This is the age of the train

In 1992, the Conservatives narrowly won a general election. This was not the expected outcome, least of all by the Conservatives themselves. Their manifesto was based on them losing but returning to power quite quickly, having sorted their internal problems out. Instead, they had to keep their crazy promises and have their internal battles publicly.

One crazy promise was a vague commitment to privatise British Rail. BR was, by this time, the last big state corporation. It hadn't been touched before because, conventional wisdom had it, you can't privatise something that usually makes a loss and you shouldn't privatise something that will continue to require subsidies. This is what Mrs Thatcher believed; but she was gone and someone much less intelligent was now in charge (if you can remember who he was, please leave a note in the comments).

British Rail was the most economically efficient railway in the entire world. It received the least subsidy from government of any railway in Europe, yet still managed to be seen as innovative and well-run by other railway administrations. Compared to attempting to make local trips in Northern Ireland or rural France, a BR train – even a crappy Pacer – was a dream. BR actually had very good industrial relations. Not perfect by any means, but national stoppages were very rare compared to both France and Germany of the time.

To meet their crazy promise, the Tories turned to outside interest groups to find ways of privatising BR. Their initial ideas included having trains race between stations – the winner would get all the passengers – an idea that failed when they realised that there are very few places to overtake on a railway. The other bright idea was that fast and well-upholstered trains could be run for businessmen and rich people, whilst another company could provide cheap and cheerful services for secretaries (yes, the rail minister actually said that; that's what Tory government are like, you may now be noticing again).

Eventually, it fell to the Adam Smith Institute, a right-wing, demented pack of liars and thieves masquerading as a pressure group (the modern successor is the much worse Taxpayers' Alliance) to decide that the best way to proceed was to take a hammer to BR and smash it into 137 pieces. Each depot became a Train Operating Company, even though that left the Hull to Liverpool trains being run from Newcastle. The infrastructure – rails, signals, ballast – was cleaved from the operations – trains, passengers – to create Railtrack, which the Tories promised solemnly would be kept as a public corporation, then privatised. Various departments in 222 Marylebone Road were turned into companies and flogged – many, like Red Star Parcels, being bought by a competitor and then simply closed down.

The main aim of privatisation was to destroy the three railways unions (Aslef for the drivers, RMT for the guards and signalmen, TSSA for the managers and supervisors). It didn't quite work: Aslef helped to create a fierce internal market in the railways for drivers, boosting pay into the stratosphere. TSSA found that most of the bigger talent left the industry in disgust, leaving many vacancies for its members – even the ones who didn't go upward saw their pay and terms protected as the new companies looked under every stone for people with some knowledge of how to run a railway. RMT's signallers got massive share options in Railtrack to keep them sweet and the guards got their terms and conditions protected by law. BR itself worked to achieve these things as the clock ticked down to its destruction: it couldn't save the railway, but it could still defend its staff.

What we're left with now is exactly what the Tories wanted. There is competition in the industry. It doesn't work, it was never going to work, and to make it look like it works, the government must throw billions of pounds at it, but they knew that would happen and it didn't bother them (not least because it would be Labour's problem after the next election in 1997). There is still a fierce internal market for skilled staff, with drivers now able to screw ??50,000 and four-day weeks out of the operators: again, a prime example of how markets operate and something to be applauded. There was clearly some elastic in the fares system, and the market has now pushed up ticket prices way beyond inflation every year since BR was disaggregated: again, this is how markets are supposed to work and the Tories should be applauding what they've achieved.

Of course, it now costs 400% more to run Britain's railways than it did to run British Railways. It costs a third more to run our railways than it costs to run the far-inferior and ramshackle SNCF classic lines. The government has to keep pumping money into the system just to have the trains run at all: if the amount they're prepared to pay is too little, the private companies announce they're taking their ball home with them and fuck off – as National Express has done on the east coast and First is doing on the Great Western. It turns out that running a railway for profit and running a railway for passengers are two completely different and unrelated things. If the government wants trains at useful times, it must either pay more now or renegotiate the contract (and pay even more) as it has had to do with First Great Western and Virgin.

This is exactly what the Adam Smith Institute said would happen and wanted to happen. This is exactly what John McGregor, the ineffectual and deceitful Transport Secretary of the time, wanted to happen. The railways are now a market operation with a captive audience – the passengers and the government – and any business with a monopoly of supply will take the customer to the cleaners.

This present unholy Tory government, however, for some reason doesn't like this market operating like a market. Well, it does, but it expected market forces to push prices down (when, in the history of privatisation, did any prices fall once the company was out of state hands?). To get the bill to fall, the Tories need to do something. Now, you and I know that the best way to save money would be to take the profiteering companies out of the system and merge the operating companies and the infrastructure company to create one organisation run at arms-length from the government. You and I both know that it would be best if that organisation was 100% owned by the state and run by a board of experienced railway managers. You could call it the British Railways Board, for instance.

But the Tories don't want that: they say they want to cut costs across government, but they are lying. They're always lying. Tories lie. They have not changed. They want to cut services across government, which is not the same thing as cutting costs at all. That's why they're continuing to do mad things like buy replacements for Trident and fight unwinnable wars against people who will come to hate us. They're not cutting anything expensive, they're just withdrawing services from the people least likely to complain loudly enough to be heard – old people, the disabled, the unemployed, the low paid – saving them fuck all.

To save money on the ludicrous railway market, the big plan is to force pay cuts on staff and reduce terms and conditions. Railwaymen should work longer and harder for less money and have their 10 instances of free travel a year taken away. That'll cut, ooh, fuck all from the system. It won't be any cheaper to run, since the money it frees up (very little money, actually) will be absorbed by the private companies, not by the government. The railways will be much, much less safe, too: but accidents are rare and it takes three or four before a government needs to react, making it the next government's problem (hurrah!).

If the Tories were serious ab
out saving money, they wouldn't be tinkering at the edges of the railways, they'd be reforming them from the centre. But they're not serious about saving money. They're just serious about putting working people in their place.


  1. "British Rail was the most economically efficient railway in the entire world"More than Japan? More than the Hong Kong metro? I’m not entirely sure that’s true."Each depot became a Train Operating Company"No idea if that’s hyperbole or not, but it isn’t true."The main aim of privatisation was to destroy the three railways unions "No it wasn’t. The aims may well have been ideological and free-market, but they weren’t primarily anti-union."Now, you and I know that the best way to save money would be to take the profiteering companies out of the system and merge the operating companies and the infrastructure company to create one organisation run at arms-length from the government"I might well know that, but I also know that such a system would be possibly illegal under EU competition law. A more sensible move would to be to keep NR, allow TOC contracts to expire and then have government contracts stepping in where the TOCs were. The ROSCOs, which you didn’t mention for some reason, were a far bigger scandal than the TOCs if you look at the prices they were sold at compared to their true market value.

  2. JR got a larger subsidy than BR; comparing a national railway system with a citywide metro is comparing apples and umbrellas. The original TOCs were not based on logical line routes or travel patterns but on where the BR depots were, each TOC being based around one or more major hub depot. John McGregor has since admitted that the disaggregation of BR at privatisation was in order to destroy the power of the three main unions. A unified railway is not illegal under EU law (see Belgium, France and Ireland for other places with unified railways) as all the Directive in question requires is that separate accounts are kept for train operations and infrastructure to allow access for freight through-working at the same cost for the incumbent and new entrants. Multiple state-owned TOCs would be only slightly less sinkholes for money than multiple private TOCs are because fragmentation is the main driver of industry cost inflation. I didn’t mention the scandal of the ROSCOs because the government has no plans to alter that cartel by blaming and then penalising the ROSCO’s staff for the government’s own mistakes.

  3. Stupid thing is we’re now approaching our second chance to "do something about this" and start a process.Labour could have started nationalising TOCs because they already had South Eastern on their hands. Under state operation it had a good reputation and there were campaigns to not refranchise it. the Coalition have the opportunity as they have East Coast on their hands. It seems to be doing okay. There’s even the possibility of taking west coast into the same company for a few years. We could have the two main intercity routes in public control very easily. The Coalition will therefore, naturally, refranchise.And we’ll keep going through this pointless rigmarole, with people wondering why we’re bothering, and why we’re spending all this bloomin’ money.The only real bit about the industry changes that you could possibly argue are in the true spirit of privatisation are the open access operators. Hull Trains, Grand Central – they’ve picked up on possibilities that no one else keen to do, and are making a stab at it. But then you have situations like Wrexham and Shropshire where it’s all undermined by a subsidised franchised operator restricting access to stations as it would undermine the business case they based their franchise bid on (not that I can blame them for that)

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