What if British Rail had never been privatised? - PART 1: the New Labour years
“Good morning, my name is Thomas and I’m Head of Imagined Histories here at Freewheeling.
With the Bill to renationalise the railways being passed by Parliament, we’ll imagine what would have happened if the railway had never been privatised.”
1990s
Following the 1992 general election, debate raged within the Tory party about whether to privatise the railways. There had been a commitment to do so in the winning manifesto but internal polling showed the idea was hugely unpopular. In the end, it was decided that the commitment was vague enough that adding some limited additional private services (as was already happening with the addition of Stagecoach seated carriages to the Aberdeen - London sleeper) and selling the station estates would be sufficient for the promise to be considered fulfilled, but not in a way that would risk unpopularity.
In the event, however, John Major’s Government was rapidly overtaken by eurosceptic-induced chaos, and the proposals never made it beyond White Paper stage.
Indeed, by the 1990s, British Rail was in relatively good shape. It had an efficient organisation and subsidy, the only measure of success for a Tory Government, was manageable. But it suffered from low investment. This low investment continued through the early and mid 1990s.
However, the late 90s economic boom gave the Treasury a bit more room for investment than in previous years, and British Rail was careful in choosing its battles. As had been the case through the 1980s, there was a smattering of station reopenings each year. British Rail promised to reopen the Oxford to Cambridge line though, in the event, only the cheaper Oxford to Bedford section actually happened. Following the success of the Chiltern line “Whole Route Modernisation”, British Rail promoted the same idea on the two lines struggling most with outdated kit (accepting that to push for more would have risked getting nothing). The London, Tilbury and Southend route in Network SouthEast gained new trains and refurbished stations, but the big prize was the West Coast.
By the mid 90s, the West Coast mainline needed new track, new signals, new trains and shinier stations. British Rail made the case successfully, and got the required capital for its third “Whole Route Modernisation”. New, tilting trains (Italian Pendolinos) were introduced, while the old 1960s signal boxes were replaced. Euston station in London and New Street station in Birmingham were substantially rebuilt as part of a major mixed-use housing, office and retail developments that also included a new concourse and brighter platforms.
The new concourse at Birmingham New Street, created as part of British Rail’s 1990s Total Route Modernisation of the West Coast Mainline, as imagined by AI (Dall-E)
The second half of the 1990s was dominated by delays and diversions on Britain’s key economic artery, but British Rail promised that the result would be worth it. Which it was.
New Labour
New Labour inherited a British Rail operating efficiently but with a huge renewals backlog. South East England was the only commuter region in Europe to be dominated by slam-door trains, some of them around 50 years old, with no replacements planned. The Regional Railways network outside London was dominated by shabby 1980s units that were uncomfortable and too small. The West Coast and East Coast both had relatively new trains and infrastructure, but the other InterCity routes were showing their age.
Network Rail is born:
Moreover, the EU was increasingly getting involved in the running of the railways, and Tony Blair was keen to be a good European. As part of the goal of creating a single market for rail travel, the EU decided that national railways’ tracks should be split from operation of the trains. Britain – as it tended to be – was an enthusiastic implementer of the EU legislation.
The British Rail sectors of Network SouthEast, Regional Railways and InterCity were retained as operating companies, but a new entity (we’ll call it “Network Rail”) was created to run the tracks.
The PFI boom:
New Labour was keen to fix the issues with Britain’s public realm and a new tool was available: the Public Finance Initiative, which enabled private sector financiers to invest in public assets. In 1999 Gordon Brown looked like a proud dad as he unveiled the largest PFI in history as a new consortium of investors pledged £50 billion of investment over ten years in upgrading and electrifying Network Rail’s infrastructure.
Separately, another mega-PFI was signed, with £6 billion to be invested in new trains for Southern England, replacing the existing slam-door stock. The rolling stock market was somewhat overwhelmed; especially as the new devolved administrations in London and Scotland were also buying large fleets of new trains at the same time.
Indeed, the next few years were something of a golden period for British Rail, heavily lubricated by PFI cash.
Another major PFI deal created a new national smartcard system. Sponsored by John Prescott’s mega-Department of Environment, Transport and the Regions, the new national smartcard was intended to work on all trains and buses across the country.
Integrated transport:
To be honest, the national smartcard never quite lived up to expectations. It turned out to be incompatible with the London Oyster card, which was being introduced in parallel, and never achieved the Pay-As-You-Go functionality that made London’s transport system a world leader.
However, the platform it created enabled regional multi-modal travel products, and bound the privatised bus operators closer to British Rail, which had been appointed as operator of the national smartcard on behalf of the Government.
Gradually, British Rail took more and more control of local bus times and bus fares, with the tacit approval of the private bus companies, who found that BR’s expertise and integration boosted profits even at the expense of commercial freedom.
Devolution:
Another consequence of John Prescott’s department was a big step forward in devolution. When Transport for London was created, the various transport management functions undertaken directly by central Government were devolved. These included management of the national highways network (including the iconic Westway motorway) and the Public Carriage Office (previously a department of the Metropolitan Police). It also included the right to ‘buy’ train services from Network SouthEast, on behalf of London.
Network SouthEast’s inner suburban services, hitherto tired and neglected, were transformed as Transport for London invested in new trains, refurbished stations and ticketing integration. The London “Overground”, as the inner suburban NSE services became known, became a model for cities elsewhere in the country, rapidly replicated by Passenger Transport Executives in Liverpool, Manchester, Birmingham and elsewhere.
Rail routes in South London continued to be operated by Network SouthEast, but under the London Overground brand, specified and paid for by TfL. As imagined by AI (Dall-E)
As part of the devolution settlement, ScotRail was made into a self-contained organisation, under the control of the Scottish Executive, though Network Rail continued to operate the Scottish infrastructure.
Open access:
The Government implemented the new EU directive to the letter, which included opening up Network Rail’s infrastructure to the highest bidders. State railways from other European countries (including many from countries who, themselves, had ignored the new EU rules) bid for paths from Network Rail, and won them. Longer distance routes now saw a plethora of new brandnames competing with the established InterCity service.
This competition was largely good news. It held prices down for users and further drove use up. Product innovation followed: foreign railways introduced different classes and types of service, which forced a response from British Rail. The service quality on InterCity was excellent, benefiting customers from locations like Plymouth or Swansea who didn’t even enjoy open access services. The upgraded signalling on the West Coast was especially valuable: three trains per hour were run between Manchester and London, of which only one was operated by InterCity, and the other two were operated by one of SNCF, FS and RENFE, on a slightly arbitrary basis. An enterprising British Rail manager, Adrian Shooter, resigned and formed a new company to bid for Open Access paths, and won a decent handful, especially on the Midland Mainline, which had been somewhat ignored by the foreign state railways, and between London and Bristol.
There were complaints from customers getting on the wrong train and finding their tickets invalid, but overall the Open Access operators made a valuable contribution and intercity travel in the UK was a success story.
Open access resulted in a dazzling array of different operators and liveries, especially between Manchester and London. As imagined by AI (Dall-E)
The Green Book:
The 2000s were a boom time for the railways. The combination of the recent West Coast route modernisation, the rolling PFI electrification, smaller PFI projects initiated by British Rail and Open Access competition drove ridership to record levels.
However, it wasn’t all good news. Treasury “Green Book” investment rules seemed to encourage investment onto routes that were already popular. The PTEs struggled to replicate the success of the Overground, as their funding bids to central Government tended to fail. And Regional Railways stagnated.
The big investments in new trains for the South East and West Coast resulted in old slam door electric trains being released, which weren’t suitable for cascade onto the Regional Railways networks. As a result, the inadequate 1980s trains continued to be all there was.
Network Rail’s electrification PFI was also driven by Green Book rules, so the Chiltern line and Gospel Oak – Barking line went first, followed by the Midland Mainline and Great Western mainline. Infill electrification in the South East to Uckfield went ahead of any mainlines in the North.
Moreover, the benefits of the Great Western and Midland Mainline electrifications were somewhat undermined by the fact that the Network Rail electrification PFI had no mechanism to unlock investment in rolling stock, so diesel High Speed Trains (HSTs) continued to be the majority of the trains used, long after these routes had been electrified. Investment in new electric trains, not covered by one of the PFI deals and dependent on ordinary Treasury funding, was painfully slow and incremental.
Regional Railways saw no electrification or new train investment, and even major Regional Railways routes like the Transpennine route or Cardiff to Manchester route continued to be served by increasingly overcrowded 1980s two-carriage trains.
HS1:
Throughout this period, a private consortium was building Britain’s first High Speed railway. London & Continental Railways were selected to build the line from a rebuilt St Pancras station to the Channel Tunnel. The line was partly to fulfil a longstanding commitment to connect the capital to the continent, but was also designed to have a role in London’s delivery of the 2012 Olympics. The first stage opened on time and on budget.
London and the South East:
The situation in the rest of London and the South East was interesting. The Overground (covering all the inner-suburban services into the mainline termini) was a triumph: transforming travel within the capital, creating new housing and regeneration opportunities in previous poorly connected suburbs like Sutton and Bexley.
Thameslink 2000 and Crossrail were both approved for funding: the icing on the cake of rail regeneration in the capital.
However, the situation in the wider South East was somewhat different. Rail paths into the London termini ended up being subject to something of an internal Network SouthEast market.
With an incremental path, NSE could either operate a train under contract to TfL (using the Overground brand), for which NSE received a set payment and TfL took the revenue risk. Or it could operate a service from outside London, for which NSE took the revenue risk and bore the cost. It became increasingly clear that NSE preferred to do the former.
As service frequencies within London increased, the service from commuter towns like Guildford, Oxford and Ipswich was gradually reduced. Services were merged and became slower to free up paths for inner suburban Overground trains. To avoid dangerous levels of crowding, Network SouthEast pushed up season ticket prices from the home counties significantly ahead of inflation.
Commuters from the home counties started to move back into London, buying up the new homes being built in densifying “Overground suburbs” like Epsom and Chislehurst. London property prices soared while the home counties stayed, comparatively, flat. The “border” between London and the rest of the country felt more defined than ever.
A golden age?
However, despite these challenges, the 2000s were undoubtedly the best years in British Rail’s history. It was an efficient organisation, its level of subsidy was one of the lowest per mile of any state railway on earth, usage of the railways was at the highest level in history (though when you stripped out InterCity, open access and Overground routes, the picture looked a lot more sickly), while the Network Rail PFI was delivering a more modern infrastructure – at least for Network SouthEast and InterCity.
But there’s a global financial crisis on the horizon. What happens to the railways, laden with debt and PFI inflexibility, when the funding tide goes out and the nation elects a Government committed to austerity? We’ll find out next week…
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