Financial support for regional public transport is theoretically based on four concepts: (1) temporary financial aid to enable undertakings to regain a profitable market-share, (2) financial aid to compensate for a decline in transport demand, (3) financial aid to assure the continuation of public transport services, and (4) temporary financial aid to be able to nationalise public transport undertakings. The second concept refers to the additional costs of public transport as a result of improvement measures taken by the government. In this case government support is needed. The amount of additional costs is determined by using the average utilisation factor in public transport as a criterion. Groups of public transport undertakings are discerned which suffer differently from government improvement measures. The advantages and disadvantages of the principles applied are discussed. The third concept refers to government standards concerning production costs and quality of service. In order to stimulate efficiency of public transport its production costs must be covered by an appropriate tariff structure. Additional costs might occur if the quality of service is to be maintained. The first and fourth concepts are said not to be of any relevance as long as the two other concepts can be used. The article concludes with a description of the choice between relevant concepts and a description of the present application of the concepts in the Netherlands.
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