Recent research by transport trades union RMT has revealed that three quarters of the rail franchises in the UK are now owned by foreign state-owned or backed rail companies. In contrast to the government’s stated opposition to public ownership of our railways and its commitment to competition, this research reveals that they have no opposition to state ownership of our railways when it is by other governments.
RMT has called for an urgent Parliamentary Inquiry to review this situation, whereby foreign state-owned rail companies are using profits earned through operating franchises in the UK to keep fares down and ensure rail services are better in their respective countries. That the profits have been acquired through ever increasing passenger fares and taxpayer subsidies makes the situation more in need of review and radical reform.
A German Transport Ministry spokesperson recently admitted to such a strategy in reference to its state-owned company Deutsche Bahn: “We’re skimming profit from the entire Deutsche Bahn and ensuring that it is anchored in our budget – that way we can make sure it is invested in the rail network here in Germany.”1
Train company Abellio, the international arm of Nederlandse Spoorwegen, a rail company wholly owned by the Dutch government and which holds a concession to run the majority of rail lines in Holland, was recently announced as the winner of the tender for ScotRail. Abellio currently operates a network in the UK two and half times larger than the Netherlands.
The publicly owned East Coast main line is due to be privatised by the government, despite operating very successfully. Since being taken back under public ownership in 2009, East Coast has returned over £1bn to the Treasury, in stark contrast to private train operators. East Coast was brought under public ownership following the failure of two previous private train operators, but the government seems determined to privatise it.
We have the highest fares in Europe. Passengers and taxpayers are subsidising a system that hands increasing profits to private, largely foreign, state-owned train operators, rather than being invested back into the system, as it would be under public ownership.
1. 7 April 2011 – see Rebuilding Rail by Transport for Quality of Life
RMT’s research – ‘Foreign State Owned Domination of UK Rail’, can be downloaded here: http://www.rmt.org.uk/news/publications/rmt-research-foreign-state-owned-backed-rail-domination-of-uk/