Saturday Read: On freezing rail fares
Taxpayers left to cough up even more to subsidise relatively well-off travellers
LEN SHACKLETON AND INSTITUTE OF ECONOMIC AFFAIRS
This week, boasting of the government’s achievements in combatting inflation, Rachel Reeves mentioned freezing rail fares. To economists, this claim is laughable. What the Chancellor is doing just means that the taxpayer is going to have to cough up even more to subsidise relatively well-off travellers. Remember that four out of ten people never use a train from one year-end to the next, because trains are too expensive, too inaccessible, or just too unpleasant.
In the last full financial year, government support just to keep the trains running cost us £12 billion. This did not include our ‘investment’ in HS2 and other new schemes.
We are now approximately at the halfway stage of renationalising passenger services, with big providers such as LNER, Northern, Transpennine, Greater Anglia and West Midlands already back in the public sector. Transport for Wales and ScotRail have been run by the devolved governments for some time.
While it would be silly to expect any significant change so quickly, it is worrying that the current Railways Bill is still fairly inchoate and Heidi Alexander and her team have not yet developed anything recognisable as a strategy for Great British Railways – although renationalisation has been Labour policy for many years.
Part of the selling point of nationalisation was the savings from ending the duplication of privatised management, administration and other staffing, which might do something to improve the industry’s poor productivity performance. But that is likely to mean job losses, and the unions are already making grumbling noises on this.
They are making it clear that they wish to retain – and extend – their veto over meaningful change. Take the case of the reopened line between Oxford and Bletchley/Milton Keynes, intended to be part of the eventual East-West line to Cambridge and the Silicon Fens. The track has been approved for service for nearly a year and a half. But no passenger trains have run yet, or are in immediate prospect.
RMT are insisting that on each train there be a guard or ‘train manager’ whose almost entire function will be to open and close doors. This can perfectly well be done by the driver, as passengers on the underground, Transport for London, c2c and many other services can attest. The union, which won a similar battle on Merseyrail a few years back, is in no mood to give in now there is a Labour government in office, so this expensive new line remains unused. Even if an agreement was reached tomorrow morning, it would be several months before trains could run. Drivers have to be trained and practice on new routes, and ASLEF members, in solidarity with their fellow unionists, have been refusing to provide or undergo training.
Rachel Reeves may regard further subsidising this sort of bloodymindedness as a triumph for her fantasy economics, but I’m afraid I don’t.
This article (Saturday Read: On freezing rail fares) was created and published by Len Shackleton and Institute of Economic Affairs and is republished here under “Fair Use”
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