What price a new railway?

Some of the most difficult emails or letters I receive tell me we need to nationalise the railways. I write back pointing out that is exactly what Labour did when they took over Railtrack and put it into 100% taxpayer ownership, and strengthened the controls of the state over the contracts of the individual train operating companies that run trains on the nationalised railway. Today’s problems in the railways are the direct result of having a nationalised monopoly railway with access to huge sums of taxpayer cash.

In the year to March 2014 the Network Rail accounts show that the five executive directors were paid £990,000 (2 people successively in the same post),£922,000, £880,000, £890,000 and £567,000. It is difficult to understand why the state sector pays such huge salaries to people who presumably have some sense of public service and duty, and when the railway pre subsidy is heavily loss making, offering an indifferent service to its users. The only explanation for such large salaries must be the talent and ability of the people concerned and the results they are achieving. In which case, why aren’t the financial and operational results better?

I raised the issue of Network Rail’s poor financial performance and high cost base in the Commons during the productivity debate, before the latest problems were known. I also met with representatives of the industry at the Commons recently and asked them about the high costs of work being done. Why I asked, did the welcome improvements at Reading station cost somewhere between £850million and £900 million when the original estimate was reported at £400 million? Although this was the prime project Network Rail reported last year no-one at the session could tell me which was the right figure for the cost or why the original cost/plan had been so much lower. The representatives of the industry did not come across as regarding cost or taxpayer money as that important. I still await a written reply to my queries at the meeting.

I also pointed out to them that when I travel on the railway I see plenty of evidence of poor management. I see large areas of unused land close to stations and town centres, with no sign of anyone trying to use or develop it in ways which could improve the facilities and bring in private sector investment or cash. I see supplies of building materials, sleepers and engineered products lying around decaying. I see old coaches, engines and wagons left in sidings to rust. I see sidings and branch lines with weeds growing high between the tracks. It does not look like a well run business, with proper control of its stocks and assets. They need to clean the place up, see what they have lying around, use the stocks and assets or sell them off for scrap or recycling.

The present failure to proceed on time and budget with the electrification schemes the railway top management have always said they need to run a better service is shocking. I have myself been sceptical about the need to change traction to get a better railway, but it is this railway management’s mantra and if it brings better trains and more services then all well and good. Electric traction should be dearer than diesel, as it is a secondary fuel. There are substantial fossil fuel energy losses when generating the power in the first place and losses in taking the power to the tracks as well as the energy inefficiencies in the electric engines themselves.

I hope the Minister will use his unwelcome pause of modernisation schemes to review whether there are quicker and cheaper ways to give people a better service with more trains when needed. The new Chairman needs to review his top team and see if with better leadership they can do the job, or whether some of them need replacing as well. What is clear is so far the state is overpaying the management of the railway for what they do, and proving again that nationalisation does not work well.


  1. Lifelogic
    June 28, 2015

    Indeed. Why is it that I can rent a car and drive seven people from say London to Manchester return for perhaps just £60 total (including the car costs, vat, road tax, fuel duty etc. of perhaps £25) yet tickets cost £164 per person by train (without much tax and lots of tax payer subsidies to boot).

    If trains are as efficient at the green loons and BBC claim why do they cost 45 times as much as roads and with this tax subsidy bias on top of that? HS trains are even worse than normal ones.

    Electric trains (as you point out) have little advantage of diesel. The losses at the power stations, the motor and in transmission are often larger that the losses in the diesel engines. If wind or PV power is used (with back up needed) it is hugely more expensive than diesel.
    Plus there is the huge cost of installing and maintaining the miles & miles of overhead power lines needed. These lines are vulnerable to adverse weather, falling trees, ice, snow, vandalism, crashes, accidents etc.

    Trains are, after all, just large coaches in essence. They have the huge disadvantage of being limited to certain specialised tracks, routes and stops. Also the further disadvantage of being very susceptible to trade union blackmail and being brought to a standstill by a fallen tree, flood or minor crash.

    They also need (often double) journeys by car, bus or taxis at each end of the rail section.

    1. Lifelogic
      June 28, 2015

      sorry – electric trains have little advantage over diesel.

      Also when cost electric trains have to be heated electrically where as with diesel trains waste heat from the engine is utilised – giving in effect efficient combined heat and power.

      1. Hope
        June 28, 2015

        A bit of clue that radical change is required by the Tory policy when we witnessed the Villiers cock up that cost the taxpayer about £40 million for incompetence. She is still in office, no one sanctioned or sacked and the rail mess and cover ups continues. HS2 expected to cost the taxpayer £80 billion is still set to go ahead, but the report on it is held secret because there is no value for money in providing a service for a limited number of people to save half an hour on one journey! Clue, Tory party madness on railways and economics continues. You could add EU energy policy, EU free movement of people creating an unsafe environment, immigration, border controls, security of our nation, PC madness and gay marriage imposed upon us. What success is Cameron talking about? What has he achieved? He can no longer blame the Lib Dumbs.

        1. Lifelogic
          June 28, 2015

          Indeed – still at least we do not have to suffer a landlord thieving, mansion tax pushing, tax increasing, economy destroying, Miliband dog being wagged by an SNP tail.

          Cameron is clearly dreadful, but better than the alternative. It was the alternative that won it for him.

        2. brian
          June 28, 2015

          Your hysterical comments offer no solutions. HS2 is about increasing capacity, not saving time.

          1. Lifelogic
            June 29, 2015

            There is no need for extra capacity on this route. The lack of capacity is mainly on local London commuter routes.

            Anyway without train subsidies demand would decline. More road capacity is what is needed far more. Plus better broadband to avoid the need to travel in many cases.

          2. Narrow Shoulders
            June 29, 2015

            Double decker trains would do that for much less.

      2. Lifelogic
        June 28, 2015

        Also when “cold”!

    2. F.Cunctator
      June 28, 2015

      Diesel is also much more flexible than electric. A free standing diesel electric locomotive can move around the network to breakdown points, can tow all sorts of goods etc. The advantages are clear and obvious to all but the greens and railway operators. Older mainline trains can in the later lives be used on branch lines without the need for the very vulnerable electricity supply system. It really is a no brainer. Moving the locomotive from each end of the six car units would make the interior of carriages quieter and less bone shaking.

    3. Know-Dice
      June 28, 2015

      Even two people in a car going from Wokingham to London can be more cost effective than taking the train.

      Efficiency – I don’t know, but, a full train “should” be reasonably efficient compared to a car with one person, but what percentage of trains are full? Probably only those for two hours in the morning and two hours in the evening, so 4 hours out of 24!

      Why do planners seem to forget that the essential part of a station (or airport) is the passengers, so why make it so difficult (and expensive) to park or drop off/collect passengers? Reading has cunning arranged their station so that is easy for the unknowing to receive a ticket by going in to the bus/taxis only area. This can be for revenue raising reasons only 🙁

      1. Lifelogic
        June 28, 2015

        As you say “Probably only those for two hours in the morning and two hours in the evening, so 4 hours out of 24”

        Indeed and actually only half of those (and only those for a small part of the journey). A full train can clearly not pick anyone else up. Only the ones going into town in the morning and the ones going out in the evening.

      2. alan jutson
        June 28, 2015


        Just back from a couple of weeks holiday in the south West of France,.

        The home of the TGV is still expanding its routes fast into the far reaches of the Country, which unlike the UK is better suited for this purpose because of the much greater distances, thus it does truly save time.

        Also interesting how much additional new fast By Pass/Trunk Road/Motorway type expansion there has been, even since last year, and work ongoing for even more.

        Meanwhile the newly built Wokingham Train station has just six waiting/drop off spaces available its passengers (when they are not being used by the contractors who are still working on the surrounding site) unless you want to pay £7.50 the minimum price to pay for Station parking, no matter how short a time.

        The alternative being to wait on double yellow lines.

        The new Reading Station has similar problems.

        Why is it that “customers” are treated as nothing more cash cows in this Country.

        So called “Service” could almost be erased from the dictionary of some businesses.

    4. JJE
      June 28, 2015

      That £60 number strikes me as extremely optimistic. Perhaps you could share your workings?

      1. Lifelogic
        June 28, 2015

        50 MPG say 400 miles return @ £1.21 a litre = about £44 in fuel and perhaps £5840 PA to run a (second hand) car (£16 a day).

        Perhaps a smite optimistic but at 60 mph you can do better than 50 mpg in a diesel. There or there abouts – and far cheaper than the train, it also goes door to door can stop off on route, does not have endless announcements and does not need the end link journeys.

        1. Lifelogic
          June 28, 2015

          Without the tax subsidy bias it might be more like 90 times more expensive by train for seven people.

    5. Anonymous
      June 28, 2015

      Lifelogic – Diesel fuel has to be transported to fuel points before being loaded onto the diesel train on which the hefty weight of the fuel has to be carried until it is spent. The diesel engine powers an electric generator and motors. Rather like the power station the conversion of fuel to motive effort is indirect and wasteful.

      1. Lifelogic
        June 29, 2015

        I understand that, never the less you need the huge capital cost and maintenance costs of the electrification of miles of track.

  2. JJE
    June 28, 2015

    Trains such as the Inter City are diesel-electric. The wheels are driven by electric motors. The Diesel engines run a generator that supplies the electricity.
    Electric traction is used because it offers superior torque characteristics. Full torque can be applied at zero rpm and thereafter the torque is linear.
    But this entails dragging two heavy diesel generators plus fuel with you everywhere the train goes.

    1. acorn
      June 28, 2015

      It is posts like these that really show up the uninformed Redneck ranters.

      All the “diesel” train sets I know, carry there own power station in the loco. The diesel engine generating set, powers electric traction motors to get a much higher acceleration than a diesel with a clutch / torque converter / gearbox, could get for the same weight. The old DMUs in the old days, could be seen at a platform, with the driver trying to get all the traction diesels to go into the same gear at the same time. There are still some diesel – hydraulic shunters I think.

      Anyway the future is electric and the advent of the new diesel and/or battery electric train is with us now. Like a Toyota Prius on rails. But if you want to go fast; and, accelerate out of a station like a rat up a drain pipe, you need 25kV pantograph electrics. http://www.railway-technology.com/projects/independently-powered-electric-multiple-unit-ipemu-essex/

      1. acorn
        June 28, 2015

        Have you noticed that Bookmakers have stopped taking bets on Grexit. The Greeks are playing a good hand at the moment and, frankly, so should all you Euroskeptics be supporting them.

        If the Greeks fail to pay the IMF, who cares? What is Fifi Lagarde of the IMF going to do, send in some tanks to get her money? The IMF is basically just another US government global control agency. The US Treasury can cover her loss at no cost.

        Likewise, the likes of the BBC’s Peston, are saying the ECB is financing Greek Banks with ELA (Emergency Liquidity Assistance), when in fact it is the Greek Central Bank that does this, (read the ESCB rules), and could, if it wished, carry on doing it to the point where the ECB decides to stop capital transfers via the Target2 interbank system, and Greece would effectively leave the Eurosystem and have its own currency again.

        With a little luck and judgement, this could start the collapse of the Euro and get the EU back to a bog standard free trade agreement. UK problem solved.

    2. Lifelogic
      June 28, 2015

      True but you do not have the cost of electrifying and maintaining hundreds of miles line.

  3. Lifelogic
    June 28, 2015

    Congratulations to the England Women’s Football team too.

    1. Leslie Singleton
      June 28, 2015

      Dear Lifelogic–Another stage on the way to full identity

    2. Know-Dice
      June 28, 2015

      Yes, absolutely 🙂

  4. Peter a
    June 28, 2015

    John, I do a large amount of work with the railways and the Underground. I’m afraid that on both business and operational sides there is no fear of discipline or job loss in the event of poor performance. There is no fear of recrimination if money is wasted as the public pot floweth over.

    My pet hate is ‘blockade engineering works’ where whole sections of line are taken out of service for a weekend, ostensibly because it’s easier to do the work and cheaper. So far, so good. However, unlike continental railway systems where they massively flood these sections with contractors, to maximise time and balance the negative of Lost Customer Hours, on the railway and underground this just does not happen.

    Commercial railways wouldn’t make any money if they were as inefficient as Network rail and TFL; therein lies the nub.

    1. Lifelogic
      June 28, 2015


  5. Excalibur
    June 28, 2015

    Indeed, JR, there is much merit in what you say. However, in Network Rail’s defence I learn that a centre like Bath has no fewer than eight National Heritage sites in the vicinity of its railways.

    While agreeing that changing the method of traction is questionable, once this decision was taken, the dismantling and reassembly of such features as tunnels and bridges is a monumental and expensive task given the degree of care and preservation that these sites require. A pause is probably the most sensible option. But there is no excuse for the abandonment of assets, which you rightly point out, smacks of poor management.

    Given the English predilection for prevarication and making a big deal of everything, it was always going to be difficult to keep to the estimated costs and time schedules.

  6. Margaret Brandreth-J
    June 28, 2015

    I do not use the railway much ,but when I have done the decay and unkempt sidings have always struck me as waste and bad management not to mention the aesthetics.

  7. mick
    June 28, 2015

    off topic, no doubt tomorrow when Mr Cameron gives his speech on his visit to Brussels all you tories will support him and will do the same when the referendum comes, there is going to be no deal now or ever its all smoke and mirrors in the hope you can con the British people to vote to stay in, but hopefully there is somebody in the wings who can lead the fight to get out

  8. ian wragg
    June 28, 2015

    Railtrack should be franchised out like the trains and its performance closely monitored. Subsidies should be cut and the ridiculous HS2 scrapped. The bonus culture should be stopped and heavy penalties on companies that don’t perform.
    Why should the railways attract so much public money when the motorist is taxed to blazes.

  9. rick hamilton
    June 28, 2015

    Who in government approves these bloated salaries and why cannot an MP demand an enquiry into how they are set?

    I am tired of hearing state sector management justifying their vast salaries by claiming they control the same budget as a director in the private sector. In private business they have to generate the income in the first place before paying anybody, and produce a return for their shareholders as well, whereas in the state sector they are just given taxpayers money to waste at will. State sector management should be paid half the private sector level for the equivalent responsibility because they are only doing half the job. Any fool can spend other peoples money.

    1. APL
      June 28, 2015

      rick hamilton: ” Any fool can spend other peoples money.”

      As is demonstrated in Parliament every day.

      rich hamilton: “state sector management justifying their vast salaries by claiming they control the same budget”

      You’ll keep hearing it too, because it’s exactly the same argument that MPs use ( natch being in the public sector too ) to justify their latest £10,000 public funds ‘smash and grab’.

      Never let a good excuse go to waste.

    2. bigneil
      June 28, 2015

      “Any fool can spend other peoples money.” – And certain ones can borrow billions to give away to be wasted on ridiculous “foreign aid” projects knowing the billions will have to be paid back by the nation. Still, some do any stupid thing to try to look good to the rest of the world, while their own nation is deliberately destroyed.

    3. Paul Cohen
      June 28, 2015

      Hear, Hear!

      There is no shortage of customers, they pay top dollar for the privilege and have to somehow navigate a nonsensical fare structure.

      How are continenal rail systems able to offer a far better travel experience at about 72% of the cost here?

    4. brian
      June 28, 2015

      Until very recently Network Rail was a publically owned private company invented by Gordon Brown to keep its debts off the national books. It is now answerable to politicians who will be able to have more input to its operations.

  10. agricola
    June 28, 2015

    That the UKs railways are sub standard and not very well managed has been a fact since WW2. Having experienced rail travel around Europe, India, Taiwan and in Japan, the inferiority of the UK is all too obvious. I can only assume that they are a symptom of our inability to manage. They are Longbridge in a different guise, and as such would, like our car industry, be better off for all concerned were they in the hands of the Japanese.

    On another note Andrew Marr and the BBC have been at it again this morning. Richard Branson is entitled to his opinion but went totally unchallenged when spouting the myth that leaving the EU would lead to a deterioration in trade with Europe. It is deteriorating already thanks to the demise of the EU under the Euro, but as you have pointed out many times, the Germans are not going to want to stop selling us cars.

    He then went on to infer that the existence of the EU has kept Europe war free. Rubbish, the EU has shown a capacity for getting us into conflict. It is NATO that has kept Europe secure. Again no balance or challenge from Marr. How long before the BBC gets sorted.
    Next week we may get Nigel Farage , will Marr allow him the same freedom.

    1. Lifelogic
      June 28, 2015

      You ask “Will Marr allow him the same freedom?”

      Of course not. Marr is incapable of challenging anyone who is on BBC message, he simply nods his head & helps them along. On BBC message being:- pro EU, lefty, for an ever big state, enforced “equality”, ever higher taxes and pro all the greencrap/expensive energy nonsense.

      He is also incapable of not attacking sensible views and equally incapable of questioning them in a sensible & intelligent manner. He suffers from “Guardian /BBC Think” group think to the core – he just cannot help it poor chap.


      1. Lifelogic
        June 29, 2015

        He admits himself that he was a raving lefty at Cambridge (English at Trinity Hall) – it seems little has changed, he still “thinks” like a lefty.

    2. forthurst
      June 28, 2015

      “I can only assume that they are a symptom of our inability to manage.”

      Poor management is associated with those industries that have been subject historically to Trotskyite-invested trade union activism; is it really a problem of management or the failure of politicians to treat economic sabotage as the treason that it manifestly is?

  11. APL
    June 28, 2015

    JR: “Why I asked, did the welcome improvements at Reading station cost somewhere between £850million and £900 million when the original estimate was reported at £400 million? ”

    Yesterday, I went for a haircut and shave. It cost me £4 more than the same service at the same barbers six months ago, by my reckoning that reflects a 35% depreciation of the value of sterling over six months.

    If the government you support stopped debasing the currency with its inflationary policies then perhaps you could have a reasonable expectation that prices might remain stable.

    Meanwhile: MPs bung themselves another £10,000 of tax payers money because …. ‘the last Parliament made us do it’.

    Right out of the infant child’s playbook.

    June 28, 2015

    Mayhap the fantasy of mixing rail and road travel in Lilliput was a bridge too far for Jonathan Swift. Swift Travels as opposed to Gulliver’s Travels. Stagecoach and train each having to stop and start so the other could function with extremely expensive bridges and tunnels adding to the human nonsense until some bright spark came up with the idea of mixing trains and stagecoaches on the same road in the form of trams. Hilarious.
    But a fantasy of course. It could never happen.

    Human experience and wisdom is recorded in books. But in political life it is amazing how generations do not learn one from the other. Sometimes only human memory can prevent catastrophe. Many of us can remember when even the most amateur comedian could raise guffaws at any mention of the then nationalised railways. The sandwiches on the counter of station cafes cut into triangles which were so dry and old that their corners were bent upwards as if about to take flight. Everyone laughed but we had all seen them. No joke. The filthy disgusting carriages where you could not see through the windows for dirt. The attitude of some railway employees… again a national joke …seen on station platforms idling about and telling the tale for hours, the length of time it took for the dirty trains to arrive. The “Couldn’t care less attitude” . They all had supervisors, managers tier upon tier who it seemed did not give a damn.

    In the banking system now parallel problems with “the culture” are being sorted out by having a grand dinner with people dressed like penguins. Very well educated and intelligent people are telling the diners “Oh no it’s not the fault of the people eating here tonight. ” “People in Finance need to….” Jonathan Swift would better write the rest.

  13. Bert Young
    June 28, 2015

    I haven’t used the railways for many years ; those that do tell me horrific stories of overcrowding , delays , cancellations and booking horrors ( when going from one place in the UK to another ) . Above all is the huge cost involved . Many individuals near to where I live are daily commuters to London ; apart from the cost of parking the annual cost in keeping their jobs alive runs into the thousands .

    I can see no reason why there are so many different rail operators involved across the country . Each organization has its own management and infrastructure imposing a disproportionate burden on the running costs . Each organization is nevertheless dependent on the national network system – what a ridiculous state of affairs ! .This cumbersome arrangement is unwieldy and adds to the confusion .

    British Rail was a nationalised concern and , as such , a burden on the taxpayer when it was in the black , nonetheless it was organised with a structure that worked . Now that there are better controls over the Unions , I see no reason why it should not be brought back into life – it , certainly , would be better that the plethora mess we now have .

  14. Lifelogic
    June 28, 2015

    I just heard Sir Richard Branston (on Andrew Marr) trotting out all the usual silly drivel in favour of being “in Europe” 35% tariffs and barriers, back to 50 years ago if we come out, peace in Europe, no more people than run Birmingham and the likes. I did not know anyone was proposing to tow our Islands anywhere outside Europe anyway. Constant confusion of the EU with Europe.

    Branston, who was always an enthusiast of the Euro (just like half the Tory Party were), even suggested that Britain would be doing better now had we been in the EURO and that Greece’s problems were not due to the EU/Euro!

    One can see that it might suit Sir Richard to keep in with the EU bureaucrats for his interest, but surely as an intelligent man he cannot believe it is in the interest of the UK to stay in the EU can he?

    Not a single sensible question from Andrew Marr needless to say, one assumes because Sir Richard was so “BBC think” throughout.

    1. Lifelogic
      June 28, 2015

      Plus the usual “BBC think” on the carbon catastrophe (the huge exaggeration of) religion from Sir David Attenborough.

      All we have to do is get “renewables” cheaper than fossil fuels and crack electrical storage he suggests. Alas there are the laws of physics and economics rather standing in the way of this at current prices. The only likely such solution is advanced nuclear. Storage of electricity in general is very wasteful, far better to generate as needed.

      He obtained a Cambridge degree in Natural Sciences so you might have thought he would have grasped this – perhaps he concentrated more on the biology.

      1. Hefner
        June 28, 2015

        Maybe contrary to some on this blog, Sir David continued his further education.
        For anybody interested, within the present laws of physics or economics, it can be shown than jatropha, and algae are potentially sources of biofuels directly competitive with fossil fuels. For proof, the University of California in San Diego (equivalent to a town with 45,000 inhabitants) is 92 % off grid and self-sufficient for its transportation fuels.

        1. Margaret Brandreth-J
          June 29, 2015

          That is interesting. I have often wondered why if our earth’s strata has trapped dead algae giving us a supply of oil then why can we not synthesise that ourselves. I came up with the answer of scarcity v plentiful supplies threatening the value and therefore the finances of any particular country.?

          1. Hefner
            June 29, 2015

            There are various departments at UCSD (physics, biology, economics), which have been involved in the R&D of clean energy (from corn ethanol, cellulosic ethanol, jatropha, cyanobacteria (i.e., green & blue algae), diatoms). All these university projects (financed essentially by the state) have been going on for at least ten years, and most of them have been since around 2010 coming out of university laboratories and into start-up companies, where proof-of-concept “plants” have been/are developed.
            The “oil” (oily compounds) produced by these different sources, being a liquid, has the advantage of being usable in present refineries with relatively small modifications to the plants. In case of algae-derived oil products, they are directly usable in the present-day oil refineries.
            The economics suggest that they can be produced at prices between 6 and 15 dollars per gallon depending on the exact source and processing. Petrol for cars is presently at around $4/gallon.
            Oil from algae, if it were to become developed on a large scale, would be largely unlimited, as different sorts of algae growing in very different environments can be used.
            The big advantage, recognised by the Californian legislature, which has put grant money in these projects is that all these “oils” products being based on plants and algae are obviously not fossil fuels, so have a much smaller CO2 impact than petrol has (there is still a need for energy to transform from plants/algae to “oils”).
            Some (cellulosic ethanol) actually absorb more CO2 during the “oil” production than they release when used.

        2. bluedog
          June 29, 2015

          Interesting that you should raise the issue of jatropha (curcas), there are various sub-species but the one mentioned can be crushed to produce a vegetable diesel oil. The Indian Railways diesel locos are now 20% fuelled by jatropha which is grown down the railway corridors. The problem with jatropha from a UK point of view is that it requires a dry sub-tropical climate, so is ideal for California, India, Africa, Australia and inland China. It is also highly toxic to livestock and a proscribed noxious weed in many jurisdictions.

          1. Hefner
            June 30, 2015

            Agreed. Jatropha is typically found in the 30N-35S latitude band, and it is a traditional vomiting “medicine”.

    2. JoeSoap
      June 28, 2015

      Closely followed by Teresa May refusing not to have sympathy with people who are coming here illegally….
      Why be so damned “nice” to these people who are trampling all over us? They know the rules. They get as far as Calais but the risk of reaching the land of milk, honey and endless benefits is worth it right now… why can’t we up the ante on that risk?

    3. alan jutson
      June 28, 2015


      I though Richard Branson was spending most of his time on his own little private island these days, where he can choose to run it how he likes, and good luck to him too.


      I wonder how he would feel if a committee of unelected outsiders somehow took control of his Island, charged him for the privilege, and then started to make rules that he did not agree with.

      The EU will break up eventually when its people realise the truth, it simply is a matter of time and its cost.

    4. JoeSoap
      June 28, 2015

      Well he was saying our currency would be weaker and that that would be a good thing. Well it can be arranged Sir Richard, we just have to print it like crazy. Frankly the poorer pensioners of your age wouldn’t be too impressed though.
      Just keep your earnings in USD Sir R, you’ll be fine.

    5. libertarian
      June 28, 2015

      Interesting that Branson is such a fan of the EU that he actually lives as a tax exile in the Virgin Isles. Hmm and nothing to do with the fact that the EU allows large multinationals to move tax bases via Luxembourg to reduce their corporation tax bills then

  15. Pete
    June 28, 2015

    No public sector organization can or will ever be efficient. They don’t have the profit incentive therefore cannot react to cost overruns, customer dissatisfaction or new circumstances as a private company with no subsidy or monopoly can. We can argue and discuss the merits of public and private ownership for the next thousand years but that lack of connection with reality in the public sector will remain forever.

    1. Hefner
      June 28, 2015

      “No public sector organization can or will ever be efficient”.

      Wasn’t it the public sector that won WWII by financing Los Alamos, among other things … More recently, wasn’t it also the (US) public sector which created the internet (DARPA), the GPS (Navy), Siri (DARPA), the touchscreen display (contracts from the CIA, NSF), nanotechnology, and 70% of new drugs’ development (i.e., not cosmetic changes to branding or packaging) via contracts with universities.
      If anything, most of the time, the private sector is only following the ground work carried out by public organizations (often linked to the military) and/or public funding.

      For anyone interested in testing the idea, see M. Mazzucato, 2013, “The Entrepreneurial State: Debunking Public vs. Private Sector Myths”.

      1. bluedog
        June 28, 2015

        Absolutely right, Mt Hefner. Our host conveniently overlooks that the German (DB) and French railways (SNCF) are still state owned, and seemingly successful in that the German railways are buying up the British rail network.

        The problem for the British rail network is that the British economy no longer depends on the manufacture of goods but largely produces services. The old days in which South Wales coal was transported to power stations in the Thames Valley have gone. Train loads of commuters are somehow less profitable despite the congestion charge in London. In addition, Britain is a small island with a large number of excellent ports so that short rail links to container ports are all that is required for the export of manufactures. It was no accident that the first steam railway in Britain ran between Manchester and Liverpool.

      2. libertarian
        June 29, 2015


        No it wasn’t the public sector ARPAnet ( which relied totally on equipment and communications sourced from private sector) that created the internet . The modems ( codex, motorola, Racal ) Mux’s Codex, Case, Comten ) and leased circuits AT&T , Western Union, Cable & Wireless ). As well as ALL the computers in use by the US public sector where sourced from private manufacturers. DEC, IBM, Cray, Wang etc. Mass data networks existed in private corporations and peer2peer networking was used extensively SNA & global standard X25 . I personally designed and installed a large scale international data network in the early 70’s using equipment sourced entirely from private sector. Oh and I also used a link via Westar a satellite in geostationary orbit launched and operated by the private Western Union Co. in 1974

        Ethernet was developed at Xerox Parc and Digital Equipment Corporation was amongst first to adopt ethernet interface cards on PDP 11/70 machines. For a while DEC had the worlds largest data network long before DARPA etc.

        1. Hefner
          June 29, 2015

          ARPANET (Advanced Research Projects Agency Network) obviously used equipment from the private sector but was part of ARPA, fully funded by the U.S. Dept. Defense. As for who designed the project, please check Wikipedia for the history.

  16. ChrisS
    June 28, 2015

    I am a railway enthusiast but the current level of cost is far in excess of what is economical to provide. Further investment therefore cannot be justified by conventional calculations.

    Instead, I would like to see us invest in new technology such as coaches running in dedicated lanes and powered by electricity transferred to the vehicle by induction. This has been successfully demonstrated and would be far more suitable for the UK where our journeys are comparatively short compared with France or Germany. The cost a setting up a basic network would be a fraction of the cost of new railway lines and also ease congestion on existing motorway lanes.

    Driverless-enabled cars and trucks could also use the same lanes and travel at high speed much closer than would be possible if a human driver had to remain in control 100% of the time. I suspect the overall cost per passenger or freight mile would finish the railway industry for good.

    Blinkered enthusiasts for trains fail to address the needs of those who live or have to travel to areas outside of major city centres yet we are in the majority.

    What is the point in me, living in Dorset, catching a train to London, crossing the city and boarding another train to Manchester when my ultimate destination is somewhere in rural Lancashire ? There is no public transport to get me to a railway station and how am I supposed to get around when I get off the train at the other end ?

    Most important, it’s impossible to make this journey in one day.

    For the majority of us it is far more efficient to travel by car, especially if there are at least two people making the journey. The kind of road infrastructure I am suggesting would make so much more sense for the vast majority of people who don’t live in London.

  17. William Long
    June 28, 2015

    The problem facing all the formerly nationalised utility industries is lack of real competition. This has been addressed for all the others by imposition of a regulator to control charges, while shareholders should do something to control costs. As far as I am aware the only control on Railtrack is Parliament which has proved totally ineffective. Noone, with a few honourable exceptions such as our host, seems remotely interested. This is perhaps not surprising when one of the main champions of HS2, a development with no commercial justification, is the Chancellor of the Exchequer himself. I think we can be very confident that the overspend on Reading Station will fall into total insignificance when HS2 gets going.
    What requirement is there on Railtrack to get competing quotes for any work it does? Surely some way can be found to hold its executives to account?

  18. petermartin2001
    June 28, 2015

    The ownership of the railways is primarily an ideological decision rather than an economic decision.

    But, shouldn’t economics have something to with it? Why was East Coast Mainline privatised when it was very successful under public ownership? It has generated £1bn for UK taxpayers since 2009.


  19. Narrow Shoulders
    June 28, 2015

    Completely agree.

    In the private sector administrators do not get the same salaries as the chief who has to decide commercial income generating strategy as well as service delivery.

    Public sector bosses are in effect administrators so should not command top dollar.

    The whole public sector bonus culture should be scrapped, bonuses in the private sector are mostly tied to income and profit. Why does anyone get a large bonus for doing their job?

  20. Peter a
    June 28, 2015

    Marvellous examples of BBC THINK and tough analytical TV today both on BBC. Marr show and A Neil on Sun Politics. Complete, pandering rubbish as usual from Marr, Neil bravely and almost uniquely held a thorough discussion on the alleged perversion of Islam …………….. and then held an interview with Farage, which uniquely on BBC fairly discussed a eurosceptic viewpoint!

    Political correctness could well destroy this country.

    Should be an important and vocal week for publically prominent euroceptics: Calais migrants/boat people/terrorism/Greece/Cameron’s euro humiliation and impending Wilsonian Sophistry (first installmenti tomorrow)

  21. brian
    June 28, 2015

    I am not in favour of the nationalisation of the UK’s railways but we should observe the example of German State Railways (DB). It runs the franchises for many of UK’s rail operations and the only UK freight operation. Can we imagine the UK industry being so aggressive internationally. The best we can do is National Express’s couple of franchises in Germany. How come DB could justify its purchase of the UK bus and train company Arriva? Was it to pre-empt a competitor in Germany? In Germany they think of their nation’s situation first – short term capitalism is suppressed.

  22. Denis Cooper
    June 28, 2015

    It’s easy to understand why Network Rail is so inefficient: it doesn’t have the optimum 50:50 male:female split on its board. But there is cross-party support for eliminating that kind of problem in Scotland, starting with a requirement that half of the candidates for the Scottish Parliament elections must be female even that means scraping the bottom of the barrel to find enough women who actually want to do it.

    “The proposal, which includes plans to achieve a 50-50 gender ratio on the boards of Scottish public authorities, follows calls from a cross-party group to present voters with an equal balance of men and women parliamentary candidates.

    The pressure group Women 5050 wants Scotland to follow in the footsteps of nations like France and Ireland which, while recognising that the ultimate decision on who makes it to parliament lies with the voters, have introduced election candidate quotas to drive up the number of female politicians.

    Scotland on Sunday can reveal that the plan has been drawn up by Ian Murray, Labour’s Shadow Scottish Secretary, who has tabled an amendment to the Scotland Bill, which is bringing new powers for Holyrood and is currently being processed by the House of Commons.”

    The question must surely be whether or not the MPs elected elsewhere in the UK should block that amendment in order to save the Scots from themselves, or rather to save the Scots from the somewhat barmy politicians they have elected.

  23. DaveM
    June 28, 2015

    I spend a huge amount of time travelling, and would love to use trains more. However, the cost of a bus/taxi to and from the station at both ends, plus the cost of the train ticket is 3 times the petrol and running costs of the car. And whoever came up with the ludicrous idea of a return ticket being £1 more than a single? If I need to travel one way, I’ll buy a single – making the value for money worse isn’t going to change what I have to do!!!! That’s like charging the same price for two MOTs on the same car on the same day even though I only need one! I suspect, John, the reason why you receive letters about nationalising the railways is that people like myself (who know nothing about railways) are confused by the fact that trains, tracks, stations, and ticketing are all owned by different companies and yet the system is poor in comparison to continental railways. I’d imagine that if one huge company ran everything and broke the country down into manageable areas that it would all be far more efficient. As you say, the minister has a lot of thinking to do.

  24. Ex-expat Colin
    June 28, 2015

    The railways have been a scruffy mess since I can remember..1955 -ish. Fortunately for me I have not had to use them much being in the military and then largely working overseas. Severn Railway next to me is very nice though….volunteers!

    O/T – but perhaps not quite with E.Tunnel?

    “James Brokenshire, the Immigration Minister, tells the Telegraph he is holding urgent talks with hauliers to improve security on foreign lorries and sending two miles of security fencing to tackle the migrant crisis”.

    Don’t get that really…not getting to the source of the problem. Surely its the fault of all EU states bar us? Apart from the smash up of Libya of course.

  25. forthurst
    June 28, 2015

    The continuing problems with the railways stem from John Major’s disastrous privatisation when British Rail was fragmented into a myriad discrete business operations, each vying to maximise its slice of the pie, which, latter, consequently has grown, astronomically, thanks to taxpayers’ largesse.

    Perhaps we should give John Major the benefit of the doubt, however, and once again when things go wrong in this country, as is very often these days, point the finger in the direction of guilt, Brussels, specifically in regard to Council Directive 91/440/EEC, to which our civil service gave maximal compliance, thereby sundering train and track and any possibility of value for money for taxpayers and passengers.

    Until we have waived goodbye to the Brussels meddlers and incompetents, it is too early to plan the rationalisation of the railways as when confronted with a recent massive cock-up, the French transport minister Frederic Cuvillier affirmed: “When you separate the rail operator from the user, it doesn’t work.”

  26. Margaret Brandreth-J
    June 28, 2015

    It would be refreshing if sometimes some of the more verbose and repetitive contributors said something positive about their fellow men/women.

  27. Chris S
    June 28, 2015

    The railways were a financial disaster before privatisation and at least the operating companies are now fairly efficient.

    The problem is with Network Rail which uses a very expensive business model, supervising a few private contractors who do the actual work and charge a fortune for doing so.

    Railways are so inherently expensive to construct and run that they can never compete with the car, truck and coach. Even mass transport like commuter trains lose money because the trains and lines are sparsely used during the day.

    Trains are heavily subsidised for the benefit of the very small proportion of the population who can use them by the majority of taxpayer who, as car drivers, suffer for gross underinvestment in the roads.

    This policy needs to be reversed, now!

  28. DiscoveredJoys
    June 29, 2015

    Re trackside clutter and disused areas. New projects (like HS2) are generally seen to be heroic and sexy, career building, and (relatively) well funded. Maintenance work is generally seen as unexciting, dull, a home for the incompetent, and the first to be cut when budgets are tight.

    Until, of course, a train is derailed because of trackside clutter on the line and people ask ‘how did we get to this state of affairs?’ Now you know. It takes a particular mindset to work well at never ending maintenance tasks – one that is rarely recognised.

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