Tories to privatise British Rail

August 5, 1992

By Frank Noakes

LONDON — The Tory government on July 14 announced plans to privatise British Rail. The process, sketched in a 21-page white paper, will begin as early as next year.

Under the remarkably vague proposals, BR will retain the tracks and signals in the short term under a new company, Railtrack. Freight and parcels will be sold outright, passenger services are to be franchised, and stations could be sold or leased.

The eventual aim is to transfer full ownership to the private sector. But as transport secretary John MacGregor noted, "BR cannot be sold off as a complete concern in the same way as other industries". BR had an operating loss last year of £144 million pounds.

The government is also concerned that private enterprise has no experience in running such a complex industry. BR runs 16,000 train services per day.

In 1923, the 120 private rail companies were rationalised into four new companies. Eventually, in 1948, nationalisation rescued the failing system. John Major's Conservative government now wants to turn the clock back, breaking the network into 40 areas and promoting the entry of numerous operators.

Trade unions, the Labour Party and environmental groups have all condemned the government's plans.

Labour's transport spokesperson, John Prescott, says the white paper "is ripe for the exploitation by property speculators, route operators bribed by public subsidies, and inevitably by the Tories' City friends".

A number of potential investors have shown interest. Richard Branson, of Virgin Atlantic Airlines, wants to provide a faster inter-city from Edinburgh, via Newcastle to London, with TV sets for each seated passenger. However, as one rail industry commentator noted, "Private operators will simply cherry-pick routes. Branson may want the 10 a.m. service from London to Newcastle, but he won't want the 12 o'clock or the 2 p.m."

BR will be responsible for maintaining the services that the private sector won't touch. Ultimately, unwanted services will close, despite MacGregor's rather coy statement that "we expect, broadly, the national network to be maintained."

Notwithstanding the silence on the matter, thousands of jobs would go under the scheme. In line with the experience of other privatisations, charges will soar in parallel with profits.

There has been a creeping privatisation in BR for many years services and many other interests have gradually gone under the hammer. This began even before the first Thatcher government.

Sweden is something of a model for the British government in this venture. Sweden split its rail operations into two, and four years later some private services are now operating. However, there are no stated plans to sell off its track.

Some other European countries are also moving towards rail privatisation. Germany's Bundesbahn is a candidate in the near future. Switzerland already has partial privatisation, and the Italian government expects to move fastest of all to full denationalisation.

The Tories starved BR of capital for a decade: they boast of spending less than one quarter of the European average on rail. The cost of repairing the resulting damage, which everybody agrees is essential, is now enormous.

The money needed to revitalise the railways is beyond what the private sector can profitably invest. Business, which has of course welcomed privatisation, is worried that the government may use this as a pretext to avoid spending on rail infrastructure. For business, an efficient transport system reduces costs.

John Richards, press officer for the railway drivers' union, ASLEF, told Green Left Weekly that a propaganda campaign, Save Our Services, has already been initiated. The travelling public and environmentalists will be asked to demand that the government to scrap its white paper.

Industrial action is not on the agenda, Richards asserts, because of draconian anti-union laws prohibiting politically motivated strikes.

Ironically, the parlous state of BR will probably work in favour of privatisation. Any campaign to save the system is likely to run up against public dissatisfaction with the existing, inefficient and already costly service.

The serious environmental effect of forcing ever more people into road traffic can be gauged by the government's own projection that the number of cars on the road will double, from 20 million to 40 million, by the year 2025.

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