Tuesday, 3 January 2012

Voices from the Occupation - The Great British Train Robbery


Voices from the Occupation
The Great British Train Robbery


As many of Britain’s project managers, doctors, accountants and nurses awoke to their first day back to work they have been met by drastic increases in their rail fares.  Commuters stood before ticket booths across the country, open mouthed as the reality of the fare increases flashed across screens.  This article discusses just how the Great British Train robbery occurred, how it is just one among many of the symptoms of a global systemic failure, leaving the 99% confused, disenfranchised and frankly, skint...and finally, what you can do about it.

Whatever Happened to British Rail?



It can be awfully tempting to look back fondly upon British Rail with spectacles of a thoroughly fuschia hue.  Let’s not do that.  At the time of British Rail, there were points failures, leaves on the line, late trains, no trains, cold trains, overcrowded trains, anaemic tea and rancid coffee.  The views of the frustrations about the experience of British Rail era commuters was best summed up in the poem ‘British Rail Regrets’ by Steve Turner. 

The thing is, it was ours.  We could have a conversation about how to fix it, safe in the knowledge that it was our joint resource.  Instead, the approach to ‘solve’ the issues of British Rail were about as ineffective as it is possible to make a solution.  How so?  Well, as a commuter who has only experienced trains post-privatisation – this poem captures almost entirely my experience of attempting to travel by train, anywhere in the UK.    Except, if I were living in the British Rail era – I would not have had to pay out a fifth of my income for the pleasure.  This is what today’s commuters are faced with. 

Let us take a look back.  During the reign of Prime Minister Margaret Thatcher (1979-1990) – the UK’s  first neo-liberal PM, a wave of socialised industries were sold into private hands.  It had been a long held conviction of the majority of the British Public that core industries and utilities should be owned and run by us, as a community, rather than surrendered to private interests.  Energy supply, telecommunications, the postal service, water, sewage and public transportation services, for example.  These were central necessities for our society to function.  The profit motive was secondary to the development motive.  For Britain to work, our people needed to be able to get from their home to their place of work, they needed to be able to stay warm and clean at home in order to remain healthy and therefore able to contribute, businesses needed to be able to communicate with each other and the world efficiently and at lowest possible cost.   
This all worked on the basic premise that things cost less if the price does not need to be inflated to include a profit this year, and a bigger profit next year and every year after that.
 

However, Thatcher represented and promoted a new way of thinking.  Business and the free market are more efficient providers of any service than the State is.  Business will drive out inefficiencies, competition among business will reduce prices, commercial innovation will see improved service.  Sound familiar?  It should, they’ve been banging that old drum for decades now.  So how come our trains are overcrowded, overpriced, our rail infrastructure is the worst in Europe, and satisfaction of users of the railways in this country is lower than ever?


A great explanation for this was put together in the paper ‘The Privatisation of British Rail – What WentWrong?’ In short – everything.

British Rail was perceived as a bureaucratic monolith by Thatcher's successor, John Major – so in 1996, the centralised railway was carved up amongst 100 different businesses and three regulatory bodies.  Each business subcontracted other businesses to fulfil elements of its service though; from providing rolling stock, to stations, signals, tracks, cleaners, maintenance – there was an endless sea of subcontracting, each with a layer of profit required.  To highlight just how insane this is, over 2000 companies were involved just in maintenance, overseen by infamous RailTrack, a company set up for this purpose.
 
Just a year later, in 1997, with confusion and disconnection in full flight, the recently elected New Labour government brought in the Strategic Rail Authority (SRA) to develop long term plans for the rail network, 'working in concert' with private companies. 

What Did we Get out of it?



The UK government made £5.3bn by selling British Rail.  This equates to a mere 3 years in the increased, yes increased, state subsidy agreed by the UK government.  This means, the companies gave us £5.3bn in 1996, and we gave that back in subsidies in the following three years.  Not only that, but we continue to pay the subsidy.  In fact, today, the rail subsidy stands at £5.2bn per year.  Fare-payers contribute £6.2bn per year.  Therefore, we sold a service for £5.3bn in 1996, which we now rent for £11.5bn per year.  We pay for this mistake in other ways too.

Firstly, people paid with their lives and limbs. Southall, Ladbroke Grove, Hatfield, Potters Bar, Clapham Junction.  From the late nineties to the early noughties, multiple train derailments and crashes happened as a direct result of the neglect of the infrastructure of our railway system.  Just years after its inception, RailTrack was aborted, as its failure to effectively maintain the network hit home with these tragic results.  RailTrack folded with £3.3bn of debt on its books, and shareholders seeking compensation were given 262p per share by the UK government; shares worth 2p when the company was dissolved.  Sound familiar?  Once again, private company fails, and the public pays several times over – with their lives, the fares, the subsidy, the compensation.

Secondly, we paid in a reduction in service.  Between 1996 and 2000, according to the Association for Train Operating Companies (ATOC) own numbers, passenger journeys increased by 25% and freight volume by 40%.  Great huh?  Not really, as the rise in so called ‘passenger services’ rose by a mere 7%.  In plain English, more people crammed into fewer trains. 

And finally, the fares.  The ATOC website, discussing the train fair rise this time around is keen to mention that despite this, train fares have actually increased in real terms by just 1.2% since 1996. Which is strange, because Chief Executive Michael Roberts, talking to the Guardian in November 2008 about the 7% increases about to kick in the next year, stated that fares had increased in real terms by 5%.  Yet there has been at least a 5% per annum fare rise on the trains every year since.  In short, they are lying.

What did the Private Companies get?



 Meanwhile, a host of private companies, including the 29 Train Operating Companies have made off with enormous profits. Many of the services purchased during privatisation were sold on shortly after at rates much higher than the government sold them for.  One company which purchased rolling stock sold the franchise just 6 months later for a profit of £300m.  You might think, well so what?  Well done them for having the initiative.  But the thing is, the company who bought it also has a profit motive; so you and I and the other train users will be paying that £300m back in fare increases, reductions in service and state subsidies.  The profit doesn’t come from nowhere.  It comes from our pockets, ultimately.

Each time the fares increase, the same two excuses are trotted out by ATOC.  Don’t believe me?  Review the press releases yourself.  They are 1) Passenger numbers are increasing and we need to fund improvements in the service, 2) The government is reducing its subsidy and we need to make the money back.

Now, the train operating companies must be the first businesses in the world to turn an increase in customers into a bad thing.  In basically every other customer scenario, more customers equals price freeze and more profits, or a split between the two.  Can you imagine Nike saying –we’re sorry, so many people bought Nike trainers this year we had to buy a new factory to produce more next year so prices have gone up 7%?  No.

The fact that the government is reducing the subsidy is merely making the real cost of the bungled quasi-privatisation visible to the users.  Most people have no idea we even pay a subsidy to the railways, let alone fund HALF of what it costs to run the trains.  But, people can see the cost of their tickets.  It seems to be quite rich, that the businesses who bemoaned the clunky, bureaucratic, inefficient State – are more than happy to be subsidised by them.

This year, the season ticket for commuters in the south east broke through the £5000 a year barrier for the first time.  Commuters travelling to St Pancras from Hastings, Rye and Tonbridge will have to find £5,192 a year. 

The Wider Picture



As the government persists in making us feel like spendthrifts for breaking the economy with our demands for excessive wages and public services, it is worth a look at the wider picture.

Energy prices have shot up by 25% just this year, childcare fees have risen to an average of £177 per week – with some areas much higher, if you are lucky enough to have made it to University you have the repayments on your student loan deducted from your pay each month too, tax rises are meaning each family are paying £5 per day more…Wages?  If you were a FTSE 100 director last year – your pay increased by 49%.
If you were a binman, a police officer, a nurse, an office worker – your wage rose by an average of 1%.  Inflation stands at around 5%, so in real terms, you’re being paid less.

And on top of everything else, the train ticket to work could cost you £5000 per year.

So, as those commuters stand with their mouths agape as the increased digits flash across the FastTicket machine.  They are not only seeing this fare increase, but all of the price hikes, wage cuts and service reductions.
It is no wonder that the average UK citizen today feels like they are having the blood sucked out of them.  They are.   



So What do We do?



Firstly, make the connections.  The energy prices, the fare increases, the pension cuts, the increased hours, the shrinking wage, the pointless elections where you think it makes no difference who you vote for  - these are connected.  They are connected by ideology.  If you have every leader, of every mainstream party agreed, that state subsidised private profiteering is the best way of doing things – the conditions remain the same, whatever government you choose. 

So you can do two things.  One is get involved in forms of protest which you are able to and which have a direct impact on those perpetuating the situation.
Get involved with the national protest at #Farefail and join other train users, by grouping together you simply amplify your complaint. 

The second thing is support the Occupy Movement.  Join the conversation about how we tackle the biggest issues in our world.  Be a part of your community and help assess the broader picture.  It is time to make your voice heard. We get the world we tolerate. If we continue to stay silent, and tolerate, more of our collective resources will be sold so we can pay more, to get less, so someone else can turn a profit.
 
It is not enough to be angry, it is not enough to be upset.  It is not enough to complain.  If you want a difference to be made, you need to get up and make it.  People in over 2000 camps, in 90 countries in the world are making that stand now.  If you can’t join them in body, join them in spirit and support however you can.  And who knows?  A sustainable, reliable train service could be the tip of the iceberg.

4 comments:

  1. crazy but true. a nicely put account of why it's important for us free market consumers need to take more notice of our obligation to stay interested in prices, competition and political claptrap.

    ReplyDelete
  2. Excellent account. People get the government they deserve. We are all literally having the life blood sucked out of us. It's time for real change in this country.

    ReplyDelete
  3. Excellent! Well written and good analysis.

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  4. Just another thought....... How much of the money used to buy the rail franchises has come from pension funds - or has been leveraged from pension funds. Each year workers pay in hundreds of billions in the hope of a reasonable retirement, but while fund managers take their fees they use investments like this to inflate the value of funds to make it all look OK, but it is the high fares and tax subsidies that maintain the value. So long as everyone keeps paying taxes and high fares and any other scam required the pensions might just get paid. So much for return on investment.

    ReplyDelete

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