So it wasn’t any of that big stuff that shocked me. It was something much smaller and less globally significant. Sometimes it is the tiny routine lies and deceptions that aggravate the most. This time the betrayal of public trust that got to me was the announcement that Virgin Rail and its partners are to hand back the East Coast Rail Franchise. This isn’t annoying just because it is a stupid thing for the government to allow. Or because it illustrates once again the utter failure of rail privatisation. The thing that struck me most was the degree of routinised contempt it showed for the public. Cupidity has been normalised to an astonishing degree since Blair perfected the art.
The government knew it had a problem over Virgin. So it went for the oldest trick in the book. Pick a busy news day. Find a related topic that you can get a few positive headlines out of. Then try and release hugely damaging information quietly amongst the storm of other news.
Most of the public will have heard some of the ample news coverage about the possibility of some new rail lines being opened up. Sometime in the future. This all must have sounded very good and it must have served to secure the government a few extra votes.
Few people will have seen that a multi-billion pounds contract that generated revenue for the government had just been cancelled at the tax payers expense. Or noted that the amount of money this will cost could easily dwarf the amount of any genuine hard cash announced to open new stations. That relevant facts were hidden away at the end of the news releases and the decision to let Virgin forget about paying a great deal of money was treated as if it were a simple piece of normal management decision making.
On close reading it turns out that Virgin Rail has discovered that it cannot make as much money as it wants out of operating the East Coast Rail franchise and so has decided to hand it back and stop making the payments it is contractually obliged to make. This is an astonishing way of doing business. It means that Richard Branson has been gifted a guaranteed one way bet on making money. If he wins a franchise bid that proves highly profitable because the price is too high, then he gets to keep all that money. If he wins a franchise bid that is not making as much money as he would like, then he is allowed to simply hand the contract back.
That is not the way contracts are supposed to work. If you sign a deal then you are supposed to deliver on it. Civil servants aren’t meant to have the discretion to let suppliers decide which government contracts are making them lots of money and to forget about delivering any that aren’t doing so well.
Incredibly this is not the first time that this has happened so the circumstance should have been anticipated and plans put in place to prevent it. Once before the East Coast rail line was operated by a private company and that company chose to, and was allowed to, hand back the contract. The last time that happened the government nationalised the East Coast line and the service was delivered every bit as efficiently by a public enterprise contributing all the not inconsiderable profits to the government - and more importantly therefore to the people of this country.
The public sector company proved a success but having a successful public-sector rail franchise was ideologically unacceptable to the Conservative Government. They insisted on taking the service out to tender once again and proudly announced that the winner of this particular franchise was not – for once – the state run railway company of some foreign government but a proud private enterprise success story. Virgin trains and its partner.
What was trumpeted as a huge private enterprise success has now proved to be a huge private sector failure. The public sector could operate the line profitably but Virgin couldn’t. No wonder they needed to bury that bit of news.
Many things are, of course, much better organised by the private sector than the public. Railways aren’t one of them because there is only one line and one supplier. Splitting the railways up into a multitude of different private suppliers hasn’t created a single case of competition to offer a service to the public. All it has done is created chaos. Mainly around ticketing but also around who is responsible for what.
Incredibly it has now been decided to make that chaos even worse. Not only are the train operators to remain firmly in private hands making easy one way bets that they can later welch on. Now the tracks and the infrastructure itself are to be divided up into a confusing mess. Network Rail is to be divided up and exposed to the same messy confused and over generous contracting system.
I don’t normally favour top down government re-organisations. When it comes to the railways one is desperately overdue. What is needed is a proper national plan and a much more coherent service. For example, the North of England has a whole series of different suppliers all making their own plans for a different bit of the service. As a consequence we have a rag bag of uncoordinated services which reek of neglect and are operated in grotesquely inefficient ways. Take a train between Leeds and Manchester and you will trundle along via a slow stopping service which takes an age to reach anywhere. Try and take a simple train ride 40 miles from my home into Manchester and you need to allow 2 hours.
In Germany there are many different powerful economic activity centres backed up by strong regional infrastructure. In Britain we have a badly overheated economy in the South East where young people can find jobs but can’t afford the housing. Up north and in the Midlands we have places where housing is decaying and has been left to rot because there isn’t enough work to attract people to do them up and live in them. The best way of reviving the northern and the Midlands economies would be to improve the ease of travel to work so that companies can draw on a wide pool of skills and people can choose a much richer variety of work from a wider network of employers. There are major banks located in many northern towns including Skipton, Bradford, Leeds, Manchester and Halifax. Yet there isn’t a single employment market because workers can’t easily travel between these locations. The same applies to medical technology and pharmaceuticals.
The government is therefore absolutely right to be thinking of re-opening rail lines and trying to supply new services. It is just a touch unfortunate that they don’t have a proper plan for what they are doing and how they are going to do it. It is also a touch unfortunate that the main focus of any actual spending commitments was the Oxford to Cambridge corridor of development. For the north all that was really announced was the possibility of maybe doing something about opening a couple of new stations at some future stage.
Proper government planning requires a plan, a strategy and finance. What we have instead is spin, deception and incompetence. What could possibly make anyone cross!?