Rail 534: Defence of privatisation decadcade disregards the downsides

It’s ten years since the handful of passengers on the 0510 Twickenham-Waterloo unknowingly made history as the pioneers of rail privatisation. CHRISTIAN WOLMAR assesses TOCs’ progress.

The tenth anniversary of the first privatised train passed with little attention, despite a press release from the Association of Train Operating Companies which touted the huge benefi ts that had occurred over the decade. I remember that journey well. It was the 0510 from Twickenham to Waterloo on Sunday February 4 1996. In fact, the fi rst train was the service linking the Irish ferry from Fishguard, but that started out as a bus replacement service, and there was also a 0105 from Waterloo to Eastleigh, but South West Trains was desperate not to let journalists travel on it as that too was a bus for part of the journey.

So the official first train became the Twickenham service, whose half-dozen normal passengers train were rather surprised to be joined by a bunch of bigwigs and journalists (who did not include the Transport Secretary Sir George Young as he clearly preferred a weekend lie-in, nor any of his fellow ministers equally intent on their beauty sleep). The poor regulars were even more shocked to discover an army of ticket inspectors at Waterloo who promptly nabbed several of them, since normally these early-dawn travellers would have been able to travel for free.

Subsequently, such vigilance about fare dodgers has been the exception rather than the rule, with TOCs surprisingly showing as little interest in collecting marginal revenue as their BR predecessors. Indeed, the London suburban railway has long been a free railway after 2000 unless the fare dodger is unlucky enough to get on one of the rare trains where tickets are checked.

A campaign in the Evening Standard has highlighted the extent to which London stations are unstaffed after hours, with a frontpage story citing the ‘229 dangerous rail stations’. Now much of this might be hyped up, to say the least, and stations are not quite the war zone that has been portrayed, but the London tabloid does have a point in arguing that the train companies could provide adequate security at the stations for a fraction of the millions they make in profits from running the trains. (It is rather entertaining to hear Associated Newspapers’ finest sounding like Bob Crow). And some of those people could even check the tickets.

OK, so the private operators have not been as good at preventing fraud as they had set out to be, but what is the rest of their record like? A reader expressed the challenge perfectly (RAIL 532) when he said that I had made a powerful case for vertical integration (in my book extract in RAIL 531), so “where is the counter-argument for a system based on contracts between a large number of private providers?” I couldn’t have put it better myself.

Well, ATOC has at least partially taken up the challenge. The aforementioned press release is a brave attempt to set out the arguments in favour of what has happened in the past decade even if it makes no attempt to justify completely the existing structure, which would be an intellectual impossibility. ATOC gives ten reasons why there has been a period of ‘positive change for Britain’s railways’.

First, growth: passenger journeys have risen 42% and, secondly, the number of services has increased to 19,600, a rise of 20%. This is undoubtedly a commendable achievement but the extent to which it is the operators’ actions that have generated this increased patronage remains questionable. There has been economic growth every quarter for more than 13 years, and in the previous long growth period – 1984-89 – rail use grew at a similar rate of around 3% a year. The recently published Transport Trends 2005 shows that usage of the London Underground, which remains essentially state-run, pretty much mirrors that on the national rail network until 2002 when, because of major improvements in bus services, usage has flatlined.

There has undoubtedly been some imaginative marketing, such as Stagecoach’s recent megatrain experiment, but most of the growth is simply generated by the booming jobs market and higher incomes for leisure spending.

On investment in new trains, ATOC says more than 4,800 passenger train vehicles costing £4.7 billion have been introduced on the network and average age has now gone down to 13 years from 16 a decade ago. True, but average age will rise again, as it did in the early years of privatisation, because there are very few orders in hand. Nor is the achievement that impressive. The rate of investment over the past decade is about a fi fth better than in the last ten years of British Rail when 4,000 vehicles were purchased. And we are now saddled with the expensive leasing system for older stock that means the taxpayer is shelling out £850,000 for six sets of two-car 67-year-old Tube trains on the Isle of Wight.

Fourthly, ATOC says there have been 19 new sections of passenger line (totalling 157 miles) and 51 new stations have been added to the rail network since 1995. Yes, but most of these were schemes generated by BR or Passenger Transport Executives before privatisation, and the cost of reopenings has now become prohibitive thanks to the large number of ‘stakeholders’ involved. Again, very few new schemes are in prospect.

On passenger information, there has undoubtedly been a revolution for the better. The system under BR was a haphazard mess which had never been properly addressed and National Rail Enquiries is an unquestioned success. The website, too, is a fantastic service, though one must stress that state-owned rail companies such as Deutsche Bahn have equally good sites.

I will skip over the sixth point, passenger satisfaction, as there is no base measurement and those sort of surveys are pretty meaningless but the seventh – safety – is of great significance. ATOC points out that the “the downward trend achieved by British Rail in the number of accidents per train kilometres has been improved on”. That is undoubtedly true. The last fatal rail accident was Potters Bar in May 2002 (discounting Ufton, caused by a suicidal motorist) and this is the longest period without a fatal train crash in the history of the railways. And it is true that the rate of reduction of accidents has accelerated since the end of BR (in other words, the railways are getting safer at a faster rate than before).

Just to make it more complicated, there is no doubt that because the privatised railways were perceived by the public – spurred on by that irresponsible buffoon John Prescott – as being more dangerous, a lot of extra spending on safety had to be made to reassure passengers that companies were not putting profi ts before safety.

The eighth point covers improvement in stations such as CCTV and ticketing. Well, yes, there has been improvement in some stations but the claim that “in 2003/04, more than £675 million was spent on maintaining, cleaning and improving Britain’s railway stations” is totally fatuous without any comparative analysis. BR, too, spent money on stations! And recently a Commons committee delivered a harsh verdict on the state of stations, saying “far too many small and medium-sized stations were threatening places, with poorly-lit, graffi ti-covered passages and platforms” (RAIL 533).

Specifi cally, the committee was critical of the existing structure, saying too “few TOCs had joined national crime reduction schemes”, despite studies suggesting they could increase passenger numbers by up to 11%, and that private sector investment in stations had been discouraged by the “sheer number of bodies involved, all at loggerheads about who is responsible for what”.

The last two points concern bus/rail links and community rail partnerships. ATOC says that “over 250 stations have Plus Bus schemes enabling a bus add-on fare to be added to a rail ticket for onward travel by bus”. Well, yes again, but lack of integration, even when bus and rail operators are owned by the same company, remains the norm, which is partly the fault of government competition rules that suggest ministers are more concerned with ensuring there is competition rather than co-operation.

On Community Rail Partnerships, these have flourished with more than 60 schemes, but this is largely a voluntary effort and while support from operators is welcome, it is the energies of dedicated local people which ensure their success.

There is not the space to consider the downsides here, such as the high cost of the railways, the lack of vision, the absence of co-ordination between companies, the profits needlessly extracted, the billions spent on consultants to set up this structure, and the uncertainties caused by the almost constant changes in the past decade.

So it is no surprise that when Peter Hendy, the new Transport Commissioner for London, asked at the recent Railway Studies Association dinner, “hands up anyone who thinks the present structure is optimal?”, there were no takers in the 250- strong audience.