Rail Review a hastily put together compromise

After all the kafuffle, the rail review is something of a damp squib. It was announced in January by Alistair Darling, the Transport Secretary, after he became exasperated at the ability of the railways to absorb taxpayers’ money while apparently being unable to provide a decent service.

There was much talk of fundamental reform for a railway which Darling had recognised was ‘dysfunctional’. The key issue was integration. The biggest mistake of the Tories’ privatisation was the separation of what was then Railtrack (now Network Rail) and the train operations. In private, ministers liked the idea of reintegrating them to form strong local unified companies.

But then it all got too difficult. Tom Winsor, the now departed Rail Regulator, fulminated in the sidelines, arguing that the review was pointless and warned that ministers must not tamper with the contracts with the private companies or he would see them in court. The various vested interests in the railway all argued for their corner and ministers shied away from the radical reform that is so clearly needed.

Reintegration was seen as too difficult to achieve, even though many train operators favour the idea, as the existing contracts would have had to be modified. Other radical ideas such as doing away with the performance regime – which employs an army of over 300 clerks to check who is responsible for delays – have also been quietly ditched.

So, as ever with this type of process, we have ended up with is a compromise, which shows all the hallmarks of being hastily put together. Indeed it was still being thrashed out at the eleventh hour by civil servants and ministers last week and there are an awful lot of details missing.

There are some sensible changes, The Strategic Rail Authority, created four short years ago by Labour, is to be abolished because, bizarrely, ministers now say it was the wrong sort of organisation which could never exercise the necessary authority since it was up to ministers to determine long term rail strategy. So one could ask why they created it in the first place?

Ministers will exercise more power over the industry, an eminently sensible move given that it is now costing taxpayers £5bn per year. They insist that politicans will not run the railways directly but that will be a difficult promise to keep since they will now be held responsible for things when they go wrong, making it difficult for them to keep their hands off.

Another sensible move is the decision to hand safety over to the new Office of Rail Regulation on the basis that spending decisions on safety measures have to be made within the context of what is affordable. Unions and victims’ groups may not approve, but the railway is a very safe industry and spending on measures with very little benefit has contributed to the soaring costs.

However, these are all administrative changes that are aimed more at keeping costs under control than making the railway better for passengers. While ministers hope that a slightly simplified structure will eventually deliver some improvements on punctuality and reliability, it is a long haul and there are none of the short term electoral gains which ministers had hoped could be achieved when they first announced the review.

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