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The Tories can put an end to rail fare hell by completing privatisation

    This piece was originally published by The Telegraph online.

    For the first time in a generation the Conservatives are at real risk of losing the great railway debate. A toxic mix of not delivering on privatisation pledges, Whitehall micromanagement and failing to address the Southern franchise failure have combined to convince Jeremy Corbyn that he commands huge public support for rail re-nationalisation. Then there’s outrage at poor value for money, compounded by fare rises which consistently outstrip wages – like those announced yesterday. The Tories need to take the lead again and fast.

    This summer marks the 25th anniversary of the policy which led to privatisation and did so much to reverse the railway’s decline and secure long overdue investment in new trains and a safer network. The result has been a rail revolution in the way we travel – passenger journeys on the network have more than doubled since privatisation, from 735 million in 1994 to 1.7 billion in 2016, almost trebling since the 1982 post-war slump.

    But while a growing railway is good, there is still so much more to do to improve the passenger experience, get fares down and regain the initiative on the nationalisation debate. John Major’s original privatisation plan pledged to deliver “more competition, greater efficiency and a wider choice of services more closely tailored to what customers want”.

    It was right then and is right now. Unfortunately, however, his plan has not been fully implemented. Instead, policymakers have so far delivered only an unsatisfactory halfway house where most passengers don’t enjoy any choice or competition. Fixing that – and transforming the lives of rail users – offers huge political rewards.

    Ministers should look at last month’s rail passenger satisfaction survey. All passengers have their own horror stories, and some will no doubt roll their eyes when they read this, but July’s National Rail Passenger Survey shows that many of John Major’s original ambitions are now being delivered – but only on one main line. At London King’s Cross the main train franchise, Virgin Trains East Coast (VTEC), faces stiff competition from two high speed “open access” train operators on intercity services between London, Yorkshire and the North East.

    These trains all compete on the East Coast Main Line (ECML) and record the highest passenger satisfaction ratings anywhere in the country. Hull Trains comes top with 97 per cent, followed by rival Grand Central on 94 per cent and VTEC with 91 per cent. Grand Central and Hull Trains also came top on value for money, reliability, punctuality and getting a seat. The message is clear: when passengers have real choice and train companies face rivals on the same track, they raise their game. Evidence also shows that competition limits fare increases, so putting an end to the regular bad news on ticket prices that passengers have to endure.

    Why are Ministers afraid of encouraging and expanding this proven model across the railways? This is a huge opportunity for Conservatives to deliver for passengers and regions across Britain.

    The price of not doing this is very clear elsewhere, where the ECML model is not in operation. At London Paddington, for example, the Great Western franchise enjoys a complete monopoly on services across vast swathes of western England and Wales and suffers one of the lowest satisfaction scores. There is no competition on long distance fares, and only 48 per cent of passengers think tickets are value for money.

    Similarly at London Liverpool Street, where Greater Anglia services enjoy a “railopoly” to serve eastern England, just 42 per cent of travellers think they are getting value for money. Compare this with the average of the three competing East Coast services, which hits 67 per cent, and where Grand Central scored a huge 78 per cent.

    At Britain’s busiest station, London Waterloo, used by almost 100 million passengers last year, there is just one train operator, which scores a pitiful 40 per cent on value for money. A new application to bring intercity competition to the Waterloo to Southampton line is awaiting approval. But track managers have already said there is space for the new trains. So the signal should be turned to green immediately.

    The success of the ECML means we now have a mature test case where train companies compete on the same track to deliver the choice and growth which privatisation promised. It shows that competition must not just be at the franchise bid stage, because that way the eventual winner gets the keys to a long monopoly. Part of the prolonged southern rail problem is that this now huge franchise was allowed to absorb two other train firms against which it used to compete. Passengers now have no alternative service when the unions strike.

    A new rail policy which delivers real choice for passengers would expose Corbyn’s flawed calls for renationalisation and finally deliver on the Conservatives’ rail pledges made a generation ago. It’s still not too late.

    Tony Lodge is a political and energy analyst. He is a former Editor of the European Journal and a former Chief of Staff to the Shadow Attorney General and Shadow Secretary of State for Constitutional Affairs. He has written regularly in the national and international media and appeared on national TV and radio covering energy policy issues.

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