The Railways Act 1993, 24 years on: What is its legacy?

5 Nov 2017

 

On 5 November 1993 the Railways Bill was given Royal Assent and became enshrined into law as the Railways Act. It has been said that railway privatisation had been considered a step too far by Margaret Thatcher when she was Prime Minister – though the truth is, perhaps, much more likely to be that she would very much have wanted to do it but had possibly decided against it on a calculation that public opposition would be too overwhelming.

 

The Railways Act was the fulfilment of a promise made in the 1992 Conservative Party manifesto. That promise read: ‘We will end British Rail’s monopoly. We will sell certain rail services and franchise others.’

 

In its 1997 General Election manifesto, New Labour criticised the Tory government for a ‘process of rail privatisation’ that had ‘made fortunes for a few, but has been a poor deal for the taxpayer’. To prove to the electorate that New Labour was indeed ‘New’ Labour – that it had parted with socialism (an ideology now associated with ‘Old Labour’), the Party made a pledge not to renationalise the railways but to instead, 'establish more effective and accountable regulation'.

 

Many on the Old Left, which includes those in the Labour Party of today who still refer to themselves as being socialists (and who now find themselves at the helm of Labour under Jeremy Corbyn’s leadership) still regard privatisation of the railways and the rail services as a national disgrace that has failed the British people and has only benefited the owners of the TOCs (Train Operating Companies) – whose franchise contracts, by the way, are reviewed every few years.

 

Public opinion, currently, is largely in favour of the State taking back control of the railways, with 60% supporting renationalisation according to a YouGov poll conducted earlier this year. I suspect that, perhaps the primary reason for this is not so much punctuality and efficiency (which, as I shall discuss, has actually been extremely good since the railways were handed over to the private sector) but the prices of rail fares. This country has the most expensive rail fares in the whole of the European continent – and this is an issue that angers many of the general public, who assume that if State-run, fares would be much cheaper (as they indeed were).

 

Has though, the legacy of the Railways Act, the legislation that provided the background for the privatisation of rail services in Britain, been a successful one or has it indeed been a failure as so many seem to think it has been?

 

 

 

The truth is, that in comparison to when the railways were in the hands of State-owned British Rail, safety improvement has increased dramatically in the hands of private ownership, according to a study conducted by Imperial College London. Indeed, Britain’s railways are among the safest in Europe, based on the number of incidents and accidents – that is, of course, not to deny the fact that there have been a number of major accidents, even in recent years.

 

The quality of and satisfactory rates of customer service has also increased since privatisation, with the average satisfaction rate among rail passengers being 78%. Punctuality has also increased in the years since the enactment of the Railways Act –  with 88% of all trains arriving on time at the end of the 2015-16 year, with its peak to date having been reached in 2011 when 92% punctuality was achieved.

 

When compared to the nationalised system, efficiency under the private ownership franchises of the TOCs has also increased, with operating losses falling by 20% in real terms since 1997 (when Tony Blair’s government completed the privatisation process that the previous Tory government had embarked on in 1994 under the provisions set out in the 1993 Act). This is evidence that the so-called 'profit motive' has, therefore, worked well. It has indeed made the railway services much more efficient for its users.

 

In 2004, the then General Secretary of the trade union ASLEF (Associated Society of Locomotive Engineers and Firemen) Lew Adams, conceded that privatisation had been a positive thing.  He said: ‘We are running 1,700 more trains per day since it [the railways and rail services] was privatised. The entrepreneurs built traffic to the extent that we are having to build more infrastructure. What is true is true: £4.2 billion spent on new trains. We never saw that in all the years I’ve been in the rail industry. All the time it was in the public sector, all we got were cuts, cuts, cuts.’

 

It is clear that, despite the New Statesman publishing an article on the 20th anniversary of the Railways Act (5 Nov, 2013) saying that privatisation had been a total failure, the implications of the Railways Act 1993 have, in actual fact, been largely beneficial.

 

In conclusion, Britain’s railways and our rail services are in a much better way now than before the Conservative government of John Major sold them off. It has been extremely beneficial for passengers – yes, fares are high, alas that is a mere annoyance that we must simply hold our noses and accept as part and parcel of a free market economy.

 

In an age where the neoliberal consensus has come under serious threat in Britain for the first time since the early 1980s, the anniversary of the Railways Act 1993 allows us to look back into history at a particular piece of legislation that remains to this day a shining example of neoliberalism working extremely well for ordinary people. Neoliberalism is delivering well and the Railways Act 1993 is proof of this.

 

The Railways Act 1993 has been a success for those who use the railways. It must not be repealed.

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