Predictably, the EU spin machine portrayed this major step towards a fully privatised passenger rail market as a ‘victory for consumers’, claiming new rights for passenger compensation.

However, the small print reveals that such compensation is triggered only if train operators are held responsible for delays, not if they are caused by engineering work, points or signal failures or bad weather.

EU Directive 91/440/EEC, which mandates member states to create a “vertical split” between train operations and rail infrastructure, means that severe rail disruption, such as swept parts of the UK this summer, would almost certainly not leave rail companies facing compensation claims.

The ‘liberalisation’ measures in the EU’s so-called ‘third rail package’ also includes common EU rules for train driver certification covering medical fitness and professional skills to facilitate “professional mobility and cross-border services”.

Train companies that operate over international routes from 2010 will also be able to practise ‘cabotage’ – meaning to stop and take on passengers in countries they cross.

This latest ‘package’ amending Directive 91/440/EEC marks the second major step in implementing EU rail privatisation since rail freight was liberalised in 2003, when trans-Europe networks were opened to competition, followed by international freight and domestic networks from March 31, 2006.

A similar staged ‘liberalisation’ process is now being applied to passenger rail regardless of the consequences. The European Commission will now report on the next stage of ‘liberalising’ domestic rail services by 31 December 2012.

This hugely complicated process, proposed by the German MEP Georg Jarzembowski, amounts to little more than the enforced mass privatisation of the entire rail sector across the EU.

The European Parliament left group GUE/NGL has opposed the introduction of competition for international rail services, arguing that, once again hardline neo-liberal ideology, promoted by corporate lobbyists, had prevailed.

GUE/NGL President Francis Wurtz described the "Jarzembowski report" as a new stage in the politics of "liberalisation at all costs" without serious studies of the effects of ‘liberalisation’ such as the disastrous experience of rail privatisation in the UK.

He told the European Parliament that such a path was “dangerous for public employment and service and a path subjected to an obsession with competition and the market". However, Jarzembowski, an MEP from German Chancellor Angela Merkel’s right wing CDU, assumed that “national governments are going to apply the new Regulation as soon as possible also for domestic trains. We will be able to do away with the notorious change of train drivers at borders”.

While right wing Belgian MEP Dirk Sterckx described the agreement as a “serious step” towards a European railway market.

“European railway companies have to organise themselves to face international competition, national administrations will have to act more as regulators instead of financers of national monopolies," he said.

The third rail package is a dramatic escalation of the drive to transform rail services from a social railway towards a rail business with an investment bias towards freight and business travel and away from regional and urban rail services.

The proposals were criticised earlier this year by Hans Rat, secretary-general of the International Association for Public Transport (UITP), who noted the EU focused too much on "glossy" trans-European projects, such as high-speed trains and stressed the need to re-direct attention towards regional projects that play a "decisive role" for revitalisation of cities and improvement of public transport services.

The latest moves clearly lean towards the former and directly benefit Europe’s largest rail interests and the development of private rail monopolies, particularly in Germany.

German rail operator Deutsche Bahn (DB) has extended its dominance of the rail freight sector buying up companies in Poland, Slovakia, Netherlands, Denmark, Spain and most recently, English, Welsh, Scottish Railways Ltd with a 75 per cent share of the UK rail freight market. DB is due to be privatised, with an Initial Public Offering of 30 per cent expected this year.

It is easy to see why DB bosses would welcome interoperability and a common EU train driver licence. The newspaper Bild am Sonntag has reported that DB is planning to hire foreign train drivers from Austria and Switzerland to break a national rail strike by the GDL drivers' union.

“We plan to hire locomotive drivers from other countries such as Austria and Switzerland to help out,” a senior manager told the newspaper.

DB now also threatens French state operator SNCF in its own backyard through EWS’s international rail freight operating arm. SNCF lost €260 million on its freight business last year and is also facing an imminent national rail strike on October 18 against pension cuts proposed by president Nicolas Sarkozy.

While Brussels may dress ‘rail packages’ and privatisation up as a matter of consumer rights, competitiveness or ‘liberalisation’, in fact, it represents a political decision about what sort of a society we will be living in.

In short, the third rail package marks a decisive turn by the EU towards consolidation of the neo-liberal project embodied in the Single European Act of 1986 and further developed through the Lisbon Strategy in March 2000. It is a strategy that is also reflected in the EU Constitution rejected in 2005 and now being undemocratically resurrected. One of the 52 areas where all national vetoes will be abolished, as envisaged in the Constitution is transport, including rail.

The effect of EU rail privatisation will increase downward pressure on jobs and wages in the rail sector and inevitably undermine occupational and environmental safety standards.

For European rail unions a serious strategy to defeat the social dumping which will undoubtedly follow is long overdue. Next spring RMT is organising an international conference to discuss these issues.