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
    0

    Comment number 324.

    Several UK rail franchises are operated by subsidiaries of mainly European state owned railway operators: Abellio is owned by Netherlands State Railways; DB of Germany owns several train operating companies; Govia is part owned by SNCF.

    This, and the experience of East Coast Rail, suggests that it is not essential to have private sector ownership to run efficient rail services.

  • rate this
    0

    Comment number 323.

    Dr Richard Wellings may hark back to the 19th century, but seems to forget that in those days people didn't have cars, so of course they used trains.

    For me the problem is a lack of integration. This is a national network which should be run by one organisation-more specifically one person; Sir Richard

  • rate this
    0

    Comment number 322.

    313.Mel0dymaker
    4 Minutes ago
    @ David H,

    Bicycles don't necessarily need roads.
    ====
    Correct, they are equally happy causing havoc on pavements to skip lights, Zebra Crossings to cut corners/jump traffic, Riding in pedestian only streets etc etc...

  • rate this
    0

    Comment number 321.

    "315.SurRob

    I thought the reason overly complex privatisation wasn't a success was ... "

    The reason it wasn't a success, in fact reason it ever happened at all, was investors being told the West Coast line upgrade would be 'free' due to Moving Block Signaling, which unfortunately even now does not exist. Read this and weep...

    http://www.guardian.co.uk/world/2004/apr/01/transport.politics

  • rate this
    0

    Comment number 320.

    @ Mel0dymaker

    Roads don't necessarily need bicycles

  • rate this
    0

    Comment number 319.

    We were told that only private money could give the investment in infrastructure, yet on First Great Western the same 36 year old trains are being used that were bought by British Rail. Then we have the safety fragmentation. It is instructive to see some of the archive British Transport Films training videos to see how much the rolling stock and track used to be examined. Not now.

  • rate this
    0

    Comment number 318.

    Adam Smith, the theorist most adored by the Tories, said that transport should not be in private hands, and he was right.

  • rate this
    +1

    Comment number 317.

    "87.krokodil

    I note Mr Crow does not say how it would be paid for ;)"

    There's nothing to say - it'd be paid for exactly as it is now, by subsidy. Assuming for argument's sake the private companies make a 10% profit, then nationalization instantly saves the 10% of the tax payers subsidy that is currently just given away never to benefit the uses.

  • rate this
    +1

    Comment number 316.

    Honestly BBC; could you not find someone on the "For" side slightly more credible than Bob Crow?! It should be clear from this whose side the BBC is on in this argument.

  • rate this
    +1

    Comment number 315.

    Gosh what a political football.

    I thought the reason overly complex privatisation wasn't a success was that the ROSCOs (effectively monopolies that own the trains themselves) wandered off with all the profits (several £Bn) as they owned all the trains, so could lease them out to whichever franchise was selected at the price of their choosing.

  • rate this
    0

    Comment number 314.

    Taxpayer subsidies have, however, reached unacceptable levels, at around £5bn a year. And costs are much higher than on comparable networks abroad.
    ---------------
    Just one very simple question. WHY?

  • rate this
    0

    Comment number 313.

    @ David H,

    Bicycles don't necessarily need roads.

  • rate this
    +2

    Comment number 312.

    @ 285.
    Richard "The biggest problems on the railways are caused by failures at Network Rail, a public sector company."

    Were network rail not renationalised not that long ago because the private sector was failing to maintain lines and had been deemed responsible for causing train derailments !

  • rate this
    -1

    Comment number 311.

    304.Bear in the Bull
    5 Minutes ago
    While we're about it, let's see ALL of our road tax spent on the roads, rather than this ludicrous trend towards "public£ toll roads.
    ====
    There is no such thing as Road Tax now: http://ipayroadtax.com/
    ((BTW, I don't support that site...
    Bicycles are un-insured, non tested hazards... don't get me started))

  • rate this
    -2

    Comment number 310.

    Nationalised services are grossly inefficient and reward years of service rather than competence.

    I remember the railways as a nationalised service and it was awful.

  • rate this
    0

    Comment number 309.

    The fragmented and bureaucratic rail system that we have at present is worst than any nationalised system. A framework of targets and accountability ought to be created, in which a new and rejuvenated national rail organisation can operate. Develop the infrastructure, get more people onto the railways, and costs per passenger down.

  • rate this
    +1

    Comment number 308.

    303.John Airey
    4th October 2012 - 23:54

    "The claim that subsidies of the railways are too much does not take into account the huge cost of maintaining our roads (which fuel and vehicle excise duty do not cover)."

    This is ill-informed and wrong. The amount spent on roads is little more than ONE THIRD of the DVLA's annual revenue - without even starting to consider the tax revenue the petrol.

  • rate this
    +1

    Comment number 307.

    Yes... Nationalise, then
    Bob The Boiler can call everybody out on strike the next day
    for some benal reason, like the trains are the wrong colour.

    on the plus side though
    It means we won't have endure "British Rail Sandwiches"

  • rate this
    +4

    Comment number 306.

    It's difficult to see how Wellings can square the circle he creates when on the one side he says that subsidies are out of control (£5bn) and on the other that nationalised industries are inefficient. The private railways now receive twice as much subsidy as when under public control. His appeal to history offers equally poor value to the tax-payer.

  • rate this
    +2

    Comment number 305.

    More like train manufacturing should be nationalized, anybody can run a service but we should have our own hi tech train manufacturing which could lead to exports instead of buying our trains off canada and germany.

 

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