West Coast Main Line row: Should railways be renationalised?

 
A Virgin train passes along the West Coast Main Line route near Abington on 29 August Should Britain's railways be returned to public ownership?

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The collapse of the West Coast Main Line bidding process, after the government found significant flaws, has once again sparked calls in some quarters to renationalise Britain's railways - 17 years after they were privatised.

FirstGroup had been due to take over the running of the line from current operator Virgin Trains in December, but now the competition will have to be re-run after the government scrapped its decision on the franchise.

Here two transport experts argue the case for and against.

AGAINST: Dr Richard Wellings, head of transport, Institute of Economic Affairs

In many ways the railways have been successful over the last 15 years, with significant growth in passenger numbers and freight. Several routes have been upgraded, ageing trains have been replaced and safety has continued to improve.

Dr Richard Wellings, head of transport, Institute of Economic Affairs Dr Richard Wellings says changes are needed but a private rail industry is still the way forward

Taxpayer subsidies have, however, reached unacceptable levels, at around £5bn a year. And costs are much higher than on comparable networks abroad.

In reality, the railways were not privatised properly. Politicians and officials retained tight control. As the current West Coast debacle shows, the government decides who runs the trains. It also decides levels of service, controls prices and determines the priorities for investment.

This is not genuine privatisation. Rail firms are essentially subcontractors for the state. And the high costs of the railways flow directly from these high levels of government involvement.

In particular, the government has imposed a complex artificial structure on the industry. The railways are suffocated by unnecessary bureaucracy. Highly paid lawyers, accountants, consultants and civil servants have benefited at the expense of taxpayers and passengers.

A further shift toward nationalisation would only make this worse. Nationalised industries are hugely inefficient and quickly become a drain on the economy, as we know from bitter experience in the 1960s and 1970s. Politicians would exert even more control over the railways, squandering money to buy off special interests and wasting yet more billions on uneconomic vanity projects.

In the 19th Century private firms built and operated a vast network without massive handouts from taxpayers. A similarly innovative and entrepreneurial private rail industry is the best way to improve outcomes and reduce costs. In particular, the same firms should be free to own the tracks and run the trains, as happened in the past. This is the best way of removing the political interference that is holding the industry back.

FOR: Bob Crow, general secretary, RMT

The sheer scale of the chaos over the botched award of the West Coast Main Line franchise played out in the media must have shocked even those who thought that the insanity of rail privatisation could not plumb any further depths.

RMT leader Bob Crow Bob Crow says now is the time for renationalisation

Some 3,200 workers on the [West Coast] line, and hundreds more on associated fleet and service contracts, have been left hanging by a thread. Many of them live and work in areas with a rich and proud tradition as a cornerstone of the British railway industry. The reputation of Britain as the nation that gave the railways to the world has been dragged through the mud by this unmitigated and costly shambles.

Leave aside for a moment the corporate Punch and Judy show between First Group and Virgin and the Whitehall farce that even a scriptwriter on Yes Minister would have ditched as too ridiculous. This fiasco shines the spotlight on the greed and self-serving that has robbed billions in profits and dividends from our railways since privatisation two decades ago.

Now, at last, the vast majority of people are waking up to that cold, hard fact. Recent polls show 70% now support the RMT call for full renationalisation. Online polls show that figure at closer to 90%. The entire political class, including the Labour Party, need to be dragged out of their stupor on this central issue.

With fares set to rise by up to 11% in January to boost private profits, thousands of jobs at risk from the McNulty rail review cuts and ticket offices and stations being smashed up by the politicians and their business allies, the time for renationalisation is here right now.

With the East Coast run efficiently and safely in public hands, and contributing hundreds of millions back to the Treasury and investing in services rather than private profits, the West Coast should be next with the rest to follow under one, single, publicly owned and integrated umbrella.

Bring back British Rail? As an alternative to the greed and chaos on our railways laid bare over the past week? You bet.

 

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  • rate this
    -3

    Comment number 24.

    Woody
    2 Minutes ago
    Yes. Just YES. It's a no-brainer

    You obviously don't remember how bad things were under BR. If you want to know how wasteful nationalised industries were, look at the BBC.

  • rate this
    +3

    Comment number 23.

    Yes. Just YES. It's a no-brainer

  • rate this
    +4

    Comment number 22.

    YES

  • rate this
    +27

    Comment number 21.

    Yes.

  • rate this
    +4

    Comment number 20.

    Trains are run by individuals that have to get things to run.

    If they see an overriding ethos that prevents them from doing their job properly then you will have any number of problems.

    If the profit motive - where other people simply skim - isn't a show stopper then I don't know what is.

    While we are at it - the same goes for the National Health Service.

  • rate this
    -2

    Comment number 19.

    The bidding process was obviously corrupted and probably had been for years which may explain a lot of the problems on the other lines. First Choice didnt just submit erroneous figures they actively fudged the numbers and the the govt was complicit. In this climate we cannot say privatisation as an idea was given a fair crack.

  • rate this
    +9

    Comment number 18.

    Let face it the tories love & want to Privatising every thing at any cost & that usually means the taxpayers who foot bill, what amazes me is how many MP's & Lords have got their fingers in the pie like selling off of the #NHS etc

  • rate this
    0

    Comment number 17.

    IF we had a transport minister that actuly understood transport then maybe we could have ALL of the public transport nationalised BUT until such a minister is found forget it. Lets face it ..EVERY minister in EVERY government has NO CLUE how to run his/her department/s! WHY? Because they are NOT trained for the job/s! They are just 'voted in'!

  • rate this
    +37

    Comment number 16.

    If privatisation had saved the tax payer money & still paid a profit to the train companies for a decent service then it should stay private....

    ....but, as that is the complete oppsite of what happened we shoud re-nationalise it - at least then we'd own what we were subsidising, not subsidising private profit for obscenely rich big businessmen lacking all morals.....

  • rate this
    +5

    Comment number 15.

    Comparison of the railways of the 1800's with today is a nonsense.The Liverpool to Manchester line competed with canal barges and horse and cart.Rail traffic foundered as road transport became more economic.Losing thousands of miles of track under Beeching made rail travel even less attractive.Early 1900 light rail was never a success.Companies were nationalised through failure,not success.

  • rate this
    +6

    Comment number 14.

    Get rid of Network Rail- have train and track run by the same company, public or private.

  • rate this
    -4

    Comment number 13.

    Back in the sixtys there was lotst of nationlised industries, Birtish Leyland, British Steel etc and they were all such great successes that there was common graffitti/joke of the day was

    "Don't let crime pay - nationalise it!"

    but then we all have such short memories

  • rate this
    +2

    Comment number 12.

    Does anyone now have any confidence the proposed High Speed 2 folly financial modelling is also anything but rubbish now too. The lessons from HS1 are over optimistic figures, and public debt.

    WCML debacle - Heathrow constituency bordering on Heathrow Justine Greening ex Transport Secretary has an awful lot to answer for, as this was done on her watch.

  • Comment number 11.

    All this user's posts have been removed.Why?

  • rate this
    -3

    Comment number 10.

    9. Peter_Sym

    What you suggest are assests being sold in "alleged" good faith by the government being stolen back. Do that once and the value of every govt bond and every square inch of land in the UK becomes worthless (see Zimbabwe or 1950's Argentina or Suez etc)

    --

    The last Government did it numerous times - Northern Rock and Railtrack to name but two - where the share price collapsed.

  • rate this
    -4

    Comment number 9.

    #6 thats not share prices falling & I bet 'may be renationalised with no comp' wasn't in the small print!. What you suggest are assests being sold in "alleged" good faith by the government being stolen back. Do that once and the value of every govt bond and every square inch of land in the UK becomes worthless (see Zimbabwe or 1950's Argentina or Suez etc).

    Euro-law makes it illegal anyway.

  • rate this
    -1

    Comment number 8.

    Renationalise and be even more at the mercy of the likes of Bob Crow, now why does that NOT sound like a good idea to me?
    It's hard enough to get rid of incompetent public sector staff as it is, as shown by this debacle, this would make it even more incompetent and unaccountable. & I bet they still get their bonuses if the Unions have their say.

  • rate this
    +7

    Comment number 7.

    "In the 19th Century private firms built and operated a vast network without massive handouts from taxpayers"
    -----------------

    But it was only the force of government which got them all using the same track gauge. The private sector railway companies would still be arguing about whose track gauge was best, if the state hadn't intervened.

  • rate this
    +22

    Comment number 6.

    2. Peter_Sym

    Can someone in favour of nationalisation suggest where we find the cash to compensate the shareholders (pension funds largely)?

    --

    Compensation?

    "The value of your investment may go up as well as down". Always read the small print before investing old chap.

  • rate this
    0

    Comment number 5.

    A fully nationalised rail network effectively means x-thousand railway workers all become state employees and would qualify for the sort of pension the post office, NHS or you local council workers get. Given that 20% of your council tax bill covers their pension costs what impact would this have on ticket prices? (I get no workplace pension at all so yes I am biased!)

 

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