Privatised Rail Has Meant 'higher Fares, Older Trains And Bigger Taxpayers' Bill'

[interestrateripoff]

http://www.guardian.co.uk/uk/2013/jun/07/privatised-rail-higher-fares-older-trains

Privatised rail has meant higher fares, older trains and a greater bill for the taxpayer, with train companies diverting profits to shareholders with barely any investment, a report has found.

Researchers said the public was "bamboozled" by number-shuffling in the system and called for the abolition of train operating companies, concluding that the selloff of rail had brought little private sector investment in new technology and the most expensive fares in Europe.

The TUC-commissioned report, by the Centre for Research on Socio-Cultural Change at the University of Manchester, says private train companies depend heavily on public subsidy to run services. It claims that the halving of track access charges for companies since privatisation has resulted in a hidden, indirect subsidy from the taxpayer.

But nice large salaries for those running the train companies?

Hardly a ground breaking report as I bet most people who use trains regularly could have told you the same conclusions?

[richc]

The TUC-commissioned report

'nuf said

Edited June 7, 2013 by richc

[RufflesTheGuineaPig]

The plan for privatisation was that it would lead to private investment in rail infrastructure, leading to new lines and rolling stock.

The problem was, the people who bought the rail companies considered buying the companies/shares to be their investment... and they expected a return.

Their is no incentive for the private companies to invest. They wont see any profits from the investments... profits/savings from those sort of investments take decades to repay their costs, and the licences to run the lines are for 5-10 years. This is why these was such a fuss when Virgin trains lost that mainline contract... they had invested billions in track improvement, and then lost the contract.

If you have invest £10bn in infrastructure and need to recoup those costs, you are bound to be outbid at the next renewal by someone who doesn't have the investment costs to repay. Thus you will never get your investment back, so why bother. Besides... the passengers pay the same regardless of how new or reliable the trains are, so it makes better financial sense to just run it into the ground.

The whole privatisation idea was stupid. I just can't tell if the Tories were dishonest or stupid.

[R K]

The whole privatisation idea was stupid. I just can't tell if the Tories were dishonest or stupid

.

Private profits for rentiers.

That's why they exist.

All public utilities, quasi-monopolies, public goods etc ought to be run for public benefit not private profit.

All the Tory privatisations have had the same outcome. Cost more, poorer service, less investment, collapse eventually requiring state subsidy = bailout private bondholders, reprivatise windfall, rinse/repeat.........

[liminalien]

I'd like to see trunk roads and motorways privatised. I'm sick of my taxes bankrolling all those those subsidy junky socialist motorists.

[fluffy666]

Private profits for rentiers.

That's why they exist.

All public utilities, quasi-monopolies, public goods etc ought to be run for public benefit not private profit.

All the Tory privatisations have had the same outcome. Cost more, poorer service, less investment, collapse eventually requiring state subsidy = bailout private bondholders, reprivatise windfall, rinse/repeat.........

Private Good Public Bad has become a doctorine every bit as blinkered and dangerous as 1930s communists.

[swissy_fit]

Private Good Public Bad has become a doctorine every bit as blinkered and dangerous as 1930s communists.

And it has many, many fans on here.

The problem is, the unions were/are stupid enough to allow this to happen.

How so, you say?

By allowing publicly run things to become sh1t, blocking reform and unjustifiably protecting their sh1t members who work in these public institutions.

The Tories would never have got the "Private is good" thing going if the unions had been better because it simply wouldn't have been necessary so it would never have gained the political support that it did in Thatcher's time, and ever since.

[Guest_GradualCringe_*]

Rail isn't a proper private concern though. It's subsidised to the hilt left right and centre and the very worst of both worlds i.e. corporate sharks getting the incompetent government to agree to ludicrously generous contracts ("heads I win, tails, tax payer picks up the bill" type contracts).

- Rail operators don't own or maintain the track, that's the repsonsibility of Network Rail.

- Rail operators directly receive grants from the government (Rail Subsidy Figures), some operators are paid as much as 30p per passenger, per mile.

- The congestion charge is an indirect subsidy to operators, running trains to and from London, in that it increases the cost of driving into London and hence decreases competition from cars, taxis, and coaches.

- Council parking restrictions and fees are yet another indirect subsidy, further reducing competition from motorists, it also allows stations to charge ludicrous parking fees.

- Anyone remember the Virgin/First Capital tender debacle? Who in their right mind agrees to pay out millions for unsuccessful tenders? That's a risk and cost borne by the organisation making the pitch.

It's little wonder the trains are dirty, late, and the staff are idiotic and unhelpful (after having used the trains as a commuter for several years, I have to say the staff at stations and on trains for the most part are surly morons. Surely someone posting on here has been caught up in some sort of rail delay? I have never, never to this day ever received coherent advice, rather confused, fractious, and contradictory information from station staff when the ordinary schedules have become disrupted), they have no incentive to run a good a service, and the general attitute I receive from rail staff, is that of those living in an ivory tower i.e. we need them more than they need peoples' custom.

Edited June 7, 2013 by GradualCringe

[winkie]

Not yet another service to give up on using......the way things are going, it will be if you can't do it yourself don't do it or use it.

Edited June 7, 2013 by winkie

[fluffy666]

And it has many, many fans on here.

The problem is, the unions were/are stupid enough to allow this to happen.

How so, you say?

By allowing publicly run things to become sh1t, blocking reform and unjustifiably protecting their sh1t members who work in these public institutions.

The Tories would never have got the "Private is good" thing going if the unions had been better because it simply wouldn't have been necessary so it would never have gained the political support that it did in Thatcher's time, and ever since.

Indeed.. a good union should have the long term interests of the company as one priority. Moreso than the management or shareholders in many ways.

But it reached the stage a while ago where the general public opposes more privatisation - the Post Office and NHS being the big ones - but the government just carries on obliviously. Well, apart from the hugely well paid consultancy positions they get on leaving office with these privatised companies.

[Travisher]

Funny how East Coast, now back in 'public' hands gets by on far less subsidy than the so called private companies.

The staff remain the same though whatever the logo on the side of the train.

Govt plans to privatise and toll the A14 will cripple business west of Huntingdon.

For those that don't know, the A14 came into being as the main (only viable) east-west route in the teeth of opposition from Thatcher's mob.

However, the flyover at Huntingdon is end of life. it is monitored 24/7 for movement via a satellite link to somewhere in Canada. Frantic efforts to stop it falling down are ongoing. If it fails the East Coast mainline will be shut as well the A14. There is no other viable route from Felixstow and Harwich docks to Birmingham. Everything will have to go down the A12, A11, M11, M25 and back up the M1.

If the toll road is built it will not be like the M6 where you can still use the old road. I'm betting fatal accidents will rocket as fen lanes get overloaded with east-west toll dodgers.

[Venger]

The TUC-commissioned report, by the Centre for Research on Socio-Cultural Change at the University of Manchester, says private train companies depend heavily on public subsidy to run services. It claims that the halving of track access charges for companies since privatisation has resulted in a hidden, indirect subsidy from the taxpayer.

It would help if older people had to pay something towards their train fares. Instead of the Labour bribe free-market distortion for older people that we've had for so many years. The free to obtain pass for everyone of state pension age.

I think I had to pay £2.10 for a short 1 stop train journey a few months ago. Had just dropped my car off for work at a garage. The train was half-full of old people, and students. Added to which when I got up to go to the doors just before arriving at my stop, the indignity of a train-ticket inspector who came all the way over from one end of the carriage to say 'ticket please' with a tone that suggested he thought I didn't have one. When I didn't immediately comply, his excuse was he had come over to open the door away, with a button at the back. Subsidising all those oldies with their non-mortgaged homes on some nice day out, which many of them could afford to contribute towards the rail cost.

How much will I have to pay to travel on trains and Metrolink trams in Greater Manchester?: With your pass, you can travel for free between 9.30am and midnight Monday to Friday, and all day at weekends and on public holidays. You will not need a ticket to travel after 9.30am.

[mfp123]

in real terms government subsidys today has only gone up slightly since privatisation 2.75 1994 to 3.9 billion today. it went steadily down during the period after privatisation however following the selby train crash investment went up heavily into the train systems.

however what this doesnt take into account is the success of privatised rail.

since privatisation it has turned around a declining service. passengers have doubled, record numbers of journeys, record distance travelled.

so although government subsidy has gone up in comparative terms, thats because it has been successful in turning things around. more people use trains than ever before. the more demand there is for the service, the more investment is needed to build more lines and the infrastructure to support it.

Edited June 7, 2013 by mfp123

[StainlessSteelCat]

It's little wonder the trains are dirty, late, and the staff are idiotic and unhelpful (after having used the trains as a commuter for several years, I have to say the staff at stations and on trains for the most part are surly morons. Surely someone posting on here has been caught up in some sort of rail delay? I have never, never to this day ever received coherent advice, rather confused, fractious, and contradictory information from station staff when the ordinary schedules have become disrupted), they have no incentive to run a good a service, and the general attitute I receive from rail staff, is that of those living in an ivory tower i.e. we need them more than they need peoples' custom.

I find it varies enormously. Virgin staff are very good on the whole. Some, not all, East Coast staff are rude jobsworths of the very worst kind. Some highly professional and friendly. Grand Central staff really nice. Rarely see Arriva staff on the few occasions I've taken one of their trains. London Tube staff tend to be very good. British Transport Police extremely poor.

I am beginning to think no punishment is too great for cable thieves though.

Edited June 7, 2013 by StainlessSteelCat

[alexw]

in real terms government subsidys today has only gone up slightly since privatisation 2.75 1994 to 3.9 billion today. it went steadily down during the period after privatisation however following the selby train crash investment went up heavily into the train systems.

however what this doesnt take into account is the success of privatised rail.

since privatisation it has turned around a declining service. passengers have doubled, record numbers of journeys, record distance travelled.

so although government subsidy has gone up in comparative terms, thats because it has been successful in turning things around. more people use trains than ever before. the more demand there is for the service, the more investment is needed to build more lines and the infrastructure to support it.

Correlation does not impy causation which is what you are saying.

Given the rate at which train fares have risen since privatization it's almost certainly not causation, given those trends we'd expect train usage to fall not rise. It's almost certainly because the users don't see any viable alternative which is not surprising as it's a de facto privatized monopoly. This also explains the way train operators have been able to so easily push through these rises - the customers don't see any choice but to accept.

So we have fares rising 3 times faster than inflation, a 60% increase in use, and yet only a 3% rise in the number of available carriages - screams monopoly with no alternatives to me.

The perfect example of this monopoly in action is commuters coming into london, for which there is no viable alternative during rush hour.

These passenger number rises have next to nothing to do with improved service. It's not been a success, far from it.

Edited June 7, 2013 by alexw

[mfp123]

Correlation does not impy causation which is what you are saying.

Given the rate at which train fares have risen since privatization it's almost certainly not causation, given those trends we'd expect train usage to fall not rise. It's almost certainly because the users don't see any viable alternative which is not surprising as it's a de facto privatized monopoly. This also explains the way train operators have been able to so easily push through these rises - the customers don't see any choice but to accept.

So we have fares rising 3 times faster than inflation, a 60% increase in use, and yet only a 3% rise in the number of available carriages - screams monopoly with no alternatives to me.

The perfect example of this monopoly in action is commuters coming into london, for which there is no viable alternative during rush hour.

These passenger number rises have next to nothing to do with improved service.

fares are more expensive, im not denying that but that also goes hand in hand with rising usage.

you cant tell me flat/declining usage for 30 years then suddenly in an instant changing to a massive surge and year on year growth following privatisation is not linked.

Edited June 7, 2013 by mfp123

[alexw]

fares are more expensive, im not denying that but that also goes hand in hand with rising usage.

you cant tell me flat/declining usage for 30 years then suddenly in an instant changing to a massive surge and year on year growth following privatisation is not correlated.

Umm I certainly can.

And rising fares certainly do not go hand in hand with rising usage. It's exactly the opposite of what economics tells us should happen. If I triple the price of potato's in real terms do you then expect people to eat more potato's? No of course not.

But if that coincides with the alternatives to potato's suddenly becoming unavailable or much less attractive, then you'll see that rise in potato eaters.

The same applies to train usage.

[mfp123]

Umm I certainly can.

And rising fares certainly do not go hand in hand with rising usage. It's exactly the opposite of what economics tells us should happen. If I triple the price of potato's in real terms do you then expect people to eat more potato's? No of course not.

But if that coincides with the alternatives to potato's suddenly becoming unavailable or much less attractive, then you'll see that rise in potato eaters.

The same applies to train usage.

if usage rises then so do prices. if i triple demand for potatoes then the price of potatoes goes up. basic economics.

the only way you could keep prices down with rising usage is through subsidy. those that dont take trains paying for those that do.

the fact is usage was declining over decades. the inflection point happened when rail was privatised.

Edited June 7, 2013 by mfp123

[the shaping machine]

"Privatised rail has meant higher fares, older trains and a greater bill for the taxpayer"

Unless TUC has a time machine in the basement it is impossible to say whether keeping the railways totally in the hands of the state would have been better or worse than what actually happened.

Hardly a ground breaking report as I bet most people who use trains regularly could have told you the same conclusions?

Actually I can remember how bad BR was.

Though certainly not perfect, the railways are now far better than they were when nationalised.

[mfp123]

UK train usage:

[the shaping machine]

And rising fares certainly do not go hand in hand with rising usage. It's exactly the opposite of what economics tells us should happen.

Which is why they should try increasing fares on the London to Birmingham route instead of building HS2.

[corevalue]

It would help if older people had to pay something towards their train fares. Instead of the Labour bribe free-market distortion for older people that we've had for so many years. The free to obtain pass for everyone of state pension age.

I think I had to pay £2.10 for a short 1 stop train journey a few months ago. Had just dropped my car off for work at a garage. The train was half-full of old people, and students. Added to which when I got up to go to the doors just before arriving at my stop, the indignity of a train-ticket inspector who came all the way over from one end of the carriage to say 'ticket please' with a tone that suggested he thought I didn't have one. When I didn't immediately comply, his excuse was he had come over to open the door away, with a button at the back. Subsidising all those oldies with their non-mortgaged homes on some nice day out, which many of them could afford to contribute towards the rail cost.

And exactly where did you read this piece of garbage? The only concession a pensioner gets is the offer to buy a senior railpass for £28, which gets you 30% discount.

[campervanman]

Private Good Public Bad has become a doctorine every bit as blinkered and dangerous as 1930s communists.

And Thatchers children (bless em) just lap it up as was intended. Keep the bogeyman (Europe/foreigners) and they will continue to blame them for the stuff we keep shafting the suckers with (it's what they want).

[Venger]

And exactly where did you read this piece of garbage? The only concession a pensioner gets is the offer to buy a senior railpass for £28, which gets you 30% discount.

My own mother gets the free rail (not before 9:30am). And it looks like her pass entitles her to free tram, with the network that has just been extended, and expensive fares (imo) for actual payers. You know, younger people who face massive challenges with incomes and housing costs.

Not national free rail, but within Greater Manchester, and that's many stations. You have to prove you live in the area, but I'd be surprised if there weren't similar subsidies, or generous concessions in place for other regions. They don't even need a ticket. Just a flash of their laminate pass. That's the fairness for you.

Transport for Greater Manchester

A guide to concessionary

travel in Greater Manchester

for older people

June 2012

How much will I have to pay to travel on trains and Metrolink trams in Greater Manchester?: With your pass, you can travel for free between 9.30am and midnight Monday to Friday, and all day at weekends and on public holidays. You will not need a ticket to travel after 9.30am.

[PDF]http://www.tfgm.com/...let-Over-60.pdf

[alexw]

if usage rises then so do prices. if i triple demand for potatoes then the price of potatoes goes up. basic economics.

the only way you could keep prices down with rising usage is through subsidy. those that dont take trains paying for those that do.

the fact is usage was declining over decades. the inflection point happened when rail was privatised.

If we are talking about only having the same available crop space yes.

Now tell me have they stopped building train carriages, so there's a shortage of passenger space?