31. Provisions

Provision for reorganisation costs

The purpose of the provision for reorganisation costs is to cover the costs arising from reorganisation measures. Most of the provision is needed for redundancy schemes, bridging payments and the redeployment of staff whose jobs have been eliminated as a result of reorganisations. Important starting points for determining the provisions for reorganisation costs at year-end 2022 and 2021 in the Netherlands are:

• the final collective bargaining offer submitted by NS to the parties to the collective labour agreement was accepted by the trade unions in February 2021 and the new collective labour agreements for the period from 1 July 2022 to 1 January 2024;

• estimates with respect to advancement and outflow during the reorganisation.

Provision for soil remediation

The provision for soil remediation is for managing and remedying environmental damage. The provision is calculated using an average discount rate of 2.5% (2021: 1.5%).

Provision for the continued payment of unsocial hours during holidays

The Group has made a provision for the claimed unsocial hours allowance during holidays over the non-statutory holiday entitlement. The legal proceedings with respect to this topic have not yet been completed.

Provision for onerous contract

This concerns the provision for onerous contract for the DISA (Abellio Mitteldeutschland GmbH) franchise with a term up to and including 15 December 2024.

Provisions Abellio Germany and other provisions

As of 30 June 2021, the Group has estimated the expected outflow of funds arising from the termination and winding up of the activities in Germany. Provisions have been made for this. In 2021, these provisions, with the exception of € 10 million (which was charged to other operating expenses), were charged to its financing result and are included in provisions for Abellio Germany and other provisions. These provisions are made for outflows of funds in respect of guarantees and settlement of other possible liabilities related to the insolvency proceedings. In addition, a provision has been made for expected legal and litigation costs. The guarantees of € 77 million provided for in 2021 in connection with the uncertainties in the acquisition of the Mitteldeutschland franchises were released in 2022. This release was recognised under the net financing result. Furthermore, these provisions were reassessed at year-end 2022 and determined virtually unchanged. The provision for guarantees is part of the total guarantees issued as disclosed in note 31 o the financial statements.

The Group’s legal negotiating position is expected to be severely damaged if further information is provided on the nature and extent of the Abellio Germany provisions and other provisions made. The Group therefore makes use of the provisions of IAS 37.92 and confines itself to the above explanation.

The outcome of the solvency proceedings in Germany is inherently uncertain and it is possible that cash flows or operating results in future years could be materially affected positively or negatively as a result of an outcome that is favourable or unfavourable to the Group compared to the current estimates made in these financial statements.

Other provisions

Chromium 6

On Thursday, 31 January 2019, the National Institute for Public Health and the Environment (RIVM) presented the results of the Chromium-6 investigation into the municipal reintegration project tROM in Tilburg. In that project, people on unemployment benefit worked on trains belonging to the Dutch Railway Museum at the then NedTrain workshop in Tilburg between 2004 and 2011. The RIVM carried out an investigation in which NS cooperated. An independent committee drew conclusions on the basis of the results of the investigation and formulated ad hoc recommendations. The committee drew firm conclusions, including about the role of NS in the Tilburg project. According to the committee, the municipality of Tilburg, NS and the Railway Museum all cut corners. At the beginning of February 2019, the parties announced that they would come to an arrangement jointly and each on the basis of its own responsibility, with the aim to provide clarity to those involved as quickly as possible. NS had already provided for its share of the expected costs as at 31 December 2019 and updated this figure based on its understanding as at 31 December 2022.

Furthermore, the police carried out a criminal investigation on the instructions of the Public Prosecution Service, in which NedTrain was one of the suspects. NedTrain and the municipality of Tilburg were prosecuted for violations of the Working Conditions Act (Arbeidsomstandighedenwet) and the Environmental Management Act (Wet milieubeheer). The court delivered judgement on 1 February 2023. With regard to the violation of the Working Conditions Act, the Court ruled that the Public Prosecution Service is barred from prosecuting because the alleged violation has expired. NedTrain has however been fined € 250,000 for complicity in violation of the Environmental Management Act, which has been included in the results for 2022. NS will study the ruling before deciding whether to appeal.

Chromium-6 NS Staff

In 2022, NS established a scheme for colleagues and former colleagues who have become ill due to working with chromium-6. The amount of the compensation depends on the medical condition, the activities performed and the duration of the exposure. If applicable, surviving dependants may also apply for a surviving dependant's benefit. At the end of 2022, 231 applications had been made. At the end of December, NS made a provision for this.

‘Other provisions’ include provisions for losses arising from accidents and fire, provisions for maintenance in connection with lease contracts in Germany and provisions for staff-related matters.