LEADING ARTICLE : Getting back on the rails

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The Independent Online
Whose side are you on, Prescott's or Mawhinney's? Are you enthralled by the prospect of the snazzy carriages and chaotic ticketing of privatisation, or really keen on a return to the good old days of huge subsidies and slack management? As a frie nd of Billy Bunter's might have observed, the unterrificness of this choice is truly awesome. So here are the pick of the arguments, to try to make it easier.

First, two good ones from Mawhinney. One, privatisation almost always works. It shakes up managements, ushers in commercial disciplines and attracts additional investment. The result usually means greater efficiency and benefits for the consumer in termsof price and quality of service. And two, British Rail needed to be shaken up. The railways of Britain have been managed appallingly for decades. There has been chronic underinvestment, constant political interference, timid management and belligerent unions.

OK, now two that favour Prescott. Unlike all other privatised industries, rail is not now, nor can it ever be, a profit-making enterprise. Certain lines or services might lose less than others, but overall it is an essential public service that requires subsidy. It cannot, like those loss-makers coal and steel, be reduced to its profitable core. This may help to explain the particular form of privatisation that the Government has introduced to rail. But the byzantine franchising structure, the

hiving off of Railtrack and the appointment of a regulator with relatively weak powers have all led to real doubt about this privatisation among those who would normally champion it. As the ticketing fiasco has shown, it is a mess.

These four arguments all contain a large measure of truth. But they suggest that neither party has so far got it right. The solving of the rail conundrum cannot be achieved in isolation: it requires that the various hidden subsidies in British transport be made transparent. Only when that is done can we compare the true costs of different modes of transport, from driving to riding. So, for example, the real cost to the environment and to public services of motoring should be reflected in what the motorist actually pays. This would allow rational decisions to be taken about which forms of transport, and which consumers, should benefit from which subsidy.

The transport policy that Britain needs would thus combine a publicly regulated and subsidised private rail system with road-pricing, motorway tolls and high petrol prices. This might well, in Mr Major's phrase, make us "the envy of the world". Sadly, n e ither Labour nor the Tories have reached that destination.