A trip to Germany

I have just spent a week in Germany travelling round the whole country by train. And they were impressive. There was the odd delay of a few minutes, but the trains are of a high standard and comfortable, and the service helpful and, mostly, very friendly.

Deutsche Bahn is the dominant operator and runs most of the mainline services and many of the regional ones, but some services have been franchised out to private operators. However, the railway retains a cohesion and a feeling of being a coherent entity that is lacking in the UK with its fragmented and vertically separated structure. There is something comforting about seeing all the staff wear the same uniform, even if, perhaps, there are on occasion just a few too many of them. They did, though, all seem ready to work and provide information, something that cannot be said about all railway staff in the UK.

While travelling in a foreign country, it was particularly helpful to have reservations that not only gave seat and coach numbers, but also gave the platform from which the train would depart. And on the platform, there is always an indicator showing precisely where each coach will be stopping when the train arrives, something that is impossible to do in the UK because the trains are reversed so often.

But as is the fashion, privatisation rears its ugly head and DB has long wanted to float part of its holdings on the stock exchange. For the time being, this has been postponed because the company cannot get into the black, but the intent still remains.

One has to ask – what exactly would such a flotation offer, either for the shareholders or the company. Railways are inherently loss making and while the German intercity services largely pay for themselves – it is doubtful whether they really cover their track charges – the regional ones are subsidised. Therefore once shareholders come into the equation, the thorny issue of dividends being paid out of taxpayers income immediately arises.

While the DB management is dead set against the idea of separating the infrastructure from operations, but nevertheless it does seem that the lessons of the British experience of rail privatisation are not being learnt abroad. As a recent report by the think tank Catalyst, commissioned by the unions, demonstrates, the extra costs of rail privatisation are all too apparent. The subsidy this year is expected to be £6.5bn and there are several ways in which privatisation has increased that bill: fragmentation has meant no one has control over the budget; the rolling stock companies make profits for little risk; the train operators do not invest but also take profits out of the system; and Network Rail has to borrow money at a greater cost because there is the pretence that it is a private company.

Does Germany really want to follow our daft example?

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