Christian Wolmar: Compromise that fails to confront desperate need for radical reform

After all the kerfuffle, the rail review is a damp squib. Alistair Darling, the Secretary of State for Transport, announced the review in January after he became exasperated at how the railways absorbed taxpayers' money while apparently unable to provide a decent service.

After all the kerfuffle, the rail review is a damp squib. Alistair Darling, the Secretary of State for Transport, announced the review in January after he became exasperated at how the railways absorbed taxpayers' money while apparently unable to provide a decent service.

There was much talk of fundamental reform for a railway that Mr Darling had recognised as "dysfunctional". The key issue was integration. The biggest mistake of the Tories' privatisation was the separation of what was then Railtrack (now Network Rail) and the train operations. In private, ministers liked the idea of reintegrating them to form strong, local, unified companies.

Then it all got too difficult. Tom Winsor, the now-departed rail regulator, fulminated on the sidelines, saying the review was pointless and warning ministers not to tamper with contracts with the private companies or he would see them in court. The various vested interests in the railway argued their corner and ministers shied away from the radical reform that is so clearly needed.

Reintegration was seen as problematic, although many train operators favour the idea, because existing contracts would have had to be modified. Other radical ideas such as doing away with the performance regime - which employs more than 300 clerks to check who is responsible for delays - have also been quietly ditched.

So we have ended up with a compromise with all the hallmarks of being hastily put together. But there are sensible changes. The Strategic Rail Authority, created just four years ago by Labour, is to be abolished because, bizarrely, ministers now say it was the wrong sort of organisation which could never exercise the necessary authority since it was up to ministers to determine long-term rail strategy. One could ask why they created it in the first place?

Ministers will exercise more power over the industry, an good move, given that it is costing taxpayers £5bn a year. They say politicians will not run the railways directly but that will be a difficult promise to keep since they will be held responsible for things when they go wrong, making it difficult for them to keep their hands off.

Another sensible move is the decision to hand safety to the new Office of Rail Regulation, because spending decisions on safety have to be made within the context of what is affordable. Unions and victims' groups may not approve, but the railway is a very safe industry and spending on measures with little benefit has contributed to the soaring costs.

But all these are administrative changes aimed more at keeping costs under control than making the railway better for passengers. Ministers hope a slightly simplified structure will eventually improve punctuality and reliability, but it is a long haul and there are no short-term electoral gains which ministers hoped for when they announced the review.

Christian Wolmar is the author of 'The Subterranean Railway', to be published in November by Atlantic Books. www.christianwolmar.co.uk