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Dear Readers!
Family-run companies generate almost 50% of the German economy’s total turnover and provide over 50% of all jobs in our country. Our ‘Mittelstand’ (i.e. our SMEs) – which, we are constantly being told, is held in envy around the world – is the anchor that gives Europe’s largest national economy the stability it needs, driving growth across the whole of the continent. 83% of all apprenticeship jobs in Germany are created by SMEs. 1,307 of the globally identified 2,700 ‘Hidden Champions’ are German Mittelstand firms. So what have these facts got to do with public private partnerships?
They are an opportunity for local authorities and their companies to become a part of this exceptional success story. Family-owned businesses focus on values, traditions and reliability across generations. More often than not, they are deeply rooted in their regions and actively involved in their communities. And it is this that enables them to enjoy long-term success. We believe it to be a good decision when a municipal partner chooses to have its essential public services provided by a joint venture with a private-sector partner. Learning from mistakes made and drawing the right conclusions for the future are two further strengths of family-run companies that have been able to enjoy decades of success on their markets thanks to their high levels of expertise and their special ethos.
The need for greater efficiency by, on the one hand, dividing up tasks and specialising in specific areas and, on the other, keeping costs under control means that once again public private partnerships are being viewed as a future-proof business model.
For decades now, REMONDIS has been showing every day that better results can be achieved by working together. With 64 PPP companies and a whole range of third-party service provision agreements, we have perfected the public private partnership concept for all essential public services – from waste management, to water management, all the way through to public transport – to the benefit of both parties. Working together with its municipal partners, REMONDIS delivers services to over twelve million people living in Germany. Local authorities and their residents always receive the highest quality of service possible and have the peace of mind that their fees and charges will remain stable over a long period of time.
As a rule, public private partnerships are a real blessing for a council’s budget as they are a reliable source of tax revenue. The most can be made of the opportunities to optimise operations. Successful collaboration work with the private sector preserves public property and creates jobs. Fees and charges are stabilised and the pressure on the public purse is relieved.
This latest special issue is dedicated to the subject of public private partnerships and takes an in-depth look at the various PPP models, the advantages for local authorities and their residents and the positive impact they have on jobs, the environment and the local economy. Councils wishing to achieve long-term budget stability, high quality public services and maximum levels of sustainability by operating an environmentally responsible circular economy will find some valuable suggestions and accounts in this issue to help them with their decision-making processes.
We look forward to working with you!
Yours Ludger Rethmann
Investing in public transport
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Many of the RETHMANN Group’s companies and associated businesses have invested in public private partnerships to help provide a variety of essential public services. One special feature of such collaboration work between the public and private sectors is the provision of public transport and logistics services. Just one example here is Transdev, which is one of the world’s leading providers of public transport solutions. It owns shares in five public private partnerships in North Rhine-Westphalia alone – Germany’s most densely populated state – which sees it serving, among others, the towns of Hagen, Düsseldorf, Krefeld and Mönchengladbach. Moreover, Niederrheinische Verkehrsbetriebe Aktiengesellschaft NIAG operates in the Lower Rhine region where it focuses on optimising its well-run and low-cost public transport network and offering logistics services that are of huge economic importance to the whole of the region as well as to the east of the Ruhr.
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Largest public transport provider in the Lower Rhine region
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NIAG’s largest municipal shareholder is the District of Wesel with a 43% stake in the business. Other public sector owners include the District of Kleve, the City of Wesel, the City of Duisburg and the City of Moers. REMONDIS’ sister company, Rhenus SE & Co. KG, is the private sector shareholder and owns 51% of the shares. NIAG is the largest provider of public transport services in the southern part of the Lower Rhine region and employs around 700 people. The joint venture is responsible for delivering local public transport for an area covering approximately 3,000km². To be able to provide the services required, it operates a total of 77 bus routes using 192 of its own buses and 137 leased buses, which travel around twelve million kilometres per year. NIAG also helps keep the people in the region mobile by offering a range of other services including twelve of its own community buses and car-sharing and taxi-share systems in several towns.
From the Rhine onto the rails
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In addition, NIAG also operates two of the region’s most important logistics sites, which are located in Rheinhafen Orsoy, a suburb of Rheinberg, and in Moers. The company’s premises in Orsoy has a storage area covering 65,000m² and delivers a number of logistics services including transhipping coal for the power plants in the Rhine and Ruhr region.
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The logistics centre in Moers has 25km of main tracks with a rail operating centre and direct links to the Deutsche Bahn’s rail network in Moers and Rheinberg. It ensures, therefore, that transport operations run smoothly by acting as a link between the water and rail transport systems. With the help of a large number of electric locomotives, diesel locomotives and shunting locomotives and 550 leased freight wagons, it enables local rail transport to be carried out across the region and beyond using its own network as well as those owned by others. But that’s not all – NIAG’s logistics portfolio also includes offering block train, individual wagon, wagon loading and shunting services, in-house transport systems and container transport services.
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Training centre guarantees quality
By collaborating closely with its customers, NIAG is able to provide them with the exact transport service they need – whenever they need it – and deliver maximum transparency. And it is prepared for all eventualities. Its highly qualified staff, who are trained in the company’s own accredited training centre, ensures that everything runs smoothly along the whole of the logistics chain. As a result, this exceptional public private partnership runs a business that benefits everyone involved and has become a role model for all such types of transport collaborations.
A genuine win-win situation
Indeed, the success of this part-privatisation was reflected in its books just two years into the partnership. While the private sector shareholder carries the majority of the business risk, the municipal partners not only benefit from the advantages in line with their share in the company. They also have the additional financial advantage that they no longer have to pay subsidies. In the past, before the part-privatisation, they had to plough money into the business to cover the losses it was making – a sum that ran into millions. This public private partnership has, therefore, created a genuine win-win situation that has succeeded in taking the pressure off the public purse and delivering sustainable, top quality services.
Facts & Figures
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Niederrheinische Verkehrsbetriebe Aktiengesellschaft NIAG
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PPP model:
cooperation modelShareholders:
Rhenus (51%)
District of Wesel (43%)
District of Kleve (3%)
Moers (0.63%)
Duisburg (1.26%)
Wesel (1.11%)Vehicles used:
192 company-owned buses, of which 50 are articulated buses, 137 standard buses, 3 buses for teaching bus drivers, 2 minibuses, 5 midi-buses, 1 city train and 1 city bus, 12 company-owned community buses, 2 reserve vehicles, 137 leased buses -
Other services:
e.g. fare & timetable advice, ticket sales, 5 company-owned customer centres, 26 external sales pointsLocomotives & freight wagons:
9 electric locomotives, 15 diesel locomotives, 3 shunting locomotives, 550 leased freight wagonsSpecialist services:
transparency by introducing an SQAS system, company-wide emergency management, highly qualified staff thanks to the company’s own accredited training centre
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