THE RAIL SUPPLY INDUSTRY IS IMPRESSIVE, BUT UNDER PERFORMS, LEADING RAIL PUNDIT, CHRISTIAN WOLMAR, TELLS THE RAILWAY INDUSTRY

Magazine

In a forthright and wide-ranging interview, Wolmar also described the creation of Great British Railways as “the wrong type of approach”, said he is “very worried” about Labour’s plans for the railways and criticised HS2 as a project that “seems to have been very poorly run”.

Emphasising that he sees railways as the best form of travel, which deliver huge benefits to society, he was critical of politicians who use an inappropriately narrow business case approach to take decisions on rail investment, without taking proper account of the external benefits that rail provides to the wider economy, society and the environment.

Asked about Britain’s rail supply industry, Wolmar described it as

“very impressive”, but added that he felt it “under performs”, given the advantage of being based in the country that had invented the railways. He said “this is an industry that should have been and still can be a model for the world because we invented the railways, and we should have kept some of that advantage. Unfortunately we haven’t”.

I THINK WE UNDER-PERFORM

He said that, while Britain still has rolling stock manufacturers, today they are largely parts of much bigger international concerns. “We have some major engineering companies that are our own and are very impressive, but I think we under-perform” he said. “There is a lot of potential in this industry, which has not been helped by Brexit, not been helped by consolidation of companies into too big concerns that are multinational”.

He gave the example of “a very impressive firm, which is not British” – Stadler Rail, the Swiss manufacturer of rolling stock, based in a small Swiss town, which, within about 20 years “has suddenly become a very major provider of rolling stock, through having very good products, very great attention to detail. It would be great to see companies like that emerge in the UK”.

Turning to the Government’s plans to create Great British Railways, Wolmar described himself as a critic of the way that the railways had been privatised 25 years’ ago and of the fragmentation that resulted from privatisation and “a great fan of British Rail”. He said the Government’s attempt to “bring it back under something called GBR could be seen as laudable, but I think it is the wrong type of approach. Trying to create something that is ‘a guiding mind’, which implies that it won’t have actual powers to implement what it is guiding about is a mistake”.

“What we need really” he said, “is a reversal to a strong commercially and socially minded organisation that is at arm’s length from the

Government, but which has a healthy relationship with Government, that can run the railways. I don’t think GBR will deliver that”.

Wolmar said British Rail had been “a very good way to run a railway. We can’t return to British Rail, though, because some of the break-up is unrepairable. Nobody is going to think of having a state-owned organisation owning all the rolling stock. The engineering has been split up as well. It would be difficult to bring all that back together, but I do believe, as do most railway people that I talk to, that railways are inherently a single business and should be integrated. There are just too many constraints to have a market. Most of what passes off as private sector involvement in the industry is ‘pretend capitalism’. It is impossible to create a genuine capitalist model for the railways. To suggest that the railway itself can function like Coca Cola or McDonalds and be a genuine risktaking structure is just a pretence”.

Labour Has Been Fooled

However, Wolmar also declared that he is “very worried about Labour’s plans. I don’t think they understand that Great British Railways is not a renationalising of the railways, but rather is a kind of reconfiguration of the same franchising model. I think the whole franchising model is a mistake. It is a one-sided offer. Franchises can’t really go bust and the risk transfer is always in one direction. So GBR is to some extent a reconstruction of that. I think that Labour has been fooled into thinking it is a renationalisation and it is not”.

He said “Labour needs to focus on putting railway people at the heart of the industry and acknowledging that it is a natural state-run monopoly. It is an inherent part of our infrastructure and is best run at an arm’s length by a government agency, working in concert with the Government, but not at their behest for every single decision”.

Wolmar said “Labour needs to set out a model like that and unfortunately so far, we haven’t seen what Labour really thinks, apart from saying it is going to renationalise the railways and I don’t understand what that means. It is slogan, not a strategy. So I would like to know who is going to run the railways, how are they going to structure it, are they going to be innovative, what ideas do they have on fares, what ideas do they have on investment, how are they going to control HS2’s costs? All these sorts of questions remain unanswered by the slogan ‘we are going to renationalise the railways’.”

Wolmar described himself as “not a great fan of HS2”. He said he had been “sceptical of it from the beginning. I think it is a project that is inappropriate for this country. We are a relatively small country. We have got very efficient railways already between most of the major centres. It wasn’t really about high speed. It was about capacity. Do we need that level of capacity? Could we not improve the existing railway, particularly south of Rugby? Do we really need this absolutely massive step change in capacity, which is coming at a very high cost?”.

That was his initial thinking, Wolmar said, but it had been further coloured by the fact that “it seems to be a project that has been very poorly run. The other day I bumped into somebody very senior involved in it, who admitted that it is never under control. HS2 Ltd has been let loose. There is no proper control structure or oversight of it. The contracts are poorly designed. There has been far too much pandering to the nimbies, so you needed to put far too much in tunnels and in cuttings, which is very expensive. Overall, one has to ask, ‘was this the right project?’. In terms of environmental benefits they are few. It will obviously deliver some benefits, but far fewer than is worthwhile for the amount of money”.

Wolmar said “there are always hard choices to be made and pouring all our money into the HS2 project and starving both the existing railway and new investment because of that, is proving a great mistake. I don’t think you can now abandon it, because too much has been spent on it. Some of it looks absolutely fantastic. There is some great engineering, but I still think that it is the wrong project that has been ill thought out and doesn’t have sufficient connection to the existing network”.

Andy Lord