Private transport companies have received billions of pounds in support from the UK government, leaving people to believe it is time for transport to become nationalised again.
In the 1980s Margaret Thatcher’s government privatised bus services and then in the 1990s, our railways followed suit.
The justification for privatisation was that it would reduce public-sector borrowing while still allowing for growth in the industries.
The flaws in privatisation became abundantly clear in the last two years, however, when Covid-19 brought about lockdowns and restrictions that made it harder for privately-owned transport companies to remain profitable.
The UK government paid furlough to 187,600 people working in transport and storage because of Covid-19 restrictions.
On top of the support from furlough, the UK government also paid billions in bailouts to transport companies.
One such bailout to transport company Go-Ahead caused controversy after it was realised that they recorded a rail operating profit of £6.5m despite receiving 10bn from a government bailout.
It’s this financial support that has people questioning why transport isn’t nationalised.
Currently, transport is being given billions in support while companies are still allowed to take profit.
Why not cut out the middle man and just let the government take control?
RMT (The National Union of Rail, Maritime and Transport Workers) General Secretary Mick Cash said:
“All the operators are now effectively public operations anyway with the taxpayer taking responsibility through a network of management contracts from which the operators extract a profit for doing nothing. The final moves to full public ownership would be a mere formality.”
Mick Cash isn’t alone in noticing that transport is getting closer to being publicly owned.
Angela Surtees, a Councillor for Durham County Council explained how the North-East has suffered in some ways under privatised public transport, in County Durham for example, some bus routes have been cancelled due to them not being profitable enough for bus companies. She talks about the fact that rail companies are already being put under the management of the government for rescue and recovery.
She explained her views in an interview:
County Councillor for Blackhalls Division
The failures and shortcomings of privatised transport were further highlighted by Stacey Deinali, Shadow Cabinet Member for Connectivity and County Councillor for Blackhalls Division.
She elaborates on a point made by Angela that rural areas suffer most under privatised transport.
Stacey said:
“The current system in my local area, the Blackhall Division, demonstrates why privatised companies don’t work. Many people from disadvantaged, rural areas are constantly left behind when it comes to public transport. Private companies tend not to venture where it is not profitable to do so. Many people in those areas find themselves cut off from vital services including work opportunities and health services or have to struggle financially to run a car in order to access these amenities.
“In my opinion, publicly-owned transport controlled by the local Councils would be the better option. This is a view I have held since prior to the Covid pandemic and feel strongly about.
“I believe that public transport should be publicly owned and tightly controlled by local Councils as this allows all profit to be reinvested into the service rather than lining the pockets of shareholders. By reinvesting into the service, more services could be provided to ensure all areas have reliable transport that increases connectivity. In turn, people may begin to use public transport more frequently and we would therefore see a positive impact on the environment with reduced numbers of cars.”
With Covid-19 shining a light on the flaws of privatised transport, the positives that come with privatised transport are becoming harder to see.
The public is seemingly paying to keep transport companies afloat, while the owners and shareholders still reap profit wherever they can and remove any services that aren’t profitable, leaving people without reliable transport.
Councillors and the RMT aren’t the only people that think transport should be publicly owned, there are people working with the privately-owned transport companies who think it’s time for a change.
Craig John is a Service Manager who works with rail companies all across England.
Craig shared his thoughts under the disclaimer that they are his own personal opinions and do not represent the views of his employers or anyone he works with.
His views are based on existing stats and data that are already publicly available and presented through the news and government.
He explained the intrinsic problems that come with privatisation, specifically the problem with bidding, along with his general personal thoughts on private vs publicly-owned transport in an interview:
All the data showing how much money is being given to these private transport companies to keep them in service is publicly available through the government’s website.
With this data available, it quickly becomes clear how dependant on financial support these private companies are.
Despite receiving this support, and in some cases still making a profit on top of this support, transport companies still do not provide the level of service needed to support every region of the country.
The government aims to fix this problem with its new “Levelling up Fund” of £4.8 billion.
The first round of successful bidding has been done and is also viewable on the government site for the public to see which areas are getting funding and how much they are getting.
This solution points more towards nationalising transport in England.
If the government is willing to throw billions towards improving transport and bailing out companies and paying furlough for transport workers, how different would it really be if they just took full control permanently?
As Mick Cash from RMT pointed out, it would likely not be very different at all, but it would save the British public money by cutting out the middle man.
