Unpopular opinion: fully privatise the railways

[Samuel88]

It's clear that part privatisation has failed. Sky high fares, overcrowded trains, no accountability so passengers are treated like dirt, and even the big transport companies are growing weary of this system. Most of us (myself included) support nationalisation, but what if we went in the opposite direction and completely privatised the railways. Could there be any benefits to the Government just washing it's hands of national rail?

 

[6Gman]

It's clear that part privatisation has failed. Sky high fares, overcrowded trains, no accountability so passengers are treated like dirt, and even the big transport companies are growing weary of this system. Most of us (myself included) support nationalisation, but what if we went in the opposite direction and completely privatised the railways. Could there be any benefits to the Government just washing it's hands of national rail?

Depends what you mean by a fully privatised railway.

What would you sell?

And to whom?

 

[Samuel88]

Depends what you mean by a fully privatised railway.

What would you sell?

And to whom?

I'd sell everything, the infrastructure, the trains, Network Rail, to whoever's buying.

 

[6Gman]

So you'd be content to sell Waterloo (e.g.) to a property company that then turned all the trains round at Clapham Junction/ Vauxhall and redeveloped Waterloo for billions?

Could be a tough one to "sell" to the public ...

 

[6Gman]

And - of course - hard to believe there would be buyers for Whitby, Blaenau Ffestiniog, Looe, Sheringham, the whole of Lincolnshire ...

 

[Samuel88]

So you'd be content to sell Waterloo (e.g.) to a property company that then turned all the trains round at Clapham Junction/ Vauxhall and redeveloped Waterloo for billions?

Could be a tough one to "sell" to the public ...

And - of course - hard to believe there would be buyers for Whitby, Blaenau Ffestiniog, Looe, Sheringham, the whole of Lincolnshire ...

Not at all, I support full nationalisation, but I doubt that's going to happen anytime soon, and we can't go on with the system we have, so I'm just asking for people's opinions on the subject.

 

[EM2]

One word - Railtrack.

 

[800002]

Does one mean Fully Nationalised Railway?

 

[6Gman]

Not at all, I support full nationalisation, but I doubt that's going to happen anytime soon, and we can't go on with the system we have, so I'm just asking for people's opinions on the subject.

And you've had mine.

A fully privatised railway wouldn't touch the loss-making areas, and would happily run down even busier routes if it could make more money by e.g. redevelopment of sites.

 

[hexagon789]

I'd sell everything, the infrastructure, the trains, Network Rail, to whoever's buying.

I'm sure one of the original proposals for privitisation was full privitisation, a sort-of modern 'Big Four' with a number of regional companies (something in my mind says 13), owning trains and track as well as running services.

 

[TurbostarFan]

One word - Railtrack.

That was an epic fail. Just ask any of the victims of Hatfield. Even Steve Marshall can probably see the error of Railtracks ways. I'd say no, we should either leave it as it is or fully nationalise it but with privately owned open access operators permitted to operate trains.

 

[coppercapped]

I'm sure one of the original proposals for privitisation was full privitisation, a sort-of modern 'Big Four' with a number of regional companies (something in my mind says 13), owning trains and track as well as running services.

That form of organisation was one of several put forward/studied in the years running up to the Railways Act.

However, it was clear, and accepted by all concerned, that the railways would continue to require subsidy from the Government, so a complete sale - of all the fixtures and fittings - was ruled out very early in the process.

The question was only - what is the best way to enable the Government to continue paying a subsidy in a manner that enabled it to keep oversight of the monies being supplied? The answer was found with a variant of the 'Landlord - Tenant' structure suggested by the LNER at the end of the Second World War.

 

[hexagon789]

The answer was found with a variant of the 'Landlord - Tenant' structure suggested by the LNER at the end of the Second World War.

If the current system is a variant, it would be interesting to see what the original scheme entailed; how it differed.

 

[Harpers Tate]

I'd probably plump for a fully franchised Railway (singular) with private operators actually running the trains and employing the staff, but the whole thing run as an integrated whole with each party obliged to fulfil that requirement. Something like the London Buses model.

Full privatisation? I think the evidence of buses outside London is sufficient evidence of the complete absence of private enterprise's ability and willingness to not systematically destroy their own industry.

 

[coppercapped]

If the current system is a variant, it would be interesting to see what the original scheme entailed; how it differed.

The LNER was financially the weakest of the 'Big Four' - it had suffered very badly from the collapse of heavy industry in the North East in the 1920s. At the end of the War it proposed two different models for its survival. One was the 'Landlord and Tenant' model whereby it proposed selling its network to the Government and then paying rent to run its services over it. The other was that it split itself into two companies - a profitable and a loss making part. The loss making part would be closed or offered to the Government.

Nationalisation meant that, in the event, neither happened!

The LNER model assumed it would continue to operate both passenger and freight services as one organisation (rather than being split between several freight operators and geographic passenger companies) and it could do so profitably if it no longer had to carry the capital and renewal costs of the infrastructure. If Government-owned such costs (renewal and the servicing of capital) could be spread over a longer time scale than were possible for a private company with wobbly finances so reducing annual costs.

The other main differences are that at the start of the 'privatised' railway passenger services were, in the round, loss-making so passenger train operations needed Government support - the LNER was still, just, profitable and would need no Government cash to run its trains - and the infrastructure was already State owned. No sale necessary!

 

[Neptune]

Make Intercity fully nationalised along with all infrastructure and run the regional networks by local authorities such as TfN, TfWM, TfW, Scotrail etc.. Make it all not for profit ploughing back in any excesses.

 

[Tomos y Tanc]

Make Intercity fully nationalised along with all infrastructure and run the regional networks by local authorities such as TfN, TfWM, TfW, Scotrail etc.. Make it all not for profit ploughing back in any excesses.

TfW is pretty close to a not for profit model. I think I'm right in saying that Keolis Amey/ TFW Rail Services profits are capped at 2% of turnover with any excess reinvested in service improvements.

 

[coppercapped]

Make Intercity fully nationalised along with all infrastructure and run the regional networks by local authorities such as TfN, TfWM, TfW, Scotrail etc.. Make it all not for profit ploughing back in any excesses.

Err, all of Network Rail's shares are owned by the State.

 

[Bald Rick]

Even Steve Marshall can probably see the error of Railtracks ways.

Unlikely now, as he died two years ago.

 

[TurbostarFan]

Unlikely now, as he died two years ago.

I'm technically incorrect then but I'm sure that even Mr Marshall could see the error of Railtrack's ways whilst he was alive.

 

[yoyothehobo]

Arent Japanese Railways completely privately owned (with a big governmental subsidy) and they seem to work just fine and allowed me to get into the back of beyond, but also travel at 200mph in comfort. The service frequency is very high, every station was staffed (bar some little tiny halts).

 

[Esker-pades]

Arent Japanese Railways completely privately owned (with a big governmental subsidy) and they seem to work just fine and allowed me to get into the back of beyond, but also travel at 200mph in comfort. The service frequency is very high, every station was staffed (bar some little tiny halts).

But yet the private Japanese companies want to close (and are closing) a lot of railways, especially the rural ones.

https://www.railforums.co.uk/threads/did-the-japanese-rail-network-ever-have-a-beeching-cut.161945/

Also see my comment from earlier this year on another thread:

A Japanese model of privatisation seems to be the best that's out there, but I have a concern: What happens to rural railways that are not pulling their weight?

March 2018 saw the closure of the Sanko Line because of falling passenger numbers meaning it no longer made commercial sense (50 passengers per km per day in 2014). Much of the Hokkaido network (the northernmost island of Japan) is unprofitable and there are proposals (dating from Nov 2016) to close ~50% of the railway lines on that island or transfer them to other operaters (government, "third sector" etc).

There is a reasonable comparison to draw between Hokkaido and Scotland. There are some cities and major passenger flows, but a large amount of rural areas with challenging terrain with railway lines that are unlikely to break even.

I am a big supporter of the Far North Line, and spend too much time looking at timetables and ways to improve the current service. Previous threads on the subject of the FNL have had many members proposing the closure of the line north of Tain. Luckily, this is a crayonista cutting which is unlikely to happen anytime soon.
There is a counterpart in Hokkaido Island called the the Soya Main Line, which runs from Asahikawa to Nayoro to Wakkanai (the northernmost station in Japan). It mirrors the Far North Line in many ways: There is a southern section which has increasing commuter traffic (Asahikawa to Nayoro/Inverness to Tain) and a northern section which passes through some very isolated parts of the country as well as linking several small towns together (Bifuka, Toyotomi/Lairg and Helmsdale) to a port at the very northern end (Wakkanai/Thurso).
As part of this 2016 proposed rationalisation, the Soya Main Line north of Nayoro would be shut unless the government or the third sector stepped in. Thus, it is not a big jump to make to see that bringing Japanese-style privatisation would close similar lines or parts of lines (like the Far North from Tain to Thurso and Wick).

I don't think that it will make our railways more efficient either. JJapanese privatisation works for several reasons, with cultural and social ones being very important. Importing that culture here simply will not happen to any great extent (bar the more infantile parts of anime) and is arguably not desirable. See the Amagasaki Derailment (which has previously been cited) but also the phenomenon of Karoshi (translated as overwork death) which is fairly widespread.

Efficiency at what price?

 

[Tobbes]

There's an intellectual case for a privatised railway subject to economic regulation along the lines of water or electricity. However, whatever model you choose, you need to make a fundamental choice: do you (i) support loss-making operations (ie, most of the rural network, and the commuter network off-peak) - and if so, how?, or (ii) let the market rip, in which case you need to make sure other modes pay for all of their externalities, and then let the devil take the hindmost.

The reality is that we are always going to do (i) and have an argument about the correct level of subsidy and structure, as (ii) is politically undeliverable and probably environmentally unsustainable. Once you get to that place, the question is then all about what is the most efficient method for doing this? Personally, I don't see that the current model is fit-for-purpose because the premium payments are in no way guaranteed (see: every failed franchise handed back), so I'd prefer to have a single national passenger operator (either nationalised or not), and I see very little value in open access. Freight I'm much more agnostic about - whatever we can do to maximise freight is fine with me, but an intergrated BR Mark II model doesn't seem to offer much.

 

[Meerkat]

I would auction off packages of paths on the mainlines so there is competition on the most profitable and expensive fares.
Then devolved concessions for the local/urban areas, including infrastructure.

Even if the railways must be nationalised I would like maximum devolution, and certainly not a single national operator - we really need to be able to benchmark for efficiency etc.

 

[TrainBoy98]

I would auction off packages of paths on the mainlines so there is competition on the most profitable and expensive fares.
Then devolved concessions for the local/urban areas, including infrastructure.

Actioning off paths almost like they do with 3G/4G bandwidths etc? I know it's comparing apples with oranges, but theres plenty of competition with that, but would it actually be able to work?

 

[Tobbes]

Actioning off paths almost like they do with 3G/4G bandwidths etc? I know it's comparing apples with oranges, but theres plenty of competition with that, but would it actually be able to work?

The problem I've always seen with this is that the capital costs of the equipement and the staff costs are relatively inflexible if you only wanted to bid on peak time services.

 

[class26]

There's an intellectual case for a privatised railway subject to economic regulation along the lines of water or electricity. However, whatever model you choose, you need to make a fundamental choice: do you (i) support loss-making operations (ie, most of the rural network, and the commuter network off-peak) - and if so, how?, or (ii) let the market rip, in which case you need to make sure other modes pay for all of their externalities, and then let the devil take the hindmost.

The reality is that we are always going to do (i) and have an argument about the correct level of subsidy and structure, as (ii) is politically undeliverable and probably environmentally unsustainable. Once you get to that place, the question is then all about what is the most efficient method for doing this? Personally, I don't see that the current model is fit-for-purpose because the premium payments are in no way guaranteed (see: every failed franchise handed back), so I'd prefer to have a single national passenger operator (either nationalised or not), and I see very little value in open access. Freight I'm much more agnostic about - whatever we can do to maximise freight is fine with me, but an intergrated BR Mark II model doesn't seem to offer much.

There`s also an intellectual case for communism but the history of the last 100 years shows us it is a disaster!

About supporting local services their benefits need to be apportioned correctly,ie NOT just income and outgoings but what if the local line didn`t exist ? Users would drive to a railhead causing more congestion, pollution etc at a time when we are supposed to be using cars. In other words the overall benefit to society, not just a profit and loss of the line seen in isolation.

 

[TrainBoy98]

The problem I've always seen with this is that the capital costs of the equipement and the staff costs are relatively inflexible if you only wanted to bid on peak time services.

So an overall body (ie, National Rail or some such) employs all the staff, and owns all the equipment and then "rents" it all out as such. So it's the same staff at say Victoria, and they work for the umbrella organisation. Just ensure that all the bids for paths etc out of that station cover the staffing costs.

Same with the equipment, then you could have operators including extra money in their bids if they want to use upgraded services (ie, operating costs are lower for electric services, so you pay a premium on your bid to include money for electrification.) You'd need to allow for the bundles of paths to be bid for longer-term, so that the operator sees the benefits of what they're paying for, but then again Chiltern is longer-term and many consider this one of the successes of franchising.

 

[TrainBoy98]

If you could bundle up higher-profit paths on one line with ones that run at a loss on another (but that the income still outweighs the loss), then that could help "subsidise" the loss making routes.

You might however still need some form of govt subsidy for the very worst lines, but perhaps from a local communities stand point as a "without the railways x or y would be worse" and so overall the subsidy would be better in the long run than losing the service (ie, environmental grounds, social mobility or only transport to said town etc).

 

[Peter Kelford]

It's clear that part privatisation has failed. Sky high fares, overcrowded trains, no accountability so passengers are treated like dirt, and even the big transport companies are growing weary of this system. Most of us (myself included) support nationalisation, but what if we went in the opposite direction and completely privatised the railways. Could there be any benefits to the Government just washing it's hands of national rail?

This might actually work... let's not forget that we were running a cutting edge railway when fully private, why must it be negative? The current model of multiple bureaucracies is the worst. What it does is apportion blame on someone else. Here's a story that summarises the problem we currently have:

This is a story about four people named Everybody, Somebody, Anybody and Nobody. There was an important job to be done and Everybody was sure that Somebody would do it. Anybody could have done it, but Nobody did it. Somebody got angry about that, because it was Everybody’s job. Everybody thought Anybody could do it, but Nobody realized that Everybody wouldn’t do it. It ended up that Everybody blamed Somebody when Nobody did what Anybody could have.

This is what multiple corporate bureaucracies do, not forgetting the competition between companies and also the lack of motivation by Entity A to do Action B in order to make Entity C's life workable.