Labour has hailed its new plan for Britain’s railway as ‘the biggest overhaul to our railways in a generation’ – but can it deliver?
Labour leader Sir Keir Starmer and shadow transport secretary Louise Haigh
You wait ages for a transport policy from Labour then two come along at once. Hard on the heels of their plan to bring bus services under public control, we now have Getting Britain Moving, their plan for the railway.
This too leans heavily towards public control and away from private companies, which suggests, with Louise Haigh at the helm, that some of Corbyn’s approach to policy is alive and well, though Starmer of course will never put it like that. And Corbyn would certainly not have had the Union Jack emblazoned on the front cover, which now seems obligatory for any Labour publication or public event. Nor, in fact, would the vast majority of Labour MPs and activists.
The impression given by the media, and indeed by Labour itself, is that what is proposed is a radical departure – “the biggest overhaul to our railways in a generation” is how Louise Haigh puts it.
That is objectively true, though the hyperbole deployed overstates the changes, for the reality is that a great deal of the spadework has been done by this government and accepted by Labour.
It is acknowledged by nearly everyone that the pre-Covid franchise arrangements were past their sell-by date, and that fragmentation within the railways has been adding costs and complications unnecessarily. When you have a dispute as to who bears the cost of disruption when one sort of animal as opposed to another is on the track – Network Rail or the train operator – then you know something is wrong.
The government’s answer through the Williams plan (Shapps has been unceremoniously deleted from the joint credit he awarded himself) secured widespread approval. The plan was published in May 2021, a date already delayed due to Covid.
Yet three years since publication, we are still waiting even for the simple Bill to establish Great British Railways. This is firmly down to the prime minister who hates railways and has continually blocked attempts by Mark Harper and Huw Merriman to make significant progress. I am told that he, in effect, told Mark Harper to shut up when he was arguing in cabinet for the Bill to be given legislative space, and after all, it would probably have passed all its Commons and Lords stages in less than a week. So instead we have a pointless draft Bill when the whole thing has already been microscopically analysed since 2021.
Most recently the PM is also said to have stopped the transport secretary from making a meaningful intervention to save the Alstom plant at Derby. Fortunately, a botched way round that impasse seems to have been found.
Labour is going to turn the putative Great British Railways into something more like British Rail
Labour seem sensibly content to adopt a great deal of the Williams plan, even, for the first time, accepting the name Great British Railways.
One major difference relates to the involvement of the private sector in running trains. Consequently, a great deal of media attention has been given to the proposal to “fold in” to Great British Railways the existing contracts with train operators as they expire one by one. Labour is going to turn the putative Great British Railways into something more like British Rail.
There is of course an alternative that marries the need for public accountability and direction with the innovation the private sector can bring. This, after all, is the model employed in London for London Overground and also London Buses, and one that Andy Burnham is rolling out for his Bee Network in Manchester.
In these cases, everything of importance to the public is decided by accountable bodies, and contracts are let for the private sector to deliver. It is similar to the arrangement for supported bus services which I thought worked well when I was running a bus company in Brighton, the Big Lemon.
Opponents argue that reverting to “British Rail” is dogmatic rather than pragmatic, and that it fails to take into account the doubling of passenger numbers under privatisation, ascribed to private sector innovation. It is losing the opportunity for the best of both worlds.
Those who support the plan point out that the lines now being run by the state, especially LNER, are doing rather well, thank you very much. They also point to the huge bureaucracy associated with contracts. The one for East Midlands Railway, for example, runs to 527 pages and about 263,000 words.
You have to ask, however, what the attitude of the existing contract holders, the TOCs, will be between now and contract expiry. Realistically, why would they do anything other than the bare minimum when they have an execution date inked in.
One proviso in Labour’s plan that has received little attention states that contracts can be folded early “if they are broken by operators who fail to deliver for passengers”. There may be lucrative work for the lawyers yet.
The dog that isn’t barking relates to the ROSCOs. As I pointed out in an earlier piece for Passenger Transport, the ROSCO big boys (and girls) saw their profits treble in one year, with a whopping £409m paid out to shareholders in 2022/23
The dog that isn’t barking relates to the ROSCOs. As I pointed out in an earlier piece for Passenger Transport, the ROSCO big boys (and girls) saw their profits treble in one year, with a whopping £409m paid out to shareholders in 2022/23, up from £122m the year before. Profit margins are 41.6%.
Train companies spent £3.1bn, 26% of their overall expenditure, on train leases in the year to March 2023.
This avalanche of money tumbling out from the industry dwarfs in significance what the TOCs are receiving, yet Labour propose to do nothing about it, despite union agitation. Their plan says it would “not be responsible to take on the cost of renationalisation”. In other words, Starmer and Reeves won’t wear it.
It is interesting and welcome that Labour plans to allow the continuation of open access operators. But give it time, and Treasury civil servants will be whispering in ministers’ ears that this is income abstracted from the state and which could be captured if open access were wound up. Not true, in my view, but it has long been the standard Treasury line.
Getting Britain Moving is good on analysis, identifying in particular the passenger frustration with overcrowded trains and cancelled services. Ms Haigh, who wants to be known in office as the Passenger-In-Chief (a nice touch) has set out six tests for the railway, which should be: reliable, affordable, efficient, quality, accessible and safe.
That would seem to cover all bases. The question is whether this sound analysis leads on to policy interventions that will deliver the outcomes desired.
The largely unspoken assumption underpinning the plan is that there will be no extra cost to the Treasury. This is almost certainly a pre-requisite demanded by Rachel Reeves, the shadow chancellor.
On the plus side, the elimination of waste and duplication is estimated to save £1.5bn a year, a figure taken from the 2021 Williams plan. Ms Haigh thinks this can be upped to £2bn by eliminating the sort of contracts like the East Midland Railway one referred to above.
There is also an assumption that the £25m a day which the ASLEF strikes are costing will be saved, though if Labour think ASLEF are going to meekly end their industrial action just because there is a Labour government, they may be disappointed. But the plan’s promise that “individual and collective rights of work are protected and strengthened” looks like an abandonment of any meaningful attempt to update often very old and inappropriate working conditions, for example relating to Sunday working.
One stand-out promise in the paper is Labour’s Best Price Guarantee, which sounds good but what exactly does it mean?
One stand-out promise in the paper is Labour’s Best Price Guarantee, which sounds good but what exactly does it mean? If it means that someone at a ticket machine will always get a ticket at the same price as they would at the ticket office, that might be achievable, notwithstanding software challenges.
But does it mean that the split ticket price available online now becomes the default best price? It should really, but that suggests a big bill for Rachel Reeves to pick up as the price of a great many journeys would fall.
And how will best price be measured when it comes to advance tickets, subject to dynamic pricing?
Automatic delay and cancellation refunds will be welcome for passengers, but of course that cannot apply to those with paper tickets.
Labour’s plan says that “prices are kept, wherever possible, at a point that works for both passengers and taxpayers”. (My italics). With due respect, this is a meaningless sentence and insofar as it isn’t, it simply reiterates the approach taken by successive governments over many decades. It doesn’t suggest a whole lot of progress on cutting fares any time soon.
Labour could find money to cut fares if they ended the ludicrous freeze on fuel duty and started to make airlines pay for their environmental cost rather more
Of course Labour could find money to cut fares if they ended the ludicrous freeze on fuel duty and started to make airlines pay for their environmental cost rather more. Don’t place any bets on this, though, despite the clear logic.
What is welcome, and essential, is the clear pledge to introduce in the first session of the new parliament a Railways Act to do what the present government has been dithering about since 2021. We need this to give a clear direction forward. And certainty over this way forward will in itself act as a spur for action.
The train, at last, will be rolling and picking up speed. Just mind the gap between the rhetoric and the reality..
ABOUT THE AUTHOR: Norman Baker served as transport minister from May 2010 until October 2013. He was Lib Dem MP for Lewes between 1997 and 2015.
This story appears inside the latest issue of Passenger Transport.
The plan arriving at platform one…
by Passenger Transport on May 2, 2024 • 11:22 am No CommentsLabour has hailed its new plan for Britain’s railway as ‘the biggest overhaul to our railways in a generation’ – but can it deliver?
You wait ages for a transport policy from Labour then two come along at once. Hard on the heels of their plan to bring bus services under public control, we now have Getting Britain Moving, their plan for the railway.
This too leans heavily towards public control and away from private companies, which suggests, with Louise Haigh at the helm, that some of Corbyn’s approach to policy is alive and well, though Starmer of course will never put it like that. And Corbyn would certainly not have had the Union Jack emblazoned on the front cover, which now seems obligatory for any Labour publication or public event. Nor, in fact, would the vast majority of Labour MPs and activists.
The impression given by the media, and indeed by Labour itself, is that what is proposed is a radical departure – “the biggest overhaul to our railways in a generation” is how Louise Haigh puts it.
That is objectively true, though the hyperbole deployed overstates the changes, for the reality is that a great deal of the spadework has been done by this government and accepted by Labour.
It is acknowledged by nearly everyone that the pre-Covid franchise arrangements were past their sell-by date, and that fragmentation within the railways has been adding costs and complications unnecessarily. When you have a dispute as to who bears the cost of disruption when one sort of animal as opposed to another is on the track – Network Rail or the train operator – then you know something is wrong.
The government’s answer through the Williams plan (Shapps has been unceremoniously deleted from the joint credit he awarded himself) secured widespread approval. The plan was published in May 2021, a date already delayed due to Covid.
Yet three years since publication, we are still waiting even for the simple Bill to establish Great British Railways. This is firmly down to the prime minister who hates railways and has continually blocked attempts by Mark Harper and Huw Merriman to make significant progress. I am told that he, in effect, told Mark Harper to shut up when he was arguing in cabinet for the Bill to be given legislative space, and after all, it would probably have passed all its Commons and Lords stages in less than a week. So instead we have a pointless draft Bill when the whole thing has already been microscopically analysed since 2021.
Most recently the PM is also said to have stopped the transport secretary from making a meaningful intervention to save the Alstom plant at Derby. Fortunately, a botched way round that impasse seems to have been found.
Labour seem sensibly content to adopt a great deal of the Williams plan, even, for the first time, accepting the name Great British Railways.
One major difference relates to the involvement of the private sector in running trains. Consequently, a great deal of media attention has been given to the proposal to “fold in” to Great British Railways the existing contracts with train operators as they expire one by one. Labour is going to turn the putative Great British Railways into something more like British Rail.
There is of course an alternative that marries the need for public accountability and direction with the innovation the private sector can bring. This, after all, is the model employed in London for London Overground and also London Buses, and one that Andy Burnham is rolling out for his Bee Network in Manchester.
In these cases, everything of importance to the public is decided by accountable bodies, and contracts are let for the private sector to deliver. It is similar to the arrangement for supported bus services which I thought worked well when I was running a bus company in Brighton, the Big Lemon.
Opponents argue that reverting to “British Rail” is dogmatic rather than pragmatic, and that it fails to take into account the doubling of passenger numbers under privatisation, ascribed to private sector innovation. It is losing the opportunity for the best of both worlds.
Those who support the plan point out that the lines now being run by the state, especially LNER, are doing rather well, thank you very much. They also point to the huge bureaucracy associated with contracts. The one for East Midlands Railway, for example, runs to 527 pages and about 263,000 words.
You have to ask, however, what the attitude of the existing contract holders, the TOCs, will be between now and contract expiry. Realistically, why would they do anything other than the bare minimum when they have an execution date inked in.
One proviso in Labour’s plan that has received little attention states that contracts can be folded early “if they are broken by operators who fail to deliver for passengers”. There may be lucrative work for the lawyers yet.
The dog that isn’t barking relates to the ROSCOs. As I pointed out in an earlier piece for Passenger Transport, the ROSCO big boys (and girls) saw their profits treble in one year, with a whopping £409m paid out to shareholders in 2022/23, up from £122m the year before. Profit margins are 41.6%.
Train companies spent £3.1bn, 26% of their overall expenditure, on train leases in the year to March 2023.
This avalanche of money tumbling out from the industry dwarfs in significance what the TOCs are receiving, yet Labour propose to do nothing about it, despite union agitation. Their plan says it would “not be responsible to take on the cost of renationalisation”. In other words, Starmer and Reeves won’t wear it.
It is interesting and welcome that Labour plans to allow the continuation of open access operators. But give it time, and Treasury civil servants will be whispering in ministers’ ears that this is income abstracted from the state and which could be captured if open access were wound up. Not true, in my view, but it has long been the standard Treasury line.
Getting Britain Moving is good on analysis, identifying in particular the passenger frustration with overcrowded trains and cancelled services. Ms Haigh, who wants to be known in office as the Passenger-In-Chief (a nice touch) has set out six tests for the railway, which should be: reliable, affordable, efficient, quality, accessible and safe.
That would seem to cover all bases. The question is whether this sound analysis leads on to policy interventions that will deliver the outcomes desired.
The largely unspoken assumption underpinning the plan is that there will be no extra cost to the Treasury. This is almost certainly a pre-requisite demanded by Rachel Reeves, the shadow chancellor.
On the plus side, the elimination of waste and duplication is estimated to save £1.5bn a year, a figure taken from the 2021 Williams plan. Ms Haigh thinks this can be upped to £2bn by eliminating the sort of contracts like the East Midland Railway one referred to above.
There is also an assumption that the £25m a day which the ASLEF strikes are costing will be saved, though if Labour think ASLEF are going to meekly end their industrial action just because there is a Labour government, they may be disappointed. But the plan’s promise that “individual and collective rights of work are protected and strengthened” looks like an abandonment of any meaningful attempt to update often very old and inappropriate working conditions, for example relating to Sunday working.
One stand-out promise in the paper is Labour’s Best Price Guarantee, which sounds good but what exactly does it mean? If it means that someone at a ticket machine will always get a ticket at the same price as they would at the ticket office, that might be achievable, notwithstanding software challenges.
But does it mean that the split ticket price available online now becomes the default best price? It should really, but that suggests a big bill for Rachel Reeves to pick up as the price of a great many journeys would fall.
And how will best price be measured when it comes to advance tickets, subject to dynamic pricing?
Automatic delay and cancellation refunds will be welcome for passengers, but of course that cannot apply to those with paper tickets.
Labour’s plan says that “prices are kept, wherever possible, at a point that works for both passengers and taxpayers”. (My italics). With due respect, this is a meaningless sentence and insofar as it isn’t, it simply reiterates the approach taken by successive governments over many decades. It doesn’t suggest a whole lot of progress on cutting fares any time soon.
Of course Labour could find money to cut fares if they ended the ludicrous freeze on fuel duty and started to make airlines pay for their environmental cost rather more. Don’t place any bets on this, though, despite the clear logic.
What is welcome, and essential, is the clear pledge to introduce in the first session of the new parliament a Railways Act to do what the present government has been dithering about since 2021. We need this to give a clear direction forward. And certainty over this way forward will in itself act as a spur for action.
The train, at last, will be rolling and picking up speed. Just mind the gap between the rhetoric and the reality..
ABOUT THE AUTHOR: Norman Baker served as transport minister from May 2010 until October 2013. He was Lib Dem MP for Lewes between 1997 and 2015.
This story appears inside the latest issue of Passenger Transport.
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