Slow, unreliable, expensive: 10th anniversary of rail sell-off gives little cause for celebration

Ten years after the Conservative government started to break up British Rail, supporters of the privatisation are thin on the ground.

They are at their thinnest on the packed and often late rush- hour commuter trains.

More than nine out of 10 services arrived on time under BR, whereas fewer than eight out of 10 do so now. That means thousands more people are being inconvenienced day after day, week after week.

Ten years ago today, John Major's administration finally pushed through the law to privatise our rail network. The "enabling" legislation set the scene for three years of ministerial squabbling over the form the industry should take amid growing public concern that it was a privatisation too far.

Mr Major was eventually forced to rush through the sell-off before his hapless government was voted out by the electorate.

Railtrack, which took control of the infrastructure, was floated on the Stock Exchange in 1996, but the last few train operators were sold off a matter of weeks before Labour won the election in May 1997.

The Conservatives' Big Idea was that the railways would become a "customer-focused" enterprise to replace an industry that had long laboured under the reputation of being run for the convenience of managers.

This was, apart from the appointment of an independent regulator to keep an eye on Railtrack's pricing strategy, a privatisation red in tooth and claw.

There was little in the way of central direction. The Department for Transport was ultimately responsible for the network, but hundreds of private-sector companies went about their business as they saw fit. The Government's Office of Passenger Rail Franchising was simply there to contract out train operations.

Despite warnings from Labour politicians that the industry would be renationalised, the Blair Government decided initially to live with the Conservative legacy. One important exception was the Strategic Rail Authority (SRA), which was formed to impose some kind of order on the fragmented system.

That was the first in a series of decisions leading to increasing state control. It is a process widely seen as "creeping nationalisation". The "privatised" network is now a very different animal to the dysfunctional free market beast unleashed by the Conservatives.

The incompetent Railtrack was finally laid to rest last year - after a series of rail crashes and demands for more government money - and replaced by the state-backed Network Rail, which can do little without the SRA's approval.

The process of renationalisation continued recently when Network Rail decided to take all rail maintenance back in-house. Such operations had originally been part of BR, but were sold to companies such as Jarvis, Balfour Beatty and Amey. A decision by Jarvis to relinquish its contract after a series of high-profile gaffes started the process.

The 25 train operators have fared little better in the private sector. Half are being bailed out by large and unforeseen handouts from taxpayers. A quarter of the companies are technically insolvent and in effect managed by the SRA.

Roger Ford, industry editor of Modern Railways, estimates that public support for the system is now nearly three times more than in the last year of BR. He calculates that the subsidy in 2003-04 will amount to £3.84bn. In BR's last year the figure was £1.325bn at 2003-04 prices.

The authority prefers to see extra public subsidies as much-needed additional investment. Paul Latham, of the SRA, said that BR always struggled to win funds from the government to buy new trains - something that privatisation had put right. "How can you possibly see 20 per cent more trains, 30 per cent more passenger-journeys and a very significant increase in investment as a bad thing?" he said.

The Association of Train Operating Companies said yesterday that its members had backed £4bn worth of spending in rolling stock since privatisation. Britain had the youngest train fleet in Europe and hundreds of stations had been refurbished, the association said.

The SRA concedes that increasing costs and lower punctuality - among other factors - have furthered the case for complete renationalisation. But Mr Latham said the industry was getting to grip with costs and train performance was "gradually clawing its way back". He adds: "If you were to ask if privatisation was perfect then the answer would be no, but overall it has certainly been a success."

But there is little doubt that costs, in the words of the rail regulator, Tom Winsor, have "exploded".

Mr Ford, in his analysis for the pressure group Transport 2000, says the price of the west coast main line modernisation is £16.7m a mile, compared with the cost of similar work undertaken on the east coast main line in the 1980s of £1.8m a mile - both at 2000-01 prices. He says that even the line for the new high-speed French trains Grande Vitesse Est only costs £10.8m a mile.

The industry argues that safety has improved under the present regime. For most passengers, however, safety only becomes of primary importance in the immediate aftermath of an accident.

Those who use the services day in, day out are most concerned that their trains will run on time.