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Tag Archives: The Economist
CAMPAIGNING FOR BETTER RAIL SERVICES IN THE WEST
On Sunday I had my first introduction to an organisation I’d read about many times in the seven years since I moved to Bristol and started using the public transport here. The organisation’s full name is Friends of Suburban Bristol Railways; admittedly a bit of a mouthful, so they tend to be known by their initials FOSBR. (well, OK, acronym, as it could be a word)
The occasion was a celebration of progress made in several of FOSBR’s campaigns and the location was a pub near Bristol’s Temple Meads station. Being fond of trains and pubs, I found it an easy decision to attend; I also found that FOSBR has even produced a guide to pubs along the Temple Meads / Severn Beach line, called FOSBEER of course.
Enough of the fun side of it; the content of the meeting, even though billed as a celebration, was deadly serious, i.e. the possible / probable negative impact of the recent McNulty Report. I was impressed with the presentations by three local rail union officials (RMT, TSSA and ASLEF respectively); incisive and fact-filled.
Correction; I’d assumed they’d be local union officials but in fact two of them had national status: Alex Gordon is national President of the RMT and Manuel Cortes is Assistant General Secretary of TSSA.
They also had a local councillor speaking; importantly, he represents an area in North Somerset that could be served by rail once more if passenger services are restored to the (currently freight-only) Portbury branch and it’s extended a couple of miles to Portishead.
Subsidy five times higher since privatisation
I’ve often read, (e.g in The Economist) or heard it said verbally (Richard Wilson’s recent impassioned plea on behalf of harassed British rail users on Channel 4) that the level of public subsidy of our railways was now higher than it was pre-privatisation, despite our fares being the highest in Europe. However it was not made clear in either of those sources if the comparison was inflation-adjusted.
At this meeting, though, the guy from TSSA filled in the blanks; the subsidy is now five times higher; £5 bn, compared to £1 bn at today’s prices back then. How can that be? McNulty apparently thinks that staffing levels and pay costs are a big part of it, which concerns the unions, naturally, including the possibility of DOO (driver-only operation). Maybe his brief didn’t allow him to conclude that the fragmentary and thus potentially chaotic way the railways were privatised had a big impact on costs and that should be addressed first.
I learned some other interesting stuff, all of which I shall check out in the interests of balance; for example that First Group will be able to exploit a loophole and avoid large subsidy repayments by giving up the Great Western rail franchise three years early.
The feeling of the meeting was summed up for me by FOSBR member Mike: “McNulty is Beeching Mk 2”.
I’ve now joined this worthwhile and effective organisation and will be blogging about rail in the West, so watch this space.
WANT TO KNOW MORE?
On the McNulty Report:
On Driver-Only Operation (DOO):
On FOSBR: http://fosbr.org.uk/
UK RAIL LINES IN THE HEADLINES AGAIN
Just when British rail travellers thought they had seen the end of travel miseries caused by the ice and snow in the weeks up to Christmas, they’ve been hit with steep fare increases. The average fare hike is double the inflation rate and some fares will rise by 12.8%. Meanwhile promised improvements to services are in most cases nowhere to be seen, although to be fair punctuality has improved. (By British standards, that is; we say that a train is punctual if it’s less than 10 minutes late, whereas in Spain, the land supposedly of ‘manana’, if one of their high-speed services is five minutes late your fare is refunded.).
Rail’s share of “total miles” small?
A recent article in last weekend’s Independent on Sunday (2 Jan 2010) by Alexandra Woodsworth, of the Campaign for Better Transport, says that even steeper rises are planned from January 2012, as the government wants to reduce the taxpayer’s contribution to the cost of running our much-criticised rail network. In itself a justifiable aim, if you consider it unfair to subsidise so heavily a mode of transport that represents 8% of the total distance travelled in Britain, (The Economist, 1 Jan 2010) compared with “85% by cars and vans”. That last phrase makes me wonder whether the statistic included freight miles; time to call in Tim Harford and his team at Radio 4’s wonderful “More or Less” programme with their genius for unpicking the headline statistics so beloved of many journalists and so often misleadingly used. It was Gore Vidal who said, “The worst thing I can say about my fellow-Americans is that they don’t like any question that can’t be answered in ten seconds” and sometimes I think we are going the same way.
The Economist article points out that UK rail fares have grown by 50% in real terms since 1980 and it’s already well-known that our fares are the highest in Europe by a massive margin. Despite that, many commuters have no real alternative and “many rail firms enjoy a virtually captive market, (and regional monopolies too) hence passenger numbers continue to increase: we complain but many of us cannot vote with our feet because we need the trains to get to our jobs. The claim is often made that trains are “favoured by the better-off” but this is somewhat misleading: trains are not so much the favoured solution as a necessity for those who work in London, where wages and salaries are higher but so are living costs.
Subsidies and profits
The same magazine has often made the claim that the taxpayer subsidy of rail (currently £4.4 bn / annum) is four times higher than it was before we privatised the network in the mid-1990s (a decision taken by the then Tory government but implemented by Labour) but it’s not clear if that’s inflation-adjusted. Either way, can this massive subsidy be justified in view of rail’s small share of the travel market? And can it be consistent with the highest fares in Europe? (and in many people’s opinion the worst services?)
In a recent post I quoted a letter scoffing at a claim by a senior manager in the train operating companies (TOCs) that there would be fares “to suit everyone’s pockets”. The writer guessed whose pockets would be best suited by the new fares and it would not be the traveller. These new fares will be better news for the taxpayer and best of all for the TOCs themselves. The partial justification of the increases is planned improvements to the services provided by these privately owned train operators; that’s equivalent to Tesco, for example saying: “we want to open new stores next year, which will of course increase our market share, our turnover and our profits; that’s a good economic decision for us but to pay for it we need you, the consumer, to make the investment, so we will increase all our prices now.”
Off-peak more expensive?
“And another thing …” Why are our rail fares so complicated? Last week I travelled from Bristol to Exeter. Even though I knew exactly which train I wanted to get, there were seven different single fares available, just for that particular train, according to www.thetrainline.com, all with slightly different conditions attached. If I had not been sure which train to take, there would have been dozens of different fares.
Of course advance booking is usually cheaper than walk-up and off-peak is cheaper than peak, i.e. “anytime”. However, here’s the most ludicrous thing I noticed last week: the walk-up fare for an “off-peak single” on my train was slightly more expensive than the equivalent fare for an “anytime single.” As Jeremy Clarkson might say, if he’d ever written about trains (which I doubt), “you couldn’t make it up.”
WANT TO KNOW MORE?
“What’s green about encouraging us to drive?” The Independent on Sunday, 2 January 2011. http://www.independent.co.uk/opinion/commentators/alexandra-woodsworth-whats-green-about-encouraging-us-to-drive-2173948.html
Alexandra Woodsworth, The Campaign for Better Transport. http://www.bettertransport.org.uk/
“After the deluge, the pinch: Britain’s expensive trains are set to get even pricier.” The Economist, 1 January 2011. http://www.economist.com/node/17800351?story_id=17800351&CFID=158635719&CFTOKEN=67846156
“ … Britain’s definition of punctual includes trains up to ten minutes late”. From The Economist 4 June 2009: “Pay up, pay up, and board the train.” http://www.economist.com/node/13788573
UK RAIL FARES
I read a letter in Metro yesterday that was so good I want to quote from it. It was from Julian Self of Buckinghamshire.
So the Association of Train Operating Companies reckons it will always offer “a range of fares to suit every pocket”, does it?
Given it (rail) is already massively subsidised by the public purse at a far higher level than the old, state-owned British Rail ever was, and that it has`raised fares above inflation ever since privatisation in the mid-1990s, I rather fancy I know whose pockets these fares are designed to suit. It certainly isn’t those who depend on trains to get them to their places of work.
It seems rail companies and successive governments have done their very best to reduce train overcrowding in peak hours … by making the entire rail experience as unpleasant and uncomfortable as possible.
… At a time when all public services are struggling to provide more for less, it seems these railwaymen (and I use the term in the same spirit as highwaymen) are intent on providing less for more.
Good man yourself, Julian Self. The overcrowding I can vouch for, as I am at present experiencing it a daily basis between Bristol, where I live, and Newport, where I am working for the next couple of weeks.
… and another thing: in case you don’t believe J. Self’s assertion that the subsidy is higher now than before rail was privatised in the UK, I have read the same claim in “The Economist”, a magazine whose grasp of facts I tend to trust.
UK PROPERTY STILL OVERPRICED
House prices up?
I read recently that domestic property prices in the UK increased by an average of 1.8% over the last month. That seemed surprising, given the economic situation but, according to a friend who is “in the know”, it isn’t a meaningful trend because the volume of sales is still small.
… or down?
However this rise followed “a big drop” the previous month, according to the Halifax. (I think it was 0.7%) Such a wide variation from month to month would seem to support the fact that these are not really meaningful trends. The less volatile three-month index showed a drop of 1.2% in the quarter.
First-time buyers still priced out
When last month’s drop was announced, a newsreader on BBC Radio 4 actually added: “however, first-time buyers are not taking advantage of the drop in prices”. Well, is that so surprising? Even if that month’s price drop had been a meaningful statistic, which it wasn’t, 0.7% is not much of a drop.
More importantly, UK property is still greatly overpriced. Who says so? The “Economist” magazine’s survey of international house price comparisons, taken in turn from official stats on price/rent ratios. According to the table the magazine published in late October, average UK property prices increased by 3% year-on-year; more importantly, property here is 32% overpriced.
To compare countries’ housing data over time, including price-to-rent ratios, see www.economist.com/houseprices
To view my guide to personal debt, “Back to the Black: how to become debt-free and stay that way”, go to www.back-to-the-black.com