Johnson and the railways. Is he ready for pay as you go – and the end of the season ticket? And are passengers?

21 Apr

Boris Johnson loves infrastructure, and is impatient about the unconscionable delays and exorbitant costs which improvements to it generally entail.

In his speech last summer at Dudley, delivered at a lectern bearing the upward-slanting words “BUILD, BUILD, BUILD”, the Prime Minister declared that as the pandemic recedes, we must “move with levels of energy and speed that we have not needed for generations” in order to bring about an “infrastructure revolution”.

An early test of this boosterism will come on the railways. In November, ConservativeHome revealed that, as soon as the pandemic took hold, Grant Shapps set up a committee on rail reform to work out how to seize the once-in-a-lifetime opportunity presented by the emergency.

One member of that committee, Keith Williams, a former Chief Executive of British Airways, has since September 2018 chaired the Williams Rail Review, set up to make recommendations for reforming the entire structure of the industry, with the interests of passengers and taxpayers put first.

The original announcement said:

“The review’s findings and recommendations will be published in a government White Paper in autumn 2019. Reform will begin in 2020.”

Johnson, who became Prime Minister in July 2019, was that autumn contending to get Brexit done, and has for most of the last year had his attention monopolised by the pandemic.

But he is reported recently to have spent time mastering and approving the Government’s response to the Williams Review, which is likely to be published in May, after the local elections.

The whole situation has changed, and has become more favourable to sweeping reform. The pandemic hastened the end of the franchising system, under which companies bid against each other to run particular lines.

He who pays the piper calls the tune. Since March last year, as Tony Lodge reminded us on this site yesterday, the railways have only been kept running with public money.

The rail unions can no longer hope, in their defence of outmoded working practices, to divide and rule among the different rail companies.

They instead face a single opponent, the Treasury, which is not inclined to regard the preservation of inefficiencies as a justifiable use of public funds.

Before the pandemic, the unions could threaten to bring trains full of commuters to a halt, with immediate loss of revenue to the operating company.

Now that what little fare revenue there is goes to the Treasury, which in turn pays the operating companies to keep a reduced service running, the balance of advantage has changed.

To stop almost empty trains is an empty threat. The Rail, Maritime and Transport Union has this week been sabre-rattling, but the more important argument is within the Government itself.

Rishi Sunak, as Chancellor, is known to have fretted at spending billions over the last year to ship “fresh air” round the country.

The Williams Review is likely to propose the creation of an arm’s-length body to run the railways: in layman’s language, a Fat Controller.

The Treasury will require assurances that the Fat Controller, and the Fat Controller’s dependents, do not gorge themselves on endless taxpayer-funded subsidies.

The most delicate task for the Department for Transport is to keep the Treasury on side. For there can be no denying that under the new system, where the train companies are paid to provide services and the fare revenue goes to the Government, it is the latter that takes the risk.

Nobody knows how passenger numbers will recover after the pandemic. How many of us will continue to work from home, at least for part of the week?

A big determining factor will be the cost of getting to the office. The present fare structure, as anyone who uses the railway knows, is a complete mess, incorporating many ludicrous but long-standing anomalies, so that, for example, when setting out to travel from A to D, it can be cheaper to book three different tickets, from A to B, B to C, and C to D.

Will the Government seize the chance to sweep these anomalies away? A future beckons in which, when we want to go somewhere, we just swipe a card and step on the next train, in the justified belief that we have obtained the cheapest fare we could have got under any more cumbersome system.

This already happens in London. In time it will probably happen throughout the network. But the cost of introducing it will be considerable, losers from the reform will be angry they can no longer get the cheap fares currently available to passengers who book in advance on non-peak services, and from the Treasury’s point of view there will be an acute danger of missing out on the season-ticket revenue from commuters, which before the pandemic was such a significant element in the financing of the railway.

Those commuters had nowhere else to go: they simply had to get to the office, and the train was the only way. The pandemic has revealed to them and their employers that they could instead remain at home.

Yet it has recently been reported that these long-suffering commuters will soon be offered carnets of tickets, which if used will mean that to go to the office for only three days a week will end up costing them more than if they went there for five days a week with a season ticket.

That sounds like a pretty effective way to deter people from travelling by train at all if they can possibly avoid it.

The other side of the equation is costs. The pay of train drivers is very high, approaching that of airline pilots, and far above what bus or lorry drivers get.

And the training of train drivers is extraordinarily expensive. It has not been transferred to computer simulators, as much of it could be. Why should the Treasury, and indeed the taxpayer, fund these outmoded methods?

I would like, in passing, to express my admiration for the job ASLEF, the train drivers’ union, has done on  behalf of its members. But conservatism has its limits.

British Rail, which ran the system until privatisation in 1994-97, had a certain charm. It was dedicated, like the other nationalised industries, to the preservation of the past, and especially to the preservation of jobs.

As a young passenger of conservative disposition in the 1970s, I could not help hoping that BR would succeed.

But BR failed. It possessed none of the freedoms of the railway companies which had preceded it, so it could not modernise itself.

Extensive modernisation is just now required. The last thing the DftT, or the Treasury, wants to do is to reinvent BR.

The Government wants to preserve the vitality of the private sector, while also taking charge, and running the railways in the public interest.

Here, one may say, is the paradox of Johnsonism. During his short prime ministership, the railways have thanks to the pandemic been nationalised, but he aspires also to preserve for them the rude freedom of the private sector.

What an awkward circle for Williams to square.

“We need a Kate Bingham,” as one railwayperson exclaimed during the preparation of this article.