Fare rises show why British railways should be renationalised

It’s the first week of January, so it’s time for that painful annual ritual – the introduction of yet more rail fare rises. No wonder rail passengers have had enough. Fares are increasing much faster than wages, with regulated ticket prices having risen by more than 20% since 2010.

Figures released today by the Campaign for Better Transport show what this could mean for a constituency like mine in Brighton. Average ticket prices have soared by more than 20% for Brighton-London commuters, for example, whose journey to and from work could cost the equivalent of 8.6 weeks of net earnings – more than £4,400. That’s 17% of the average regional salary, and a price increase of £745 under the coalition. And while today’s rise sees regulated fare hikes capped at 2.5%, the cost increase on unregulated fares, such as off-peak leisure tickets, will be left to train companies’ own discretion.

Passengers in this country pay the highest fares in Europe to travel on services that all too often are unreliable, understaffed, and overcrowded. After two decades of privatisation, the private sector has not delivered the innovation and investment that were once promised.

Moreover, private rail companies still remain dependent on public subsidies to run their services. But these same companies can then turn over up to an estimated 90% of their operating profits to shareholders. This blatant transfer of public money means that the public purse is effectively propping up a failing rail system for private gain.

The Rebuilding Rail report, published by Transport for Quality of Life, conservatively estimates that about £1.2bn is lost each year as a result of fragmentation and privatisation. The irony is that some of the biggest profiters are the state-owned rail companies of our European neighbours. Yet that’s money that could, and should, be reinvested to improve our own rail services and reduce fares.
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That’s why on Monday, I will be joining campaigners from groups including RMT, Action for Rail, Compass and the People’s Assembly at rallies at stations all around the country to call for rail to be brought back into public ownership, with passengers having a greater say in the development of the system. We are proposing that the government would take back individual franchises when they expire, or when companies fail to meet their conditions. The enormous savings generated could and should then be reinvested in rail infrastructure, and to reduce the soaring cost of fares.

This is no dewy-eyed throwback to a 1970s British Rail. The modern, efficient, clean and affordable services enjoyed in other parts of Europe offer a much better blueprint for the future. Closer to home, the recent experience of the East Coast Mainline tells its own story. In the five years it was run by the public sector, it returned almost £1bn to the taxpayer, as well as increasing passenger numbers, introducing a new timetable, improving punctuality and establishing industry-leading approaches to recycling and reducing carbon emissions. No wonder a government ideologically obsessed with privatising public services was so embarrassed by this success that it bundled it back into the private sector as soon as it could.

My private member’s bill to bring rail back into public ownership is due for its second reading at the end of next week. I’d like to think that Labour would support it. Yet its policy of inviting public operators to compete against private companies is half-hearted and deeply flawed, and will do nothing to address the fragmentation at the heart of the privatisation chaos.

Come on, Ed Miliband, have the courage of your convictions and join the vast majority of people in this country who want to see an integrated rail service run for passengers, not for private gain.