Philip Haigh
As Network Rail moves towards greater route devolution, how can the balance between local interest and national needs be maintained? PHILIP HAIGH consults the history books
Changes from route devolution.
1923. 1948. 1996. Three years in which Britain’s railway changed greatly.
In 1923, four companies were created covering mainland Great Britain. The quartet owned tracks and ran trains. They were vertically integrated, just as their constituent companies were.
They made their own investment decisions, designing and building their own rolling stock, as well as upgrading signalling and track layouts to create more capacity when it was needed and could be afforded.
There was some competition between them. Travellers for Exeter could choose between the Southern Railway from Waterloo to Exeter Central or the Great Western Railway from Paddington to Exeter St Davids. That choice still exists today.
Other towns and cities no longer have that advantage. Nottingham’s direct trains from London come from St Pancras on the Midland Railway route that became part of the London, Midland and Scottish Railway in 1923. Back then, passengers could also reach Nottingham using trains from Marylebone, which called at Victoria station on their way north. The Great Central Railway built this route, and it became part of the London and North Eastern Railway in 1923.
When Labour’s Clement Attlee swept to power in 1945, he came with a firm conviction that the state should own fundamental industries in order to reorganise a country.
The ‘Big Four’ of 1923 had remained private companies through the Second World War, but were under close government control. When peace came and Attlee entered Downing Street, nationalising the GWR, SR, LNER and LMS in 1948 was one of his easier tasks.
Now British Railways, the network was divided into regions along roughly the same geographic lines as the previous private companies - with the exception of Scotland, which was given its own region.
The network and trains that BR took over were tired. Britain was as good as bankrupt - there was no money to invest in rail, and it took years to recover from its wartime exertions. Eventually, a programme of building modern locomotives started, and new coaches (the BR Mk 1) began to be built. 1955’s Modernisation Plan brought great hope and several white elephants as BR equipped itself for yesterday’s traffic rather than tomorrow’s.
Rationalisation came courtesy of Chairman Richard Beeching and his infamous programme of line closures in the 1960s. But he also created what became Freightliner, merry-go-round coal deliveries, and the InterCity network.
BR’s next major change came in the 1980s, when it switched from a regional to a traffic structure of different sectors - railfreight was one, InterCity another, with Provincial taking over other services outside London. Within London and southeast England, Network SouthEast took over with plenty of red paint on lamp posts.
Despite never being flush with cash, BR developed and delivered to service in 1976 the High Speed Train (HST). Attempts to repeat the feat with its APT electric tilting train failed, but the HST was to become InterCity’s workhorse across many of its routes. It would have liked to switch more, but BR could never persuade government to authorise funds to build enough.
Just as with Attlee’s nationalisation of BR in 1948, the privatisation of tracks and trains in 1996 was built around political beliefs - this time of John Major’s Conservative government that competition was the antidote to poor service.
Since 1996, Britain’s tracks and infrastructure have reverted to national ownership, and are now under Department for Transport control following Railtrack’s financial collapse. Train operators have come and gone, as have fashions for long franchises to allow private sector investment and short franchises to allow tighter government control. There’s been a continual tension between the fear of train operators making too much money and the fear that they go bust and walk away.
Privatisation has brought investment. The locomotive-hauled trains running on what had been InterCity’s cross-country routes were finally replaced with new stock, completing a task that BR had started but never had the money to complete.
Money also came to modernise the West Coast Main Line, which was ageing and unable to cope with demands for more trains to run at higher speeds. Much more money was needed than first thought, however, testament to decades of having only just enough spent to keep it running.
Much of the increase in government funding has gone towards correcting years of underinvestment. Some has gone towards increasing capacity, occasionally reversing cuts BR had to make in more constrained times. Not everything is rosy, however - electrification has cost far more than anticipated, and that has led to howls of anguish as other programmes have been cut.
Yet in general terms, the rail network has had
“Much of the increase in government funding has gone towards correcting years of underinvestment. Some has gone towards increasing capacity, occasionally reversing cuts BR had to make in more constrained times.”
money spent on it that BR managers could only dream of. It’s been helped by moves towards five-year funding settlements that give more continuity than BR’s annual budgets.
And more change is coming. Network Rail is moving towards devolving power to its regions, known as routes. It is creating supervisory boards, with representatives from train operators as well as the local NR chief, and independently chaired. In some ways, these boards reflect those that BR once had for its regions. They might benefit from one or two more independent members.
If NR’s routes are to have more power, that leaves the question of how the railway retains the benefits of being a network. Trains cross route boundaries, and train operators need assurance that decisions on aspects such as capacity will not be taken purely to benefit trains running within route boundaries, rather than those operating over wider journeys. Who can best provide the balance between local and national? Who can advise on improvement schemes that provide more benefit outside a route’s boundaries than within it?
This is a topic that Mark Phillips considered in a lecture in mid-January at the University of Birmingham. Phillips is the chief executive of RSSB, the guardian of UK railway standards and fount of railway safety knowledge. However, he’s not always been a ‘safety bloke’.
In Railtrack’s early days, Chief Executive John Edmonds called him in to sort train planning. As Phillips told his Birmingham audience, he decided to combine train planning with engineering planning, bring in new train planning software, and institute an annual timetable conference.
These were the actions of a ‘system operator’, although it wasn’t called that at the time - the term has only recently come into the railway’s vocabulary. The system operator is the body that ensures the railway remains joined-up and keeps an eye on the long term. As NR devolves responsibility to routes, so it created a system operator, currently headed by Jo Kaye.
Phillips suggested there were three models for a system operator. The first is one run by the state that puts the state’s objectives before those of the market. The second is a customer-driven operator which is independent of the state and network owners, and can therefore respond to what customers want. The third option would be a system operator as part of a track owner but which is regulated - this is today’s model.
But he argued that today’s model cannot continue. NR is not the only infrastructure owner - there is also High Speed 1 and Heathrow Airport, as well as Crossrail, HS2 and East West Rail coming.
“As new infrastructure managers emerge, and devolution begins to demand differing approaches to suit local requirements, the need to demonstrate fair and equitable outcomes across all the routes and operating companies will also increase,” said Phillips.
He called for an independent systems authority, and argued that it could be a step towards bringing marginal pricing for track access to better match the cost of using the network with revenues. He admitted this would be complex, and something Railtrack had tried and failed to do. He said: “It seems unfair that operators cream off peak ticket prices but do not redirect any of this income towards funding infrastructure upgrades.”
I’m not convinced that’s true. Operators direct much of their income towards government, which then substantially funds NR’s infrastructure upgrades. The link is indirect rather than direct.
Technology changes bring a need for a whole-system approach, argued Phillips, particularly as access to data across different organisations becomes more important. This data could drive local or national decisions, but it’s vital that it is visible so that decisions are explicable.
Lastly, as government moves towards regional alliances between a lead operator and the local NR route, there could be changes that erode national network benefits.
Just as RSSB was created when Railtrack’s Safety and Standards Directorate was carved from its parent, so a system authority could be created from what is today NR’s system operator organisation. The reasons are much the same. There was unease that Railtrack was setting the standards across the industry because those standards might favour it rather than others. As the railway moves towards having several infrastructure managers, it is not right that one of them makes decisions that could adversely affect others. Better this is done by an independent body that is accountable to all of them.