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Rail Price Hikes: Questions

Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
http://newsforums.bbc.co.uk/nol/thread.jspa?forumID=5868&edition=1&ttl=20090103002022

I get no good information from the BBC HYS boards (natch) so I am wondering if anyone on here could help me with the following questions:

1) One of the HYS posters makes reference to the fact that despite privatisation, we continue to subsidise the railways as taxpayers. Could anyone elborate on this, on exactly to what degree this we do so?

2) Following on from the above, I seem to remember a little while ago a debate in which there was a detailed argument put forward as to why renationalisation was unworkable/unfeasible (but I can't find it). Could someone who knows about these things give me a quick summary of why?

3) I want to know the answers to the above because its something that I feel I should before I make up my mind about whether or not to get mad about. Do you feel this new price increase is justified and why?

Many thanks in advance to anyone willing to respond.

Comments

  • JsTJsT TheSite Graduate Posts: 18,265 Incredible Poster
    http://newsforums.bbc.co.uk/nol/thread.jspa?forumID=5868&edition=1&ttl=20090103002022

    I get no good information from the BBC HYS boards (natch) so I am wondering if anyone on here could help me with the following questions:

    1) One of the HYS posters makes reference to the fact that despite privatisation, we continue to subsidise the railways as taxpayers. Could anyone elborate on this, on exactly to what degree this we do so?

    Yes, the Government does subisidise the railways. As per everything government the figures are hidden somewhere in the region of about £4-5bn or so, the Government is planning to reduce subsidy to somewhere around the £2.5bn mark by around 2015, the difference in income being made by the passenger. This is done by profit generating franchises, for example National Express East Coast will pay the Government £1.4bn for running the Intercity East Coast franchise between 2007-2015. The previous incumbent GNER failed to deliver £1.3bn across the same time period and had its franchise revoked.


    2) Following on from the above, I seem to remember a little while ago a debate in which there was a detailed argument put forward as to why renationalisation was unworkable/unfeasible (but I can't find it). Could someone who knows about these things give me a quick summary of why?

    There isn't anything, other than the fact that all the UK's rolling stock is owned by banks and would have to be bought back from them at a price. There is also then difficulties in reorganising everything, from management, routes, staffing etc. It is nothing that cannot be worked around should the will be there to do and the time allowed for the franchises to expire.

    Personally I wouldn't give privatise it again, the way the government treated the railways under BR was awful, the levels of investment by both the government and private companies has been enormous, the network is a hell of a lot better than it was in BR days, a 44% passenger increase since privatisation (highest passenger numbers since 1946) proves that. The government has now decided that they are going to try and milk the industry and take as much as money back out of it as possible - the exact same attitude that made it so bad when it was nationalised. I'm happy to admit the way the privatised industry is run and operates isn't perfect, but its certainly a hell of a lot better than BR.
    3) I want to know the answers to the above because its something that I feel I should before I make up my mind about whether or not to get mad about. Do you feel this new price increase is justified and why?

    Many thanks in advance to anyone willing to respond.

    I think if the industry has to be seen to be continuously investing and improving while reducing the burden on the Government purse then we have no choice. The network has handled 18302 trains so far today, with 93% punctuality (despite a major incident), figures like this could have only been dreamed of back under BR (around 14000 and 86%).

    My only complaint is the way the media portray it, the regulated fare increase of 6% nationwide is set by the Government using there formula of June's inflation + 1%.

    The industry in any form will never be self sufficent, unless you cut off communities and pass on even larger fares increases to the customer.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Another year, another case of most railway companies applying the absolute maximum fare increase allowed by the government. Above inflation, and year after year after year after year.

    Meanwhile punctuality figures continue to leave a lot to be desired, and they are not a lot worse only because timetables are fiddled with, non-profitable services continue to be neglected or in danger (and why would it be otherwise, when railway companies have de facto monopolies and their only objective is maximum projects with no care at all for customer service) and companies continue to get handouts from the taxpayer to buy rolling stock and then profit every last penny of profit.

    It's a sad joke- in my view of course.
  • JsTJsT TheSite Graduate Posts: 18,265 Incredible Poster
    Aladdin wrote: »
    Another year, another case of most railway companies applying the absolute maximum fare increase allowed by the government. Above inflation, and year after year after year after year.
    The Government dictates the figures for regulated fares (June Inflation + 1%). It isn't the companies applying the maxiumum figure allowed by the Government, it is purely the Governments choice. Unregulated figures are a different matter, usually they are the same, except when the company hasn't paid enough back to the Government or is being forced to take on financial burden for infrastructure projects (particularly Cross Country and FCC).
    Aladdin wrote: »
    Meanwhile punctuality figures continue to leave a lot to be desired, and they are not a lot worse only because timetables are fiddled with,
    How so? I've already explained in the above post that PPM performance figures are 5-6% higher on a daily basis that BR. That figure typically under BR was around 85%, it is now typically around 92%. How are the timeables 'diddled with'?
    Aladdin wrote: »
    non-profitable services continue to be neglected or in danger
    How so? The only way unprofitable services are affected is if the Government cuts subsidy.
    Aladdin wrote: »
    (and why would it be otherwise, when railway companies have de facto monopolies and their only objective is maximum projects with no care at all for customer service) and companies continue to get handouts from the taxpayer to buy rolling stock and then profit every last penny of profit.

    Would strongly object to that too - its fairly clear that you've never worked in the industry - if you had you would know full well the amount of hard work that goes into customer service each and every day.

    Companies do not pocket every penny of profit at all, which is why many companies give premiums BACK to the Government. Those who take subsidy do so to actually ensure the service runs, its a fact that many lines and stations will never ever be profitable, if we want an industry without subsidy it'll be one with further huge fare rises or many stations in rural communities missing.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    This whole topic gets me so wound up. It makes me sick to my stomach to think of the amount of money I spend in rail fares each month. For what? To sit on a train (not that I always get a seat mind you) that quite literally stinks of crap.

    I am not meaning to offend anyone who works on the trains. Its not their fault its so bloody expensive.

    Its really getting to the point now where I might not be able to use the trains much longer. My 16-25 rail card runs out soon and if the next few years see rises like this one then I'll have to re-think things. Its just too expensive. I'm not even really talking about the new rise, it was already too expensive before that!

    Sorry for not really answering the questions. I admit I don't know much about the politics of it all but what I do know is that I'm paying way over the odds for a service that is pretty crap. I wouldn't even mind it being crap if it was cheaper to be honest.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Every year ATOC comes out with the same old excuses about investing in the railways, tbh it really doesn't wash anymore.

    We have some of the highest rail fares in Europe, which would be fine if we had the best rail system, but we dont. Its piss poor.

    In the UK we are light years behind Japan, France and Spain. Still all these price rises will mean a better service in 2050.
  • JsTJsT TheSite Graduate Posts: 18,265 Incredible Poster
    We're paying now though for lack of investment in the 60, 70's and 80's.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    I'm boycotting Crosscountry btw James, I'm gonna go home using National Express, the Tube and then Chiltern!
  • JsTJsT TheSite Graduate Posts: 18,265 Incredible Poster
    I'm boycotting Crosscountry btw James, I'm gonna go home using National Express, the Tube and then Chiltern!
    Give them two years and they'll be off the franchise regardless.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    How so? Were they on a short non renewable one?
  • JsTJsT TheSite Graduate Posts: 18,265 Incredible Poster
    Its a long story, I'll let you know at some point.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    my pm box is always open :)
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    JST: many thanks for the detailed reply - I'd heard this for years, mainly from my Nan and Grandad years back when he worked for BR
    We're paying now though for lack of investment in the 60, 70's and 80's.

    I suppose my question now is this; if underinvestment in the railways was originally the reason for their poor performance, in a situation where investment was equal would it be sensible to call for renationalisation rather than having a for profit system?

    Has the privatisation led to significant increases in investment required (I think from your previous answers the answer might be yes but I wondered if you could shed any more detail on this).

    Once again many thanks.
  • JsTJsT TheSite Graduate Posts: 18,265 Incredible Poster
    I suppose my question now is this; if underinvestment in the railways was originally the reason for their poor performance, in a situation where investment was equal would it be sensible to call for renationalisation rather than having a for profit system?

    Personally I think having the privatised network has given the network a competitive edge. Without the privatised network we would never have had the system of change we've had under the private sector, be that new services, improved and new rolling stock, the concept of open access rail etc. The Government has proven time and time again it is incompetent with the network, be that nationalised network before 1993 and even under the privatised network. http://news.bbc.co.uk/1/hi/uk/7784868.stm this is one of many many things they've done, I really could go on for hours.
    Has the privatisation led to significant increases in investment required (I think from your previous answers the answer might be yes but I wondered if you could shed any more detail on this).

    I don't think the increase in subsidy was necessarily required - the subsidy figures could have been kept the same by the Government and the network wouldn't have improved, if anything it would have stagnated. I think the private companies have motivated the Government to put the money forward to pay for the improvements which have been delivered. The private sector has put plenty of money forward too. I think the privatised network is the better solution, the Government just needs to spend time refining the franchise process and learn to butt out.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Typical... biggest increase was Crosscountry which I use a lot :( Although, if I'm not in a rush and it's convenient I use megabus these days - it's more unreliable than the trains... I really don't ever expect it to be on time but at least it's cheap and I get a seat guaranteed. Although unfortunately megabus is owned by stagecoach - and stagecoach are a really nasty company but impossible to boycott as they have a monopoly on the buses in my area... and a monopoly on cheap travel around the country too (megabus).

    I've no idea if renationalisation is the answer but the status quo is definitely unacceptable... more and more people can't afford to use the trains and for those that can, they're not getting value for money.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    They were extortionate to begin with. So, it's all elementary for me. Kinda like hell being hotter than the sun.
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