Is Miliband about to restore some sanity on railway ownership?

Judging by the interview that he gave to Mark Ferguson, Ed Miliband could be on the brink of restoring some sanity to Labour’s policy on railway ownership in the UK.

Whilst the government remains determined to place the East Coast mainline franchise into private hands, Ed Miliband told Ferguson:

“We should be looking at mutual and public options.”

Whisper it quietly, but common sense might be prevailing in time for Labour’s 2015 manifesto.

A cursory examination of the facts demonstrates that railway privatisation has failed to deliver the lower costs, efficiency and investment taxpayers were promised by John Major’s government in the early 1990s.

According to research conducted by the TUC, train operators coined £2.7 billion in 2011 as a result of taxpayer subsidy. I predominantly use First Capital Connect trains, and despite the poor service and its dire reputation in the media and among commuters, it still managed to take bag hundreds of millions of pounds of taxpayers’ money.

Commuting taxpayers are paying twice as they fork out ever increasing amounts to cover above inflation fare hikes across the rail network. Despite the subsidy and increased fares, staffing levels are being reduced and a majority of passengers believe that the service does not deliver value for money, according to the National Passenger Survey.

Every time the British public is polled about the ownership of railways, they back public ownership, by an overwhelming majority.  A recent poll for the Sunday Express, showed that almost two thirds of participants wanted the railways taken into public ownership.

And who can blame them?

When rail companies are not busy reneging on their contractual commitments, the government is busy botching the franchising process for lines that commuters rely on day in, day out.

You can’t help but laugh. Applying the logic of the free market to an industry that does not offer scope for genuine competition has the tendency to end in tears.

So I read the interview with Ed Miliband enthusiastically, as it looks like the party is creeping towards a sensible policy on railway ownership.

There are alternatives to the current settlement.

The Action for Rail group, which consists of a number of transport unions, supported by the TUC, advocates the public ownership option when franchises expire or fail, coupled with the nationalisation of Network Rail and the abolition of the current rolling stock leasing system, to be replaced by a system which supports British train manufacturers.

Whilst this option has a lot to commend it, so does the approach outlined by Professor Paul Salveson, in a paper for the Co-operative Party produced after the collapse of the tendering process for West Coast mainline franchise.

Salveson advocates the creation of a not-for-profit enterprise to run the West Coast mainline, called Rail Cymru, which would embody co-operative principles as opposed to an exclusive focus on profit. It would have representation from the Welsh Government, rail employees, passengers and other stakeholders, in order to deliver the best possible service for users.

If successful, this model could be rolled out across the country, as franchises end or train operators renege on contracts.

The point here is not to examine the minutiae of alternatives, it is to establish that feasible ones exist, and Ed Miliband is absolutely right to examine him.  We can only hope that he is working to find the right model of public ownership, that Labour can  put to the British people in 2015.

When even RMT leader Bob Crow and Mail on Sunday columnist Peter Hitchens are united in making the case for public ownership of Britain’s railways, you know you might well be onto a winner.