Consider these facts about the East Coast railway franchise. Between 2003 and 2009, when the franchise was privately owned, two operators failed and the average cost of a peak fare between York and London ballooned from £69 to £111.50 – a 62 per cent increase. Since the government stepped in and took it over in 2009, there have been no more crises and fares have risen only 12 per cent. During the four years of public ownership of the East Coast, £800m has poured into the public purse, while Virgin’s West Coast operation has funnelled £500m to its own shareholders.
Things are rarely cut and dried in politics, but this is as close to a no-brainer as it gets. Anybody who looks at the evidence can see that East Coast should stay in public ownership – not because public is always better than private, but because in this case, public has been so spectacularly better than private. Andrew Adonis who, as secretary of state for transport in 2009, had pledged to return East Coast to private ownership within a year, has reversed his position, saying: ‘I don’t use the language of nationalisation; I use the language of fair competition’.
He is right, as is the shadow transport team and the TSSA, all of whom are calling for East Coast to stay public, as a benchmark for the private franchises. They are right because, for the last four years, taxpayers have won, as have travellers – satisfaction and punctuality are up, and the fares have increased at less than a fifth of the rate under the private operators. Research for TSSA suggests that even 48 per cent of Tory voters support keeping East Coast in public ownership, double the number of Tories who want it returned to the private sector. Yet, in October last year, transport ministers released their prospectus to return the East Coast franchise to the private sector. Why is the government about to end this happy win-win?
When all the evidence pushes public and the government choose private, this can only mean that they are hellbent on making an ideological decision. They are ignoring the evidence, ignoring Adonis’ call for fair competition and living up to the words of their 2011 Open Public Services white paper, which called for public services to ‘justify why it makes sense to run a monopoly’.
But running a private monopoly is what they are doing in other parts of the public sector, continuing an unfortunate trend which we pushed in government. A monopoly is developing among just four private companies – Serco, Atos, G4S and Capita – which between them reap £4.3bn in public sector revenues every year, running services previously provided by central and local government.
The depth and breadth of their operations is astonishing. Serco alone runs Boris bikes, manages the Atomic Weapons Establishment, escorts prisoners to court, provides out-of-hours GP services, operates the Docklands Light Railway, maintains missile defence systems, provides security for the former UK Border Agency, manages air traffic control, runs leisure services and administers government websites. That sounds suspiciously like the ‘monopoly’ we used to call the public sector – only it is now a private monopoly. Private is always good and public is always bad.
None of this makes any sense: the government appears determined to make a point with the East Coast and their point is not a practical one, concerned about travellers and taxpayers. It is entirely ideological: what matters is what does not work. By contrast, Labour and the TSSA have a sensible position: we looked at the evidence and made our decision. Unfortunately, the government decided that, for them, this is a time for purity of thought, not practicality of problem-solving. This is not in our interest, and it is not in the national interest. Travellers in York, London, Peterborough, Doncaster, Edinburgh and everywhere else along the line will pay.
Progressive centre-ground Labour politics does not come for free.
Our work depends on you.