Last night’s eagerly awaited speech by the Chairman of the Government’s much hyped rail review, former British Airways CEO, Keith Williams, raised real concern amongst those of us holding out for real structural change on the railways. In 3200 words there wasn’t one reference to the need to deliver more on-track train competition so to deliver real passenger choice and get fares down.
Over 25 years have passed since one of the most unpopular and poorly delivered privatisations passed into law. The subsequent failure to get rail policy right has fuelled renationalisation and consistently put Ministers on the defensive. Labour and its RMT/ASLEF comrades rightly scent blood.
John Major’s plans for the railways had lofty ambitions; privatisation would deliver “more competition, greater efficiency and a wider choice of services more closely tailored to what customers want.” Compared with the old British Rail behemoth it replaced, there have been some impressive achievements including record safety, a doubling in passengers, new stations, and huge innovations in ticketing and fares. Yet real choice for passengers and competition between train operators is still missing on any significant scale.
Faced with plunging passenger satisfaction, departmental panic and soaring complaints, Ministers announced last year yet another rail review, but this time it should be different. Transport Secretary Chris Grayling’s pledge to put its recommendations into a White Paper in the autumn followed by legislation next year is fine but will the right diagnosis have been made?
The key to this latest review must be to leave alone what works and identify and fix what doesn’t. As well as having run BA, Keith Williams is also the Deputy Chairman of John Lewis. This hopefully should mean that passengers will, at last, be put at its heart and and treated for what they really are: consumers, clients, and customers. This change in mindset is critical to improving the management and delivery of train services.accepted
In his speech Williams was right to say that the current rail model is no longer fit for purpose. So what to do?
The benefit of strong competition for passengers in aviation is overwhelming; so why not on rail? It would not only provide choice for passengers but would also keep fares down and deliver more modal shift from road to rail. Take London’s main line stations, most of which, apart from London King’s Cross, are the preserve of one large monopoly train franchise. King’s Cross is the only station where some direct on-track long-distance competition has been allowed with clear evidence that passengers have really benefited.
By comparing walk-on standard single fares at 8am tomorrow over the same direct journey distance (185 miles) at London Euston which has no competition, and King’s Cross, the fare differences are stark. From Euston to Manchester the fare is £169 but over the same distance between King’s Cross and York, the maximum fare is £131.50, with one as low as £50 from a rival train firm making the same journey just six minutes later. Competition here has led to lower fares, more choice and happier passengers.
The successful model of train competition at King’s Cross is now well established and provides an aviation-style solution where high-speed train companies should bid for slots to run on the same tracks. This will put an end to train firms running route monopolies, drive innovation, connect more places and empower passengers. The new review is a huge opportunity to finally get it right, deliver choice and restore passenger trust. Anything less will mean yet another much vaunted rail review is dismissed and a historic policy opportunity has been wasted.
Perhaps last night’s speech was meant to avoid radical detail at this still early stage of the review. Those of us who want to see a real passenger facing railway where choice and competition is key will still hold out hope. After all, Keith Williams surely knows what customers really want?
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