Shelagh Fogarty is Leading Britain's Conversation.
1 June 2017, 09:57
Andy McDonald says rail re-nationalisation will mean big savings
The Shadow Transport Secretary says that big savings would be made with an end to profits going to the national rail companies of other countries.
Andy McDonald claimed the move will “save hundreds of millions of pounds” by getting rid of the franchise process, cut waste and with current shareholder dividends (i.e. profits) going to the government. The result will be savings for passengers.
“We’re saying that those season tickets that we talk about, those regulated fares, we can get them down on average by about £1000.”
Under Labour’s proposal the rail franchises would be brought under public ownership as the private agreements expire. Mr McDonald said this means the government won’t have to pay anything to reacquire them, but Nick suggested that the length of these contracts means the process will take a long time.
“No, we’ll get through them quite quickly,” Mr McDonald said. “In the course of the first term I think we’ll get through 11 franchises, and four in the second term.”
Under the current system various private operators run various rail routes, a setup that McDonald said is “the most complex, fragmented and expensive system in the entirety of Europe.”
“It can’t be right that I can get 21 different types of journeys from Teeside to Tyneside on a day return at 21 different prices from three different operators. It’s crazy.”
He also addressed the situation where national rail companies of other countries run routes in the UK with the profits, subsidised by taxpayers, going to the national rail companies of those countries.
“We don’t share the government’s view that the UK is singularly incapable of running its own railway system. It’s a bizarre situation where the only country in the world that can not run UK railways is the UK.
“It’s a nonsense we’re happy to fund other nations' railway systems. That’s just sheer madness.”
He said that the new system would continue to be funded through a mix of passenger money and taxpayer money, but pledged that the current split of 75 percent from passengers and 25 percent from taxpayers would change, with less coming from taxpayers if the proposed benefits emerge.
Mr McDonald said a Labour government would put a lid on fares so they rise inline with CPI as opposed to RPI or RPI +1%.