What would have happened if BR had stayed in the public sector?

It was no surprise British Rail was the last of the big privatisations of the Tory governments of 1979 to 1997. Mrs Thatcher had counselled one of her most ideological acolytes, Nicholas Ridley, against selling of the railways as they were too deeply engraved on the nation’s hearts. British Railways was not as fondly viewed as the trains themselves, but the upheaval was considered too risky.

Not for John Major. The grey prime minister somehow allowed rail privatisation into the manifesto for the 1992 election but it did not matter since they were going to lose anyway. When the Tories surprisingly won the election with an overall majority of 21 seats, enough to see through a five year Parliament, panic set in over the commitment to sell off the railways as no one had thought through how it could be done. After a researcher was apparently sent in a hasty run around Whitehall, the government emerged with a plan, a very thin one in a document published in July 1992 called New Opportunities for the Railways, just 21 sparse pages on how to restructure a massive nationwide industry and break it into more than 100 parts. The ensuing process was messy, with strong opposition not only from rail passengers and British Rail, but also Labour and the trade unions, and, less predictably, even from inside the Tory party.

The legislation was eventually enacted after a bumpy ride in the form of the Railways Act 1993 whose 20th anniversary has just been celebrated in the industry.  But is there much to celebrate? The timing of the demise of British Rail was unfortunate. It had just got its act together and become an effective and well-managed organisation. BR had benefitted from a series of excellent board chairman, notably Peter Parker and Bob Reid 1 (so called because oddly he was succeeded by a namesake). It had created a series of popular brands such as InterCity, Scotrail and Network SouthEast and it had an effective business-oriented structure that meant subsidy was on a downward trend, except in hard economic times. There was a new-found clarity between social and profitable services and there was a generation of very competent and forward looking lifelong railway managers who had been bred on a public service ethos.

There are numerous myths about British Rail most notably over sandwiches and strikes. Criticism of the quality of its sandwiches stretched back to a 1954 episode of the Goon Show but in fact by privatisation, the snack with curly edges and dried chees had long gone. Indeed – and not many people know this – British Rail pioneered the idea of packaged sandwiches and employed the likes of Delia Smith to devise their contents. As for strikes, there were many threats Bob Crow predecessors were as fond as he is of sabre-rattling but the industrial record was mostly good with few strikes. BR over its 50 year history shed half a million staff. Indeed, one of the oddities of privatisation is that the unions have been strengthened and drivers wages gone up by far more than they would otherwise. Indeed, BR’s ability to hone down on its costs would have resulted in far less subsidy than taxpayers are forking out today.

Even in terms of investment, British Rail fared reasonably well. Chris Green, one of its most forward looking managers, devised the concept of total route modernisation, improving both the track and the trains, and the idea was for a rolling programme across the network. That came to an immediate halt with privatisation which led to something of an investment hiatus. As Tanya Gold, in her balanced and sober assessment of its record in her recently published British Rail, The Nation’s Railway ‘By the late 1980s, it seemed BR had dispelled the doldrums…it seemed to have new energy and purpose, a new spring in its step – or its wheel’.

So if it had survived, we would have seen a successful state run organisation gain in confidence and expand its remit. With government backing, it might even have become a successful international player like its foreign counterparts, offering expertise to the world’s growing railway investment programme.

Indeed, to assess what a 70 year old British Rail might have been like today, it’s probably easiest to look over the Channel at SNCF in France (created in 1938) or Deutsche Bahn (created in 1949). These are both huge organisations which have expanded by buying up overseas companies and trying to establish themselves on the world stage. SNCF is in particular strong on consulting while DB is the biggest rail freight operator in Europe. Interestingly, both are involved in rail franchising in the UK while British Rail was banned from bidding for franchises from the outset, despite a late amendment forced on the government by the Lords which technically allowed it.

If there is one telling aspect of the whole process, it is that John Major does not mention rail privatisation in his 816 page autobiography, even though it was a key area of controversy throughout the 1992 – 7 administration. I recently bumped into him and asked  about this omission. He answered that he had wanted to include it ‘but we ran out of time’. Shame the same did not go for his rail privatisation plans.

  • ricp

    John Major conveniently forgets that as Rail Privatisati on was the biggest cock-up of his administration. Costs have more than doubled, and the subsidy quadrupled, and we know the rest. Lack of standardisaion, a multiplicity of suppliers and a loss of the benefits from the economies of scale. It’s a bit of a mess and it is a wonder we get train services at all.
    Industry management has become entrenched in a flawed system, and seem unwilling to restructure, and both politicians, think tank dwellers, and inevitably the Civil Service have not a clue ‘How to put Humpty together again.’ Network Rail as of 2014 is a public sector industry, so that has thrown a spanner in the works to keep the debt off the PSBR, and the TOCS are draining public subsidy into the shareholders’ profits black hole.
    Some laudable concepts have been discussed, but like the original privatisation, none has gone beyond the idea stage, to develop a coherent strategy, and HS2 is being used to divert minds away from the shortcomings of the management structures of the railways.

  • John Bright

    I recall that before privatisation BR was a world leader in railway technology and made huge sums in consultancy. Presumably that was all lost at the time of the sell-off. What must that have cost us over the years?

  • Paul Holt

    Would CW like to consider what would have happened had Beeching not made many journeys only possible by car? In particular, the haste with which the track was ripped up from the most marginal closures, preventing intelligent reappraisal?

  • MrJuniusDunning

    As a good friend of the journalist Tanya Gold, I was surprised to see her credited as author of “British Rail, The Nation’s Railway”. I believe that the true author of this book is someone called Tanya Jackson.