Readers respond to the government’s plans to restructure the railway industry
I do not agree with much of what Simon Jenkins says on the plans for a part-nationalised, part-privatised rail network (There’s nothing ‘great’ about this new British Railways revamp, 20 May), but he is right that the model being proposed is wrong. There used to be a simple maxim that the reason for involving the private sector in public services was to transfer risk. Taking risks was something the private sector was supposed to be good at. It targets investments to make the service attractive. It then sells that service to maximise profits. Getting the decisions right is the difficult thing – that is the risk it takes. To do this, it needs to be allowed to make key decisions, such as how big the service is and how often it will run, to match how many it believes it can sell. The more it sells, the better the profits. Simple.
But the new Great British Railways model takes these risks away from the private sector. The “how big” and “how often” decisions will be taken by the government. The private companies will just get paid for running the trains. The only variable in the private sector’s control will be costs. The decision, therefore, will no longer be “how many do we sell?”, as that will be fixed by the government, but “how do we deliver this more cheaply?”. To maximise profits, the companies will have just one aim: to reduce costs. And we are to believe Grant Shapps when he says that this will result in a better service?
Shaun Soper
Midhurst, West Sussex
