openDemocracyUK: Opinion

The government’s ‘Great British Railways’ is privatisation rebranded

With the ‘fudged’ outcome of a review of England’s railways, the government has missed an opportunity to put passengers first

Cat Hobbs
24 May 2021, 2.03pm
Almost two-thirds of the British public want the railways to be in public ownership
Matthew Clarke / Alamy Stock Photo

When in 2019 the government announced the biggest review of Britain’s railways since privatisation, we knew it was an opportunity not to be missed.

The review was prompted by the totally chaotic introduction of new timetables in May 2018, causing major delays and disruption to passengers, and a blame game between train operators and Network Rail. It was clear that rail franchising had failed. When We Own It, a campaign group I founded against privatisation, met with Keith Williams, the man in charge of the government’s review, in April 2019, he told us that all options were on the table for his recommendations – including public ownership.

Since the break up and privatisation of British Rail between 1994 and 1997, the average price of a train journey has increased by 23.5% in real terms. And train rolling stock is in fact now on average older than it was in 1996, even as train-leasing companies pocket millions.

No wonder 64% of the public want the railways to be in public ownership.

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Together with Bring Back British Rail, We Own It told Keith Williams in no uncertain terms that passengers want our railway in public hands. We handed in a petition signed by 120,000 people.

But the outcome of the review – held back for 18 months during the pandemic – is a fudge. “Great British Railways” sounds like a shiny new way of running the railway, but it’s really the same old privatisation, tweaked and rebranded.

That’s despite the fact that if our railway was run in public ownership, the country would save £1bn a year, enough to fund an 18% cut in rail fares, pay for 100 miles of new railway track. Because we wouldn't be wasting money on shareholder profits, fragmentation, and the higher cost of borrowing in the private sector.

What changes and what doesn’t in our fragmented railways

There are two fundamental problems with privatisation of the railway.

One is the leaking out of dividends to shareholders – money that could have been reinvested in improving services.

The other problem is fragmentation. With more than 20 private rail companies running the services, there are too many cooks, no clear line of accountability.

The new “Great British Railways” could go a very small way to tackling the second problem. The publicly owned body will have responsibility for ticketing and timetables as well as train tracks and stations. Combining functions of the Department for Transport and Network Rail into one body is a step in the direction of a guiding mind, or what journalists have delighted in calling ‘The Fat Controller’. Taking more direct control over what rail franchises will deliver in terms of fares and train times moves national rail towards the Transport for London model. Instead of letting train companies call the shots, the new body, supposedly, will be in charge of deciding what passengers need and making sure the companies deliver.

But it’s hard to see that there will be a clear line of accountability. Private rail companies will still be in charge of running services – and the government is still promising them their freedom.

The private sector has guaranteed profits while the public sector bears the responsibility if things go wrong

Transport secretary Grant Shapps says he wants to create “a single familiar brand” that he hopes people will come to love but is simultaneously singing the virtues of “unleashing the competitive, innovative and expert abilities of the private sector”. Keith Williams talks about “real accountability when things go wrong”. But they can’t have it both ways. Who should passengers contact when things go wrong? Great British Railways or the unleashed private sector?

In the new model, rail franchises are being replaced with “Passenger Service Contracts”. Franchises are simply a type of contract, so this is not a big change – it just means a shift to a slightly different type of arrangement, where the private rail companies won’t be bearing revenue risk – so passenger numbers can go up and down and the profit line won’t be affected.

In other words, yet again the private sector has guaranteed profits while the public sector takes the risk and bears the responsibility if things go wrong. A familiar story.

This is what happened during the pandemic, with the government paying out £12bn to the private rail industry to prop them up while passenger numbers dwindled.

It could be so different

Both Scotland and Wales have made the sensible decision to bring their railways into public ownership in response to the failure of the franchising model. England had the perfect opportunity to do the same.

The UK government had already been forced to bring franchises into public hands when the private companies failed – the East Coast line in May 2018 and the Northern franchise in March 2020. But when the pandemic hit, instead of introducing public ownership across the board, the government suspended the franchise model while guaranteeing the income of the private rail companies. “Great British Railways” is a continuation of that decision, dressed up as real change.

In March 2020, while we were waiting for Keith Williams to conclude his review of the railways and make his recommendations, a far more useful document appeared. Labours’ Plan for a Nationally Integrated Publicly Owned Railway did what this government has failed to do. It offered a real vision for our railway in public hands, and a plan to get there. It outlines how the railway can be structured locally, regionally and nationally, how it can copy best practice from elsewhere and deliver for the climate, how it can offer fair fares and a strong voice for passengers.

While Keir Starmer included public ownership of the railway in his ten pledges for a Labour government, he has not always been as vocal about this as many would like. In September 2020 shadow frontbencher Lisa Nandy seemed to row back on this pledge, stating that public ownership was “one way” of doing things – and Starmer failed to set the record straight. But it appears that shadow rail minister Tan Dhesi MP and shadow transport secretary Jim McMahon are both still calling for public ownership of the railway.

Public ownership could deliver a guiding mind for the railway and take private shareholders out of the equation to deliver better services. Yet it seems clear that Keith Williams was told at the start of his review process that private companies must continue to run trains in England, come what may. If the government ever decides to really put passengers first, there’s a plan ready and waiting.

This is a huge missed opportunity – and Great British Railways won’t be truly great until it’s owning and running the trains directly.

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