Labour backs plans to return railway network to public control

[Schnellzug]

Actual separation is unnecessary if separate accounts are kept.

But I will believe this when I see it.

It does seem to work without too many complaints in Germany, with DB Netz and a whole plethora of private operators.

 

[warriorwarlord]

I would love the railway to be brought back into public hands, but I find it a bit rich comming from Labour though. This was also the same party that promised the tube wouldn't be privatised...

 

[jon0844]

As i said, it's a classic political tactic, blame Fat Cat Rail Chiefs for {(c) Daily Mail} Sky High Fares and try to make it out that they're ruthlessly profiteering off the long suffering public. If they owned the rail system, however, and were responsible for setting fares and so on, who could they blame then for Sky High Fares? No one surely would imagine that fares would go down on a nationalised rail system under a Labout govt.

If fares DID come down, it would either be down to some clever accounting - or perhaps increasing the subsidies, meaning even those not using the railway would end up paying.

Now, I'm not necessarily against that idea - but fear Network Rail and the 'operators' would get even more inefficient and we'd see it becoming a bottomless pit like I am sure it was before - with money being diverted from elsewhere to keep the railway going. This could also lead to more rail cuts, beyond what even McNulty has suggested.

If Labour could find a way to reduce costs for doing simple jobs, then perhaps they'd be on to something. However, in opposition they don't really need to provide evidence on how they'd do anything, just attack the coalition on everything. It's also very easy to make the necessary cuts look simply like the Tories being the Tories and cutting everything to look after their toff mates.

 

[Harbon 1]

Instead of nationalising, why not just put an absolute limit on fares with it being worked out on pence per mile, surely that would gain more interest from the public than nationalisation, because of the stories of running down that have come from the BR era.

And from an enthusiasts (and in some respects, customers) view, surely if the network, or even the main franchise were nationalised, we'd see an application of a colour scheme, confusing the hell out of people at big stations, and boring the hell out of enthusiasts. BR blue is nice now, but variety is better.

 

[scandal]

It's widely acknowledged that the UK went beyond the remit of Directive 91/440 which states

Separation between infrastructure management and transport operations
EU countries must ensure the separation of infrastructure management and transport operations by keeping separate profit and loss accounts and balance sheets and publishing them individually for business relating to the provision of transport services by railways undertakings and for business relating to the management of railway infrastructure. Public funds must also reflect this separation and those paid to one activity must not be transferred to the other.

The main issue in the UK with regards to public ownership of the Railways is the 1993 Railways Act, which unlike the 1986 Deregulation Act for Buses does not allow the public sector to operate transport services, in Section 25 of the 1993 it clearly states "Public sector operators not to be franchisees." This has caused particularly uproar in recent years with the influx of foreign state publically owned railway companies increasing operations in the UK, at the same time that the public sector of the UK are unable to do so, this was recently flagged up by the Scottish Government.

In regards to criticsm of Labour failing to deliver on a publically own and publically accountable railway from 1997-2010, the Third Way ethos of New Labour at the time was against traditional black and white ideas of state ownership, indeed look at the development of Welsh Water and Network Rail as the mantra for public services, not for profit and limited by guarantee. I personally think that the most interesting discussion from the Guardian article is that there could be greater regulatory powers for local authorities in the management and procurement of rail services to meet the local populations needs, perhaps this would finally allow rail to be integrated in transport planning decision making and public transport to refocus its efforts on modal competition and instead to competing with the private car.

For those interested and commenting on the legal challenges involved, the report can be found here with: http://www.transportforqualityoflif...ebuilding_Rail_Final_Report_print_version.pdf

 

[Manchester77]

They're talking about renationalistation now on BBC breakfast

 

[jon0844]

A great way to score some points. With the new banking crisis and tax avoidance in the news, everyone is one again thinking that everyone that dares to make money is evil. that is anyone making money but you, obviously!

So, you now begin your effort to make out the train operators as evil. It is in fact the private companies and their greedy CEOs getting rich from your train ticket. They're only looking out for their shareholders, who are also greedy and probably don't pay tax.

Include some examples of no longer being able afford to take your kids to the seaside, or your nan to get to hospital for her regular check-ups and job done.

Besides Network Rail costing us the most, and ROSCOs also doing their level best to rip us off too, I think many TOCs offer some very reasonable off-peak and super off-peak deals. They have an incentive to offer competitive pricing to get more people to travel on their trains, off-peak at least. If nationalised, would it matter so much? There's no need to make a profit.

Commuters will always be hit hard as there's usually a capacity issue and lowering prices without investment will just result in even more crush loading and even more complaints. I am sure it's no surprise that people who can get a seat or have a fairly relaxed commute are less likely to complain about what they pay to travel than those who are standing or even miss trains, or travel on trains that break down or are cancelled regularly.

I'd still like to see something in between.. based on the TfL way of doing things. Still keeping private operators, but having a nationalised look and feel to the end user. More joined up thinking on timetables and ticket pricing, and more money on doing up stations, staffing them, security, revenue protection etc. It's perhaps the best chance of getting the best of both worlds.

 

[HH]

For those interested and commenting on the legal challenges involved, the report can be found here with: http://www.transportforqualityoflif...ebuilding_Rail_Final_Report_print_version.pdf

Take a good look at the list of "experts" consulted. Totally unbiased then.

I was interested to see the numbers. As far as I can see almost all are just "guesstimates". To take one example, there is the McNulty estimate that the TOC cost of interfacing with NR at 5% of total costs. To be frank this is garbage, and comes from asking people who do not have clear visibility as to what goes on. Many of the roles where there might appear to be overlap form a very useful check that NR's plans do not cause unnecessary disruption to passengers, or that delay is correctly attributed so that it can be addressed. That there is inefficiency here is true, but it's not £ms per TOC, more like a couple of hundred thousand. The biggest areas for improvement (which is widely recognised in the industry) are to do with planning engineering works and timetables, and can be adequately addressed by working together more closely.

Another great example of 'creative accounting' is in the phrase "CEOs of TOCS and Network Rail typically receive remuneration packages of £640,000 - £1.35 million per year, comparable to typical annual earnings of a FTSE mid-250 CEO". TOC MDs earn far less than this. These sorts of salaries are for the CEO of the Group, and most of those are in the FTSE top 250 (First used to be top 100 for example). Given that all these companies have other businesses at home and abroad, it's not clear that there is any cost to Rail at all. Certainly, being familiar with two owning groups, neither charge anything to the TOC for the Group Board. NR salaries are very high; let's recall who oversaw the setting up of NR, and who failed to adequately match reward with delivery. It doesn't require re-nationalisation to correct that.

I could go on, but I doubt that I'll change any minds. People believe what they want to, and rarely let facts get in the way.

 

[185]

I remember reading Labour saying something similar before the 1997 election and look we still have a privatised Rail network so I am taking this with a pinch of salt so to speak.

Agree. Annoying as so many within the party wanted this, but the people at the top were too tied up rescueing the financial disaster of Railtrack and shooing off it's greedy shareholders.... I reckon it was the cost of that which deterred the cabinet from going ahead with nationalisation.

 

[Pen Mill]

I think re-nationalisation is a useful political football when someone with nothing better to do wants to kick off (pardon the pun).
One of the big advantages of private operation is that management have the incentive to drive a better business to deliver better profit , that just wouldn't happen in a nationalised environment.

The one argument that I do agree with wholeheartedly is the beef about allowing foreign government subsidiaries to bid for franchises (Abellio/DB/SNCF).

Basically this scenario emerges :-
I pay my taxes so that French/German or Dutch taxpayers can be subsidised !!!!!!!!! give me a break , this is certainly immoral and has to be borderline illegal and can you imagine the French/German/Dutch taxpayers subsideising our taxes... no you can't and neither can I. How this is allowed by our government is totally escaping me.

 

[table38]

Maria Eagle on the Daily Politics Show now, but more interestingly they used a clip from the advert below to introduce the segment. Aww, it makes me feel all warm and fuzzy about BR :cry:.

[youtube]vLA7Q-pPQhQ[/youtube]

 

[HSTEd]

I think re-nationalisation is a useful political football when someone with nothing better to do wants to kick off (pardon the pun).
One of the big advantages of private operation is that management have the incentive to drive a better business to deliver better profit , that just wouldn't happen in a nationalised environment.

The one argument that I do agree with wholeheartedly is the beef about allowing foreign government subsidiaries to bid for franchises (Abellio/DB/SNCF).

Basically this scenario emerges :-
I pay my taxes so that French/German or Dutch taxpayers can be subsidised !!!!!!!!! give me a break , this is certainly immoral and has to be borderline illegal and can you imagine the French/German/Dutch taxpayers subsideising our taxes... no you can't and neither can I. How this is allowed by our government is totally escaping me.

You don't get to have it both ways.... either you are for the free market in infrastructure and all it entails, or you are not.
You can't demand privatised infrastructure to drive improvements and then complain that the market selects foreign governments as the most efficient providers of services.

 

[jon0844]

Maria Eagle on the Daily Politics Show now, but more interestingly they used a clip from the advert below to introduce the segment. Aww, it makes me feel all warm and fuzzy about BR :cry:.

[youtube]vLA7Q-pPQhQ[/youtube]

'We're getting there' was of course reference to the fact that BR actually had a bad reputation and was trying hard to rectify that.. one of the first examples I can remember where a company actually held its hands up and said 'Yes, we're not perfect' and tried to turn a negative into a positive.

While it does bring back memories, I think it's unfair for the media (or politicians) to try and use things like this to paint a rosy picture of BR and suggest that it's all bad now. The vast majority of staff working on a privatised railway are just as helpful - perhaps more so in this day of customer-service-is-king (and, sadly, the customer is always right even when they're making total arses out of themselves).

A lot of the staff are ex-BR too. Sure you get the disinterested ones, but they must have existed before under BR. In fact, probably more so given the 'job for life' mentality that people have in the public sector. God knows I saw enough of that when I worked for a local authority.

 

[LNW-GW Joint]

For those interested and commenting on the legal challenges involved, the report can be found here with: http://www.transportforqualityoflif...ebuilding_Rail_Final_Report_print_version.pdf

Thanks for posting the link.
I like the report, except for the political overtones which consign it to the dustbin.
If this was a critique of the GB rail setup addressed to the government, then fine.
But instead it seems to be an attempt to write a few paragraphs for the next Labour manifesto.

The background on other countries is very interesting.
They are proposing a "German" style for the UK, with a lot of devolution.

Against that, the UK government (any government) is culturally opposed to public subsidy and proper devolution.
They want to be the "controlling mind".

It's also too late.
By the time there is a change of government, another half-dozen 15-year franchises will have been let, and I can't see them being renegotiated - another cultural problem.
But if First win them all then we will have an integrated inter-city network by accident.

I think the best we can expect is that the PTE-type networks will be run on the TfL LOROL pattern.

 

[WelshBluebird]

The title and the actual article are a bit confusing.
Does it mean ownership, or does it mean control?
Being under public control does not specifically mean ownership.
Indeed despite being privatised, the railway today is near enough under public control (as the DfT decide so much about the franchise and services that are run).
--- old post above --- --- new post below ---

One of the big advantages of private operation is that management have the incentive to drive a better business to deliver better profit , that just wouldn't happen in a nationalised environment.

But in a lot of cases, better profit is not the same as a better service.
Companies can improve profits a great deal by actually making the service worse! This is especially true with the railways where many people simply do not have the choice to use a different operator, or use a different mode of transport.

 

[yorksrob]

You don't get to have it both ways.... either you are for the free market in infrastructure and all it entails, or you are not.
You can't demand privatised infrastructure to drive improvements and then complain that the market selects foreign governments as the most efficient providers of services.

On the contrary, the only reason "the market" selects foreign Governments as "the most efficient" provider of services is because those Governments have clearly chosen not to run their national networks in the same way that we have and have chosen to support their state railway companies in a way that we didn't.

The spirit of the Railways Act that enshrined privatisation is very clear that Government backed organisations are not supposed to run franchises, hence why BR wasn't allowed to bid for franchises initially and why currently state run franchises such as the ECML have to be handed back to the private sector. If the powers that be genuinely believe in the ideology that they foisted upon us, they should have the guts to enforce it.

 

[Zoe]

The spirit of the Railways Act that enshrined privatisation is very clear that Government backed organisations are not supposed to run franchises, hence why BR wasn't allowed to bid for franchises initially and why currently state run franchises such as the ECML have to be handed back to the private sector. If the powers that be genuinely believe in the ideology that they foisted upon us, they should have the guts to enforce it.

The Railways Act 1993 did allow BR to bid for franchises (originally it would not have done but an amendment was passed) but OPRAF did not allow this as it was thought that it would discourage other bids.

 

[yorksrob]

The Railways Act 1993 did allow BR to bid for franchises (originally it would not have done but an amendment was passed) but OPRAF did not allow this as it was thought that it would discourage other bids.

Either way it wasn't allowed.

The spirit of the act seems to be fairly evident in section 25 to me:

http://www.legislation.gov.uk/ukpga/1993/43/section/25

The letter of the law confines this block to the British state - but even then, if they were so against allowing agents of the British state to run franchises, how can they possibly justify allowing agents of a foreign state to run a franchise.

 

[Zoe]

The letter of the law confines this block to the British state - but even then, if they were so against allowing agents of the British state to run franchises, how can they possibly justify allowing agents of a foreign state to run a franchise.

But had there not been a concern that other bidders would be discouraged, BR would have been allowed to bid and the Railways Act 1993 did not prevent this. The question is though if any private sector company would have wanted to bid against BR for a franchise.

(3)Subject to the following provisions of this section, subsection (1) above shall not prevent—
(a)the British Railways Board (in this Act referred to as “the Board”), or
(b)a wholly owned subsidiary of the Board,
from being a franchisee.

 

[yorksrob]

But had there not been a concern that other bidders would be discouraged, BR would have been allowed to bid and the Railways Act 1993 did not prevent this. The question is though if any private sector company would have wanted to bid against BR for a franchise.

If the Regulator thinks that a British state company will put off other bidders, by what logic does it believe that a company owned by a foreign state won't?

I refer you to the remaining provisions as originally enacted:

Subject to the following provisions of this section, subsection (1) above shall not prevent— .
(a)the British Railways Board (in this Act referred to as “the Board”), or .
(b)a wholly owned subsidiary of the Board, .
from being a franchisee.
(4)Subject to the following provisions of this section, whenever the Franchising Director proposes to issue invitations to tender under section 26 below in respect of any particular services for the carriage of passengers by railway, he may, after consultation with the Board and the Regulator, determine that neither the Board nor any wholly owned subsidiary of the Board shall be eligible for inclusion among the persons to whom the invitations are to be issued or who may be selected as the franchisee. .
(5)The Franchising Director shall not make a determination under subsection (4) above unless he considers that it is desirable to do so— .
(a)for the purpose of promoting competition for franchises; .
(b)for the purpose of promoting the award of franchise agreements to companies in which qualifying railway employees have a substantial interest; .
(c)for the purpose of encouraging new entry to the passenger railway industry; or .
(d)for the purpose of preventing or reducing the dominance of any person or persons in the market for the provision in Great Britain, or in a part of Great Britain, of services for the carriage of passengers by railway.

Notice how sections 4 and 5 invite the regulator to hobble the BRB so as to render the amendment (doubtless forced upon the Government of the day against their wishes) effectively useless.

Make no mistake. There was never any intention to allow BR into the market.

 

[Zoe]

Notice how sections 4 and 5 invite the regulator to hobble the BRB so as to render the amendment (doubtless forced upon the Government of the day against their wishes) effectively useless.

Make no mistake. There was never any intention to allow BR into the market.

If the private sector had been discouraged from bidding then it would have reduced competition.

 

[yorksrob]

If the private sector had been discouraged from bidding then it would have reduced competition.

That still doesn't answer the question - If the Regulator thinks that a British state owned company will put off other bidders, by what logic does it believe that a company owned by a foreign state won't?

 

[HSTEd]

That still doesn't answer the question - If the Regulator thinks that a British state owned company will put off other bidders, by what logic does it believe that a company owned by a foreign state won't?

Because a company owned by a foreign state will certainly be entirely arms length, why would they subsidise us?
Whereas a company owned by the British state could be subsidised under the table.

 

[yorksrob]

Because a company owned by a foreign state will certainly be entirely arms length, why would they subsidise us?
Whereas a company owned by the British state could be subsidised under the table.

You have to ask yourself, what on earth would a foreign state owned entity possibly want from a British TOC. As you rightly surmise, our continental partners obviously aren't paying for improvements out of a sense of European solidarity, they clearly expect to make a return. It does rather beg the question, if this system is so wonderful for us, why is it (as always) everyone else taking over our railways rather than the other way round. Surely they should have been jumping at the chance to flog off their operations for the past twenty years ?

Also, I don't recall a very nuanced political discourse at the time as to whether the railway could be state run at "arms length" or on a continental model. We were very much peddled a highly simplistic argument of inefficient state owned companies verses the rightious private sector. I'm afraid in that context, for the Government to go crawling back to the state owned sector seems like a case of the politicians not believing their own propaganda.

 

[ivanhoe]

They had 13 years to do something but in all honesty they strengthened the current system. I cannot see a Labour Government led by Ed Milliband re nationalising the system. It's just plain show boating ! I would rather they packaged it with the Regulation of Bus services outside of London but I doubt whether they would take that one on. Paper never refuses ink as they say!