State to pay country’s rail operator extra €80.9M compensation due to pandemic

The government has approved extra financial compensation to the country’s rail operator, CP – Comboios de Portugal, of €80.9 million, due to the impact of the pandemic, which changed the assumptions of the contract that the company had until 2029.

In a cabinet resolution published Friday in the Official Gazette, the government recalled that last year, through another statute, “the expenditure on financial compensation payable by the State to CP for public rail transport from 2020 to 2029, fixed the maximum budgetary charges to be borne in each economic year, having established for the year 2021 the amount of €89,384,372.00, plus VAT”.

However, “the year 2020, which was the first year of the contract, would be marked by the effects of the pandemic, which had a particular impact on the transport sector, causing a significant reduction in demand and revenue, but also an increase in costs, both due to the obligations to maintain certain levels of service and the increase in costs determined by the specific conditions of service provision with a guarantee of compliance with public health standards,” reads the diploma.

The additional amount for 2020 is “€80,914,205.00, plus VAT,” the document states.

The total amount payable in 2021 rises to €170.2 million, compared to €89.3 million that had been allocated to the company in the resolution published in 2020. In total, until 2029, CP will now receive nearly €930 million.