Privatisation was sold to us as a solution, but has brought only problems, says Keith Norman
Renationalising Britain’s railways and maintaining the Royal Mail as a publicly-owned service is not simply a matter of ideology but of common sense.
Since 1993, when the Tories introduced the Railways Act, which broke British Rail into more than 100 separate companies, the cost of operating the same size railway as before has doubled. Like the railways, the Royal Mail is a national service used by the entire population. So it’s no wonder that the vast majority of people in Britain wish to see the railways back in public ownership, just as 89 per cent of Britons, when surveyed earlier this year, strongly disagreed with the idea of privatising the Royal Mail.
Despite the overwhelming popularity of a nationalised railway, none of Britain’s three main political parties dare to consider it, fearing that to do so would mean turning the clock back to a more “socialistic” era.
Just five years ago, despite pleas from then Chancellor Gordon Brown and Transport Secretary Alistair Darling not to attempt to tie the Government’s hands, the Labour conference inflicted an embarrassing defeat when a card vote demonstrated overwhelming support for a publicly owned rail network. The views of 63 per cent of delegates were ignored as Brown warned that re-nationalisation would cost £22 billion. In fact, it would have cost the Government nothing simply not to renew rail franchises once they had expired.
This year it is likely that Labour delegates will inflict a similar defeat over the Government’s plans for the Royal Mail. And , sadly, it is almost inevitable that ministers will again ignore their own supporters and press ahead regardless.
Having made the right decision in putting on hold plans to privatise the postal service, the Government now insists that those plans are not dead in the water. Rather, it is waiting until the economic conditions are more conducive to a successful sale.
You only have to look at what has happened to the railways since privatisation to see this would be a mistake.
Low points have included the establishment and subsequent dismantling of Railtrack and the Strategic Rail Authority and, more recently, the failure of the East Coast rail service operated by National Express.
The Government’s willingness to take over the East Coast service should not be seen as an emergency measure, but as an opportunity to demonstrate that a publicly-owned rail service can be profitable, while reinstating democracy and accountability.
Privatisation was sold as the solution to a failing railway, but has resulted in chaos, not customer choice. The bosses of the train operating companies are among the highest paid in the country, yet the subsidies paid each year to Britain’s private rail companies are substantially higher – in some cases three or four times higher – than those paid to British Rail.
Worse, at a time of almost zero inflation, fares remain among the highest in Europe, overcrowding is a perennial problem and punctuality is below the European average. So, there is no choice, no cost benefit and no greater efficiency.
It doesn’t take a genius to realise that no private company is going to invest substantially in the long-term success of something they might not own in the long term. Just as the current franchise system operated by the Government has starved parts of the rail network of the investment needed for a first-class railway, so postal privatisation will result in the most profitable parts attracting the highest bidders while the service retains its costly but necessary obligation to deliver mail anywhere in the country. The best business brains would struggle to balance the books in such a radically altered organisation.
On the eve of the TUC conference, ASLEF will be considering the implications of further liberalisation of rail and mail and asking how these two essential services can be publicly owned and publicly accountable, and whether customers really do have any choice.
Labour MP Louise Ellman, chair of the Transport Select Committee, who warned earlier this year that the franchise system is in chaos, will be joining Billy Hayes, general secretary of the CWU, Mark Dowd, chair of Merseyrail and me to discuss the “competition myth” on Sunday September 13 at Britannia Pavilion, Express Holiday Inn, Liverpool. All are welcome. l
Keith Norman is general secretary of ASLEF
