Abstract

This paper explores the introduction of transport policy instrument namely Public Service Obligation (PSO), Infrastructure Maintenance and Operation (IMO), and Track Access Charges (TAC) schemes as the basis of national railway financial restructurization to clarify the relationship between government obligation and commercial function of train operator. The first five year implementation is analyzed to determine the convergence of the objectives and their achievements. The result shows that the outcomes are not meeting the objectives since they have not been properly conducted. The fund allocation provided by the government was insufficient thus the net payment system causing the impacts for both circumstances of present service performance and preparation in the near future development. This paper emphasizes that the attention of sustaining political action as sustainable approach for allocating sufficient fund to railway sector plays a critical role to improve the later restructuring process of Indonesian Railways system.

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