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Labour vows to put BR back on track

Donald Macintyre
Friday 29 March 1996 00:02 GMT
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DONALD MACINTYRE

and JOHN RENTOUL

British Rail will be reconstituted by a Labour government as the crucial means of preserving the party's stated commitment to a publicly owned and accountable railway, the party will announce today.

Clare Short, Labour's transport spokeswoman, will announce a pledge to re-establish British Rail as a publicly owned company, with the goal of harnessing private and public sector investment in the railway.

The commitment to British Rail's survival after a Labour election victory, without saddling a Labour government with a drain on public-sector funds, is seen by Tony Blair, the Labour leader, as an ingenious solution to the dilemma it faced over privatisation. While not precluding an earlier public stake in the privatised rail network, the move means the party is working on the assumption that parts of the rail system that are privatised by election time would revert to the public sector once franchises run out.

The Government's ambitious goal is to sell off a controlling stake in Railtrack in May, and to have sold off all services to 25 franchise operators by the end of April next year. Under those plans BR would have be left a shell, employing a maximum of 60 staff.

Under Labour's plans, it would play an active role in encouraging joint private and public sector investment, and could take a stake in Railtrack, which owns the track, signals and stations. But Mr Blair and the shadow Chancellor, Gordon Brown, have said the party may only return Railtrack to the public sector "as resources allow".

Today's announcement will accompany the publication of Labour's statement of its intentions in the prospectus for the sale of Railtrack by City bankers SBC Warburg.

The statement represents a compromise hammered out by leading Labour figures over their approach to Railtrack. The main difference between rail and previous privatisations is that the railways will continue to need taxpayers' subsidies after they are sold off.

Such a solution has the full support of all the participants in the discussion , including Mr Brown. It will be the first time Labour has offered to draft a detailed statement of intent for inclusion in a privatisation sale prospectus.

Last weekend, Lew Adams, general secretary of rail union Aslef, said he wanted to see the renationalisation of Railtrack. Mr Adams welcomed part of Labour's policy but wanted it to go further. "We want a corporate railway system, we don't want to see it all divided."

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