The Secretary of State for Transport, Grant Shapps, has presented his plans for the future of the railways as a fundamental re-orientation of policy. It is true that the strategy addresses some long-lasting problems, such as the absurdities of ticketing in a fragmented system, and the perverse incentives embedded in the franchising system. However, this policy leaves three major problems untouched.
First, the railways will continue to be financed preponderantly from passenger revenue rather than state subsidy. This means, in practice, that fares will increase, and probably quite steeply, given that a shortfall must be made good: passenger volume has reduced by 39 % since the start of the pandemic. This economic model is unsustainable. It will force passengers away from rail to the motor vehicle. People will not pay unrealistic fares for an unreliable and uncomfortable service (which is very much the case in most of the North of England). (Electric cars are not the answer: they also require heavy inputs of rare minerals, such as lithium, which will no doubt encourage future resource wars and environmental destruction). Only a fundamental re-orientation of policy away from the motor vehicle will do. Under nationalisation, the railways were starved of money by the parsimony of the Treasury. Privatisation was supposed to increase investment, but did not do so, because railway companies' profits were eaten up by operating overheads, and by the demands of shareholders. (The most obvious consequence of this is chronic under-investment in critical elements of infrastucture, most notably signalling, defects of which are responsible for many delays and cancellations.) The only solution, once the railways are fully returned to public ownership, is to define expenditure on the railways as capital investment rather than current expenditure, thereby bypassing Treasury rules.
Second, the ownership model of the railways is deficient. It needs to include all stakeholders : passengers ; railway workers ; regional and local government. This model should be applied to all utilities, and should bea template for viable public ownership. The railways are a public service, and their ownership model needs to reflect this.
Third, the public ownership of the railways needs to take place in the context of a thoroughly integrated transport strategy. Bus services should be taken back into public ownership (preferably under the control of municipal aujthorities, as Andy Burnham has decided to do in Greater Manchester). Bus services should become frequent and reliable and their timetables should be integrated with those of the railways. Where possible, tram services could be re-introduced in urban areas.
At present, the government's transport policy reflects the wider context of Conservative Party ideology. It is in a state of flux, with many free-market fundamentalists finding that they have, for urgent electoral reasons, to embrace some sort of State intervention. Confusion, incoherence, and a great deal of cognitive dissonance (as is shown in the Cabinet's anguished debate over its trade deal with Australia) are to be expected, for a long time to come.