Dean_Forest wrote:
ORR state that the average pre tax surplus was 3.4%. Deduct tax and the cost of actually bidding for the franchises.
Thanks for that, rather interesting, may do some reasearch into this of my, own links you'd suggest?
Dean_Forest wrote:
Why is this necessarily a bad thing? Profits can be reinvested as capital. Yes, you get the occasional bad egg (such as the mob who wrecked BHS but rail franchises are heavily regulated and don't actually have any assets to strip.
Profiteering on it's own isn't a bad thing, money has to come from somewhere! But when it's applied to something where the public service it provides is far more valuable than it's quantative cost, driving for profits (lets face it, railways will never be completely profitable) can seem very cynical. A profit driven narrative creates a drive to the bottom, where it's social value is ignored, and whatever isn't written in cold hard text into a service level contract goes out the window. I work for a private IT outsourcing company, I've been told off many times for going above and beyond the level of service, (eg spending a bit of extra time teaching an elderly gent how to use their computer, having a general chat with someone to make the service feel more personal) in case the extra time may impact on profits. In a drive for profits, everything is quantified, how much time you spent doing x task, how many resources you used to complete it etc. It allows no room, for intuition, worker solidarity or even basic kindness. Look at the railways, you have the ridiculous system of rail access charges, and the TRUST system, customer service level agreements, etc. All this allows absolutely no room for intuition, and this was all introduced to ensure private rail companies all toe the line.
How very naive of you. The last people who benefit from nationalised industries are the people they purport to serve
The exmaple you mentioned there was an exmaple of management failing and not an ethos failing.
In industry if you mess up, you get the boot. In the civil service (and other parts of the public sector) you are anonymous and pretty safe.
I would suggest the reason for it being an ethos failing rather than a managerial failing, I'm going to simply list all of the major crashes that occurred between 1995 and 2000, the sheer number of serious rail crashes compared to BR is horrific.
BR Crashes, between 1989 and 1994, (A period when BR was being underfunded, as part of the tories ideological attempts to slate BR) 13 crashes overall, and 22 deaths from these crashes, overall, worthy of note is the majority of these crashes seem to be from driver inattention, I remember reading material from the time suggesting that BR was desperate to install ATP to prevent these accidents from occurring, but they could never get the funds from the conservative government of the time, imagine the comparable amount of extra investment that would have needed for ATP equipment to be installed nationwide compared to how much investment is required now, when we had OTMR installed, which is from what I understand, the cut price version of ATP.
Now lets compare that with the first 5 years of privatisation (which is supposed to be with newer fresher free market investment)
14 crashes overall, (not too disimilar from BR so far), but the death toll is considerably higher, 44 deaths, twice the amount from the last 5 years of BR, these crashes seems to be from a lack of maintenance or investment. to rather than driver inattention, although this includes Ladbroke rail crash which is why ATP eventually was fitted, which was partly caused by insufficiant driver training at the time, due to the Rail company changing the syllabuses emphasis from route learning to, introduction and learning the traction. My opinion behind this change was to teach drivers how to drive more aggresively to reduce delays from being signal checked, so the company could pay less in compensation to railtrack for late running.
In fact the period proceeding those 5 years, we had, Great Heck, Potters bar and Tebay, all caused by gross negligence, which is why the state had to step in with the creation of Network Rail. Overall how can you say that's not an ethos failing? When the majority of the accidents could have been prevented had the companies wished to invest more in their service and less on paying their directors saleries and shareholders. The figure for investor payment, maybe 2% now, but I wonder what it was in the first 5 years of privatisation?
I could suggest from appearences, you seem to have a rather naive view of private companies. From what I've noticed from working in private companies that is also the case, if you're in a clique with the management, you mess up, you're pretty safe. I have someone in the family who was senior civil service, and he would tell you that definately is not the case.
An example of an entire ethos failing an organisation, is Rail Track, all those people who died in needless train crashes, becuase the management wanted to chuck out 'the BR way' and introduce 'newer streamlined measures' so they could turn a profit, which meant cost cutting to degrees that made the railways incredably unsafe.
Just because one system wasn't fit for purpose, it doesn't mean that the private sector can't run safe railways. BR had plenty of accidents that could be attributed to not renewing time-expired equipment or overworking safety-critical staff.
Hence why Network rail and a whole raft of legislation had to be introduced to ensure safer infrastructure, and an over compensation of safety measures (ironically meaning more state regulation rather than less) to ensure private companies toe the line, now means, so called free market efficiancy is costing us at least double than BR ever did. Furthermore rail fares have increased dramatically since privatisation.
Have you any quantitative evidence that BR never raised fares by more than inflation?
Unfortunately I don't as finding material like that is quite difficult, unless I have a dig around in archives, although a better comparison would be the cost of fares for a similar journey today between our privatised system and a nationalised system outside the UK. I've compared the cost of journeys from London to Birmingham and Berlin to Dresden, these tickets will be two adult off peak singles, travelling as of 22/01/17 at 13.00, The majority of the fares from London to Birmingham were £66 although there was one for £32. Meanwhile for a Journey from Berlin to Dresden most of the fares were around 40 euros, which in UK stirling is around £35.
Last time I checked, Tesco had plenty of competition (which helps to keep prices down). In any case there is so much government regulation bearing down on small businesses that they struggle to compete. Not very free.
By plenty of competition, you mean, Asda, Morrisons, Lidl, Aldi, Co-op, Iceland, Marks and Spencer, Sainsbury, Marks and Spencer and Waitrose, I'd hardly call 10 other supermarkets competition? In fact this infographic maybe of some use as to just how food production is dominated by 10 companies:
http://www.zerohedge.com/sites/default/ ... 5_food.jpg
Hang on, a couple of lines ago you were declaring monopolies to be a bad thing.
Missed the point somewhat there. My point was it was up to BR to clean up the mess left by private companies.
What brink? The railway might've been struggling after the war but with the reparations it was owed combined with deregulation (when a haulier can change his prices to keep up with the market what chance does the railway have when it has to aply to a tribunal to change its rates and has to publish them where the competition can see them and undercut) then it would've had a fighting chance.
Ah thought you'd say that, well there was a reason why the railways where nationalised. The railways were on the brink of collapse, obviously from the state of the infrastructure after the world war, but also before the world war, the big four were struggling from rising coal prices, (in fact the GWR even commissoined a report into electrifying certain lines as a ploy to bring down coal prices) and the effects of the Great Depression. The reason BR built so many steam engines in the late 40s and early 50s, was because the previous stock was so life expired, they needed new stock sooner rather than later, so they simply didn't have the available rolling existing roling stock, to be be able to dedicate research into building new diesels, it wasnt until the had an adequate supply of stock could they begin the process of researching and building diesels.
In fact from the 20s onwards, much like America the railway companies stopped expanding and started to economise. Branch lines started to be closed, stations downgraded to halts and steam rail motors introduced in a bid to reduce costs. In fact the war, was a reprieve from mass closures and so was nationalisation. So this belief that the railways onkly retracted becuase of BR, is a complete myth. If the railways had stayed in private hands, like America, the process of economising and shrinking rail lines would be far more severe.
Beeching I think only trimmed the most loss making examples for the good of the rest of network, now I'm not saying the beeching plan was without its faults, but I think had the railways been in private hands, the closures would be out of public hands, so the government isn't accountable for the lines, more of them would have closed.
I think we would have been like America had the railways stayed in private hands, whereby Amtrak had to be formed from the dregs of a passenger system.
Do you really think that when planning services, BR managers thought "how can we best serve this community?" (save a few honourable exceptions such as John Davies).
That's somewhat of an overexaggeration, but NSE had lines of thinking rather similar to that.
The fact of the matter is that whenever the private market messed up, the tax payer has had to clear up the mess, history will prove that. I give you the following examples:
Northern Rock, Bradford and Bingley had to be nationalised, during the the banking crisis of 2008.
National Express, had to be taken over by DOR
Connex Southeastern, had to be nationalised.
Railtrack, had to be taken over by Network Rail
Metronet, had to be renationalised by London Underground Limited and Tube Lines part nationalised.
UERL, had to be nationalised into London Underground in 1933
The big four had to be under government control during the first world war.
Countless bus companies had to be municiplised, I give Reading buses as an example, and they're still owned by the council and offer an absolutely stirling service.
The NHS from various piecemeal individual doctors.
The council house program, which helped to clear victorian slums and rookeries (incidentally owned by landlords)
