Should the railways be nationalised?

[htafc]

Afternoon all. First of all, apologies for returning to a rather oft-mentioned topic. However, I am undertaking a school project into the question "Should the railways of Great Britain be nationalised?", and would like to know the opinion of forum users.
Please indicate, using the poll, your view on the question, selecting one of the four options. Please also indicate your relationship to the railways, e.g. enthusiast, driver (this is optional).
The poll will close at the end of the month.
If anybody would like to explain their selection in the thread, please feel free to do so.

Many thanks!
HTAFC



Edit: also, if you would like to suggest an improvement to the poll, please do!

 

[507020]

The railways of Great Britain should be fully nationalised (as the railways of Northern Ireland are!) but as good as it is to stop the industry from haemorrhaging money to rentier shareholders, I do feel that more pressingly it is the industry structure which must be fully returned to a vertically integrated system, with all train crew depots and passenger services remerged into a single operator, with the same body carrying out all track maintenance and owning all rolling stock, without micromanagement from the DfT.

 

[zwk500]

I say this as I'm currently trying to formulate my Master's thesis research question so apologies if it's a little harsh: You are not going to be able to arrive at a single answer for this question. Are you talking in economic, political, ideological, or social terms? Are you measuring public opinion only or also considering empirical measures such as revenue vs costs, punctuality and service level?
There is also a world of difference between the two conclusions 'the railway should be nationalised because it will serve the people of the UK best' and 'the people of the UK believe that they will be best served by the rail network being nationalised'. See also the difference between something being in the Public Interest and something being interesting to the public.
I appreciate it's a school project, so the objective may not be to arrive at an answer, but feel free to DM me if you want to discuss how to refine the question.

Slightly more complicated, the current railway system is already nationalised. NR is state-owned, a number of operators are part of a DfT-owned structure called the Operator of Last Resort and nearly all the rest of the TOCs are on management contracts dictated by the DfT. The only truly private operations on the network are Open Access operators (Lumo, Grand Central etc) and Freight/Charter operators.

For your survey, I have ticked 'other industry member' because despite no longer working for NR I may potentially return, and many of my friends are still working there. I've also ticked enthusiast and rail user, as I approach the railway from those angles as well. I personally would split it into 2 questions, as 'what do you think the structure should be' and 'what is your point of reference to the rail network' are different parts of your answer, although I don't know if the forum allows you to do such things.

 

[GRALISTAIR]

I personally would split it into 2 questions, as 'what do you think the structure should be' and 'what is your point of reference to the rail network' are different parts of your answer, although I don't know if the forum allows you to do such things.

Two separate threads possibly?

 

[zwk500]

Two separate threads possibly?

Possibly, although it seems slightly excessive to start a new thread, and you would lose any cross-question analysis if the forum allows it (although I doubt it).

Personally I'd create a quick survey in Google or Menti and post the link on this thread. That would then allow questions such as 'should the railways serve social needs before financial concerns' or similar. Again, happy to discuss any proposals with the OP over DM but I get the sense a school project won't be big enough to have a proper quantitative analysis.

 

[MattRat]

The problem with business is the focus on profit, the problem with Government is the focus on power. Whatever the solution, it has to be independent from both and made to serve the public, not use them as pawns for their own means.

 

[LUYMun]

Slightly more complicated, the current railway system is already nationalised. NR is state-owned, a number of operators are part of a DfT-owned structure called the Operator of Last Resort and nearly all the rest of the TOCs are on management contracts dictated by the DfT. The only truly private operations on the network are Open Access operators (Lumo, Grand Central etc) and Freight/Charter operators.

The intention of railway privatisation in the 90s was to pass the infrastructure and maintenance procedures to private firms, resulting in the creation of Railtrack. We all know how that fiasco turned out, and in the end Network Rail was created by the DfT to transfer the assets, thus one could argue that it was "renationalising" a major part of the railway network.

 

[Horizon22]

In my view, the concession model is the best approach. If the principle of GBR is applied, the DfT should be really high-level strategy and say "you have £££ to spend these 5 years and it must include projects X, Y, Z" with some key performance targets, but otherwise an operator gets on with it on behalf of GBR / TfL / TfW / other devolved bodies. That is a very simplistic version, but you get the idea!

Right now you've got DfT micro-management which is probably the worst of both worlds.

 

[DanNCL]

As far as ownership goes I think it should be nationalised. Private companies should not be getting management fees for running trains, especially when companies like TPE don’t even provide half of the trains they’re contracted to provide.

However, it’s clear the government does not have the competency required to make any decisions about the railway.

I think an ÖBB style setup is what we need, where it’s a publicly owned company free to make its own commercial decisions and has an incentive to make customers happy, in turn generating more revenue. The profitable routes pay for themselves, the unprofitable routes would continue to receive subsidy.

 

[43066]

In my view, the concession model is the best approach. If the principle of GBR is applied, the DfT should be really high-level strategy and say "you have £££ to spend these 5 years and it must include projects X, Y, Z" with some key performance targets, but otherwise an operator gets on with it on behalf of GBR / TfL / TfW / other devolved bodies. That is a very simplistic version, but you get the idea!

Right now you've got DfT micro-management which is probably the worst of both worlds.

I agree with this, preferably with some level of revenue risk and commercial freedom assumed by the concessionaire, to give them a commercial incentive.

 

[JonathanH]

As far as ownership goes I think it should be nationalised. Private companies should not be getting management fees for running trains

How far down the chain should nationalisation go? Is it reasonable to pay a private company to construct the rolling stock, to manufacture signalling, to provide other consumables?

Should freight operators be nationalised?

It seems to just be management fees that people are objecting to, while also objecting to a national body, the DfT, specifying services.

Who is to say that 'the railway' would specify better services than the DfT given the same budget? Some of the DfT people would no doubt have to transfer to the public body that would run the railway. Moreover, the Treasury would still set the budget.

The problem with business is the focus on profit, the problem with Government is the focus on power. Whatever the solution, it has to be independent from both and made to serve the public, not use them as pawns for their own means.

The railways don't make a profit though, so the Government has to meet the balance of its costs. It is therefore never going to be independent from both.

If you read Hansard debates from the time of British Rail, you see a railway needing to justify funding from Government, and that is when it was nationalised.

 

[DanNCL]

How far down the chain should nationalisation go? Is it reasonable to pay a private company to construct the rolling stock, to manufacture signalling, to provide other consumables?

There's obviously going to be some element of private companies supplying services, for example building new stock. I'm not suggesting a return to the BR method of doing everything in house (and even then BR still bought in stuff from private companies).

Should freight operators be nationalised?

I'm not suggesting nationalising the existing freight operators. That said, a nationalised freight operator in addition to the existing private freight operators, ran solely to make profit, would be a good way of increasing the funds available for the passenger network.

Who is to say that 'the railway' would specify better services than the DfT given the same budget? Some of the DfT people would no doubt have to transfer to the public body that would run the railway. Moreover, the Treasury would still set the budget.

I think you've missed a very key bit of what I suggested. My suggestion was that it would function as a commercial company. DFT involvement would be limited to specifying minimum service levels and funding the loss making parts of the rail network. A minimum service level is exactly what the word 'minimum' suggests, a minimum that has to be provided. If it makes commercial sense to provide a better service than the minimum specified service level, the freedom and incentive would be there to provide it, unlike at present.

The railways will never be profitable as a whole. But there are several parts of a railway that could make a profit that currently aren't, for example the ECML long distance services. We know that can make a profit as it's done so in the past, and with the right commercial decisions taken to encourage additional custom it could return to profit again.

There are other ways the railway could generate extra revenue too, for example with merchandise. Again I'll refer to ÖBB; you can buy plenty of ÖBB branded items both online from their web shop and onboard Railjets. Indeed Virgin did the same in the UK; you could buy for example Pendolino shaped Jelly Bean boxes from the on board shop:

Image from: https://twitter.com/peterre71664668/status/442350995490996225 , found on google images.

Obviously that isn't going to make the railway financially independent from the government, but it would make it less dependent on government funding.

 

[Bletchleyite]

I've got a Merseyrail Class 507 cuddly toy, and so has my little nephew. Yeah, contracting a company to do merchandise is just free money. Not lots of it, but any money is good.

 

[Thirteen]

TfL already sell merchandise through the London Transport Museum. Indeed, my Christmas present to myself and my future brother in law was Elizabeth Line moquette socks. I do wonder who is the market is for some of the other stuff they sell though, they have furniture with moquette patterns for over £1000.

In my view, the concession model is the best approach. If the principle of GBR is applied, the DfT should be really high-level strategy and say "you have £££ to spend these 5 years and it must include projects X, Y, Z" with some key performance targets, but otherwise an operator gets on with it on behalf of GBR / TfL / TfW / other devolved bodies. That is a very simplistic version, but you get the idea!

Right now you've got DfT micro-management which is probably the worst of both worlds.

I agree the concession model is the best approach. Things like the London Overground were massive improvements both in terms of reliability, rolling stock and the station themselves. You will still have some issues such as cancellations and strikes but overall it's a very solid model.

 

[zwk500]

I'm not suggesting nationalising the existing freight operators. That said, a nationalised freight operator in addition to the existing private freight operators, ran solely to make profit, would be a good way of increasing the funds available for the passenger network.

This presumes that the freight comaony can make a profit....

 

[philosopher]

TfL already sell merchandise through the London Transport Museum. Indeed, my Christmas present to myself and my future brother in law was Elizabeth Line moquette socks. I do wonder who is the market is for some of the other stuff they sell though, they have furniture with moquette patterns for over £1000.


I agree the concession model is the best approach. Things like the London Overground were massive improvements both in terms of reliability, rolling stock and the station themselves. You will still have some issues such as cancellations and strikes but overall it's a very solid model.

TfL ironically probably have more commercial freedom than most of the privatised train operators, despite TfL being nationalised.

 

[DanNCL]

TfL already sell merchandise through the London Transport Museum. Indeed, my Christmas present to myself and my future brother in law was Elizabeth Line moquette socks. I do wonder who is the market is for some of the other stuff they sell though, they have furniture with moquette patterns for over £1000.

There must be a market for it, can't imagine they'd sell those sofas otherwise!

This presumes that the freight comaony can make a profit....

Freight companies can make a profit. GBRF is profitable.

 

[zwk500]

Freight companies can make a profit. GBRF is profitable.

Lots of shops are profitable, doesn't mean other shops don't go under. The freight market is very tight. Squeezing it further for general traffic may not be possible, especially if the parcels delivery proposals come to fruition and snap up that sector.

 

[tbtc]

I’m not intending to get into a debate about which system is better but I don’t believe that anyone is arguing for a truly Nationalised Railway or a truly Privatised one

I think we all accept that there’s a role for private companies building (at least some) trains and supplying kit, i don’t think that anyone is proposing we nationalise WH Smith/ M&S Simply Food/ Wetherspoons/ Starbucks, just like I can’t imagine anyone suggesting that “BR” owns the forests to supply the wood used in the toilet paper on their trains

We all accept that private companies can make a profit in at least some aspects of the railway (even if some people draw the line at TOCs making a profit)

Similarly, nobody seems to be arguing for a railway with no state subsidies (despite it being a knee jerk accusation if someone else dares suggest that it might be worth trimming back some highly subsidised areas). The question is how much subsidy is appropriate - if you are subsidising journeys on a line so heavily that it’d be cheaper to put passengers in electric taxis then maybe heavy rail isn’t the best tool for that particular job (although clearly there are a lot of markets that it’s suited to)

The question (for me) should be about what delivers the best results - e.g. I don’t have an opinion on whether Network Rail should use contractors or keep everything “In House” because I’m happy to go with what is most efficient - I’ve can see both arguments (one is more flexible to handle fluctuating staffing requirements as projects come on stream and are completed… The other would maintain a directly employed workforce and ensure stability of contracts) - I’d rather we focused on things like “given the quality threshold, what delivers best value for taxpayers” than obsessed about the political “ownership”

 

[Bletchleyite]

Similarly, nobody seems to be arguing for a railway with no state subsidies

I think to be fair there are a couple of people on here arguing for that. Not yourself, though.

 

[InkyScrolls]

The problem with business is the focus on profit, the problem with Government is the focus on power. Whatever the solution, it has to be independent from both and made to serve the public, not use them as pawns for their own means.

I couldn't agree more. There is no golden bullet.

 

[zwk500]

I’m not intending to get into a debate about which system is better but I don’t believe that anyone is arguing for a truly Nationalised Railway or a truly Privatised one

I think we all accept that there’s a role for private companies building (at least some) trains and supplying kit, i don’t think that anyone is proposing we nationalise WH Smith/ M&S Simply Food/ Wetherspoons/ Starbucks, just like I can’t imagine anyone suggesting that “BR” owns the forests to supply the wood used in the toilet paper on their trains

Regardless of the model I think the key thing is that day-to-day management of the railway is left in the hands of the railway managers not the whims of the DfT. I do broadly agree that a 'mixed' approach is going to be the most effective.

I think to be fair there are a couple of people on here arguing for that. Not yourself, though.

Similarly I think there are some people on here who argue for cost to be completely ignored.

 

[InkyScrolls]

Full nationalisation leads to funding being highly dependent on the government of the day, leading to endemic short-termism. Full privatisation leads to closure of all but the most profitable routes. (The railways as a whole do not make a profit, but certain sections do.)

I doubt I'm the only one who believes that the best solution is a nationally unified brand, e.g. GBR, operated by one or more private companies, with the DfT specifying a minimum service level. Said operator is then free to run six trains a day (say) between Skipton and Lancaster, and milk the WCML for all it's worth.

 

[tbtc]

I think to be fair there are a couple of people on here arguing for that. Not yourself, though.

Fair enough, I’ve not noticed, I’m just aware that every time I’ve suggested making a minor cut or raised a question about the wisdom of some spending (e.g. the million pounds plus spaffed on a Barton Line station that has a trickle of passengers) it seems to cause a knee jerk reaction of “this is just like Serpell” from the kind of people who think that any minor cut will lead to the sky falling in

You’d think I was Alan B’stard from some of the reactions I’ve had

If people cry wolf so much then it’s easy to ignore the occasions that they are complaining about someone genuinely wanting to remove ALL subsidy

Similarly I think there are some people on here who argue for cost to be completely ignored

Yup, usually with some waffle about the “bigger picture” and a “holistic approach”… accuse others of lacking the “vision” to truly appreciate the “wider economic benefits” (which coincidently can’t actually be quantified)

Personally, I’ve no problem with subsidising the railway but the costs need to be seen in the context of other spending options; as long as it provides good value to taxpayers then I’ve no complaints (but heavy rail isn’t the only tool available to government)

 

[Horizon22]

I agree the concession model is the best approach. Things like the London Overground were massive improvements both in terms of reliability, rolling stock and the station themselves. You will still have some issues such as cancellations and strikes but overall it's a very solid model.

It's helped because its very focussed on London and its needs and given a key budget to improve things where other operators maybe saw those stations as less of a focus. Same with the Elizabeth line stations and services which perhaps GA and GWR further out didn't really see as a priority when managed by those TOCs. TfL have a model of staffing, stations and service that they know works and, as you say, has seen considerable results even with an extensive initial outlay in cost.

I couldn't agree more. There is no golden bullet.

Ideally we'd have a technocracy ("Here's your budget, get on with it. If you want more money, give us a business case") but there is no model that wouldn't have its flaws. Ultimately where large sums of money are involved, there is a political element.

 

[brad465]

Privatisation only works where there is effective competition. Having private contractors to deliver rolling stock/projects therefore probably works, but having them run services on the effective monopoly routes less so. It's also worth remembering that we already have a number of nationalised operators by virtue of them being other country's nationalised operators. Furthermore, anything that gets the "privatise profits, socialise losses" tag applied is better off being nationalised, so at least in the profitable times there is a benefit, unless it's not of strategic value, then it can be privatised on the condition that if it fails, it fails.

 

[Nicholas Lewis]

Privatisation only works where there is effective competition. Having private contractors to deliver rolling stock/projects therefore probably works, but having them run services on the effective monopoly routes less so. It's also worth remembering that we already have a number of nationalised operators by virtue of them being other country's nationalised operators. Furthermore, anything that gets the "privatise profits, socialise losses" tag applied is better off being nationalised, so at least in the profitable times there is a benefit, unless it's not of strategic value, then it can be privatised on the condition that if it fails, it fails.

Not so sure about that the franchises had to hold a parent guarantee which were substantial sums and basically that money had to be burnt through before the keys could be handed back saving the taxpayer money.

 

[eldomtom2]

I think you've missed a very key bit of what I suggested. My suggestion was that it would function as a commercial company. DFT involvement would be limited to specifying minimum service levels and funding the loss making parts of the rail network. A minimum service level is exactly what the word 'minimum' suggests, a minimum that has to be provided. If it makes commercial sense to provide a better service than the minimum specified service level, the freedom and incentive would be there to provide it, unlike at present.

I think the problem there is that you'd want to set the minimum service levels for most services quite high, since you'd be running on the assumption that no further services would be provided.

 

[Western Lord]

The problem is that many people are in favour of nationalisation but not government control, as if there is some kind of ownership by the state but not the incumbent government. However if the government tries to adopt an arms length approach as with the current disputes those same people complain that the government won't talk to the unions. You can't have it both ways.

 

[zwk500]

The problem is that many people are in favour of nationalisation but not government control, as if there is some kind of ownership by the state but not the incumbent government. However if the government tries to adopt an arms length approach as with the current disputes those same people complain that the government won't talk to the unions. You can't have it both ways.

The problem with the current disputes is that the government is claiming it's arms length, but it's actually in up to it's neck. That would be quite different to a true arms-length situation.