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Posts Tagged ‘Rail fares’

Changing Politics for the better Pt 5: HS2 & Travel by Rail

September 6, 2019 Leave a comment

HS2 is an unnecessary expansion of rail infrastructure using public money. A lot of money that could be spent more wisely and more effectively in other ways. A final bill that is only set to grow like the cost of Crossrail has.

Politicians have been guilty of fire hosing money at problems, rather than giving thought to solutions that would be better and cost less – usually because there is much more effort and political risk involved.
HS2 is not a transport project that offers genuinely good value. It is not creating a new link in the way that HS1 did when it linked London with Brussels and Paris via the Channel Tunnel.
HS2 gives the impression of creating more opportunities for travel whilst not solving or doing anything to address the problems with rail travel in the UK that we have already got.
Yes, we do need more capacity on the UK rail network. But capacity can be significantly increased without spending billions on new lines and line beds across open countryside.
We just need to make better use of existing infrastructure, improve it where it needs it and be realistic about the benefits vs. the cost.
A lot of the problems with rail travel today were brought into being by the shortsightedness and backward view of politicians and the consultants they employed as consultants to advise them in the 1960’s.
Public Services always cost the Public money. But that’s because a fair and comprehensive level of service provision for all will never offer blanket profitability.
The minimum requirement from any public service should only be that surplus or ‘profit’ generated from one area of an operation should be allocated to those that cannot do so with the aim that surplus offsets any cost. Run commercially but without shareholders taking dividends would soon keep subsidies required to the absolute minimum and ensure that they were seen to be an investment, rather than a form of commercial loss.
A good Government MUST scrap HS2 and change the way that problems with rail travel in the UK are being addressed.
They could begin by doing the following:
  • End the HS2 Project and take any so-called losses on the chin.
  •  Reopen closed line beds and stations across the network.
  •  Take franchises back into ‘public care’ and run them as commercial enterprises without shareholders.
  •  Increase capacity in the network by extending existing terminus stations, building new ones where services get ‘turned around’ and rebuilding those demolished as part of the enactment of the Beeching Act.
  • Use Computer Technology to reduce gaps between services safely.
  •  Create partnerships with heritage railways to provide passenger services using their existing rolling stock and introduce green and efficient rail cars to increase capacity and services in rural and poorly served areas

Rethinking the Railways: no Public Service should be in private hands, nor should it be under union influence either

January 3, 2019 Leave a comment

It’s January and once again, we are witnessing inflation-busting rises in Rail Fares with the same old media coverage, the same old political responses from all sides and the same old reality that it is the same people being financially worked-over as a result of the ineptitude of the Politicians who were Elected to help them.

As usual, the blame game is well and truly afoot, providing ever useful cover for those choosing not to be responsible as we focus on the beneficial myths which are privatisation of public services, public ownership, building completely new railways and the inherent suggestion that people can always afford to pay more.

Whilst championed by the various sides as Westminster takes a momentary breath from Brexit, the reality is that none of these approaches can solve the fundamental problems that exist within the railways, public transport or wider public sector services.

Switching from one of these methods to another to solve just one problem, will simply create many more.

As with most issues that now surround the ineptitude and incompetency of Government, the real solutions to these problems – that’s the one that tackle the actual causes – are simply too unpalatable for the spin doctors and marketing whizzes to contemplate on behalf of the Politicians who would have us believe that they are in control.

The Politicians themselves do not have the foresight to see that by taking the tough and difficult decisions that they are supposed to, the results and impact of that action will soon speak much louder than any sound bite, as the reality of doing things properly becomes manifest and finds a very loud voice of its own.

The problem with the options that we are told are available

It’s very important to understand that one of the key principles of the Public Sector and the way that it operates is involuntarily and often deliberately overlooked:

Public Services are not and never will be a commercial business.

The purpose of Public Services is to provide uniformity of service and/or access to the wider community, which is simply contradictory to the motivation for running private business.

The simple reason being that the universal nature of the requirement for Public Services necessitates that unless you cherry pick and introduce different levels or tiers of service or remove the provision of that service from some areas altogether, the guarantee of profitability from all those parts operated, if not all of the service itself would always be denied.

This is why even in private hands, the Railways are heavily subsidised by the Government.

The Railways today

Today the Railways are effectively operated by profit-making private sector contractors or operating companies. Contractors who are often large PLC’s that make substantial sums of money by operating large-scale services and employing the economies of scale to reduce costs, usually on an ongoing basis.

Operating under the auspices of being a regulated public service as the nature of the public ownership of the railway infrastructure itself dictates, the contractors do not have the flexibility to raise prices and change service structures at will.

This effectively means that to increase profits, the contractors have to reverse engineer the profit-making-process by reducing overheads and making more money from the cost centres which have been accounted for in their Contract with the Government.

In effect, they are adhering to the terms of their agreement with the Government in principle rather than spirit. The outcome being the shitty end of the stick that we all experience each and every time we get on a sweaty train and realise that we have to stand for at least significant chunks of a very long journey, unless we want to get out and run.

Because the margins the operating companies accept to gain a contract or franchise are often very tight, expectation versus the ability to back engineer those all-important profit margins can easily prove impossible to align. And when they do, this is when we experience ‘franchises’ being passed back to public hands.

No private company will pay for the privilege of operating a Public Service, and nor should  the Government expect them to do so. But on the same count, neither should they be able to milk profit by taking all the value out.

The only thing that literally keeps the train wheels spinning is the RPI linked rise in Rail Fares which comes into operation each January.

It’s a dubious way of calculating an annual rise to say the least. But without it, the current operating model simply wouldn’t work.

Return to Public Ownership

Jeremy Corbyn and his shotgun John McDonnell advocate a wholesale return of Public Services to Public Ownership. For obvious reasons which only a fool would overlook or dismiss, this is a principle that the Public would all too easily embrace.

What it doesn’t do is answer the big questions surrounding why the idea of privatisation gained momentum in the first place. Perhaps the biggest reason being one of the left’s own making; the power of the Unions and Employment Rights too.

The simple question for anyone who understands the reasons why Public Services are put out to contract and therefore placed in profit-making hands is this: ‘Why is it more cost effective to employ a profit making company to run an identical service to the one we could or have provided ourselves?

The answer isn’t one that the left likes.

But it is also the reason that wholesale return of public services to public ownership without reform would cripple this Country in no uncertain terms: The Public Sector wage and benefits bill is out of control, as are the regulations and rights that support them, and the Union’s will bring everything to a standstill under the guidance of their barons who will employ the very same self-interest employed by big bankers and pension funds who milk public services today, simply served up in a different and even more malevolent form.

Building new Railways

Building new Railways will not solve the problems of franchising to profit-led contractors or operating them in unreformed Public hands.

It will cost money that the Country doesn’t have and would be unnecessary for us to spend too, if the Government was prepared to make the decisions that it should do.

The existing Infrastructure

One of the biggest errors of Government in ‘recent’ times, was the dismantling of the Railways undertaken by Dr Beeching in the 1960’s.

There was a complete lack of foresight and understanding by yet another Government which was reacting to the effects of problems it was facing, rather than getting on and tackling the causes as any good government should.

The result was that much of the indirect capacity which had until that time existed, was removed and with it, a ticking time bomb created for the effectiveness of the reformed railway network which would soon be as restricted as the diminished number of lines.

Today, there are simply not enough platforms at key and terminus or hub stations to increase capacity on the network in the most simple and effective way:

Increase the number of trains.

Using the Public as a cash cow

Whilst the Government heads off a simmering crisis each year by putting up the Rail Fares in what can only be argued as an unrealistic form, it relies on what is in effect taxing the same people over and over again for using a substandard service. One that only appears sustainable because over many commuters the Rail Operators hold a monopoly – something public services were NEVER created for.

Solving the problem and not creating others instead

It occurred to me as I was thinking about writing this blog, that the whole idea of public-private sector partnerships is actually oxymoronic.

Man can only have one master, and if that master is money, the service will not be about providing a good experience to the public.

Whilst I like the idea of public services being fully in public hands, this idea itself is no longer possible.

The standing influence that institutional and regulatory bias towards employees and unions has, has already priced out this operating model in many ways. It is itself the elephant in the room that it remains dangerous to identify when the collapse of public services – particularly at local level – is ever discussed.

In respect of these two options alone, the complexity of solving the Rail Fare crisis is identified and as part of the wider cost-of-public-services is concerned, certainly comes into its own.

The only way that railways and all forms of public transport can be returned to a format of universal, uniform quality and experience is to do away with the current and previous forms of operation and accept that there has to be a new operating model, focused on public service but adapted to deliver for all against the flow of self-interested times.

We need more platforms and if necessary stations in key locations, but we don’t need to build completely new lines.

The technology now exists to run and manage many more Trains on the same lines at the same times and we should be both embracing and furthering this massive opportunity for the benefits to the public, rather than just the profitability that it was developed for.

Existing line-beds and heritage Railways should be put back into commercial use and we should be making the very best of the infrastructure that we already have.

The cost of doing so and the time it will take to deliver will be substantially less and with much less disruption than any white elephant project like HS2 would ever have.

 

image thanks to unknown

 

 

 

 

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