Mr Prescott's huffing and puffing won't fix his train set

The Government would not have chosen privatised railways as a testing ground for the Third Way
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The Independent Culture
MAKE SURE you catch a news bulletin tonight. For you will see the owners of the privatised railway companies receive public carpetings, not only from John Prescott, but from some of the poor sods who rely on their services. Part of today's Rail Summit organised by Prescott will be in public and it will be good therapy to watch the multimillionaire owners shuffle uneasily. For a moment we will be returned to the mood of that great cathartic speech Prescott made at last year's Labour conference, in which he described the performance of the privatised railways as a "national disgrace".

Of course, the railway owners have their excuses. "We are a victim of our own success," they will declare. Their most recent argument has been that they are providing too many trains, which is why so many of them are late. Some of the companies are planning to reduce the number of already overcrowded trains in order that the occasional ones they do bother to run hit a punctuality target. One train a day, and there will not be a bottleneck in sight.

Hopefully such limited ambitions will be challenged at the summit. Prescott is genuinely committed to improving public transport and is the first minister responsible for transport in two decades who feels passionately about the need for an integrated system. Others attending the summit are transport specialists and business leaders, all of whom despair about the wider costs of Britain's shambolic transport. They will spell out to the railway companies the costs of their incompetence and the potential benefits to the economy and quality of life if they managed to get their act together.

And then what? Displays of Prescottian anger are not enough to tackle the crisis.

The Deputy Prime Minister tends to react with as much fury when journalists reach such a conclusion as he does when a privatised train fails to reach its destination. A fortnight ago he responded to criticism in an editorial in Rail magazine with a half-page letter setting out his achievements. But, as the transport journalist Christian Wolmar pointed out in the New Statesman, they do not amount to much: 800 new train drivers is little more than the normal replacement rate; the 500 new vehicles were ordered a long time ago, and so on.

There is much at stake in the politics of transport. Obviously there are the electoral implications of a chronic transport system, especially in London and the South-east, an area with plenty of marginal seats. But as far as the Government is concerned these considerations are neutered because disillusioned travellers have nowhere else to go politically. They are hardly going to switch to the Conservatives on the assumption that the party that ruled over this chaos for 18 years is going to make a difference now.

Where the politics is much more interesting is in how the Government attempts to resolve the nightmare it has inherited. For at the heart of this debate is the issue of ownership, a real test of Labour's general conversion to privatisation backed up by tougher regulation.

It goes without saying that the Government would not have chosen the privatised railways as a testing ground for the Third Way. It opposed the Tory government at the time and ministers continue to express genuine amazement at the incompetent way the measure was handled. None the less the railways will test whether a government can impose its will on a privatised industry in order to improve the service. This particular version of the Third Way shows every sign of failing.

Prescott's short-term solution, the only one realistically available to him, has been to strengthen the regulations governing the privatised companies and Railtrack. The Strategic Rail Authority will attempt also to ensure greater co-ordination in a fragmented network.

He is quite right to have a go, and good luck to him, but the response of the privatised companies is revealing and not without merit. "Why should we invest more if we risk losing the contract?" they ask. More fundamentally, some of the better-performing private companies balked at having any involvement in the privatisation because they feared the heavy hand of government disrupting their plans. This is one of the reasons we are left with largely mediocre companies running the railways.

Yet if tougher regulations can in effect be counter-productive, what is left? Untrammelled privatisation is not a option which even the Tories considered. Deregulation with a light touch has been a disaster.

Another option, a public/private finance initiative, is already proving to be a deadly flop for the London Underground. Private investors are not coming forward, even though the arrangement will cost taxpayers vast sums over the long term. The new London Authority will inherit a mess over which it has no control if this system remains in place. I would not be surprised, though, if changes are announced. The Treasury always favoured wholesale privatisation, as does Downing Street.

What is clear is that the chaos on the Underground offers no clues as to how the railways may be revived.

What of public ownership? John Prescott has suggested that this is an option when the existing contracts of the privatised companies come to an end. In opposition he fought hard to maintain a commitment to publicly owned and publicly accountable railways at a time when the transport spokeswoman, Clare Short, was pursuing a more pragmatic policy with the backing of Gordon Brown.

However, the transport minister John Reid was quite emphatic when asked about this on GMTV's Sunday Programme last weekend. "We want the privatised industry to work... People say this is the position we're in. The trains are there, the companies have been privatised; make it work."

But how? Reid says that the Government has to become the "passengers' champion", which is a revealing phrase. For it shows that the Government has become little more than a representative of the passengers, with only a few strings to pull.

Prescott has some innovative ideas for transport as a whole, but on the railways there is no clear way out of the nightmare. Today's summit will do us all some good. But it won't make the trains run on time.

The writer is political editor of the `New Statesman'