A case for the railways

The 1993 Railways Act was brought in with the intention of ending state monopolies on railways, improving competition and (possibly the overriding reason) raising money for a cash-stricken Government. Rail privatisation, a path that even Margaret Thatcher dared not tread, could be noted by its singularity. Privatisation will always be a heavily divisive topic, but it could be said that the effects of it, specifically the 1980s crusade, had suitably neutral-enough results for both sides of the argument to make reasoned claims. British Rail is different.  If efficiency was the aim, then why are train fares in Britain the most expensive in Europe, and our train system one of the most inefficient?

There’s little doubt that most commentators on the Right would argue that railway privatisation was a “tough but necessary” measure; another ‘sensible’ sign of the Thatcherite times. Yet Mrs Thatcher wouldn’t abide by it. To quote Simon Jenkins, author of Thatcher & Sons, “her political instinct was not even to discuss them...it was a privatisation that Thatcher always refused to countenance”. Thatcher wasn’t dubbed ‘The Iron Lady’ for her social compassion, but she nevertheless viewed the railways as “too close to popular emotion, too sensitive and too complicated to succeed”. To John Major, on the other hand, it was “simply the next item on the list...as if to prove he was in earnest, Major immediately authorised three new privatisations which Thatcher had expressly forbidden, of the railways, coal and the Post Office”. For all of her divisiveness, Thatcher was a conviction politician; if she viewed a tough policy as right and necessary, she wouldn’t have hesitated for a second in delivering it. Thatcher not only hesitated on this particular policy; she never wanted it to happen. The arguments of the Right lose credence here; their very own emblem was fervently against railway privatisation.

To quote Jenkins further, “BR (British Rail) was the cheapest and most cost-efficient rail network in Europe. Had it been able to predict the rise in rail demand over the 1990s, planners would certainly have been forecasting a profitable network in the public sector”. Jenkins is no socialist tribune. He writes for the Guardian but as a Centrist alternative (similar to the former Communist David Aaronovitch writing for the Centre-Right Times), and worked on the Boards of the British Rail from 1979-1990. Once again, this is evidence that the arguments of the Right, no doubt of a ‘costly and inefficient rail network’, fail to bear fruit. Had British Rail been a consistent drain on public finances, and privatisation brought down train costs and raised standards, then calls for renationalisation would have been hollow and purely ideological. However, privatised rail receives a public subsidy of around £1.2 billion a year, and the West Coast Mainline fiasco has done little to reassure us that we’re in good hands. Season tickets have risen this year by an average of 4.2%, and according to the ‘Campain for Better Transport’ statistics on the BBC website, since 2003 average season ticket costs in London have risen by £1,300, and commuters between Worcester and Birmingham have seen an increase of 52% since 2003. Increasing costs of this kind would not be justifiable if we had a start of the art train services, but we don’t!

We know who is to blame, but what about solving the issue? Tony Blair, part of Thatcher’s “greatest legacy” (in her own words), lacked integrity and conviction in this area. New Labour exhibited a rare moment of social democracy by committing to renationalising British Rail in their 1997 manifesto, yet Tony Blair didn’t go through with it: “I never had much faith in this particular privatisation of the Tories and felt it would lead to a hugely complex and possibly uncompetitive system; but on the other hand, I wasn’t going to waste money renationalising it”. Paddy Ashdown’s verdict on Blair is very evident here; whilst he said Thatcher would ask if a proposal was consistent with her creed and then ask “will it work?” Blair would only ask “will it work?” I’m not a transport expert, and I confess that I’m writing this blog piece with the luxury of a Student Railcard whose main uses are for trips from Manchester to Buxton and from Matlock to Derby. However, there are thousands of commuters out there taking what is often the most practical form of transport for them, and paying exorbitant costs for it.

The solution? I am in favour of renationalising British Rail, and not for ideological or dogmatic reasons; it is a practical measure. Germany and France have state-run railways which work and are efficient, and if polls are to be believed 75% of people (MSN poll) are in favour of public ownership, or 70% of people according to a GfK NOP poll. Only the Beveridge wing of the Liberal Democrats would support this measure, but the Labour Party is apparently considering it too as part of their policy reviews. Whilst this is a welcome move, the cynic in me believes that they would drop such a measure once the big business vote is needed in 2015, along with a yearning for trust on economic competence. However, £1.2 billion a year could be saved for a start by nationalisation; it would undoubtedly be a costly measure initially, but in the long term prices would be kept under control and reduced, allowing for (ironically) more competitiveness. Railway transport is popular, and it is not right that this should be exploited at any time, let alone austerity Britain, by ever rising costs. Conversely, this popularity is a key reason why nationalisation would work; it can be a “profitable network in the public sector” as Simon Jenkins had forecast. Nationalisation per se does not have to be the whole answer, either. A state run network alongside a privately run franchise would maintain the choice element of the market, whilst enlisting competition that is for the benefit of the consumer.

If Ed Miliband unambiguously declared his support for renationalisation of the railways, I would praise him, and I am not his biggest fan. I would praise him for his courage and conviction, and for being in twine with public opinion. Such a policy could, perversely, attract the London vote; in such a populous and crowded city, commuting by train is a frequent choice. Social democracy calls for a mixed economy, but my call for renationalisation here is not out of longing for a return to the post-war consensus. Money is tight, and must be spent carefully, and on worthwhile causes. I believe this is a worthwhile cause, and my view on it is borne out of pragmatism.

Mrs Thatcher was said to have come round to privatisation of the railways, but this was from the comfort of the House of Lords; she would never have changed her mind in office. She told her Transport Secretary Nicholas Ridley that "railway privatisation will be the Waterloo of this government. Please never mention the railways to me again". For a change, I agree with Margaret.

Reference: Simon Jenkins (2007), Thatcher and Sons