British Rail: the naysayer’s favourite story of state failure

I’ve been trying to find out what really went wrong with British Rail. I failed to find anything. I then turned to finding out information from the time to support the modern idea that it was badly run. I haven’t been able to find that out either. (If anyone can point me in the direction of any real information from the time that supports either of the above, do let me know – I’m always willing to see the other argument).

What I did learn is how the idea of privatising the railways came to be: and I was surprised to learn that it wasn’t some grand plan with widespread support, not by any stretch of the imagination.

Thatcher, the original queen of state-stripping (now of course totally out-classed by the current mob), didn’t see it as worth pursuing. There was no evidence that it would appeal to the private sector and there was little interest in the conservative front bench, or ministers and peers who had previously been involved with transport. Not only did the opposition and the Unions opposite it, so did the majority of the Tory party – with many voicing fears that it would destroy the railways. A leaked proposal to hike up prices by 16% in the South East, with further rises to follow (the intention being to make it appear more profitable to potential private buyers), caused outcry. The idea was killed off.

But then Thatcher was ousted and John Major, elected with only the proposition of electoral defeat ahead of him, needed policies. Rail privatisation was thrown into the mix and seemed to fit the bill. With a policy like that, the government could show they weren’t afraid of bold ideas and the right wing press, always happy to help by a spot of state-bashing, got stuck into British Rail.

The public can be easily convinced that something is wrong with a public service and scared that they were losing money to a failing state-owned system, privatisation didn’t seem like such a bad idea.

I still don’t think it would have been this policy that caused the shock victory but whatever it was, somehow, the Tories stayed in power. With a narrow mandate, they needed to make their promises stick and so the privatisation of British Rail was on. Inner discussions considered a few ways of going about it and the party and its private backers settled on the model of regional franchises and between 1994 and 1997, British Rail was pulled apart and sold off.

Fast-forward 20 years and we now have a good model to use in arguments against the privatisation of large public sector organisations.

The rail franchise which is the most cost-efficient to the taxpayer and the most highly-regarded by passengers is the only one which is not privately-owned: East Coast. East Coast put profits from fares back into the business and pays for improvements to the rolling stock and the service they provide. And there are no shareholders to satisfy. East Coast has paid almost £800 million to the treasury in less than five years. That is more than Virgin have paid in 15 years.

As a result of privatisation, our railways are now more expensive to passengers, more expensive to tax payers and less reliable. It should be impossible to believe that privatisation is now going ahead in the NHS. Yet we’re under Tory rule and pretty much anything which takes taxpayers money and puts it into the hands of the wealthy is to be expected.