Why TfL running London trains is actually a terrible idea for the capital

Whenever something does not work properly, we demand a “fat controller” to sort it out – especially when it comes to trains. Sure, there are many aspects of our transport system that are grossly unsatisfactory, but, certain facts do stand out and they do not point in the direction of more state control of the railways as has been proposed in the case of London commuter services.

Firstly, there was the doubling of passenger traffic on rail from 1995 to 2014. There were a number of causes of this, but it is difficult to deny that the marketing and pricing strategies of the privatised operators were important.

On the other hand, we have a government that seems obsessed with vanity projects such as HS2 whilst it presides over a rail infrastructure network that is unable to provide necessary extra capacity in the south east or use existing capacity better. In other words, the private operating companies – for all their faults – would seem to be doing much better than the nationalised rail infrastructure provider.

Indeed, the last year or so has been particularly catastrophic for the rail network. We had the ‘Christmas chaos’ at King’s Cross and Paddington on 27 and 28 December 2014, which resulted from overrunning engineering work. The debacle was quickly followed in early January 2015 by serious overcrowding problems at London Bridge station. By the end of financial year 2014-15, Network Rail had missed 30 out of its 84 planned milestones in its Enhancements Delivery Plan. It is not the privatised bit of the rail network that is causing the problems so why hand over commuter services to Transport for London?

Network Rail has failed to reach its targets for ensuring punctuality and reliability, has under-delivered renewal work, and fallen short on its efficiency improvement objectives. Indeed, Network Rail is responsible for 60 per cent of delays on the network – and it is these delays that normally get the chattering classes chuntering about ‘renationalising the railways’, even though it is the nationalised infrastructure provider that is responsible for them.

There are good reasons for reform, but not for handing over control of operations to Transport for London. The separation of the ownership and operation of the track from the trains is probably not sensible in most of the network – especially the commuter network – though it may have some benefits in some parts of the country. We do need better integration.

However, instead of putting more of the network under the control of politicians – the model that left people standing for hours at London Bridge in early 2015 – we should put the whole lot back into to private sector which built and integrated the system in the first place. We should start by re-privatising Network Rail and we should then allow it to merge with private operating companies. We should certainly not be giving control of the commuter network to Transport for London. As HS2 shows, when politicians run trains, they play to the gallery and not to the customer.

Prof Philip Booth is the IEA’s Academic and Research Director. This article was first published in City AM.

Academic and Research Director, IEA

Philip Booth is Senior Academic Fellow at the Institute of Economic Affairs. He is also Director of the Vinson Centre and Professor of Economics at the University of Buckingham and Professor of Finance, Public Policy and Ethics at St. Mary’s University, Twickenham. He also holds the position of (interim) Director of Catholic Mission at St. Mary’s having previously been Director of Research and Public Engagement and Dean of the Faculty of Education, Humanities and Social Sciences. From 2002-2016, Philip was Academic and Research Director (previously, Editorial and Programme Director) at the IEA. From 2002-2015 he was Professor of Insurance and Risk Management at Cass Business School. He is a Senior Research Fellow in the Centre for Federal Studies at the University of Kent and Adjunct Professor in the School of Law, University of Notre Dame, Australia. Previously, Philip Booth worked for the Bank of England as an adviser on financial stability issues and he was also Associate Dean of Cass Business School and held various other academic positions at City University. He has written widely, including a number of books, on investment, finance, social insurance and pensions as well as on the relationship between Catholic social teaching and economics. He is Deputy Editor of Economic Affairs. Philip is a Fellow of the Royal Statistical Society, a Fellow of the Institute of Actuaries and an honorary member of the Society of Actuaries of Poland. He has previously worked in the investment department of Axa Equity and Law and was been involved in a number of projects to help develop actuarial professions and actuarial, finance and investment professional teaching programmes in Central and Eastern Europe. Philip has a BA in Economics from the University of Durham and a PhD from City University.

1 thought on “Why TfL running London trains is actually a terrible idea for the capital”

  1. Posted 25/01/2016 at 15:39 | Permalink

    Yes, this is indeed a ghastly idea and it certainly won’t do anything to improve services on routes like the Brighton line, which has seen Southern Railway pilloried for providing a rotten service.

    As on other busy routes, the problem is twofold:

    1) A politically driven timetable specified by the DfT bureaucrats that involves running more trains than the infrastructure can reliably accommodate (politicians always like to offer “more”).

    2) Mismanagement of the infrastructure by clunky state monopoly Network Rail, leading to numerous totally avoidable delays caused by signalling and track faults.

    Handing over suburban services to another byzantine state monopoly certainly won’t solve anything; in fact, it will probably make things worse as there are likely to be monumental disputes over whether long distance or suburban trains should take priority at various pinch points, and politicians will have an even greater opportunity to play trains.

    At the same time, existing operators that have just been told that they will lose their suburban networks will now essentially give up on them for the next few years. And who can blame them?

    Unfortunately it is much easier for politicians to target this or that train operator than it is for them to deal with the roots of the problem. They did just the same thing with the South Central (ie Southern) franchise when they booted out Connex South Central in 2001.

    What’s needed is privatisation (not the faux privatisation of 1994), most likely along the lines of vertically-integrated geographical networks, similar to the pre-1923 companies because the so-called Big Four that existed from Grouping until 1948 were actually too big to be efficient.

    Needless to say, the resulting companies should be subsidy-free. And in case anyone should object that they would not then be able to compete with buses and cars, then why not scrap bus subsidies and introduce road tolls at the same time?

    Sadly in today’s corporate state nothing like this is even on the agenda.

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