Right or wrong, Labour is offering a solution to the legitimacy crisis of our privatised railways

As I wearily forked out for my monthly rail travelcard this morning I felt the pain of hundreds of thousands of other commuters around the country over the latest round of price increases.

Does it have to be this way? Labour has been touting its promise of train company nationalisations as the solution to this miserable January ritual.

Alas, nationalisation would not, in itself, be a free lunch for passengers and commuters. The UK railway – its maintenance, refurbishment and expansion – needs to be paid for. The central question is whether we pay for it through rail fares or through general taxation.

The coalition government decided back in 2010 that passengers should bear much more of the burden. Some will agree with that decision, given regular train passengers, on average, tend to be wealthier than those who don’t use the service.

Others will argue, legitimately, that we should have a European-style funding system, where the taxpayer pays more through subsidies and that train travel ought to be vigorously promoted as a more environmentally-friendly alternative to the car. You pay your money and take your choice in that debate.

Yet that’s hardly the end of the discussion over rail fares. And the ownership question is not, in fact, irrelevant. Ask people about rising rail fares and it is clear the problem is not simply the above-inflation increases, but the quality of the service provided by the private operating companies too. 

Paying more for an improved service is one thing. Paying more for an experience that is getting no better, or even getting worse, is quite another. And in some parts of the country the rail experience really is deteriorating.

Southern Rail, the blight of Surrey and Sussex, deserves to be a case study in bad management. The disaster is, in large part, a consequence of under-staffing. The franchise relies on almost all its drivers working overtime.  There’s no slack in the system so when drivers don’t volunteer, for whatever reason, it breaks down.

Yet Southern is also a case study in the pitfalls of a disingenuous privatisation. The franchise is being run on a special “management contract” with the Government. This allows relatively little financial autonomy for its parent company, Govia Thameslink. Meanwhile, the terms of the management contract require Southern to introduce controversial driver-only operations, forcing a predictable showdown with the train guard and driver unions. Privatisation here is actually a fig leaf. The Transport Secretary, Chris Grayling, exercises a considerable degree of hidden control. And the terms of the contract create incentives for excessive management cost cutting. The Government then blames the private company for the consequences. This is essentially power without responsibility for ministers. And they appear to like it that way.





In November, the Government announced plans to effectively bail out with public money the Stagecoach/Virgin East Coast rail franchise, which had overbid for the right to operate the line. As Lord Adonis pointed out in his resignation letter as chair of the National Infrastructure Commission last week, Grayling apparently refused the option of taking the franchise into temporary national ownership, something that the last Labour government did in 2009 when National Express similarly failed on the same line, with notable success. This is part of a pattern. Grayling also refused an offer from Transport for London to take control of Southern in 2016.

This is a government that seems to regard the principle of private ownership as more important than the practical interests of passengers. Sizeable fare hikes are fuel on the top of that already smouldering fire of distrust.

The public anger over rail fare hikes reflects something deeper than traditional seasonal grumbling at the rising cost of living. It reflects a fundamental legitimacy problem for the privatised train operating companies. There is majority support in polls for rail re-nationalisation not because Britons are all foaming Trotskyists but because of these underlying trust issues.

Privatisation’s defenders are, of course, correct to say that there are no guarantees nationalisation of train operating companies would produce the more efficient and passenger-focused UK railway that we all desire. That would depend on the competence of the new management and their degree of insulation from political pressures. There are decent grounds for suspecting that things would actually get worse.

Yet what Labour is offering is a solution to the legitimacy crisis of the privatised railway. Those who believe privatisation is an experiment worth persisting with should dispense with the facile lectures about the evils of central planning and get their thinking caps on about how to make the railway work far better for passengers than it is at the moment.

This article was published in The Independent on 02/01/18

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