Dugher railways remarks appear to be a shift in substance, not just tone

Michael Dugher, the Shadow Transport Secretary, has moved to align himself with the grassroots of the party by launching a fierce attack on the rail franchising system and on particular train operators.

Dugher has gone much further than the position, agreed at the National Policy Forum, of merely creating a public sector bidder to compete in the franchising market. Now, by saying that “I’m adamant about putting the whole franchising system, as it stands today, in the bin” he is suggesting a far wider reform of the process than had previously been envisaged and even possibly its scrapping.  He added that ‘the public sector will be running sections of the rail network as soon as we can do that’. (my italics).

The proposal to allow a public sector bidder agreed at the NPF cannot possibly guarantee that it will win any of the franchises. Therefore Dugher seems to be suggesting that some franchises might simply be allowed to run out, and then revert to the public sector. The advantage of this for an incoming Labour administration would be that letting the franchises simply run out and incorporating them in a public body does not require new legislation. While under the Railways Act, public organisations are not currently allowed to bid there is nothing to stop them running a franchise that is simply not put out to tender, as has happened with East Coast for the past five years until the end of this month.

Rail privatisation as it is an issue that resonates strongly at the grassroots of the party. At many of the CLP meetings I have spoken at recently, public control of the railways has been raised as a bellwether issue for the party with members wondering why the Labour frontbench has not taken a stornger stance. Londoners have suffered from a poor service on many lines provided by the private operators and therefore are eager to see a change. The lines taken over by Transport for London from private operators such as the much derided Silverlink to become part of the London Overground have benefitted from high levels of investment and permanent staffing during operating hours, with the result that usage has soared. Indeed, this has proved so successful that the trains on much of the Overground are already been lengthened from four to five cars.

This model could easily be expanded to encompass all the suburban services within London because it allows for long term investment plans and does not result in private companies having to estimate future passenger trends, something that is little more sophisticated than the Sun’s astrology column

Dugher may well have been influenced by the fact that the plan to create a public sector bidder would be extremely expensive. Bids now routinely cost in the region of £10m for each bidder and with usually three or four organisations on the short list, success would by no means guaranteed for an expenditure that could quite easily top £40m within a couple of years. It is not difficult to imagine the outcry in the hostile press.

The rail companies tried desperately to present Dugher’s remarks as a mere change in tone, rather than substance. However, the forthright attack on Stagecoach – which has led attacks on attempts to regulate the bus network in the North East and, incidentally, whose chairman is big SNP supporter Brian Souter  – suggests otherwise. He said: “Every time you get one of the boneheads at Stagecoach attacking Labour’s policy for wanting to regulate the buses, that’s every day they put Labour’s policy out there and that’s every day which gives us an opportunity to win the election because we can win this argument”.

The tone of these remarks fits in with the recent more robust approach towards business that has followed the spate of anti-Labour remarks from Tory business supporters. Rail privatisation remains unpopular with the public and Dugher is, rightly, trying to capitalise on this.

Christian Wolmar, the author of On the Wrong Line, how ideology and incompetence wrecked Britain’s railways, is seeking the Labour nomination for the 2016 London mayoral election.