The renationalising of train companies will not necessarily bring cheaper rail fares but should reduce cancellations and late trains, the UK transport secretary has suggested.
South Western Railway is to become the first train operator nationalised under the Labour government, ministers announced on Wednesday. Greater Anglia and C2C will also be brought into public ownership next year.
Heidi Alexander, who took over at the transport department less than a week ago after the resignation of Louise Haigh, said the “primary aim” of the move was “to improve reliability and clamp down on the delays, the cancellation, the waste and the inefficiency that we’ve seen over the last 30 years”.
“We’ve had private train-operating companies running train services in this country over the last few decades, and it clearly hasn’t worked,” she told the BBC.
She said bringing the operators into public ownership was a “first step” to a “more integrated and unified railway”, and pointed to the impact of bringing LNER and Southeastern into public ownership.
“So if you look at LNER for example, we have reduced the number of trains that are cancelled because of staff shortages to basically zero, and we reduced other cancellations to about 5%.
“Southeastern, which is also now in public ownership, is in the top five of train operators for punctuality.”
Alexander declined to say what the cost of nationalising rail operators would be, but claimed it would be “a fraction” of what was paid in management fees to train companies.
She told LBC radio: “So it will be a fraction of the costs, for example – to bring them over and also … set up Great British Railways – a fraction of what we’re paying in terms of the management fees. At the moment, we pay roughly about £150m in management fees to the train operating companies.”
The government has chosen which rail operators to renationalise first based on when their contracts expire in order to avoid paying compensation to train companies, she said. “We will take the train operating companies back into public ownership when their current contracts expire,” she said. “And so the expiry date for South Western is in May of next year, and the expiry date for C2C is July.
“There is also a provision within the current contracts to issue an expiry notice when the train operator has completed a sort of minimum term of its contract. We have reached that point with Greater Anglia, and so we will be issuing an expiry notice for Greater Anglia in due course, giving them notice about the exact date on which that transfer will happen. We decided to proceed in that way because that means we don’t have to pay compensation to the train operating company.”
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Alexander said she needed to have a “mature” relationship with trade unions to provide an efficient rail service, telling Times Radio: “There is a fundamental need for a reset of the relationship because the previous government pursued a scorched earth policy when it came to the rail unions.
“They saw the trade unions as a problem purely to be managed as opposed to partners to work with. Now, there will be some occasions on which the trade unions are right about things, there will be some occasions on which the trade unions are wrong.”
When Alexander ran Transport for London as a deputy mayor under Sadiq Khan, “there were a number of occasions on which strikes happened on the network, and we resolved those strikes by negotiating with the trade union”, she said.
She added: “We’re going to have to work together to get to a really efficient railway that provides good value for money for both the fare payers and the taxpayers. And we’re only going to do that if the transport secretary has a mature relationship with the trade unions.”