Benefits of nationalisation

[Buttsy]

One advantage, as I see it, of a publicly owned network would be that the government could agree funding for a set length of time (as with Network Rail Control Periods) and then let the organisation get on with running the railway. There would be no distractions on such things as franchise bids or interfaces with other railway organisations, which you would imagine might be more efficient.

Of course, there is still the risk that funding could end up as a political football whenever the budget needs to be set for the following period.

The political football can be reduced or avoided by making the next CP start 6 months after each election, thereby ensuring at least a 5 year plan for the railways (not that I particularly want it to sound Stalinist).

 

[AndrewP]

At present I can see no advantages to nationalisation as similar benefits could be obtained by using a fixed return / management fee model (which may or may not be a good idea and by having appropriate use of competition bodies for areas such as rolling stock leasing.

I think that privatisation has brought a lot of benefits but has not always worked well with competition never really being possible to a significant extent and some terrible operator procurement (e.g. National Express East Coast for example) however I would rather have seen Intercity plc, Network SouthEast plc and that kind of think but by now they would almost certainly be owned by the transport groups who operate the railways today anyway (or possibly BA for Intercity).

I could very easily produce a highly convincing argument for both public and private ownership as there are, always have been and always will be good bits and bad bits of the railway.

 

[Pugwash]

Sorry but do you know that for a fact? A lot of services that some TOC run are actually loss making!

TOC's make a profit even if there are loss making services, the difference is a subsidy.

 

[Bald Rick]

TOC's make a profit even if there are loss making services, the difference is a subsidy.

Altogether now:

*Oh no they don't*

 

[dave55uk]

I see posters on here knocking the old BR, but to be fair, they were handicapped to some extent by lack of funding. Now if they had as much money given to them as the Government is now handing to the TOC's, things would have been far better. And, let's not forget, in BR days, when services were especially busy, or there was a major sporting event, it was quite easy to find a spare loco and (real) coaches for additional services. Also, may I remind you, that trains generally waited for booked connections - something that (almost) doesn't exist anymore. As an ex-railwayman myself (from BR days), I would most certainly welcome a re-nationalisation of the railways - but with the same level of funding as now.

 

[NSEFAN]

At the moment politicians can blame the TOC/ ROSCO/ Network Rail etc when things go wrong. With great power comes great responsibility, and I think we'd see more "involvement", which worries me.

(I know how much of a hypocrite I sound, wanting Government subsidies in investment etc but being scared of Government involvement!)

I have the same fear. Given the DfT is getting more involved in train ordering now, its clear the government wants to control the trains. Full nationalisation however would mean they no longer have a scapegoat for when it all goes wrong. I envisage therefore that the current system will stay in place for the time being, unless we somehow end up with a government which is willing to accept responsibility for the mistakes they make. :roll:

As I've said before, I support a nationalised system in principle, but only on the condition the government running it isn't full of -expletives deleted-.

 

[The Decapod]

I think that Network Rail should remain in public ownership.

Ironically, in view of the original ideology behind privatisation, a lot of our rail services, both passenger and freight, are now provided by companies owned by the German and Dutch governments!

DB Schenker, Arriva Trains, Tyne & Wear Metro are subsidiaries of Deutsche Bahn - 100% owned by German government.

Greater Anglia Trains, owned by Abellio, which is in turn owned by Dutch government.

And it doesn't stop there. A lot of the electricity consumed by our electric trains is generated in nuclear power stations in Britain that are now owned by the French government (EDF)!

 

[ntg]

I very much doubt a 21st Century British Rail would even slightly resemble the 20th Century one so I think the invoking of how things were done before should be discarded...it doesn't seem very useful to me other than a lesson of how not to do things.

Perhaps a more natural solution would be to set up a state owned TOC to compete with the private TOCs and run for the benefit of the state. That way we wouldn't need to theorise about the benefits of either system as we'll have the better one working where it is suitable to do so.

 

[The Decapod]

Perhaps a more natural solution would be to set up a state owned TOC to compete with the private TOCs and run for the benefit of the state. That way we wouldn't need to theorise about the benefits of either system as we'll have the better one working where it is suitable to do so.

Isn't that what Directly Operated Railways, the operator of the East Coast main line is? DOR took over East Coast after National Express handed back the keys.

DOR is, or could be, a useful tool for the government in gaining first-hand experience of present-day rail operation, and could be expanded to take other franchises back in-house if the need arises. In a sense it could provide a benchmark to ascertain whether re-nationalising the railways would benefit passengers and taxpayers or not.

See: http://www.directlyoperatedrailways.co.uk/html/links.php

 

[krus_aragon]

Isn't that what Directly Operated Railways, the operator of the East Coast main line is? DOR took over East Coast after National Express handed back the keys.

DOR is, or could be, a useful tool for the government in gaining first-hand experience of present-day rail operation, and could be expanded to take other franchises back in-house if the need arises. In a sense it could provide a benchmark to ascertain whether re-nationalising the railways would benefit passengers and taxpayers or not.

See: http://www.directlyoperatedrailways.co.uk/html/links.php

A good point, but scaling may be an issue. Many were pointing out during the WCML crisis that DOR would not be able to expand to run the WCML and other franchises whose bidding had to be suspended, in addition to their existing ECML commitments.

 

[jon0844]

The Government might want to have more control, but it is already trying to move funding away from Government and over to the user. If renationalised, what makes anyone think they'd suddenly pump in loads more money?

For one, it would be open to the same level of cuts as everything else and there would be the obvious temptation to try and run things with as little money as possible. Assuming safety was given priority, that would invariably lead to cuts elsewhere.

My point about the BR of old wasn't just about dirty trains but the perception people had of travelling by train. That perception has clearly changed as usage has soared, and I personally think that a combination of new stock, facelifted trains (with brighter interiors), better information systems, cleaner stations all contributed to that.

I have never suggested that some or all of that couldn't have happened under BR.

 

[Buttsy]

The phrase 'new stock' is a bit of a misnomer as stock these days is, on average, roughly the same as stock under BR in the late 80s. I think the perception of new stock comes from the fact it appears there's more of it in certain areas and the refurbs of older stock have been carried out to a better standard than in the past.

Refurbs are something that I would not have expected to stay within BR had it not been privatised and would expect it to go out to competive tender even if the Network was renationaised.

 

[merlodlliw]

The Wales & Borders franchise was thought up by faceless people at the DFT, the only contribution they asked from Arriva was £400K for car parking, and no growth, do we really want to go back to state ownership and have these people in charge again. IWJ Deputy First Minister said with ATW in its present form the Welsh Assembly Government had been sold a pup.

Plus where would the funding come from to buy back the stock, you can nationalise it, but it has to be paid for,plus a certain person buried in Highgate cemetetry would be proud that his homeland now runs Chiltern & ATW

 

[Buttsy]

The Wales & Borders franchise was thought up by faceless people at the DFT, the only contribution they asked from Arriva was £400K for car parking, and no growth, do we really want to go back to state ownership and have these people in charge again. IWJ Deputy First Minister said with ATW in its present form the Welsh Assembly Government had been sold a pup.

Plus where would the funding come from to buy back the stock, you can nationalise it, but it has to be paid for,plus a certain person buried in Highgate cemetetry would be proud that his homeland now runs Chiltern & ATW

Only the stock would need to be paid for from the ROSCOs in the medium term as you nationalise by stealth. As a franchise runs out, you don't re-let it, therefore not having the costs of having to buy-out the shareholders which hamstrung British Railways back in the late 40s early 50s as they still had to make payments to former shareholders.

The billion you could potentially save by the reduction of subsidy (no lawyers or consultant fees to pay as well as the profit margin built into the majority of franchise bids), could be used to purchase new stock so you're not in the hands of ROSCOs in the long term. No need to buy back stock, just carry on leasing until it is life expired or replaced by the new stock built, which would be potentially cheaper as a government agency could place a much larger order if they were allowed to plan for the longer term.

 

[Dave1987]

Only the stock would need to be paid for from the ROSCOs in the medium term as you nationalise by stealth. As a franchise runs out, you don't re-let it, therefore not having the costs of having to buy-out the shareholders which hamstrung British Railways back in the late 40s early 50s as they still had to make payments to former shareholders.

The billion you could potentially save by the reduction of subsidy (no lawyers or consultant fees to pay as well as the profit margin built into the majority of franchise bids), could be used to purchase new stock so you're not in the hands of ROSCOs in the long term. No need to buy back stock, just carry on leasing until it is life expired or replaced by the new stock built, which would be potentially cheaper as a government agency could place a much larger order if they were allowed to plan for the longer term.

Wow wow wow. You make sound as if it could happen so so easily. Governments are rubbish at procuring rolling stock, just think about the IEP project. Currently at about £7.5bn which equates to £15m per carriage! Compare that to about £2.5m per pendelino carriage (I know they are an awful design but never mind). Governments have to go through so much red tape before they can make an order it is ridiculous. It is not as easy as you make out.

 

[Buttsy]

Wow wow wow. You make sound as if it could happen so so easily. Governments are rubbish at procuring rolling stock, just think about the IEP project. Currently at about £7.5bn which equates to £15m per carriage! Compare that to about £2.5m per pendelino carriage (I know they are an awful design but never mind). Governments have to go through so much red tape before they can make an order it is ridiculous. It is not as easy as you make out.

Buy proven designs, don't make it up yourself as in IEP. If the government hadn't said this is what we want, I wouldn't be surprised if we'd have seen more pendos rolling off production lines.

If you make it an arms length arrangement whereby you have £x to buy trains with, there is the possibility that teh suppliers (who are better at these things) would be able to design and build to a basic requirement for the UK. 377s everywhere up to semi-fast services, pendos everywhere else perhaps?

BREL is dead so there is no political need to build 'in-house'. The only polticial thing is building in the UK, and that could be part of the deal.

Take the DfT out of the loop and let railway people buy what they know the railway needs from proven designs. It worked for EWS with the 66s...

 

[Dave1987]

Buy proven designs, don't make it up yourself as in IEP. If the government hadn't said this is what we want, I wouldn't be surprised if we'd have seen more pendos rolling off production lines.

If you make it an arms length arrangement whereby you have £x to buy trains with, there is the possibility that teh suppliers (who are better at these things) would be able to design and build to a basic requirement for the UK. 377s everywhere up to semi-fast services, pendos everywhere else perhaps?

BREL is dead so there is no political need to build 'in-house'. The only polticial thing is building in the UK, and that could be part of the deal.

Take the DfT out of the loop and let railway people buy what they know the railway needs from proven designs. It worked for EWS with the 66s...

Yeah well the railway has said that bi-mode is a stupid idea (I dont want to get into that discussion on this thread) but the govt is determined to plough on with it because some civil servants somewhere have decided that they think it is a good idea. Are you proposing letting the industry spend the govt's money on what would be suitable for the railway? Taking power away from the govt (whatever party may be in power). Are you mad? Politicians from all sides like to know that they are in command of public expenditure. The only way I can see the govt letting the industry decide what rolling stock it wants under nationalisation would be if there were set requirements for the trains and that someones head was on the chopping block if it all went wrong for some reason.

 

[merlodlliw]

Only the stock would need to be paid for from the ROSCOs in the medium term as you nationalise by stealth. As a franchise runs out, you don't re-let it, therefore not having the costs of having to buy-out the shareholders which hamstrung British Railways back in the late 40s early 50s as they still had to make payments to former shareholders.

The billion you could potentially save by the reduction of subsidy (no lawyers or consultant fees to pay as well as the profit margin built into the majority of franchise bids), could be used to purchase new stock so you're not in the hands of ROSCOs in the long term. No need to buy back stock, just carry on leasing until it is life expired or replaced by the new stock built, which would be potentially cheaper as a government agency could place a much larger order if they were allowed to plan for the longer term.

It could take well over 20 years to get the last TOC out,in your point about shareholders, of course they had to be bought out as they owned the railways,I am sure it was the Govt that paid out along with the others it took over,Coal,Steel etc, it is an interesting subject, so long as real railwaymen run the railway, unfortunately with state ownership the menu changes every five years, and it is easy for a Govt to steal money from itself for another area,I note with the reshuffle at Welsh Govt it will be interesting to see where Peter Robs Paul plus the same Minister also runs Roads,Air & trains in one portfolio in Wales,I think Political dogma of buying Cardiff Airport(a white elephant) will require around £30millions or so, WG with no cash reserves as such will have rob other areas, that is if this cock eyed idea takes off. All my opinion

Bob

 

[TDK]

Sorry but do you know that for a fact? A lot of services that some TOC run are actually loss making!

Don't you mean subsidised?
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Let me put it this way. Does all your Road fund license actually get spent on repairing the roads?? The grass is always greener on the other side!!

100% of the road tax duty goes to the treasury, to work out how much goes back into transport you will need to know what percentage of the governments spending is on roads, then you have the tax on fuel, 100% goes into the treasury, a complete rip off!
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Live with it, nationalised rail didn't work befoe so it won't work again! BR was appauling

 

[cjmillsnun]

I agree that the costs of doing many things has gone up, but a lot of that is down to new rules, including health & safety issues and so on - not just blatant profiteering. A nationalised railway would likely incur these higher costs too. Put simply, things are done differently these days, right or wrong.

Subsidy more than doubled in real terms. Not just because of health and safety but because the engineering talent left Railtrack. People who could make good engineering calls that would have ensured a safe railway were replaced by people who were totally risk averse. Think back to Hatfield and the damage the aftermath did to the railways for years. That was entirely due to privatisation.

Also, post privatisation, railway usage has soared. This must have increased overall spending too, even if the money raised in fares will have gone up.

Yes but fixed costs remain the same. There is an increased maintenance cost which would have more than been covered under the BR regime.

For one, a lot of money has been spent on making up for the lack of spending in the years before.

Can you give me examples please?

Mk1 EMUs would NOT have soldiered on till 2004 under BR, there were already steps that NSE were taking to replace them (Networker, 442s, 321s etc) that were halted by privatisation. Then Railtrack made it almost impossible to get new trains on for a good few years after privatisation because they were concerned about signalling interference. Something that was only a problem with Class 92 and 373.

We would've also got 125MPH around the WCML much quicker and at lower cost than we did under Railtrack and NR. We also would've got Mk4s and Class 91s (possibly with tilt)or Mk5s and Class 93s on both WCML and ECML with the MML being electrified and the 225s going there.

What I fear is that if the Government took over, we'd see a service run that would potentially be the bare minimum with little incentive to invest in new things.

I think HS2 would still be in the pipeline, Crossrail would've been done and Thameslink 2000 would actually have been completed ON TIME. So have to disagree here.

Staff might benefit more, possibly, but the 'job for life' concept is long gone and in fact you might find that there's more chance of a pay freeze (certainly staff couldn't just move from one TOC to another, or threaten to, in order to keep pay up) and job cuts. And that might well lead to industrial action and a downward spiral as many rail users go back to their cars, or just travel less.

Staff (particularly drivers) have done very very well under privatisation. The unions (especially ASLEF) have more power than you think. Their inflated pay translates to higher fares and subsidy required. Do drivers really NEED £50k a year? £30-35k would be more than adequate (even in London) and would bring significant reductions in cost which would benefit the fare paying passenger as they would get value for money.

And whilst no staff couldn't move around to gain more for themselves, there was much more of a common railway spirit in the BR days. Something that was lost within 2 years of privatisation because of delay compensation.
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Wow wow wow. You make sound as if it could happen so so easily. Governments are rubbish at procuring rolling stock, just think about the IEP project. Currently at about £7.5bn which equates to £15m per carriage! Compare that to about £2.5m per pendelino carriage (I know they are an awful design but never mind). Governments have to go through so much red tape before they can make an order it is ridiculous. It is not as easy as you make out.

This is where control needs to be with a board of railwaymen below government level, who agree what needs to be done, how much it will cost, before going to government for any subsidy that is required.

BRB could get trains right. HST was a very good example of that. So much so that nearly 40 years after they were introduced, they are still considered some of the best stock in front line service.

BR in the early '90s were good at what they did. Public perception of them was improving with good reason. Intercity was profitable, NSE broke even, freight use was rising. Sectorisation had worked. But its downer is that it made the industry ripe for privatisation. And when it was privatised. It was done in a way that deliberately made the whole operation fubar.

 

[Zoe]

Live with it, nationalised rail didn't work befoe so it won't work again! BR was appauling

In what way? I frequently used BR services and didn't find anything appalling about them.

 

[Trog]

Live with it, nationalised rail didn't work befoe so it won't work again! BR was appauling

Much like education in modern Britain it would appear.

 

[merlodlliw]

Subsidy more than doubled in real terms. Not just because of health and safety but because the engineering talent left Railtrack. People who could make good engineering calls that would have ensured a safe railway were replaced by people who were totally risk averse. Think back to Hatfield and the damage the aftermath did to the railways for years. That was entirely due to privatisation.

You mention Hatfield,a tragic case, but accidents however caused created problems under state ownership,many were killed after the state took control in 1948,but laws have changed since 1948,I can think back as well

 

[Zoe]

Think back to Hatfield and the damage the aftermath did to the railways for years. That was entirely due to privatisation.

According to Phillip Hammond it wasn't: http://www.publications.parliament.uk/pa/cm201011/cmhansrd/cm110519/debtext/110519-0002.htm

British Rail operated the railway on a shoestring at relatively low cost, but in doing so it built up a tremendous legacy of under-investment and disregard for safety risk, the terrible consequences of which we saw only too clearly in the late 1990s and the early years of this century.

Also this parliamentary report extract from http://www.parliament.uk/briefing-papers/SN01224.pdf

Asset condition: At the very beginning, the poor state of the railway was not recognised as the drain it would become. The railways had been badly neglected through decades of state ownership. There was no register of assets available to the new company - and it was still not complete at the time thecompany went intoadministration. The poor state of the railway network was probably the source of most of Railtrack's problems. Broken and cracked rails combined with antiquated signallingand safety systems produced endless delays, requiring Railtrack to make heftypenalty payments to the TOCs. More seriously, this neglect of an overstretchednetwork contributed to the accidents at Ladbroke Grove (October 1999), Hatfield(October 2000) and Potters Bar (May 2002) and their serious consequences for performance. After Hatfield the company admitted that it had no idea of the condition
of much of its network. Keen to protect its profit in order to attract investors to its expansion programme, Railtrack put the squeeze on maintenance costs

I'm no fan of privatization but I believe the issues raised in the above quotes do need to be addressed when discussing BR/Railtrack.

 

[Buttsy]

According to Phillip Hammond it wasn't: http://www.publications.parliament.uk/pa/cm201011/cmhansrd/cm110519/debtext/110519-0002.htm



Also this parliamentary report extract from http://www.parliament.uk/briefing-papers/SN01224.pdf



I'm no fan of privatization but I believe the issues raised in the above quotes do need to be addressed when discussing BR/Railtrack.

The other factor that comes into play when discussing Railtrack is its corporate attitude in as much a lot of experienced engineers left the industry because of the privatisation as all work was contracted out. These firms did not necessarily have the knowledge to spot things that BR engineers probably would have done or had been aware of from previous renewals.

Hatfield is less likely to have occured under BR as trains had been running over that part of the track for many years at the line speed and that had been renewed within sufficient time to avoid the cracking.

Lose the experience with no asset register and you're up a well know creek without a paddle. Corbett persuaded the government to sell off Railtrack early rather than wait until the end of the process. Had they waited, with Bob Reid II taking an appeasement attitude, Railtrack may have had a asset register to refer to... Who knows?

 

[Zoe]

Hatfield is less likely to have occured under BR as trains had been running over that part of the track for many years at the line speed and that had been renewed within sufficient time to avoid the cracking.

Would it have been though? The above report suggests that BR had been neglecting the network for years and without any register of assets, could we know for sure what condition the track was in?

 

[notadriver]

Staff (particularly drivers) have done very very well under privatisation. The unions (especially ASLEF) have more power than you think. Their inflated pay translates to higher fares and subsidy required. Do drivers really NEED £50k a year? £30-35k would be more than adequate (even in London) and would bring significant reductions in cost which would benefit the fare paying passenger as they would get value for money.

Yet another post bashing train drivers pay.

 

[jon0844]

Subsidy more than doubled in real terms. Not just because of health and safety but because the engineering talent left Railtrack. People who could make good engineering calls that would have ensured a safe railway were replaced by people who were totally risk averse. Think back to Hatfield and the damage the aftermath did to the railways for years. That was entirely due to privatisation.

From what has been written on here, it was a ticking timebomb for BR with no decent records being kept - and so Hatfield could well have happened at any time under BR and possibly anywhere else sooner or later.

If it was down to local knowledge, rather than detailed records being kept, and proper equipment to check rails, then I am not sure I'd have been very comfortable with keeping it nationalised.

It seems Railtrack effectively had to start from zero, doing surveys from scratch. Sure, that does mean that the dangers really started once privatised, but not BECAUSE of privatisation IYSWIM.

 

[NSEFAN]

The other factor that comes into play when discussing Railtrack is its corporate attitude in as much a lot of experienced engineers left the industry because of the privatisation as all work was contracted out. These firms did not necessarily have the knowledge to spot things that BR engineers probably would have done or had been aware of from previous renewals.

Hatfield is less likely to have occured under BR as trains had been running over that part of the track for many years at the line speed and that had been renewed within sufficient time to avoid the cracking.

Lose the experience with no asset register and you're up a well know creek without a paddle. Corbett persuaded the government to sell off Railtrack early rather than wait until the end of the process. Had they waited, with Bob Reid II taking an appeasement attitude, Railtrack may have had a asset register to refer to... Who knows?

Surely relying on local knowledge for safety-critical stuff is a really bad thing, though (esp. given that a lot of BR engineers were driven off by Railtrack)? I would expect information regarding the state of assets like track to be kept in a physical log somewhere at least.

Perhaps the transition from public to private operation could have been done more smoothly, but neither Railtrack nor BR are particularly squeeky clean when it comes to the events leading up to Hatfield etc.

 

[tbtc]

Governments are rubbish at procuring rolling stock, just think about the IEP project. Currently at about £7.5bn which equates to £15m per carriage! Compare that to about £2.5m per pendelino carriage

You know that the IEP costs include depots/ maintenance etc?

So you're comparing the total cost to the TOC of a 26m IEP carriage with the initial cost to the ROSCO of a shorter 390 carriage?