Government moves to connive with Britain’s private train companies to raise profits have been exposed by a recent report from the National Audit Office. The report highlighted the fact that instead of reducing the burden on the taxpayer as claimed by transport ministers, the above-inflation fares increases that came into effect in January 2012 will mean more profits for rail companies and more dividends for shareholders.
The government has been forced to reduce the fares increases from an average of 8 per cent down to 6 per cent following a vigorous campaign by rail users and unions. But the maximisation of profit at the expense of workers many of whom have seen real terms pay cuts over the past few years continues.The private train companies will also be reaping a bumper profit increase from increased station car parking charges, which are completely unregulated by the government.
Today’s railway companies have made huge profits out of privatisation. And no wonder: they currently receive in real terms nearly five times the public subsidy that British Rail received in its last year of existence. Even Sir Roy McNulty in his recent “Value for Money” report acknowledges the massive structural costs of a fragmented and privatised railway. It is obvious to all except him that ending profits by returning the railways to public ownership would substantially cut the need for subsidies.
McNulty’s solution, enthusiastically embraced by the government, is to increase fares and attack the pay, conditions and pensions of rail staff. The imminent publication of the delayed government “command paper” in response to McNulty will reveal the challenges ahead for users and workers alike. ■