Friday, Nov 21, 2008
Lets stop infrastructure funding and divert resources to justifiable projects like the Olymipics
FT: Network Rail to 'accept' cuts
The company that owns Britain's rail network yesterday edged towards accepting a tough funding package that will force it to cut costs by 21 per cent over the next five years.
Posted by matt_the_hat @ 08:39 AM (549 views) Add Comment
12 Comments
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1. planning4acrash said...
No, lets cancel the Olympics and channel that money into TAX CUTS!!!
Its amazing that the government sold us Olympics based on the Infrastructure required. Like they couldn't put more into infrastructure in place if they spent more less on a fleeting two week festival. BUT, forget government putting money into infrastructure, we need them getting out of the way. The private economy, via tax cuts could provide infrastructure far better. (But we need also to end the tax that is inflation, because that is just as bad as direct/indirect inflation) What you should know about inflation
2. harold said...
Seems perfectly reasonable, considering that an off-peak stranding-room-only day return from Cambridge to London only costs £37. I would happily pay £100 to cling to the outside of the carriage.
Mrs Trellis, North Wales
3. phdinbubbles said...
37 pounds x 1.07. Fares have are going up 7% off-peak from Jan 2nd.
4. Phdinbubbles said...
Sorry that should be "Fares are going up 7% off-peak from Jan 2nd."
5. jack c said...
planning4acrash - your mission (should you chooose to accept it) is to find out how much Lord Coe potentially stands to make from London 2012 - here is something to get you started - "Financial Mail talks to the former banker who made £110m when he left Goldman Sachs, but who faces his biggest challenge in running the 2012 Olympics... see "www.thisismoney.co.uk/investing-and-markets/article.html?in_article_id=451320&in_page_id=3
6. hubbers said...
Cut costs? Yuo are kidding right these maangers don't know the meanign of the words cost cutting. It will almost certainly mean HIGHER FARES!
7. doom&gloom said...
P4AC: "The private economy, via tax cuts could provide infrastructure far better"
Are you suggesting that public works be carried out by the private sector? Maybe call it something like 'Private Finance Initiative'? Another advantage would be that the borrowing to complete the works would not appear on government balance sheet. Marvellous.
8. phdinbubbles said...
Can anyone explain to me why passenger numbers on the rail network have increased by 70% over the last 14 years (to their highest peace-time number for at least 80 years)? - the population hasn't increased by 70%. Rail travel is still prohibitively expensive compared to just driving somewhere in a car for most journeys (even for single occupancy of a car - as soon as there are more than one in the car it's a no-brainer as to which is cheaper). So why then? Obviously train operators realised they could cram 70% more people into the aisles - so it can't be due to rail becoming a more pleasant alternative to roads. The only explanation I can think of is that (some rather silly) people feel richer because the value of their homes has gone up and therefore don't mind forking out lots of dosh to do more travelling. Perhaps people are commuting greater distances, to live in a house they can afford in a less desirable area more distant from their place of work. I'm confused. Please help.
9. doom&gloom said...
Phd - I think road use has gone up too, probably by a similar amount. All part of the boom - more leisure travel, more work travel, plus (temporary) increase in population.
As a train user myself, I've always found the total journey cost comparable to driving. If you always buy the cheapest fares (advance purchase, group save when 3/4 travelling, network rail card, etc) it compares favourably with cost of petrol plus parking (and congestion charge in London). Of course doing away with the car altogether and using car-clubs mean no insurance, MOT, road tax or servicing bills either.
10. phdinbubbles said...
I'm going to vistit my parents this weekend - the standard off-peak return ticket is £48.30, so for the two of us = £96.60 - perhaps I could have found some cheaper tickets if I'd looked some time in advance. I will be doing the same round-trip journey for under £30 in petrol. Obviously there are all the overheads and depreciation associated with motoring, but I'm not really tempted by doing the rail journey at the moment - given it will take twice as long door to door as well. I didn't get a car until my late twenties, so am well used to travelling by train which probably explains my aversion to using them now!
11. Transporteconomisttobe said...
PHD @ 7.
The economists answer to this is that we have seen such growth because there is a high income elasticity with respect to train travel. In addition, for certain parts of the network, ie travelling into London, there aren't really any alternative modes which are readily substitutable with train travel. In the absence of any increases in capacity, this means they can ratchet up the prices and people will still pay. In the long-term the increased profits from this should send a signal for further investment in capacity, but we all know how it isn't quite so simple. Nevertheless, expect to see railway patronage slump in line with the general recession over the coming years, and for the governments initiative to introduce 1300 more carriages to the network to be an utter waste of time as the railway boom will have long gone by the time they get rolled out.
12. matt_the_hat said...
8. doom&gloom
I always find this is the case with governments - they think it is there job to make the alternative expensive (congestion charge, road tax/tolls) instead of incentives.