UK’s new model railway is likely to serve the public poorly

For a country that prides itself on bringing railways to the world, Britain has made a fine mess of its own network.

Nationalised trains seldom ran on time. Nor did privatised ones: one in three trundled in late last year. Privatisation proved expensive and messy. The rail service has cost the government some £150bn since it was denationalised a quarter of a century ago. Badly-designed franchises collapsed and a disastrous timetable change unleashed mayhem. It did not even engender promised competition. Two-thirds of contracts have been awarded to single bidders since 2012.

Enter Keith Williams, a former boss of both British Airways and Royal Mail. He has been roped in to remodel Britain’s railways after the system went into meltdown in May 2018. 

The Williams-Shapps Plan for Rail, published on Thursday, envisages a third way: largely ejecting private sector players from the driving seat but avowedly not renationalisation.

Out go fragmentation and migraine-inducing flow charts of ownership, contractual obligations and public/private accountabilities. In comes Great British Railways, a public body that will own the infrastructure, receive fare revenue, run and plan the network and set most fares and timetables. 

This may well have a ring of familiarity about it for readers old enough to have travelled by train before the mid-90s. Readers from countries with modern rail networks may meanwhile be less than impressed with a move to end queueing for paper tickets — although this innovation was enough to clobber the share price of online ticket operator Trainline on Thursday morning.

The benighted franchise model is toast; GBR will hand out contractual agreements to private operators. The latter will take on some of the cost risks to encourage efficiency. But revenue risk, at least initially, lies with the central body. It will plot a 30-year strategy. Longer term contracts could in time see private operators incentivised for lifting revenues, as before.

Williams’ model railway is aimed at cutting costs and ending wrangling over accountability. An illustration of the latter: the 400 full-time “train delay attributors”, staff whose job it is to argue the toss on where blame lies when trains run late.

That justifies the taunt that Britain’s railways have embodied the worst of both worlds since privatisation. Railways, with their huge asset base and public utility status, may be natural candidates for state ownership. But privatisation need not end so badly. Take Japan, where trains have managed to combine safety, cleanliness and to-the-second punctuality with profitability since being privatised in 1987. 

No one expects the UK to match that. More modestly, British commuters, who accounted for roughly half of passenger traffic pre-Covid, will want to know whether they are more likely to get to work on time. They will also want to know if fare prices, up nearly 50 per cent in real terms since 1997, will be kept in check.

The question for taxpayers is one of cost. Government funding last year accounted for a third of industry income. In the five years to 2019-2020, state spending doubled to £5.1bn (including £300m of pandemic support) on operating and maintaining England’s rail network. That was equivalent to £3.67 per passenger journey, according to figures from the National Audit Office.

Williams envisages a better outlook for both camps. The streamlined operation will yield savings; after five years this could amount to £1.5bn a year on top of existing cuts, or 15 per cent of revenue from pre-pandemic fares.

GBR is supposed to raise revenues too. That is a tougher ask. Passenger journeys had been flatlining for years. The move to hybrid working suggests numbers could stay depressed. Novel money-spinners for stations — such as educational purposes — sound fanciful, especially when compared with the billions reaped by overseas networks from their large landbanks.

The Great British Railway represents a stab at putting British back on the rail transport map. But the title is awkward: train services are devolved in Wales, Scotland, London and other areas. If history is any guide, chances are that the epithet “Great” will prove equally redundant.