. professional competence, safety standards, working time) have been strengthened. In exchange for economic deregulation, social regulations, in particular re-regulation of labour matters, are an important issue.

A case in point is the regulatory restructuring of trucking in the United States (Motor Carrier Act of 1980) which fundamentally changed the industry. It removed most economic regulations by allowing existing firms to enter new markets, letting new firms enter markets of their choice, eliminating collective rate fixing and allowing carriers to discriminate in favour of large shippers. However, economic deregulation did not remove all regulations from the trucking industry. On the contrary, a series of social regulations, including the commercial driver's licence, drug and alcohol testing, new highway safety programmes, and extensive hazardous materials-handling rules, soon filled the void. So the industry is still regulated and the new structure is considered by some as more unwieldy and less transparent than its predecessor.⁽¹⁶⁾

Deregulation has been introduced at different levels: international and national, and for federal States, interstate or intrastate. Generally, interstate or federal level deregulation precedes state-level deregulation. These cases can be seen for example in Australia, Canada and the United States. The extent and level of deregulation vary, depending on earlier regulations and the length of time since reforms have been introduced.

Since 1989, when new legislation was passed, the trucking industry in Japan has operated under reduced regulatory burdens. The industry employs 1.6 million people -- more than half the size of its United States counterpart, despite the fact that Japan's population is less than half that of the United States. Although some differences between the two nations imply more truckers per capita in Japan (smaller trucks, more congestion, fewer transport alternatives, just-in-time deliveries), others point to the opposite conclusion, based on greater distances and higher per capita GDP in the United States, using the purchasing power parity of prices.⁽¹⁷⁾

For the past four decades China's railroads were the backbone of the economy and the primary distribution system; road freight played a secondary role. Structural changes in Chinese industry are now creating strong incentives for improvements in road transport services. Trucking services are essential to linking the country's low-cost production centres with high-density consumption areas. The problem is that, at present, the quality and quantity of these services are inadequate. For this reason, industrial and commercial enterprises increasingly move goods with their own fleets. Soon after the start of economic reforms, the Government began to liberalize regulations and controls related to the trucking business. The Government is pursuing a dual strategy. First, it is attempting to reform state-owned enterprises (SOEs) and large collectively owned enterprises (COEs). Second, it is increasing the access of small COEs and private enterprises to state-controlled freight. This strategy is designed to increase competition gradually among truck operators while avoiding drastic changes in the industrial structure that would create severe unemployment for which no effective safety net exists.⁽¹⁸⁾

In 1985 the European Commission was instructed by the European Court of Justice to accelerate the development of a Common Transport Policy (CTP). Since then the CTP has progressively eliminated the artificial barriers in each mode of transport erected between Member States by doing away with technical, fiscal and social distortions of competition and by enabling EU operators to provide, free of discrimination, services in a Member State other than the one in which they are located (cabotage). Full freedom of cabotage of goods was introduced on 1 July 1998.

As far as passenger transport in the EU is concerned, the same liberalization of market access took place. Most of the occasional services, such as round trips of groups of passengers and conference services, are exempt from authorization. Full freedom of cabotage was introduced from 11 June 1999.⁽¹⁹⁾

In Central and Eastern Europe the transport system had been shaped by an industrial policy that gave preference to the production of capital goods and favoured the development of public transport. The introduction of market economy principles in the early 1990s called for a complete reorganization of the transport sector. The road subsector reacted quite well and privatization proceeded quickly.⁽²⁰⁾

1. Belzer, M.: Paying the Toll: Economic Deregulation of the Trucking Industry (Washington, DC, Economic Policy Institute, 1994), p. 5.

2. The Economist: "One world, few airlines", 26 Sep. 1998, p. 19. Skapinker, M.: "National flags keep flying", in Financial Times, 29 Jan. 1999.

3. Peltz, J.: "Airlines worried about federal intervention", in Philadelphia Inquirer (Philadelphia), 8 July 1998. Pearlstein, S.: "Antitrust law enjoys a revival", in Washington Post (Washington, DC), 10 Mar. 1998. Kerrigan, K.: "Customers will lose if DOT's proposed airline rules fly", in San Francisco Business Times (San Francisco), 22 June 1998. The Economist: "Come fly with me", 24 June 1998.

4. Bowley, G.: "Lufthansa hits out at 'irrational' EU", in Financial Times, 30 Apr. 1998.

5. Skapinker, M.: "Call for greater EU regulation", in Financial Times, 11 Dec. 1998.

6. Peltz, op. cit.

7. Blyton, P.; Martinez Lucio, M.; McGurk, J.; Turnbull, P.: "Contesting globalisation: Airline restructuring, labour flexibility and trade union strategy" (London, International Transport Workers' Federation (ITF), 1998), pp. 14-15.

8. ILO: Consequences for management and personnel of the restructuring of railways (Geneva, 1993), p. 3.

9. International Union of Railways (UIC): "Railway restructuring, why and how?" (Paris), 1996. These seminar proceedings include studies on railway restructuring in Argentina, Belgium, Brazil, Burkina Faso, Czech Republic, France, Germany, India, Japan, Kenya, Malaysia, Morocco, Nigeria, Poland, Sweden and Tunisia.

10. For a more detailed discussion of railway concessioning, see: Thompson, L.; Budin, K.-J.: "Railway concessions: Progress to date", in Rail International (IRCA, Brussels), 1998-01/02, Jan.-Feb., pp. 60-73.

11. UIC, op. cit.

12. Willoughby, C.: "The impact of the EU", in Cargo Systems (London, IIR Publications), Vol. 25, No. 11, Nov. 1998, pp. 115-119.

13. King, M.: "Tranz Rail Ltd.: The integrated model", in Rail International, 1998-01/02, Jan.-Feb. 1998, p. 106.

14. Lloyd's List: "Strike chaos hits European rail network" (London), 7 Dec. 1998. Eggs, M.: "Contre la libéralisation du rail, L'Europe des cheminots se met en grève", in Tribune de Genève (Geneva), 21-22 Nov. 1998. Lloyd's List: "Kinnock plea to open up EU railways", 23 Dec. 1998.

15. Suzuki, Y.: Deregulation of road freight transport: Labour implications, Sectoral Activities Programme Working Paper No. 98 (Geneva, ILO, 1996), p. 16.

16. Belzer, op. cit., p. 1.

17. Ostrom, D.: "Prospects for economic reform in Japan: Where is the safety net?", in Japan Economic Institute (JEI) Report No. 37A (Washington, DC, 1997), p. 12.

18. World Bank: China: Strategies for Road Freight Development (Washington, DC, 1995), pp. 1-2.

19. International Road Transport Union (IRU): Past and present challenges: Road transport in the XXIst century (Geneva, IRU, 1998), p. 149.

20. ibid., p. 138.

5. Privatization

Privatization is a policy instrument through which governments in many countries promote and sustain economic development. It is also a manifestation of the wave of economic reform designed to reduce the role of the public sector and expand that of private market institutions. A broader concept of privatization includes policies that encourage private sector participation in public service and infrastructure provision, and that eliminate or modify the monopoly status of state-owned enterprises (SOEs). Over the past decade more than 80 countries have privatized at least some of their state-owned enterprises or shifted control of public services or infrastructure to the private sector. Transport was no exception to this; indeed in many ways the sector was at the cutting edge.

The process of privatization in most countries, however, has been slower than most advocates had forecast. During the 1980s about 70 per cent of the sales of SOEs occurred in the more developed countries, primarily in Western Europe, where the United Kingdom and France were the leaders. Fewer than 20 per cent of the sales took place in Latin America (Argentina, Brazil, Chile and Mexico), in Africa (Benin, Ghana, Guinea, Mozambique and Senegal), Eastern Europe, Asia (Indonesia, Republic of Korea, Philippines and Thailand) and the Middle East. The privatization process accelerated in the 1990s in Central and Eastern Europe and in East and South-East Asia to make it a worldwide phenomenon.⁽¹⁾

5.1. Methods of privatization

Property restitution, reprivatization and divestiture can be used to transfer ownership of commercial and industrial enterprises from the public to the private sector. Commercialization and demonopolization are means of restructuring state enterprises that will be kept in public ownership or as joint-stock companies with majority government ownership.

The most frequently used form of privatization for large SOEs is divestiture. In many countries, the government simply sells all or part of its ownership in state enterprises to private investors. This method has been followed in countries such as Argentina, Bangladesh, Germany, Hungary, Lithuania, Singapore and Thailand.

In Lithuania, the restructuring of the transport sector through privatization started at the end of 1991. By the end of 1995 more than 100 enterprises providing transport services had been privatized. The second phase of privatization involves operators in railways, air and maritime transport. However, strategic transport infrastructure facilities such as port and airport equipment, safety and navigation systems will remain in state hands in order to use them in the public interest and to encourage the activities of private transport operators.⁽²⁾

Management or employee buy-out programmes are in many cases used to overcome opposition to privatization and to give employees a stake in the future of their companies. Most of the SOEs in the Russian Federation were privatized in this way. By the end of 1995, some 3,500 SOEs or 64 per cent of all enterprises within the purview of the Ministry of Transport network scheduled for privatization had become joint-stock and private companies. This was the case for more than 76 per cent of the companies in road transport.⁽³⁾

In Argentina, Ferrocarril General Belgrano, a state-owned rail freight company which moves cargo over a 7,300 km network, was officially handed over to a consortium led by the railway workers' union (Union Ferroviaria) on 18 December 1998 as the final part of Argentina's privatization drive which began in 1990.⁽⁴⁾

There seems to be a popular misconception that only the private sector can successfully implement marketing systems, policies and strategies -- a misconception which may stem from the belief that public sector enterprises have no incentive to operate in a profit-maximizing way. However, there are numerous examples of publicly owned railway companies employing very effective marketing strategies to achieve profit or market share-maximizing objectives. In France, the state-owned railway organization (SNCF) has been able to win from the airlines a dominant share of the long-distance domestic travel market for its high-speed TGV services.

Privatization could result in a paradox whereby the profit-maximizing strategies of a privatized railway actually work against the effective marketing of services. The recent experience of railway privatization in the United Kingdom provides several examples of such paradoxes that have arisen from constraints (length of franchise term, no full commercial pricing freedom) imposed on the new private railway operators owing to the form of privatization used.⁽⁵⁾

Even when employee or management buy-outs were not the principal instrument of privatization, governments often made provisions for employee shareholding in their negotiations with private investors. In one form or another, shares have been transferred to employees in Mexico, in Central European countries like Hungary and Poland, in the Republic of Korea, and in Africa, in the case of SITARAIL. In France, as part of the privatization of Air France, the Government is offering employees shares representing 3.5 per cent of the company's capital. Air France pilots, meanwhile, would additionally take up to 12 per cent of the capital through an agreement reached in 1998 giving them shares in return for what are, in effect, wage cuts.⁽⁶⁾

Advocates of management and employee buy-outs contend that, among other things, they can generate widespread support for privatization among workers and trade unions. Some critics argue, however, that the interests of workers in ensuring employment security and higher remuneration conflict with the public interest of promoting efficiency and the lowest possible prices for goods. Moreover, critics doubt that employee or management owners can provide enterprises with effective supervision or direction and consider that employee control of companies could lead to long-run inefficiencies in a market economy.⁽⁷⁾

Lease contracts are also used extensively for both public services and commercial operations. The Washington, DC, Metropolitan Transit Authority leases land and development rights to private investors to build stations with commercial and office space along the metrorail system. The lease revenues can be used by the Government to extend and maintain transport infrastructure.

The State Railway Authority of Thailand (SRT) used contracts with private firms to provide service on three intercity rail routes that were incurring substantial losses. The private companies leased passenger railcars and railway lines from SRT and paid it a fee every 15 days. The private contractors covered the costs of railcar maintenance and cleaning, and optional concession services. SRT provided the use of railway stations and the personnel to manage them, as well as train drivers and guards.⁽⁸⁾

5.2. Social costs of deregulation and privatization

Many transport companies, be it in air, rail or road transport, still are or were until recently state owned, with employees enjoying civil service status with a high degree of employment protection and other conditions which were often better than those of workers in the private sector.

Privatization and deregulation led to changes in many aspects of employment. To the extent that private sector operation results in lower wage rates or less protective work rules than those found in the public sector, the main impact will fall on the workforce, including unionized workers. There is ample evidence that deregulation and privatization, at least initially, result in significant job losses, as has been the case in Argentina, Brazil, Chile, Georgia, Hungary, Japan, Mexico, Romania and Zambia.⁽⁹⁾

In the United Kingdom bus sector, those employed before privatization seem to have been affected less by the change than might have been expected. While the existing employees made concessions in work rules and productivity, much of the attrition in the labour force was accomplished voluntarily, with workers taking early retirement or quitting in return for large severance payments. Three years after the reforms took effect, total employment in the industry remained about the same, especially among drivers because bus mileage increased.⁽¹⁰⁾ Deregulation and privatization can also lead to increases in total employment in the industry if service innovations and efficiency improvements significantly boost demand.

The social costs of extensive job losses, while far from insignificant, can be lessened if carefully handled. Examples of such care are found in the privatization of the Brazilian federal railway,⁽¹¹⁾ the Japanese railways⁽¹²⁾ and the proposed privatization plan for Pakistan Railways.⁽¹³⁾ The redundancy packages all included voluntary early retirement, severance payments, retraining and assistance in finding alternative employment.

The threat of restructuring, lay-offs and higher unemployment has often led trade unions and workers in SOEs to try to slow down or derail privatization (Latin America, Western Europe, South-East Asia). To give only one example, in Bolivia the country's main trade union called national strikes to protest against government plans to privatize 60 companies, including the national airlines.⁽¹⁴⁾

With regard to wages and other working conditions, employees do not necessarily lose since the wage rates of those employed before privatization may be protected as one of the conditions of privatization, e.g. through the negotiation of two-tier wage structures. This approach has been used in airlines, railway companies and road passenger transport in various countries. In the United States, however, as a result of the deregulation of road freight transport, unionized drivers in many cities had to accept a percentage of revenue as remuneration because of competition from non-union drivers. For example, intermodal drivers frequently receive a percentage of revenue. Since the rate does not increase along with the driver's weekly hours, drivers are paid entirely on a piece-work basis. It is argued that, nevertheless, non-union drivers absorbed the direct impact of the regulatory reform of the trucking industry. The wage gap between union and non-union drivers nearly doubled in the first decade of economic deregulation. In addition, most non-union employees of truckload carriers give away their loading and unloading time and consequently spend many unpaid hours -- even days -- waiting to load or unload, for dispatch or for equipment.⁽¹⁵⁾

The public sector has been characterized by high levels of trade union membership, often attributed to the solid protection workers enjoy; this is true of the transport sector in particular. Unionization may, however, be the result of some of the public sector's particular features. The first is related to the size of the units and the homogeneity of occupational status which facilitates trade unionization. The second revolves around the fact that a large number of employees work for a single employer, which is conducive to the delegation of authority to trade unions. The third feature relates to the centrality of the idea of public service in employer-employee relations, which serves to strengthen solidarity.⁽¹⁶⁾

Both for legal reasons and because funds are of public origin, in many countries consultation rather than collective bargaining is the rule. Trade unions have sometimes accepted considerable restrictions in connection with bargaining and strikes which would be less readily accepted in the unionized private sector.

In recent years the public sector has undergone far-reaching changes in many countries, growing closer to the private sector in many aspects. Market constraints have made their appearance in the form of privatization, contracting out, concessioning or the introduction of competition between some services and the private sector, as well as cost cutting. However, the idea of public service is a principle that survives and may be expected to gain strength. Public service status is considered by many, particularly railway workers, as their most precious right.

When initiating the privatization and deregulation of public sector transport companies, it is important to give serious consideration to this "psychological" right in the same way as to "material" rights. Unions (including the Transport and General Workers Union) and employers' organizations in the United Kingdom have agreed on proposals which will allow workers who transfer to private firms to remain in the local government pension scheme. The deal also means that issues including pay, health and safety and training will be protected for the lifetime of a contract. This agreement will help to remove the fear of transfer from local authorities and other public sector bodies to private companies and will give the individual a greater level of protection.⁽¹⁷⁾

Governments can take various measures to protect current civil service employees, for example, by ensuring that fair wages and working conditions are provided by the private companies that take over from public agencies. Moreover, the privatization agency may create employee share ownership plans or require the new owners to give preference in hiring to laid-off employees.

Among other means of protecting public employees, Argentina, Germany, Greece, Sri Lanka and Turkey provide generous redundancy or severance pay to surplus employees, while Argentina and Venezuela allow voluntary early retirement. In Colombia, Ghana and Portugal, the Government has established retraining and vocational education programmes for its displaced workers. In Colombia, Jamaica, Senegal and Tunisia, the Government promotes entrepreneurship and the expansion of small enterprises that can absorb surplus workers.

Governments can also take action prior to the privatization of SOEs to reduce retrenchment and soften the impact on workers. These measures include freezing new recruitment and hiring as long as possible before privatization, reducing the size of the workforce through attrition as much as possible before the enterprise is transferred to private ownership, and guaranteeing the membership of workers in social security schemes or pension plans (their continued viability should be ensured) even if they lose their jobs after privatization.⁽¹⁸⁾

1. Rondinelli, D.; Iacono, M.: Policies and institutions for managing privatization (Turin, International Training Centre of the ILO, 1996), p. 1.

2. Sakalys, A.: "Statement on the transport sector in Lithuania", in United Nations Economic Commission for Europe (UN/ECE) (Inland Transport Committee), p. 36.

3. Suvorov, A.: "Statement on the transport sector in the Russian Federation", ibid., p. 45.

4. Stares, J.: "Clashes over Argentine rail sale", in Lloyd's List (London), 5 Jan. 1999.

5. United Nations Economic and Social Commission for Asia and the Pacific (UN/ESCAP): "Marketing the railway product in the Asia and Pacific region" (New York, 1988), p. 18.

6. Owen, D.: "Air France offering could raise $700m", in Financial Times (London), 21 Dec. 1998.

7. Rondinelli, Iacono, op. cit., p. 43.

8. ibid., pp. 52-53.

9. ILO: World Labour Report 1995 (Geneva, 1995), pp. 61-63.

10. Gómez-Ibáñez, J.; Meyer, J.: Going private: The international experience with transport privatization (Washington, DC, The Brookings Institution, 1993), p. 59.

11. Willoughby, C.: "The impact of the EU", in Cargo Systems (London, IIR Publications), Vol. 25, No. 11, Nov. 1998, p. 115.

12. ILO, op. cit., p. 63.

13. Personal interview with members of the Privatization Commission of Pakistan and unpublished working documents.

14. Rondinelli, Iacono, op. cit., p. 77.

15. Belzer, M.: Paying the toll: Economic deregulation of the trucking industry (Washington, DC, Economic Policy Institute, 1994), pp. 1, 21.

16. ILO: World Labour Report 1997-98 (Geneva, 1997), pp. 135-136.

17. Excite (United Kingdom): New deal eases workers' switch to private sector, 15 Feb. 1999 .

18. Rondinelli, Iacono, op. cit., pp. 171-172.

6. Employment, working conditions
and working environment

6.1. Employment

Global railway employment at the end of 1997 totalled 8,306,000 persons. During 1997 most railway operators in EU countries reduced employment. The highest was a reduction of 28.7 per cent from 1996 for the Danish State Railway (DSB). Total railway employment in the EU at the end of 1997 amounted to 779,000 persons, 6.2 per cent less than in 1996. Reductions in Norway and Switzerland were similar.

In the countries of Central and Eastern Europe, the average reduction was 4.3 per cent; in the Baltic countries it was 6.5 per cent. Railway employment fell in many other countries, including China (-1.0 per cent), India (-0.2 per cent), Japan (-2.4 per cent), United States (-2.1 per cent for AAR-Class I but 1.2 per cent for AAR Amtrak), Australia (-2.1 per cent), New Zealand (-2.8 per cent) and the Russian Federation (-9.7 per cent).⁽¹⁾

In civil aviation there was little change in the number of staff employed by the world's scheduled airlines (excluding those of the Russian Federation and China) in 1995-96. Preliminary estimates suggest that in 1996 employment was about 1.54 million, compared with 1.52 million in 1995. The number of staff employed by the international scheduled airlines (about 1.15 million in 1996) showed an increase over 1995. These generic figures cannot fully describe the overall impact of employment changes in the airline industry since they encompass both recruitment by some airlines and lay-offs by others, which in many instances do not involve the same personnel.⁽²⁾

According to the United States Bureau of Labor Statistics, at the end of 1997 some 4.2 million persons were involved in transportation in that country, of whom 230,000 were employed in railroad transportation, 462,000 in local and interurban passenger transit, 1.7 million in trucking and warehousing and 1.2 million in transportation by air.⁽³⁾ The data show that employment in the United States trucking industry has continued to increase over the last three decades. It has increased at an average annual rate of 2.6 per cent since 1947 reflecting the continued shift of freight from railroads to trucking over the period, as well as the general increase in goods production.

In the European Union countries in 1995 some 3.5 million persons were employed in the road transport industry. In addition, there are some 3 million workers in "own account" road transport. Almost 1 million people were employed in rail transport in EU countries in 1995, while there were approximately 375,000 employees working for air transport companies, of whom about 20 per cent are flight crews and the remainder ground staff, including maintenance and ticketing staff.⁽⁴⁾

In South Africa in 1997 about 384,000 persons were involved in transport, storage and communication, up from 362,000 in 1994. There were an estimated 56,000 informal sector workers in this industry (14.6 per cent of the total).⁽⁵⁾

Airports are like factories, producing units of air transport through a complex interaction of resources and processes. Airports have a direct economic impact on their surrounding areas, providing employment, economic prosperity and stability to regions. The most obvious source of economic benefit is the employment generated at or near the airport. Airports are often among the highest concentrations of employment in their national and regional economies and the areas adjacent to major airports often have lower than average unemployment rates. The total labour force required to resource an airport draws from a broad spectrum of skills, making airports sources of quality employment using the full balance of skills within local and regional areas. In 1996, 80 per cent of those employed across a sample of Europe's airports were men, although women make up a growing proportion of the workforce, and account for about 60 per cent of the part-time workforce.⁽⁶⁾

6.2. Wages and working conditions

In 1996, airlines continued their efforts to reduce labour cost or to restrict its growth, in particular by renegotiating contracts with their employees, notably in Europe and North America. Some major carriers managed to negotiate a reduction in wages in exchange for benefits including job security, stock options, participation in a profit-sharing plan, or worker representation on the board. Other carriers agreed to maintain current salary levels in exchange for concessions from the staff in terms of increased productivity, new work rules and fewer jobs. A few accepted plans for pay raises in exchange for concessions from their employees.⁽⁷⁾

Labour costs are not only an important element in the cost structure of any airline, they are also one of the few variable costs under the direct control of management (unlike fuel costs, landing charges, etc.). Labour accounts for 33 per cent of total airline costs in Europe and North America and 20 per cent in Asia.

Airlines have tried to reduce labour costs in a number of ways, including nominal wage reductions or pay freezes, the withdrawal of cost-of-living agreements or allowances (COLAs), or the introduction of two-tier wage rates with a lower second-tier rate typically for new recruits and much slower salary progression. During the 1980s many United States airlines succeeded in negotiating two-tier wage deals with their unions, as did Lufthansa and British Airways more recently.⁽⁸⁾

When Air France tried to introduce wage cuts and a two-tier wage scale for various categories of staff in 1997, it led to a strike by unions representing flight deck crews At the heart of the agreement to end the strike was a commitment by the pilots to accept share options on a voluntary basis in return for a pay cut and a wage freeze. The share option scheme will last for seven years.⁽⁹⁾

It is important to note that concession bargaining arising from the severe economic recession in the industry in the 1980s was characterized by specific "claw-back" provisions to restore prior terms and conditions following any improvement in the business. Many current agreements, however, such as two-tier contracts that establish lower entrants' pay, are indefinite concessions. Trans World Airlines (TWA) and its pilots' union, for example, concluded a four-year agreement in 1998 that restored some of the wages that pilots had agreed to forgo in a bid to save the troubled carrier. At the end of the new agreement, TWA's pilots would earn 90 per cent of the airline industry's average wage for pilots, compared with 60 per cent under the expired contract.⁽¹⁰⁾ In another case, the recuperation of earlier concessions made in order to save Northwest Airlines from bankruptcy was one of the major issues in its negotiations with the unions in 1998.

The privatization, corporatization or commercialization of air traffic control organizations has in a number of cases had a favourable or neutral short-term effect on wages and overall remuneration, often as a trade-off for staff concessions in terms of additional flexibility in working-time arrangements or in attitudes to retraining. While there were no salary increases in Switzerland or Austria, air traffic controllers in Germany, New Zealand and Portugal have seen their incomes increase. In general, there seems to be a long-term tendency to link pay schemes and general working conditions to performance indicators.⁽¹¹⁾

In 1996, the Belgian railway operator, SNCB, finalized a ten-year renewal plan which was negotiated with staff and the Government, with a view to breaking even financially in 2005. As part of the plan, the staff accept a wage reduction of 1.65 per cent, a cut in the current 42,000-strong staff to 35,000 by the year 2005 and changes in the rules governing selection and promotion. In exchange, staff retain their status, the working week is to be reduced to 37 hours, and then to 36 hours from 1999. At the same time, measures and incentives to encourage departure and part-time work are to be offered.⁽¹²⁾

6.3. Working time

Restructuring in the airline industry has led to longer shifts, more frequent shifts and an overall increase in total working hours. Temporal flexibility has assumed greater importance in recent years as management seeks to obtain maximum efficiency from (or more precisely greater utilization of) staff. There has been a regional and supranational relaxation of regulations on flight and cabin crew duty limitations. The Joint Aviation Authorities (JAA) initiatives (JAR OPS), with their implications for cabin and flight deck duties, are a case in point.⁽¹³⁾

Working time is the subject of many complaints by road transport drivers and their unions, particularly in the light of findings of studies in various countries on the consequences of driver fatigue. Sixty or more hours per week are no exception. In the United States alone there are 5,000 deaths and 100,000 injuries a year involving heavy truck crashes (equivalent to 45 jet air crashes). The National Transportation Safety Board identified fatigue as a factor in 30 to 40 per cent of these incidents.

Official statistics in South Africa show similar trends -- with fatigue contributing to 25 to 35 per cent of all fatal accidents. The official figure for the United Kingdom is slightly lower, with 15 to 20 per cent of all fatal accidents related to fatigue. Figures from the European Commission show that 18 per cent of fatal accidents on European roads each year involve coach and lorry drivers, 20 per cent of those due in part to driver fatigue: the equivalent of 8,100 deaths across the EU.

A research report finalized for the Ministry of Social Development in Spain, but still unpublished, revealed that 341 professional truck and bus drivers were killed in 1996 on the roads while at work; a further 5,921 were injured. The number of professional driver fatalities was higher than the combined total of those in mining and construction, traditionally considered especially hazardous industries.⁽¹⁴⁾

The authors of a recent study in France report that previous studies attached greater importance to the length of the working day in producing driver fatigue than to time spent driving -- which is the only criterion considered in European legislation. On the basis of observations of lorry drivers, the study analyses the effect of time pressures on driving behaviour, in particular the strategies drivers use before and after disruptions in the course of their work. It then describes an experiment to measure when the greatest manifestations of fatigue occur in relation to driving time and the length of the working day. Both the review of the existing literature and the experimental findings demonstrate that only considering the parameter of driving time, as does the European legislation, does not provide a satisfactory means of reducing lorry drivers' risks.⁽¹⁵⁾

In November 1998, the European Commission proposed a new directive aimed at normalizing working time in those transport sectors which were excluded from the EU Directive on working time (Council Directive 93/104/EC of 23 November 1993 concerning certain aspects of the organization of working time). The proposals make the standards of the Directive applicable to all non-mobile workers (including those in transport companies) as well as railway workers, and introduce specific standards for road and sea transport. In its proposals, the Commission has integrated the contents of agreements reached between the social partners in the maritime and railway sectors, and included the points on which agreement was reached in the road transport sector notwithstanding the breakdown in negotiations. The Commission will subsequently present proposals concerning mobile civil aviation workers. The regulations would limit working hours to an average of 48 hours a week over a four-month reference period, with a maximum work-week of 60 hours, regular breaks, daily rest breaks of at least 11 hours and guaranteed weekly rest periods of at least 35 hours. Night workers would be limited to eight hours per shift.⁽¹⁶⁾

Studies of the road freight industry in Pakistan show that average trip lengths are long: from 500 km to over 1,000 km. Overall journey speeds (including rest stops) are only about 23 km/h. The typical pattern of operations involves two drivers and one assistant, who travel night and day going from job to job for up to two weeks at a time before returning to base. The principal driver is responsible for finding work, collecting revenue, keeping accounts and maintaining the vehicle in good repair.⁽¹⁷⁾

In the United States, the maximum hour (overtime), minimum wage, and other pay provisions of the Fair Labor Standards Act of 1938 (FLSA) do not apply to employees of motor carriers subject to the Motor Carrier Acts (MCA) of 1935 and 1980. The law exempts more than 1.3 million employees of these MCA-regulated carriers, whether they are city or road drivers, helpers, platform workers or mechanics. Drivers may work an unlimited number of hours each week.⁽¹⁸⁾

At its 262nd Session (March-April 1995) the Governing Body of the International Labour Office approved the setting up of a Working Party on Policy regarding the Revision of Standards. This decision was taken following the discussion on standard-setting policy at the International Labour Conference in 1994. In the course of its examinations in March 1998, the Working Party noted that the Hours of Work and Rest Periods (Road Transport) Convention, 1979 (No. 153), was one of the fairly recent Conventions that had received few (seven) ratifications. Consultations with ILO constituents gave no indication that any new ratifications were imminent, although some member States were examining the issue. Some member States suggested a revision of the Convention, inter alia, "to bring it into line with" the European Agreement concerning the Work Crews of Vehicles engaged in International Road Transport (AETR). No member State questioned the relevance of the Convention. Consequently, at the recommendation of the Committee on Legal Issues and International Labour Standards, the Governing Body approved the proposal of the Working Party to recommend the revision of this Convention and the inclusion of this item in the portfolio of proposals for the agenda of the Conference.

6.4. Transport and violence at work

Rising verbal and physical violence against workers in all modes of transport is an area of growing concern to the workers involved, their unions, employers and their organizations, public authorities and, increasingly, to the general public.

While most attention has been focused on direct physical and verbal violence, fresh evidence has been emerging in recent years about the impact and harm caused by what is termed "psychological" violence. A survey conducted by the Canadian Union of Public Employees in 1994 showed that for almost 70 per cent of the employees, verbal aggression was the leading form of violence against workers. Employees working in public transport call centres in many countries, most of whom are women, complain about the amount of verbal aggression they are exposed to throughout their working hours. They also complain about the lack of understanding by their supervisors and employers.

A recent study in the United States has shown that in the mid-1990s taxicab drivers, together with police and security guards, were by far the most likely workers to be attacked or threatened with violence on the job. Among taxicab drivers, 184 out of every 1,000 were threatened with violence between 1992 and 1996. The comparative figure for bus drivers during this period was 45 of every 1,000.

A report by the New South Wales (Australia) Ombudsman noted that "between 1 April 1996 and 31 March 1997, approximately 150 of Sydney Buses' operators were victims of a physical or verbal assault. I say approximately because Sydney Buses does not have accurate information about the exact number of assaults over this period nor accurate information which distinguishes between verbal and physical assault."⁽¹⁹⁾

Rail and urban transport workers are also vulnerable to aggression. For example in Britain, two-thirds of all train accidents are now reported to be attributable to vandalism and the number of such accidents is said to have doubled over the past two years.⁽²⁰⁾ In Japan, in 1993 some 230 employees of Japan Rail (JR) were victims of violence. Among them were 178 employees working at railway stations and 53 train employees. A survey revealed that the most important group of aggressors was drunken office workers.⁽²¹⁾

In order to draw attention to their security problems, in 1998 transport workers in France organized a series of strikes to protest against attacks, including fire-bombs, gunfire and stoning, on railway and public transport workers. Transport unions said that violence against their members, particularly by young offenders, rose by more than 30 per cent in the first eight months of 1998 compared with 1997 levels. Following the strikes, the French Government and the French railway company (SNCF) announced measures to protect public transport workers. The SNCF promised to recruit 800 additional workers to boost security.⁽²²⁾

The Netherlands railway operator, NS, has created a special "anti-aggression" unit within its personnel department. The unit has developed training packages aimed at improving the care and after-care of aggression victims among staff members.⁽²³⁾ In its White Paper on transport, the British Government states "Transport staff also deserve to be free from the fear of crime. We will encourage good practice by all public transport operators to protect their staff. The Department of the Environment, Transport and the Regions' (DETR) practical guide on 'Protecting bus crews' sets out measures to reduce the risk for bus crews."⁽²⁴⁾

The problem of unruly passengers on board aircraft is highly publicized in the media. British Airways' introduction of a "yellow card" system in an attempt to curb "air rage", or KLM's plan to establish a "blacklist" of aggressive passengers provide glimpses of this serious and escalating problem of violence experienced by the air transport industry.

It is a problem that in 1997 prompted the Airline Pilots Association (ALPA) to convene an international conference on disruptive airline passengers to discuss ways of dealing with the violence. A Federal Aviation Authority (FAA) report of 1996 indicates that excessive alcohol use is often the cause of the disorderly behaviour. Normally, it concerns relatively light forms of aggression such as pushing, pulling or abuse. Unfortunately, more serious physical violence also occurs.

The issue was tabled during the 32nd Session (1998) of the International Civil Aviation Association (ICAO) by both the International Air Transport Association (IATA) and the International Transport Workers' Federation (ITF) calling upon member States to amend legislation under the Tokyo Convention to make any action committed on an aircraft which is considered to be an offence in the country of arrival to be punishable regardless of the country of registration or of operation of the aircraft.⁽²⁵⁾

In a new bid to curb the problem, the Greater Manchester Police introduced early in 1999 the Disruptive Passenger Protocol, which was signed by 35 airlines and sets out a new "get tough" policy. The protocol outlines the procedure for staff and police to follow in order to bring about a successful prosecution. The protocol will work hand in hand with preventive measures investigating the impact of alcohol, smoking or passenger disobedience in bringing about incidents.⁽²⁶⁾ Several airlines, so far mainly in developed countries, have introduced training and counselling programmes for their staff on how to deal with aggressive behaviour before, during and after the flight.

A 1996 survey, carried out by one of the transport workers' unions in the Netherlands, revealed that ground staff are also increasingly subject to aggressive behaviour. According to the survey, 90 per cent of the ground staff had experienced such behaviour, of which 10 per cent was physical violence such as slapping or spitting.⁽²⁷⁾

Long-distance truck drivers are another group of transport workers often subjected to violence and harassment, including by armed forces personnel and police officers. In the Netherlands alone, every year about 700 loaded trucks are stolen, according to the industry organizations. Preventive measures include better information for and the training of drivers, as well as developing international alarm and surveillance systems.⁽²⁸⁾

Truck drivers engaged in international transport may experience various kinds of legal problems. For example, the Government of the United Kingdom announced plans to fine truck drivers £2,000 (US$3,300) for each illegal immigrant found on their vehicles. Trucks would be impounded until the driver or owner paid the fine, or proved they could pay it within a reasonable time.⁽²⁹⁾ Similarly, transport leaders are demanding protection for lorry drivers as more than 400 fight smuggling charges in Europe's jails. Most insist that they were used as unwitting couriers by drug gangs. The general secretary of the United Road Transport Union (URTU) warned that drivers have to be aware that they are targets for drug barons who see them as an easy prey, particularly those new to international routes and who are not with big companies or a union.⁽³⁰⁾

In 1992, the Inland Transport Committee of the ILO adopted conclusions concerning the social and legal protection (including repatriation) of inland transport workers engaged in international transport during their temporary periods abroad. It concluded that inland transport workers abroad may face a number of problems relating to their legal and social protection and that some of these problems are common throughout the inland transport sector, while others stem from specifics of each individual mode of transport. In the areas where workers face similar problems irrespective of the mode of transport, consideration should be given to measures that can be applied across the international inland transport sector. In addition, appropriate solutions should be sought to the specific problems of social and legal protection which workers of each mode of inland transport encounter abroad.

The social and legal protection of inland transport workers abroad may be the subject of regional and subregional agreements. Employers' and workers' organizations representing the inland transport sector in each country concerned should be consulted during the formulation of such agreements. The implementation of procedures and terms laid down should include tripartite consultations and take account of the conditions in each country.⁽³¹⁾

In Pakistan truck drivers identified police harassment as the most important problem they encountered. This is connected with the payment of gratuities to police on traffic duty; this practice is widespread and is believed to apply both to public transport and the freight transport industry. The second and third most important problems were poor roads and fear of robbers.⁽³²⁾

1. International Union of Railways (UIC): Railway Statistics Synopsis, 1997 (Paris, 1997).

2. ICAO: The World of Civil Aviation 1996-1999, p. 39.

3. Bureau of Labor Statistics (BLS): Employment and Earnings (Washington, DC), Vol. 45, No. 4, Apr. 1998, p. 48.

4. European Commission: White Paper on sectors and activities excluded from the Working Time Directive (Brussels, 1997), pp. 5, 9 and 11.

5. South African Institute of Race Relations: Fast Facts (Braamfontein), Oct. 1998, pp. 4-5.

6. ACI-Europe: Creating employment and prosperity in Europe (Brussels, 1998), pp. 5-6.

7. ICAO, op. cit., p. 39.

8. Blyton, P.; Martinez Lucio, M.; McGurk, J.; Turnbull, P.: Contesting globalisation: Airline restructuring, labour flexibility and trade union strategies (London, International Transport Workers' Federation (ITF, 1998), pp. 10-11, 16.

9. Bosshard, A.: "Air France a gagné son pari contre l'intransigeance des pilotes", in Le Temps (Geneva), 11 June 1998.

10. Lycos/Reuters (United Kingdom): TWA, pilots in tentative four-year labor pact, 13 July 1998 .

11. International Federation of Air Traffic Controllers' Associations (IFATCA), unpublished survey (Montreal), 1997.

12. Martens, A.: "Restructuring of the railways", in UIC: Railway restructuring: Why and how?, Proceedings, MAPS Seminar, Rabat, 20-25 May 1996.

13. Blyton, Martinez Lucio, McGurk, Turnbull, op. cit., p. 17.

14. International Transport Workers' Federation (ITF): Fatigue kills: Day of action on drivers' hours (London, ITF, 1998).

15. Germain, C.; Blanchet, V.: "La fatigue des routiers et ses conséquences en termes de sécurité", in Recherche Transports Sécurité (Arcueil), No. 49, Dec. 1995, pp. 63-72.

16. Bates, S.: "Employers oppose EU cut in working hours", in The Guardian (London), 19 Nov. 1998. Bulletin Quotidien Europe (Brussels), No. 7346, 19 Nov. 1998.

17. Hine, J.; Chilver, A.: Pakistan road freight industry: An overview, Transport and Road Research Laboratory (TRRL) Research Report 314 (Crowthorne, United Kingdom, 1991), p. 30.

18. Belzer, M.: Paying the toll: Economic deregulation of the trucking industry (Washington, DC, Economic Policy Institute, 1994), pp. 20-21.

19. Chappell, D.: Presentation at 2nd Worldwide Women Transport Workers' Conference of the ITF, New Delhi, 26-27 Oct. 1998.

20. ibid.

21. Komatsu, I.: "Agression à l'encontre des cheminots -- personnel roulant et des gares", in Sécurité et hygiène dans les transports en commun, Compte rendu du Symposium internationale de l'ITF, London, 4-5 June 1996, pp. 40-43.

22. Lloyd's List (London) 7, 8 and 10 Oct. 1998.

23. Boeree, T.: "Hollands Dagboek", in NRC Handelsblad (Amsterdam), 14 Nov. 1998.

24. Department of the Environment, Transport and the Regions (DETR): A new deal for transport: Better for everyone (London, The Stationery Office, 1998), p. 55.

25. ICAO: Working Papers 72 and 167 on "Unruly passengers", 32nd Session of the Assembly (Montreal), 1998. Reiss, P.: "Increasing incidence of 'air rage' is both an aviation security and safety issue", in ICAO Journal (Montreal), Vol. 53, No. 10 (Dec. 1998), pp. 13-16, 30.

26. Excite (United Kingdom): "New bid to curb air rage", 26 Jan. 1999.

27. De Volkskrant: "KLM gaat toenemende agressie passagiers aanpakken" (Amsterdam), 22 Oct. 1998.

28. Colijn, J.; Nordholt, E.: "Handboek met tips tegen truck rovers", in De Telegraaf (Amsterdam), 19 June 1998.

29. Sanghera, S.: "Warning by haulage groups", in Financial Times (London), 15 Jan. 1999.

30. McGrory, D.: "Duped truckers 'caught in drug smuggling web'", in The Times (London), 2 Oct. 1998.

31. ILO: Inland Transport Committee: Conclusions and resolutions adopted by the Inland Transport Committee 1944-1992 (Geneva, 1993), pp. 74-75.

32. Hine, Chilver, op. cit., p. 28. For a more detailed study of violence at work see: Chappell, D.; Di Martino, V.: Violence at work (Geneva, ILO, 1998).

7. Future work by the Office

The Governing Body agreed that, as an output, the Symposium should elaborate conclusions that would provide guidance for future work by the Office in the various transport sectors considered. In order to assist the participants in their work and as mentioned above, the following topics are expected to be discussed at the Symposium: (i) transport in the twenty-first century; (ii) deregulation or re-regulation; (iii) social and labour consequences of privatization of public transport enterprises; (iv) labour-management relations in a changing industry; and (v) employment, working conditions and working environment.

The participants may also wish to consult the conclusions and resolutions adopted by the Inland Transport Committee 1944-92⁽¹⁾ and the outcome of the Tripartite Meeting on the Consequences for Management and Personnel of the Restructuring of Railways.⁽²⁾

1. ILO: Inland Transport Committee: Conclusions and resolutions adopted by the Inland Transport Committee 1944-1992 (Geneva, 1993).

2. idem: Consequences for management and personnel of the restructuring of railways, Tripartite Meeting on the Consequences for Management and Personnel of the Restructuring of Railways, Geneva, 1994.

Updated by BR. Approved by OdVR. Last update: 28 September 2000.