I wonder how many friends I would make among commuters by suggesting last week’s 3% rise in rail fares is at least in part a good news story. Of course, there has been understandable indignation that fares are going up by three times the average wage increase. But the fact that fares “only” went up by the rate of inflation actually represents quite a shift in government policy, and one that is very much in the right direction.
Rail (and indeed wider transport) policy has been little short of catastrophic for decades. While many European countries invested heavily in their railways throughout the 20th century, British politicians thought they knew better. Railways were seen by successive governments as an outdated and inflexible means of travel, very much the poor relation of cars, vans, buses and lorries. Large sections of the network were closed down in the 1960s and 1970s following the Beeching Report, and what remained was in managed decline.
While the car was seen as an analogy for freedom and choice, public transport represented the very worst of producer-led state industry. The logical conclusion of this had been realised by 1997, when most of the bus industry and almost all of the rail industry had been privatised – with even the method of privatisation itself being designed to further manage decline, not stimulate growth. In this context, the market could be left to deliver across all transport modes.
Suffering from congestion
Except, of course, it couldn’t. Leaving aside the fact that transport is not a market in the conventional sense, governments didn’t help themselves by thinking cars would allow them to get transport on the cheap. Despite bold announcements about road building programmes being the “largest since since the Romans”, no one ever really got to grips with what was actually going to be needed.
So the roads became increasingly congested – Britain has by some distance the most congested roads in Europe – but because public transport was in relative decline, and since lax planning regulations allowed shops and services to spring up in out-of-town locations not usually served by buses and trains, people didn’t really have an alternative to using their cars. How ironic that the outcome of a policy based on freedom and choice had served to take these things away.
The Labour governments of Blair and Brown recognised all of this but, it has to be said, did very little about it. For whatever reason (and there are many possible ones) ministers never did the hard work necessary to correct the decline of a transport system that supports more than 60 billion journeys a year. Schemes were dismissed on the basis that they offered poor value for money, or just quietly forgotten, and it wasn’t until the death throes of the last Labour administration that public transport was put firmly back into the policy mainstream.
For the railways, then Transport Secretary Andrew Adonis identified an impressive set of strategic investment priorities. It is to the great credit of Coalition ministers that they have actually delivered on Labour’s plans. The list of commitments constitutes by far the largest programme of investment in Britain’s railways for decades. The best-known scheme is HS2, but hundreds of miles of main line electrification and several large-scale station redevelopments have been started, and thousands of new carriages have been ordered. Road building has also been ramped up, although bus, tram, walking and cycling policy remains decidedly underwhelming.
One clear problem, though, was how to pay for all of this investment. The Department for Transport hit upon the idea that since rail passengers would benefit most from the planned improvements, they should bear a large part of the cost. The policy was to increase the proportion of the railway costs borne by the passenger to around 75% (historically it has been much lower). This is the simple reason why train fares have gone up so much in real terms in recent years.
Who benefits?
Unfortunately, this policy rather misses the point that improvements to the railways will benefit the whole country, not just existing rail passengers. At the most basic level, a journey being made by train is not being made by car, and therefore should directly affect the amount of traffic on the road. Perhaps the best illustration of this principle in action is in London: around a million people arrive every weekday morning in central London by train and tube. Imagine what the roads would be like if they all came in by car.
Whether or not we will ever close the railway quality gap between the UK and major European countries remains to be seen. Germany is investing relatively little in its railways at the moment, but it is doing so with decades of committed investment in the bank. We will need not only to complete all of the currently committed railway schemes, but also to embark upon second, third and fourth rounds of schemes of at least equal magnitude before we can hope to remedy the decades of railway disinvestment we have suffered. This will cost tens of billions of pounds – and it will be worth it.
So the reason we might take at least some cheer from this year’s round of fare increases is that ministers have finally seem to have got the message that passengers already pay a high enough proportion of railway costs. The fare increases may be above average wage rises, but they are not higher than the rate of inflation. It is the fault of politicians, not passengers, that our railways are in the state that they are, and it is to the benefit of everybody –- rail-user and non rail-user alike –- that the quality and capacity of the system continues to improve. It is right that a greater proportion of the cost of rebuilding the railways comes from general taxation and fares, but it is also right that any increases should be reasonable. Let us hope the good news will continue for many years to come.