Does anyone know the process by which the railways were nationalised last time? I presume each company was taken under government control individually, then they were operationally merged over a long period of time (years? decades?). Clearly that is the most likely way any further nationalisation will happen this time around, with the benefit that a large % of the TOCs are already there.
Yes, many people know how and why the railways were nationalised in the first place, you only have to look it up!
A, brief, history lesson!
One hundred and six years ago Sidney Webb wrote what became the original Clause IV of the Labour Party’s constitution:
To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service.
Twenty years later in view of the inevitable coming war the Government placed practically all the railways under Government operational control under an order made under Regulation sixty nine of the Defence (General) Regulations 1939.
In 1942 two significant internal political events occurred. Firstly, the annual Labour Conference, with an eye on its constitution and Clause IV, passed a resolution urging the Government to coordinate road, rail and canal transport under national ownership - with the aim of aiding the war effort. This was show business as by this time the railways were already operated as one unit by the Ministry of War Transport so it wasn't such a big step to suggest they should be combined as one business.
In November of the same year the Beveridge Report was presented to parliament. This report was the result of a cross-party study aimed at identifying the principles necessary to banish poverty and 'want' from Britain. Its recommendations were to be implemented after the end of the war. The Report proposed a system of social security which would be operated by the state:
Social insurance fully developed may provide income security; it is an attack upon Want. But Want is one only of five giants on the road of reconstruction and in some ways the easiest to attack. The others are Disease, Ignorance, Squalor and Idleness.
Beveridge's suggestions were adopted by all the political parties for the 1945 election with Labour, considering its Clause IV, adding national ownership of the ‘commanding heights’ of the economy. After the election the Attlee government created its version of the Beveridge Report recommendations by setting up the NHS, thereby nationalising the hospitals; setting up National Insurance in 1946 and created a safety net by the National Assistance Act of 1948. It also nationalised about a fifth of the economy:
◦ coal;
◦ railways;
◦ canals;
◦ docks and harbours;
◦ road transport;
◦ the Bank of England;
◦ civil aviation;
◦ external telecommunications (Cable and Wireless);
◦ electricity;
◦ gas; and
◦ steel.
(Internal telecommunications were already operated by the General Post Office, the GPO, with the exception of those in Hull).
The 1947 Transport Act nationalising all commercial inland transport set up the British Transport Commission to oversea this huge conglomerate and to encourage each form of transport to specialise in the types of services for which it was most suited. The railway companies to be nationalised were those listed in the order made under Regulation sixty nine of the Defence (General) Regulations 1939 so some small ones slipped through the net.
The aim was the coordination of inland transport, so it would have been sensible to have set up the BTC functionally - engineering, operations, commercial, financial and so on - so the most effective mode, or modes, for a particular movement could have been identified. But the Act setting up the BTC also set up its 'agents' by form of transport, the Railway Executive (RE), the London Transport Executive (LTE), the Waterways Executive, Road Haulage and the Hotels Executive. The Government appointed the members of these Executives directly, not the BTC.
Of course the result was that each Executive fought its own corner and the BTC had little or no control over them - it did not control the Executives' budgets except at the highest level, it could not move Members of an Executive to a different job or fire those who were thwarting the aims of the Commission because these members of the Executives had been selected by the Government.
The RE continued to manage the railways as if they were still the ‘Big Four’ except that they were now called ‘Regions’ and not ‘Companies’. The boundaries between them remained untouched until some changes were made a dozen or so years later.
The BTC’s financial remit was vague, to say the least ‘To break even taking one year with another’. No requirements about return on capital or service levels or market share or improvements in safety or anything else. And the Common Carrier conditions for the railways and canals were still in force which the Government did nothing to remove. And the Transport Commissioners for Rates - a Government creation - ensured that income lagged behind costs.
The result of all this was the decline of the railways over the next 35 years to near insignificance. Loss of freight traffic, loss of passenger traffic, closures of miles of railway even before Beeching, the waste of money developing and building the BR Standard steam locomotives, the loss of 10 years development in diesel traction and the refusal to extend AWS until the Harrow accident. And so on and so forth.
In the late 1970s, early 1980s was there an attempt to further tighten and focus the business management of the railways — originally set in train (see what I did there?) by Dr. Beeching — with the emergence of the ‘Sectors’. Initially these operated through the regional operating framework but eventually the regional structure faded away.
Then came ‘privatisation’…