Back To Beeching - 40 Years On And More Cuts ??????

[johndibben]

Finally, someone will have to explain to me why market disciplines won't work in the UK railway industry. When done well, deregulation seems to have produced improvements for consumers in a lot of other former state industries.

A toughie ....

I would say it's the 'network' side of things.

Electricity, gas, telephones etc., all have networks for the use of a single product or fed into by by seperate suppliers as a single product.

Other competition simply comes from billing and 'paperwork'.

Airlines have no rigid network but as the skies become more crowded, similar problems to that of the railways are emerging.

[Goingnorth]

Don't forget that the motorist alone puts in some £42 billion per year into the tax pot, so in theory there is plenty of money coming from transport sources, it's all about wider government issues...

Exactly. There is a finite amount of money for the Government to spend each year on our behalf. Government expenditure in the UK for 2001/2002 was expected to be £394 billion with 30% of that for Social Security, 17% for Health and 12% for Education. It seems unrealistic to demand that the Government spends more and more on railway services to support branch lines that see little use. If we do demand that the Government directs money to support such rail services then we have to accept that money has to come from elsewhere in the budget or that the budget has to increase - i.e. more tax or more Government borrowing.

Finally, on the money sprend on SE TOCs. Remember that Network rail is speading £1 billion on 3rd rail upgrades which is far more than Scotrail ever got. Historically most money has been spent in the SE on railways and other services. Most of the network has good track and is power signalling. Many lines in Scotland have track dating from the 1930s and signalling from a similar period.

The whole point about subsidy is more money if spend on areas where you have a thinner spread of population, or more distance between nodal points. The regional/London arguments are too simplistic, it depends on how you measure benefits in terms of things like tourism, social parity and so on.

The important point is that the London area generates 17.5% of Britain's entire GDP and yet the amount of Government railways funding it receives is less than one tenth of that received by Scotrail.

Essentially it is an political and planning argument rather than a straight case of certain things don't pay. There are much wider issues at stake. Leaving things to the market, profiteering with low taxes seems sensible in the short term. But this very policy has caused a great deal of problems today.

Are the UK railways being run as a social service or are they supposed to pay their way? If they are a social service it doesn't matter how much tax-payers money is lost each year we have to accept that as the price to pay. If they are supposed to pay their way then the current set-up is flawed with funding decisions on Britains railways not being based on economic or cost vs benefit analysis.

Finally, someone will have to explain to me why market disciplines won't work in the UK railway industry. When done well, deregulation seems to have produced improvements for consumers in a lot of other former state industries.

Firstly, as it has been stated, the current set-up is costing more than 4 times the cost of BR. I think most would prefer to see waste cut back, less middle management and more kit on the railways, in hospitals and so on. If the 'system' was more efficient, then a great deal of money could be saved. It's certainly a better alternative than closing lines.

Railways are part of the nations fabric, like telecoms, emergency services, water and gas supplies and so on. The point about social security and subsidy, if you try and help areas to get back on their feet. Closing branch lines would see those areas in ever more serious trouble, and if the money was diverted to London would cause greater overheating in the economy there.

The disciplines don't work in the rail industry, primarily because the privatisation process has caused a 4 fold cost increase. That said, outlying branch lines (like water pipes, electricity pylons etc) never make the money back they are supposed to, because geographically there isn't the demand. Either because of the thin spread of population or because people have less income.

I currently live in the north of England and my train service starts at 8am and ends at 8pm. Even though our line services an area of some 900,000 people the service is terrible. Many people in the south east have an extremely good service, and would be shocked at the state of the network elsewhere. Why on earth divert money into areas that enjoy premium services already and let the rest of the country die?

Feeding areas of high demand would on the surface make good economic sense. But congestion costs industry a great deal of money. Spreading money to other area lets other economies grow, and helps prevent centralisation which has many hidden costs.

Oh BTW, I think your talking about subsidy to the TOCs. In fact L&SE area is having more money spend on it that you think with the £1 billion 3rd rail upgrade! More money that Scotrail ever got. In fact much of the track in Scotland is interwar or before. Much of the signalling is 1930s or before on a great deal of lines. While the London area is power signnalled in the main.

Much of the rest of the money has gone on the CTRL (another SE project) or the WCML. Don't forget people that jouney into London from Manchester, Birmingham, Liverpool, and Glasgow bring a lot of money into the capital in the shape of business or tourism.

[Kevo00]

Outside of the central belt Scotland's rail system is particularly poor, with many areas not served by rail at all, others served by only occasional trains and many lines having many "parliamentary" stations with only one or two trains a day. Not to mention the fact that fewer GNER and Virgin services seem to be venturing north of Edinburgh these days. Recently I saw some track being replaced at Perth - and one of the rails that was lifted said that it had been made by Colville's in 1948.

Meanwhile if the subsidy since BR days for the whole system has increased fourfold (to £4bn per year) then the solution is logical - re-establish some form of unified structure but keep the subsidy at £4bn. Without the lawyers fees etc. there would be no excuse for underinvestment and secondary routes and branchlines could be continously improved to meet their potential. Naturally this would probably be against EU law and is too logical for the government to do for fear of upsetting too many powerful friends, but it is the solution to the problem.

And as for the south east - well why not use the profits from the services there, which surely must be considerable to invest in further improvements to service? Easy really. And under a unified structure mainline profits could even be used to cross subsidise branchlines but thats probably far too logical...

[anakha]

Railways are part of the nations fabric, like telecoms, emergency services, water and gas supplies and so on.

Telecoms, water, gas, electricity etc. are all services operated and managed by private enterprise in the UK. If they are part of the nations fabric - a crucial part of national infrastructure - why can they operate successfully in private hands and the railways can't?

The disciplines don't work in the rail industry, primarily because the privatisation process has caused a 4 fold cost increase.

The idea that the privatisation in the late '90's proves that market disciplines can't work in the rail industry is a myth. No-one would deny that the privatisation has turned out to be a disaster. After the privatisation was completed it was subsequently reported that a top civil servant said he was told simply to privatise the railways as soon as possible and to make the process irreversible before the 1997 election (i.e. the Conservative Government wanted to see the railway privatised at any cost rather than not privatised at all). The mistake to make is to believe that a botched privatisation proves that any form of private management of railways would also prove to be as bad.

From my limited knowledge of the industry, I understand that for all TOC's, any gap between passenger revenues and the operators’ costs is filled by public subsidies. Those who designed the privatisation expected TOC's to become more efficient and be able to pay a fee to the government. Hence, subsidies decline over the life of the franchises. Between 1998 and 2004, it was thought that total subsidy would fall from £1.8 billion to £1.1 billion with the remaining subsidies then supporting only socially necessary franchises - mainly in rural areas etc.

However, because of incentive schemes like Railtrack/Network Rail (RT/NR) paying TOC's if it causes too much delay to their trains, RT/NR has no incentive to get more trains into the timetable, as this simply increases the risk of delays that it will have to pay for. This impacts on the ability of TOC's to generate more revenues and so be able to reduce the amount of subsidy received.

TOC's could only add services if RT/NR found slots for them and RT/NR was given no financial incentive to do so as almost 100% of its income from track usage is fixed regardless of the number of trains.

Add this sort of thing together with things like new franchise contracts for TOC's and it's easy to see why so much more money is required and it's clear that the problem isn't the fact that the railways are in private hands but that the methods used to get them there and regulate them once they were there have fundamental flaws.

As far as I know Japanese National Railways was privatised in the late '80's and the railways in that country are held up as examples to the rest of the world. Strong evidence that market disciplines can work in the rail industry.

[Goingnorth]

No - the *privatisation process*. The railways were privatised by a bunch of civil servants that knew nothing about how the industry worked. There were advised by experts and the BR board NOT to proceed with the particular set-up they chose - which I believe was advised by the Adam Smith institute.

The current set-up has too many interfaces and relies on contracts to weld the thing together, rather than hard engineering or operating discipline. The sheer amount of interfaces has caused a rise in middle management, consultants and a compensation culture. A railway were an assisting engine has to come from 200 miles away because the broken down trains TOC has depot at that distance, rather than borrowing one stuck in a nearby shed. Anyone who works inside the industry knows what an incredible waste and lack of cooperation there is. The civil servants were influenced by political dogma rather than any real knowledge.

A better system would have been the regional vertically integrated network, rather than the present model. But that, on the surface, wasn't so attractive financially. I'd be in full support of this, plus a new network of high speed lines (before we are completely left behind Europe) and conversion of some urban lines to metro and trams.

The network needs a lot of new investment in some areas, and I think this is also a source of the problem. With demand for signalling engineering and civil engineering skills high, naturally prices rise. But there is also add-ed costs by the HSE, principally so Tom, Dick and Harry from Bloggs engineering can work on the railway, rather than skilled pway men. There's costs associated with addition engineering possession protection and closure of all running lines in some cases, so unlike Europe, we can't use bi-directional signalling.

In short it's a lot of self-imposed nonsense. And you can get around the EU problem by leasing the tracks to regional companies, for say 99 years.

As for the profit. Don't forget the full benefits of having a rail network. Transport 2000 calculate that the Industry is WORTH some £4bn to the country each year, rather than the costs people believe. This is because of the tourism and extra business a fast railway creates, plus less pollution, congestion and accidents.

If we want to get real about costs, a 40 ton HGV does 10,000 times more damage to a road than a car. Should we charge hauliers £120,000 road tax per year?

[boeing126]

No we should charge hauliers more they are a pain in the backside and a danger to society,I,v been knocked of my byke by one of these foreign german juggernauts driving one of these rigs with the wheel on the wrong side (left hand drive) you wanna hear em on c.b. radio they are never watching the road this guy the knocked me off was eyeing some bit of crumpet up who passed him in a toyota,thats all they think about all day.Then he had the cheek to say i was to old to be riding a byke,cheeky sod.

[johndibben]

You wouldn't last long in Milton Keynes I'm afraid.

The amount of people with asthma here is alarming and the amount of traffic must be a contributing factor. On a bike, if the HGV's don't hit you, you'll end up coughing and wheezing after a while. I have a bike found it very unpleasant on a main road and now it stands in the barn (shed).

People living near their place of work or using public transport to commute would help. 40 years ago, most did just that, simply because they had to. Didn't hurt them and Bletchley was a far more pleasant place to live in. It's still wonderful though.

[boeing126]

Hi John,Its just the same in Manchester and it gets right up my nose when i buy a packet of cigarettes and it says smoking kills,Whats needed is health warnings on the side of cars and lorries.