Rail 492: Darling’s review: change here for a simpler railway system

Britain’s privatised railway is often said to be in a constant state of change. The reality, however, is that the structure may have been transformed – but little else has, contends CHRISTIAN WOLMAR.

Writing this before the publication of either the Rail Review or the updated Ten-Year Plan allows me to look behind the immediate headlines and try to focus on the issues facing the industry once the immediate uncertainty created by the launch of the review has been ended.

Working on the assumption that the leaked version of the review which was sent to me a few weeks ago ( Wolmar, RAIL 490) will not have been changed that much, it is clear the industry faces another set of upheavals.There will be organisational change with the SRA effectively disappearing, safety being transferred to the rail regulator and the recognition that Network Rail must play the central role in determining the timetable.

But there is still, at root, a lack of clarity about the purpose of the structure of the industry and uncertainty about whether the post-review structure will be stable. Now before I hear the huffing and puffing of the industry players bemoaning yet more change, the message from Alistair Darling is clear: this is the start of the change process – not the end – so tough, get used to it and get on with it because it may well take some years. And there is the real challenge. Regardless of those who will tell you that the rail industry is, postprivatisation, in a constant state of change, the reality is that the structuremay well have been transformed – but little else has.

Is the passenger experience radically different? Has the private sector brought creativity, lateral thinking and generally improved the passenger experience? No. In fact there has been remarkably little thinking by the private train operators about how to improve the product andmake a difference to passengers. We are always being told of the good ones, the GNERs and Chilterns, but much of the rest are pretty indistinguishable from what was being offered a decade ago.

Much of the industry has been so preoccupied with the internal change, reorganisations and restructuring according to who has what franchise, that the initiative and flair passengers were expecting the private sector to deliver seems to have got lost and been replaced by the navel-gazing of which this industry is so fond.

So, for example, if the nature of franchises is going to change as expected under the review, the operators should not just whinge about that but use it as an opportunity to rethink the way they have gone about their business. Change management is a wellaccepted discipline in many other industries, but it is an expression that barely features on the lips of senior rail managers. If change is viewed as an opportunity, rather than a problem, think of what could be achieved.

The ideas and initiatives don’t even need to be original – look around and steal them from rail companies abroad, other industries and even each other – but just do it. Take Skoda which turned itself from the biggest joke on the road into a car to which target consumers aspire, and then get the hard-bitten, petrolhead, motoring commentators to declare that the joke is over and Skoda is a car worth having. Given the present state of the industry, the comparison is appropriate and it has been done before.

I was talking recently to the campaign manager for Saatchi & Saatchi who ran the InterCity account for ten years and he told me: “Our advertising campaign made the product seem better than it really was.” At the moment it is the other way around. The railways are nothing like as bad as they are portrayed in the media. So there’s a challenge.

The Prime Minister is always harking on about reformin the public services. Yet, oddly, he never refers to the rail industry, which after all is a public service delivered entirely by the private sector. On occasion, it seems he considers that only those services delivered by the public sector are in need of reform, but that is a mistake.Much of the same inertia and resistance to change can be found in the private sector. You only have to look at Railtrack to see that this is the case. It is only now that there is a dynamic leadership inNR that finally the need for change and modernisation is being embraced.

So far Network Rail is the exception but it is interesting to note the extent to which the views of SRAChairmanRichard Bowker have changed. From being a somewhat starryeyed, adamant supporter of the private sector, after 2 1 /2 years in the top job he has realised where the line between the private and public sectors should be drawn. As he put it to me: “Originally I thought the Government could just draw up a contract and then hand over the work to the private sector. I have learned that you can’t do that. You need a very good informed buyer in the public sector who is always on the case.”

He has learnt about the limitations of what a purely market-led approach can achieve and, to his credit, he is prepared to admit that.He has realised that the way the deal for theWest Coast Main Line was struck between Virgin (for which he worked at the time) and Railtrack – two private sector companies – without reference to the public good was completely wrong. He now believes that in future, theGovernment -Whitehall – should specify and the private sector should deliver. This type of transformation is often referred to as ‘going native’, but that is unnecessarily derogatory. Quite clearly, Bowker has learnt from his experience and he should be praised, not criticised, for that.

What has happened to Bowker needs to happen to the industry as a whole – learn from the events of the past decade rather than simply reinforcing entrenched positions.How many times, for example, have I heard industry representatives saying that things were fine until Hatfield and if that accident had not happened, then everything would still be OK. Wrong. Hatfield was not the symptom of what was wrong, it merely showed there was a cancer at the heart of the system, a result of the fact that, in the original model of privatisation, performance had inadvertently been prioritised over safety. If it had not been Hatfield, it would have been something similar, somewhere else. And finally, if managers need an additional incentive, here’s a little reminder: think of it as a way of protecting your income – because if you fail this time round, the writing is on the wall and the industry will become publicly owned and run once again. But the news isn’t all bad. If past experience is anything to go on, there will be plenty of opportunities to make the odd buck or two out of this – in the short termat least.

Politicians, civil servants and managers should emphasise that this is not necessarily an unhealthy process in itself but those embarking on the process of change must have some idea of where it is taking them. And if there is a watchword that should inform all decisions going forward, it is simplification. What we have learnt from a decade of privatisation and restructuring is that there are far too many interfaces in the industry. Reducing and simplifying them, which was supposed to be the first priority of the review, must become a continuous process. The informal relationships which used to govern many of the processes in the rail industry should also be rediscovered.

Those who are running passenger services should also remember what people actually want – a safe, clean, reliable, courteous and comfortable journey. And if you can’t guarantee the reliable until NR upgrades the infrastructure, then concentrate on getting the other bits right. Otherwise, all this upheaval will have been in vain, the Rail Review will have been largely a waste of time, and we may be left facing a future with nothing more than a skeleton rail service – and wouldn’t that be a real disaster?