Thursday, 5 July 2012

Labour's biggest risk: renationalising the railways

Back at the beginning of April, with Labour starting to make some headway in the polls, I wrote a piece for LabourList entitled “7 Steps to Re-election.” I drew up a list of possible, some slightly tongue-in-cheek, policy ideas that could catapult the party into power. The need to take the odd risk, get a bit radical, was uppermost in my mind. Among them a personal favourite: renationalising the railways.

Predictably, this drew derision from the comments section - some wondering whether this was a belated April Fools - and Twittersphere. You can always rely on fellow Labour folk for support!

And then last weekend, when doing my own Sunday paper review online, I stumbled across this gem in The Observer, and the headline: “Labour backs calls to return railway network to public control.” According to the paper:

“Plans to bring the national rail network back under public ownership in order to halt big fare increases and prevent private companies siphoning off huge profits will be considered by Labour as part of its policy review.”

This comes off the back of a detailed report released this week by the Transport for Quality of Life think tank, and its publication, Rebuilding Rail; a union funded report, although its authors maintain that their research is thorough and wide-ranging.

The report claims that over a billion pounds a year could be saved if the railways came back under full public control. The current system of privatised railways is:

“failing society, the economy and the environment, whilst draining taxpayers’ money into the pockets of private shareholders. Common sense and expert railway knowledge have ceded to a misguided private-must-be best ethos, leaving Britain with a fragmented dysfunctional railway system that other countries view with disbelief.”

The biggest myth surrounding privatising is that our system was ever truly privatised. Taxpayers have gone from forking out £2.4bn pre-privatisation (the period 1990/1-1994/5), to around £5.4bn post-privatisation (2005/6-2009/10). Renationalising the railways could see users benefit from an 18% reduction in their fares.

At present, Britain’s commuters pay far more than their European counterparts (four times more in some cases), and are continuously faced with a baffling and convoluted ticket price structure, which, despite assurances, never seems to get any simpler.

The report notes that throughout Europe between 80% and 100% of passenger train services are run by the public sector.

Labour’s Shadow Transport Secretary, Maria Eagle, welcomed many of its findings and recommendations, and said the party was keeping an open mind:

"Labour's policy review is looking at all options to make our railways work better for passengers with nothing ruled out, including whether the not-for-dividend model that works for rail infrastructure should be extended to rail services."

According to Stephen Joseph, chief executive of Campaign for Better Transport, transport could well play a part in deciding the outcome of the next general election. He points out that a key number of marginal constituencies in outer London and the south-east are stuck in commuter belt territory. Every fare rise hits families hard, eating into the wage packet.

Whilst passengers get treated like fools, the bosses of Network Rail reward themselves handsomely with bonuses of £1.7m, despite missing many punctuality targets last year.

I have long wondered why political parties are so reluctant to make transport an election issue, considering how many people rely on buses and trains. Inevitably, the economy will take centre stage, with the NHS following closely behind, but Labour will be missing a rather large trick if it doesn’t seek to use the trains as a potential voter winner. Surveys consistently show the public rejecting private ownership.

It could start off by distancing itself from the flawed HS2 project, which may well be dead in the water come 2015, anyway. If £58bn can be found for such a misguided and poorly thought out scheme, surely something which saves taxpayers money should be in the offing? A commitment to renationalising our railways would be Ed Miliband’s riskiest and boldest move yet. But, it could also be his most rewarding.

This article was first published by Speaker's Chair on Thursday 5th July 2012

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