Adrian Lee is a Solicitor-Advocate in London, specialising in criminal defence, and was twice a Conservative Parliamentary Candidate.
With the recent Transport Secretary’s announcement of the creation of a state-run entity called “Great British Railways”, my mind was cast back to the time of railway privatisation. In 1993, I was one of the four National Vice-Chairmen of the Young Conservatives. One evening we met the newly-ennobled Lord Tebbit for an informal drink in a House of Lords to update him on the current health of the Young Conservatives.
Whilst he was perfectly polite, he was nonetheless pre-occupied with the detail of the Railways Bill then passing through Parliament. He was deeply concerned, believing the Bill to be so poorly drafted that it could only lead to long-term chaos, and would ultimately discredit privatisation in principle.
The legislation facilitated the break-up of British Rail into 100 companies, with contracts having to be approved by two separate quangos, the Office of Rail and Road and the Office of Passenger Rail Franchising. With the greatest reluctance, Tebbit stated that he would have to vote for this flawed Bill – because he thought that it was essential to harness private capital and management skills, and end the disaster of the nationalised British Rail.
British Rail was indeed a disaster. In its 49 year existence, all taxpayers (many of whom never used trains) were forced to pay the entire cost of the network. Because no private investment was allowed, it was continually susceptible to spending cuts. The entrepreneurial spirit associated with the pre-war privately-owned railways was replaced by disinterested state bureaucracy.
After 1948, the railways were seen as a “public service” rather than a business, and so customer service deteriorated rapidly. Railway employees had their jobs guaranteed, so they had no reason to inconvenience themselves for the mere commuter. Timetables bore little resemblance to reality, and thousands of trains were late or cancelled every year. Most of the rolling stock was ancient, Waiting Rooms on stations were filthy (frequently vandalised and stinking of urine). And the food served in Traveller’s Fare buffets, particularly the notorious British Rail sandwich, became a national joke on variety shows and sitcoms.
No wonder that British Rail never reached profitability: by 1961, it was losing £300,000 a day. A year later, British Railways recorded an annual loss of £104 million (£2.24 billion in 2019 terms). All of this occurred despite the fact that closures of railway lines started in the late 1940s, and already 3,000 miles of track had been left abandoned.
With public money metaphorically seeping through gaps between the railway sleepers, the Macmillan government had ordered a major organisational shake-up. A new structure was put in place and the first Chairman of the new British Railways Board, Richard Beeching, was appointed.
Beeching thought that he had the solution: even deeper cuts and closures. Being a nationalised industry, and so traditionally unconcerned with such commercial concerns as ticket sales and customer demand, no data existed to show which lines were profitable or essential.
A major traffic census therefore had to be undertaken, but Beeching didn’t waste time carrying it out methodically – and so the entire fate of the railway network came down to a survey that took place over the course of one week during April 1961. Stories abound of researchers turning up at empty railway stations in the mid-morning and marking them off for closure, whilst being oblivious to the fact that the same stations were heavily used in peak hours. The resulting report, The Reshaping of British Railways, was published in 1963 and recommended the closure of a third of all passenger services.
Not all of the suggested cuts were implemented – some were reprieved by dodgy political lobbying in marginal constituencies. However, conversely, many essential services bit the dust, leaving several major towns without rail transport. The whole effort was both rushed and ham-fisted. Labour, in Opposition until 1964, opposed Beeching’s Report, but implemented it in full when they returned to power. The cuts made a saving of around £30 million a year, but overall loses continued to run at over £100 million.
By the 1970s, British Rail was as much controlled by the trades unions as by the civil service. Whenever a modernisation was suggested, it had to be thrashed out first with belligerent union bosses for fear of strike action. The unions loved the nationalised system as it was so much easier holding politicians to ransom than private employers. When commuters cannot get to work for lack of trains, they usually blame the body running the railways. When the state owns the railway, the government is always to blame. Politicians hate unpopularity and, on this basis, pay rises are granted frequently. This continues to be the case for the one major British railway that was never privatised: the London Underground. Few will forget the late Bob Crow in a hurry.
In the final years leading up to privatisation, British Rail turned to public relations to paper over the cracks. First, they employed Jimmy Saville as their salesman heralding “The Age of the Train”. Then, after they dropped Saville when sexual rumours first started circulating, they turned to Gary Glitter to promote the Young Person’s Railcard. The last notable advertising slogan of British Rail was the almost desperate “We’re getting there”.
Privatisation led to the rejuvenation of Britain’s railway network. New rolling stock provided greater passenger comfort and safety, as well as faster services. There is now a better choice in food outlets in stations. Cancellations and delays have been slashed, and journey numbers have risen from 761 million in 1995 to 1.75 billion in 2019.
According to the rail regulator, 59 per cent of current service delays result from the actions of Network Rail, the section that continues to be nationalised, not the private contractors. Lew Adams, the former General Secretary of ASLEF who went to work for Virgin Rail Group after privatisation, said in 2004: “All the time it was in the public sector, all we got was cuts, cuts, cuts. And today there are more members in the trades union, more train drivers and more trains running. The reality is that it worked, we’ve protected jobs and we got more jobs.”
So what went wrong? Under the 1993 Act, private companies lacked the competitive freedom enjoyed by businesses in other sectors. The state retained control over the tracks and stations, dictated timetables, maintained fare levels and prevented competition between different contractors on the same lines.
Unlike other countries such as Japan, British train operators were forced to operate with one arm tied behind their backs by the government. In 2009, a group called the “Campaign to Bring Back British Rail” was established, and the myth was promoted that British train fare levels were significantly higher than on the continent. The Left seized upon this – believing that the railways gave them the best opportunity to reverse a major privatisation. Sadly, very few Conservatives or right-leaning think tanks fought back against this campaign with the facts.
We have yet to hear the full details of the government’s proposals for the railways, but one thing should be clear from past experience: nationalisation does not work. For over forty years, Conservatives struggled trying to manage Labour’s statist model of operation. It was not ideology that drove the Major Government to railway privatisation, but common sense. It is imperative that we don’t stray accidentally back down the same intellectual cul-de-sac of thinking that government can run business.