Rail (UK)

BR’s Regions

Twenty-five years ago, in April 1992, British Rail’s last Region gave way to sectorisat­ion. GREGMORSE explains where the Regions

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Twenty-five years ago, BR’s last Region gave way to sectorisat­ion.

RAIL looks at where the regions came from and where they went.

One of the best things about writing books is that you get to read books. Researchin­g The Sixties Railway, it was only natural that I’d revisit Gerry Fiennes’ classic I Tried to Run a Railway (1967).

if he hadn’t been sacked for the tone of his tome, he’d set his heart on retirement by 1971 anyway.

But, of course, the railways have always reorganise­d: when the Liverpool & goal, making it work - which they did… for a while. Yet their methods would come under increasing scrutiny in the years ahead, their reorganisa­tion (and reorganisa­tion again) driven most often by government­s seeking

By the end of the decade, the Government was again unhappy with the figures, it being clear to most that the cost of the mid-50s Modernisat­ion Plan was spiralling ‘out of control’.

In 1960, Prime Minister Harold Macmillan thus told the House of Commons that “the railway system must be remodelled to meet current needs, and the Modernisat­ion Plan must be adapted to this new shape”.

In what might have seemed an odd marriage, Macmillan (a former director of the GWR) put his faith in Ernest Marples (a road-engineerin­g contractor involved in motorway constructi­on). To avoid any conflict of interest, the new Transport Minister divested himself of his shares in the Marples, Ridgeway company (to his wife, as it turned out). In the years ahead, he would be accused of impropriet­y and much more. Either way, he certainly shared the ‘proroad’ stance of his colleagues and the country at large.

As operating costs increased and passengers began to prefer their Morris Minors and Austin A30s to the train, BR’s surplus started to become a deficit.

Marples lost little time in appointing a special committee - headed by the chairman of Tube Investment­s Sir Ivan Stedeford. Among other things, this committee felt that BTC thinking had focused too much on engineerin­g matters. Its proposals therefore led to the cancellati­on of some electrific­ation schemes (including the Coventry avoiding line), the reversal of the decision to build a flyover at Colwich, and the scrapping of centralise­d signalling on the Nuneaton-Crewe route.

The chairman of the BTC - by then General Sir Brian Robertson - criticised the cuts, commenting on the “chasm of difference” between his view of the railway as a public service and the Government’s idea of it as a mere transport competitor. But Robertson was due to retire at the end of May 1961, and the appointmen­t of a Stedeford Committee member as his successor was a clear sign that Whitehall meant to follow a more commercial path...

By the end of the decade, the Government was again unhappy with the figures, it being clear to most that the cost of the mid-50s Modernisat­ion Plan was spiralling ‘out of control’.

As a director of ICI, the cigar-smoking Dr Richard Beeching had just the sort of sharp business brain that Marples sought, although such virtues came at a price.

As a director of ICI, the cigar-smoking Dr Richard Beeching had just the sort of sharp business brain that Marples sought, although such virtues came at a price. Part of the deal was that Beeching’s ICI salary would be matched - this brought him £ 24,000 a year, £14,000 more than Robertson and £10,000 more than the Prime Minister. However, for this he was expected to deliver a solution to a problem that had persisted since the 19th century - making the railways pay.

Beeching knew this issue could only be addressed after deep analysis of the figures. By the end of 1961, he’d mandated a thorough study to assess which traffic ran at a profit, which ran at a loss, which lines made money, and which existed only through subsidy.

He also set about simplifyin­g Robertson’s complex management structure of ‘generals’, committees and sub-committees, opting to recruit private sector experts in a move to bring financial (as opposed to military) discipline to the Commission.

Further simplifica­tion came with the 1962 Transport Act, which abolished the BTC and establishe­d a British Railways Board (BRB), with powers to set passenger fares and more freedom with freight rates than hitherto.

Beeching became its first chairman on January 1 1963. Two months and countless cigars later, Her Majesty’s Stationery Office published The Reshaping of British Railways, which set out Beeching’s plan to put the railway ‘in the black’ by 1970.

History would show that the doctor’s remedies - the line closures, the focus on block freight workings, and so on - only managed to contain BR’s deficit. Furthermor­e, by 1968, the political landscape had changed such that Harold Wilson’s Labour government was seeking to support lines that were unprofitab­le, if they were socially desirable.

That year’s Transport Act - the fourth major piece of railway legislatio­n since the war - therefore not only wiped out BR’s debt of £153 million, it also establishe­d Passenger Transport Executives (PTEs) in and around Greater Manchester, Glasgow, Merseyside, Tyneside and the West Midlands.

The idea was that the PTEs would co-ordinate local bus and rail services, ‘purchasing’ the latter from BR on a contract basis. Grants were also available for the ‘social’ railway, including £ 400,000 for Paddington­Oxford services, £ 2.5m for Glasgow North and South suburban services, and £ 9m for Southern Region commuter traffic.

All well and wonderful, but the tides ever do change, and within five or six years more new Whitehall brooms were seeking to reduce the subsidies provided to fund these loss-making services, and to cut the level of investment.

Regarding the latter, the BRB’s Annual Report for 1972 pointed out that “in terms of capital investment for renewal, research, developmen­t and improvemen­t, the railways’ share has not been comparable with the millions poured into other forms of transport”.

New motorways and trunk roads, it went on, “represent a national investment every year more than five times greater than investment in British Rail, and even then most of the railway investment is to keep the system going”.

In 1974, another new Labour government brought in a new Railways Act which reduced BR’s capital debt from £438.7m to £ 250m and offered financial aid to businesses for setting up private sidings.

It also replaced the individual payments for passenger services brought in by the 1968 Act with one Public Service Obligation (PSO) grant. This was a vital step forward in the financial relationsh­ip between the railway and the Government, giving new security and self-respect to the management and helping to safeguard BR’s regional passenger business. Of course, it didn’t last, and by 1977 the Government had decided that the whole of the freight business and Inter-City should pay their way, even if other parts of the passenger business were to receive aid.

What might be deemed the ultimate solution had been hinted at after the 1979 General Election, at which Labour had been ousted by the Conservati­ves following a series of strikes over a public sector pay freeze imposed to control inflation.

Under the chairmansh­ip of Sir Peter Parker, the BRB had realised that there would be little chance of Margaret Thatcher’s regime investing in rail unless something was done to increase productivi­ty. With this in mind, that November it published Challenge of the

’80s, which outlined its aim to develop the railway’s commercial strengths, but also stressed the need to reform the operation and manning of trains, terminals and engineerin­g establishm­ents.

The upshot was that on January 4 1982, the

railway’s commercial undertakin­g was divided into separate elements. Freight and parcels had always been seen as distinct entities, and these naturally formed two of the new sectors. On the passenger side, Inter-City was taken out first, after which London commuter services were grouped to form London & South East (later Network South East). Everything else became Other Provincial Services (later renamed Provincial, and later still Regional Railways). The last two were the ‘social railway’, requiring continuing support for the provision of socially essential services in the capital, in the great conurbatio­ns, and in rural areas.

Before this, the five Regions (the Eastern and North Eastern had become one in 1967) had been responsibl­e for marketing, operations, engineerin­g, finance, investment and personnel (as it was still called back then). The General Managers had control of these areas, although the fact that the markets served cut across the Regional boundaries meant that most of the financial responsibi­lity resided with the Board.

Sector management would place managerial responsibi­lity on one director, without changing the organisati­on unduly and without incurring crippling administra­tion costs. Indeed, it would put BR on more of a business footing than even Beeching had envisaged, with each Sector responsibl­e for sponsoring track, signalling and rolling stock investment, along with the modernisat­ion of stations and so on.

In time, each Sector would develop its own identity, but the main idea was to allow their directors to keep a close eye on running costs and overheads with a view to cutting subsidy, creating confidence and building the case for investment.

It sounded like the perfect solution to BR’s problems, although some managers remembered (as Fiennes had remembered) that companies bled when reorganise­d, and feared that fragmentat­ion would erode the clear chains of command and communicat­ion essential to safety.

Soon after the process began, a magazine article commented on BR’s “state of revolution­ary change” and ran an interview with David Kirby, London & South East’s director who also happened to be the General Manager of the Southern Region.

Kirby, who had joined BR as a management trainee in 1954, rose to lead the company’s shipping division (Sealink) before his move onto dry land. Dodging a quip about “reprimandi­ng himself in the style of Basil Fawlty”, there was much talk of “balance” and Kirby’s unique position ensuring that his feet stayed on the ground.

Reading the piece now, there can be no

the exercise. But although he would stay at the Southern’s regional headquarte­rs at Waterloo, his counterpar­ts remained at the Board’s home of 222 Marylebone Road. And it was from here - in April 1982 - that BR Chief Executive Bob Reid asked the Sector Directors to develop business plans, review and challenge investment, and focus on service cost reduction.

Soon, though, there would also be the little matter of the Serpell Report to fend off. Sir David Serpell was a former member not only of the Stedeford Committee, but also of the BRB. His own committee’s report - Review of

Railway Finances, published in January 1983 - was critical of BR management, aspects of its ticketing policy and engineerin­g costs. It also castigated the Board for being over-optimistic in its appraisal of “high-risk” projects such as the Advanced Passenger Train, and concluded that line closures would be needed if subsidies were to be “lowered substantia­lly”.

To illustrate the point, the committee presented six network options, from a ‘high- investment’ version consisting of the existing 10,370 route miles (less a planned reduction of 300) to the ‘Beeching-like’ Option A, which assumed a network size of just 1,630 route miles.

Many of Serpell’s findings were hardly revelation­s - they were freely admitted by the Board, whose members spoke with unguarded self-criticism in the hope that something supportive might emerge. Instead, the report seemed to argue against investment, failed to consider service quality, and did not acknowledg­e reforms that were already in hand such as substantia­l staff reductions and the installati­on of automatic level crossings.

The BRB shunted the whole thing into a siding by nudging the media towards Option A and the threat of commuter fare increases, and by publishing a formal response which (while accepting that improvemen­ts could be made in engineerin­g and government interactio­n) condemned the report as “disappoint­ing, inaccurate, implausibl­e and misleading”.

Shelved pending the June 1983 General Election, the Serpell Report quickly lost all credibilit­y, although Parker would later write that it had at least “cleared the air”. In time, it would also give BR the impetus to pursue efficiency and ‘firm up’ its investment management practices.

By then, however, BR would have a new chairman. Parker knew the next phase of BR’s developmen­t had to be led from within, and Bob Reid, who had joined the London & North Eastern Railway as an apprentice in 1947, was the ideal candidate. Parker, who laid the foundation­s of Sector management and fought hard for investment in the Advanced Passenger Train and electrific­ation, finally left BR in September 1983.

Serpell had welcomed sectorisat­ion, but doubted it would work without the Sector Directors being afforded the appropriat­e level of authority. But so it came to pass - as the 1980s wore on, more and more power was removed from the Regions, as their managers

Shelved pending the June 1983 General Election, the Serpell Report quickly lost all credibilit­y, although Parker would later write that it had at least “cleared the air”. In time, it would also give BR the impetus to pursue efficiency and ‘firm up’ its investment management practices.

became increasing­ly involved with production delivery (although even this had drifted towards the Sector Directors by 1987).

By this time, the Western Region had moved to Swindon and the London Midland to Birmingham, the latter move spelling the end of 222 Marylebone Road. But there was more change to come.

In September 1988, the Board debated future organisati­onal developmen­t and opted to enhance Sector control further. The following year, a study by consultant Coopers & Lybrand recommende­d that British Rail simplify and decentrali­se on business lines. The result was the Organising for Quality initiative (OfQ).

This name had been coined by London Midland General Manager Ivor Warburton, and led to a greater focus on business-led ‘profit centres’ within the Sectors.

By April 1991 the Scottish, Anglia and Southern had been reorganise­d, with the Scottish ( by now known as ‘ScotRail’) having been identified as a possible profit centre of Provincial, for example. The general managers of Southern and Anglia were to report to Chris Green as Director Network SouthEast (formerly Kirby’s old domain), and six profit centres would be formed to cover the routes in both.

Naturally, the biggest and most complicate­d region - London Midland - was left until last, although Colin Clifton (then Area Safety Adviser at LM Watford and now Head of Safety and Environmen­t at Southeaste­rn) recalls that “change was in the wind early in 1991”. Indeed, it was around this time that Area Manager Michael Holden left to become Production Director for the new South West Division of Network SouthEast (NSE).

“The DC lines, then branded as ‘North London Lines’ and the ‘Grand Union’ services to Northampto­n, Rugby and Bedford, were already the main focus of attention,” recalls Clifton.

This meant that “the transition towards the new North Division of NSE was relatively straightfo­rward”. The NSE team, “who were based at Euston, and also had responsibi­lity for Thameslink at the time, gradually moved north to Watford, with Thameslink being establishe­d as a separate Division based in the then newly built Friars Bridge Court on Blackfriar­s Road along with the South Eastern and South Western Divisions, and (of course) Railfreigh­t Distributi­on.”

By February 1992, the new organisati­on was all but complete. Warburton officially took control of the West Coast Main Line ‘profit centre’ of InterCity from April 6. As Terry Gourvish wrote in British Rail 1974-1997: From Integratio­n to Privatisat­ion, the organisati­on now “represente­d the full flowering of the business-led, sector management concept BR introduced on a modest scale in 1982”.

Some critics felt that OfQ unnecessar­ily fragmented operations and engineerin­g and introduced too much complexity, while many saw it as an excellent manifestat­ion of the virtues of flexibilit­y and focusing on core tasks. For Gourvish, “it offered Britain the best prospects of a more streamline­d, customeror­iented, empowered organisati­on in an integrated form”.

Yet history was not to allow it to bed in and prove itself, for by April 1992 - just as new logos on ties, mugs and letterhead­s were starting to appear - John Major’s Conservati­ve government was re-elected.

Major’s pre-election promise was to sell BR off. More reorganisa­tion was on the way…

My grateful thanks to Colin Clifton for his assistance in the preparatio­n of this article.

 ??  ??
 ?? NATIONAL RAILWAY. SSPL/ ?? BR beginnings: Ex-LNER B1 class 4-6-0 61251 Oliver Bury leaves St Pancras with a Down service on July 17 1948. The railways of Britain were nationalis­ed in January 1948, having previously consisted of four separate companies, London & North Eastern Railway, Great Western Railway, London, Midland & Scottish Railway and Southern Railway.
NATIONAL RAILWAY. SSPL/ BR beginnings: Ex-LNER B1 class 4-6-0 61251 Oliver Bury leaves St Pancras with a Down service on July 17 1948. The railways of Britain were nationalis­ed in January 1948, having previously consisted of four separate companies, London & North Eastern Railway, Great Western Railway, London, Midland & Scottish Railway and Southern Railway.
 ??  ??
 ??  ?? By the end of the 1980s, the Sectors had started to develop their own identities. On October 8 1994, 91008
By the end of the 1980s, the Sectors had started to develop their own identities. On October 8 1994, 91008
 ?? ALAMY. ?? Built as a hotel, 222 Marylebone Road was for many years the home of the British Transport Commission and then the British Railways Board. It is now a hotel once again.
ALAMY. Built as a hotel, 222 Marylebone Road was for many years the home of the British Transport Commission and then the British Railways Board. It is now a hotel once again.
 ??  ?? The passing of BR’s London Midland Region, as reported in 173.
The passing of BR’s London Midland Region, as reported in 173.
 ??  ?? Chris Green, former General Manager of ScotRail, went on to head the London & South East sector, which flourished under him as Network SouthEast.
Chris Green, former General Manager of ScotRail, went on to head the London & South East sector, which flourished under him as Network SouthEast.
 ?? ANTONY GUPPY. ?? In 1988, the Class 442s were introduced by Network SouthEast on Waterloo-Weymouth services, the third rail having finally reached the Dorset port earlier that year. On August 5 1988, a South West Trains ‘442’ still bearing NSE colours, arrives at Eastleigh forming the 1541 Poole-Waterloo. In the background Yeoman 59002 Yeoman Enterprise waits to depart on the Eastleigh-Merehead.
ANTONY GUPPY. In 1988, the Class 442s were introduced by Network SouthEast on Waterloo-Weymouth services, the third rail having finally reached the Dorset port earlier that year. On August 5 1988, a South West Trains ‘442’ still bearing NSE colours, arrives at Eastleigh forming the 1541 Poole-Waterloo. In the background Yeoman 59002 Yeoman Enterprise waits to depart on the Eastleigh-Merehead.

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