If there is one thing that the current rail strike tells us, it is that no one is in charge of the railways. And that, as we have seen, is a recipe for chaos. While the unions clearly represent the workers, who speaks for the railways? Transport secretary Grant Shapps claims it is nothing to do with him, while the train operators suggest in private that they have to ask his department for permission to sneeze. The truth is that the rail companies are piggy-in-the-middle between two warring factions. This uncomfortable situation is the result of a privatisation carried out a quarter of a century ago without the co-operation of the top team at British Rail. They were deliberately excluded from discussions about the structure of the privatised railways after an initial meeting with ministers at which they argued that even if privatisation were the right solution, breaking them up was a bad idea.
Over the course of almost 200 years of rail history, nearly all railways across the world have been run as integrated organisations. In other words, the same group of managers who make sure the railway tracks are properly maintained and ensure the safety of the passengers also determine the timetable and operate the services. Separating the infrastructure from the operations was an artificial divide. The model chosen by ministers was based on aviation, where different companies operate planes, own the airports and control the airspace. But it’s a flawed parallel: controlling planes in the sky is a very different proposition from ensuring that trains stay safely on the rails, with every move circumscribed by the track and signalling.
Contrary to claims at the time, it was not the EU that mandated such a rift between the infrastructure provider (Railtrack then, now Network Rail), the rolling stock companies, and the 20 or so regional train operators — it was the Treasury’s insistence on the need for competition. In reality, the idea of having different operators on the same lines proved unrealisable. In a free-for-all, there would have been fierce competition to run trains at profitable times but no offers to run the lossmaking late-night services.
So franchising was adopted as the dominant model. Until privatisation, the services and infrastructure were still one. But British Rail’s management structure had gone through various iterations: only towards the end of its half-century of life was a robust, efficient system in place. For much of its life, it was dominated by a set of regional barons — railway managers rather than trade unionists — who were loyal to their particular fiefdom, the area services which had been merged during nationalisation in the 1940s. It was only when the power of these regional barons was broken up that British Rail started to become effective. Three business sectors were created to focus on passengers — InterCity, Network SouthEast and Regional Railways. For the first time, the managers had a free rein to make decisions over all aspects — timetabling, cheap fares, investment in new trains and so on — as long as they stayed within budgets set by British Rail centrally in concert with government.
This model worked so well that Intercity’s long-distance services became highly profitable. Even Network SouthEast broke even, a remarkable achievement for a commuter railway that had to cope with the expense of providing trains for two short peak periods alongside spare capacity at other times. The key element of this success was the lack of interference from politicians. Managers were able to make commercial decisions without having to ask permission from Whitehall. And it suggests a solution for the future. Oddly, a new national organisation is about to emerge. This follows the protracted reorganisation triggered by May 2018’s fiasco when a planned national timetable proved too onerous for the tracks on which the trains run.
The new organisation is to be called Great British Railways in an unspoken tribute to the fact that its nationalised predecessor was actually a far more successful organisation than ministers are prepared to admit. Recreating the old BR is not possible, given that so many of its disparate parts — more than a hundred companies emerged from the break-up — have long disappeared. Moreover, the model of the new GBR being presented by ministers has to fit in with prevailing ideology: the private sector must be central, even though there is little scope for conventional capitalism in the railways. Rather than trying to match irreconcilable features of the private and public sectors, the government should admit that a historic mistake has been made and go for a far simpler renationalisation. Put railway managers in charge and confine the state’s role to setting the budget.