Rail 825: Renationalisation is more complex than a slogan

Railways rarely figure in general election debates. Even when the Tories set out their, admittedly vague, plans to privatise the railways in 1992, there was precious little discussion, even though the subsequent break up of British Rail and the sell-off later became a major area of political controversy.

While I don’t think that the future of the railways will be discussed that much on the doorstep, Labour will be tempted to use renationalisation of the railways as a centrepiece of its policy. It is one of the issues that Jeremy Corbyn mentions frequently in speeches. His advisers are enthusiastic, pointing out that in polls more than two thirds of respondents would like to see the railways renationalised.

However, I would caution the Labour leadership not to give too much prominence for an issue that is highly likely to disappoint its proponents. The fundamental problem is that in 2017, it is impossible to re-create the best aspects of British Rail because that has been irreparably broken up. We will not be able to, for example, have that excellent cohort of senior managers who had undertaken every job on the railway from assistant station master at Little Puddleton on Sea to being in charge of train operations at Waterloo. Nor will it be possible to re-establish the financial disciplines that served BR well when introducing improvements at a reasonable cost, such as electrifying the East Coast Main Line which is such a contrast with today’s failures of project management. The Humpty Dumpty railway is in bits and pieces and it is impossible to stick them back together again.

Therefore Labour faces the question of what would ‘renationalisation’ in practice mean? After all, Network Rail is already renationalised and subject to considerable government scrutiny. Although it is in many ways completely dysfunctional, overspending on projects and failing to deliver them on time, this has less to do with the structure of its ownership but, rather, is down to the management skills or lack of them.

The rolling stock is owned by three private companies (ROSCOs) and there is no way that any sensible government would be able to buy it back. Of course new deals could be done through direct purchase, as TfL and Merseytravel have done but it will take decades before the stock is all in public hands.

The third element of the railways, the operations, is therefore the key battleground. Labour has said it wants to take the ownership back in house but the problem is that many deals have been signed stretching into the 2020s. Again, there is no way that a responsible government could rescind these contracts as the compensation payments would be prohibitive. Therefore, the best an incoming Labour government could do is wait for franchises to run out and not let them out again. This is permissible under the Railways Act 1993 whereas, oddly, public sector organisations are not allowed to bid for franchises. Therefore, change will come about only slowly. It will be impossible for Labour to claim to be able to ‘renationalise’ the railways quickly, and nor will it be possible for a new Labour government to do much about the current structure of the railways for a considerable time.

Labour does, of course, have a skeleton in its cupboard which is its relationship with the unions. Few people probably know that actually the RMT is no longer associated with Labour as the party, even under Corbyn, is not leftwing enough for its tastes. Nevertheless, the disruptions caused by strikes over the past year or so will undoubtedly stimulate some Tory attacks on Labour in the regions affected, which now include the party’s northern heartlands.

The other parties are likely to say little about the railways in the forthcoming election. The Tories will be loath to mention them knowing that their biggest project, HS2, has little support either in the party or among the public. It is far too early to be singing its praises, before a sod has been turned (apart from a few minor preliminary works). They are vulnerable on the issue of fares but few people are likely to determine their vote on the basis of their railway policy. Indeed, that is where Labour’s enthusiasm for renationalisation is, in a way, rather irrelevant. While, as mentioned above, many people favour taking back the railways into state ownership, a survey found that only 3 per cent are likely to base their vote on the issue. In other words, renationalisation is in the ‘nice to have’ rather than the ‘definitely want’ category.

None of this is to say that the current structure works well or does not need overhaul. I spend many of these columns writing of the failings of the system and there is no doubt that allowing the franchises to run out and bringing them back in house would save money. Moreover, there is a real need for an organisation that sits between government and the railways. The abolition of the Strategic Rail Authority was prompted by the failings of its management rather than any coherent analysis of the best structure for the railways. Having the Department for Transport run the railways directly is unprecedented in history and clearly unsatisfactory on so many levels, from rolling stock procurement and project planning to fares policy and franchising.

There is an urgent need for a new railway organisation and Labour would be much better pushing that idea than making promises over the benefits of rail renationalisation. They will not get Corbyn a seat on an overcrowded train, as he implied in his botched attempt to highlight the issue on his YouTube broadcast when he was filmed sitting on the floor on a train that was not full.

However, reform should be more about building Network Rail’s capacity to manage projects, to reintegrate the railway as much as possible and to move away from the ideological commitment that franchising is the only way to run the railway.  Labour should focus on other aspects of railway policy and transport rather than simply parroting the mantra of ‘renationalisation of the railways’. The incomprehensible and at times expensive fares structure is an issue worth addressing, as are the massive cuts in bus services across the country.

Of course, the odds of an outright victory for Labour are the sort that were offered for Leicester winning the Premiership last year and that sort of thing rarely happens twice in a lifetime. Nevertheless, this is an important issue as it is part of an ongoing debate that never seems to go away. I have mentioned before in this column that in writing my book Blood, Iron & Gold a few years ago about the world’s railways, I came across a debate in the Italian parliament in the 1870s about rail privatisation and it was the Right that supported it and the Left which opposed it.

I am, of course, a Labour supporter and want the party to do well in the forthcoming general election. That means thinking through policies rather than merely repeating sound bites that appear attractive but are not deliverable.

 

Barking up the wrong posts

The problems with the lack of project management skills in Network Rail have been made all too apparent in the Barking – Gospel Oak electrification scheme in north London. What was supposed to be a relatively straightforward and inexpensive bit of infill of electrification in suburban London has turned out to be yet another headache for Network Rail.

Everything that could go wrong has done so. Sewers have been breached by pile drivers causing flooding and needing 24 hour pumps that have infuriated neighbours, there have been problems with lowering the track sufficiently under bridges, the overhead equipment has not been delivered on time and then found to be ‘incorrectly designed’ and so on.

In one of my rare uses of a car, I have to drive to Walthamstow most weeks to pick up my twin grandsons and I go past a section of the line which is a sad sight, with a few random posts installed, some with the connective links for the wires, others without. It has all the hallmarks of a half finished job left to rot in the elements like those half finished villas that are so common on Greek islands. This is after an nine month closure that was supposed to enable all the works to be carried out and electrification to be completed. Now work will have to be completed in additional closures and there is no clear date as to when it will be completed. If Network Rail cannot get such a small scheme, just 14 miles long right, is it surprising that the bigger electrification projects have caused so much upheaval.

  • Greg Tingey

    Of course the railways ARE nationalised, right now … or NR is at any rate.
    The TOC’s are merely arm’s length supposedly private companies, operating at the arbitrary whim of the DfT.
    What a mess!

    As for GOBLIN, this can definitely be laid at the feet of the Major government & the total mismanagement of “Railtrack”, resulting in droves of experienced engineers walking off. Now, those engineers are needed & restoring that expertise & co-ordination is not going to be easy.

    Don’t expect any politicians, because Labour had the opportunity, 1992- 2010 to right this appalling mess & pretended it wasn’t there, to either admit any blame, or do anything remotely useful.

  • Paul Holt

    Related to MW #2 in http://www.christianwolmar.co.uk/2017/01/rail-818-network-needs-to-be-better-informed-not-competition/, CW could discuss that part of the Labour Manifesto relating to the London-Brighton relief route.

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