Subsidies to the railways since privatisation have increased by about 450% to around £5bn a year (Editorial, 21 August). Fare rises of up to 11% will doubtless contribute to the recently announced £12m-a-year bonus scheme for the top six executives at Network Rail. The coalition is in an ideological trap because any infrastructure problem, such as railways, has to be based on the private sector.
Railway privatisation was a triumph of ideology over common sense to produce the most expensive, fragmented, under-invested railway system in western Europe. Integration or cooperation within the system is bedevilled by at least 20 different franchisees, all operating to different timescales, plus the requirements of various regulators and the Department of Transport.
Franchise holders have no incentive to invest when three years later they could lose the franchise – as Richard Branson discovered last week after spending an estimated £60m preparing Virgin’s bid. Meanwhile, several European state railway systems, able to plan coherently for the future – good railways with reasonable fares being seen as a good thing – are now running UK franchises and exporting the (guaranteed) profits to keep fares lower and improve the quality of services in their home countries.
Melton Constable, Norfolk
• What possible rational case can be made for “reforming” the Highways Agency to make it “more independent … so it can borrow large amounts without increasing the public deficit” (Report, 22 August)? The new body has to look “more independent” – so its borrowing costs will be higher than government’s, but met almost entirely from tax revenue (tolling of existing roads having been ruled out as politically difficult). So the taxpayer will be paying more for the roads, simply to save ministers’ faces, and possibly in the hope of fooling the IMF and the markets. This looks like more financial engineering – fresh from its triumphs in the private sector.
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