Saturday 13 August 2016

Right Mickey Takers

393 - the number of Rail, Maritime and Transport members at the rail company Southern who voted to strike in a ballot in April.
120,000 - the number of commuters affected by the strikes.
£2 billion - the cost of the new trains which Southern has ready to roll and which have been mothballed as a result of the dispute.

What's it all about? Southern want to change the role of conductors, making it the driver's responsibility to open and close the doors. As it has been on London Underground for a long time now.

The RMT have two objections. Firstly, they say conductors would be "devalued" (though Southern have promised no pay or job cuts). Secondly, and just as spuriously as the junior doctors, they say it's about safety. Even though the Rail Accident Investigation Branch say there is no evidence to suggest driver-only operated trains are less safe. The RMT also say, in an open letter to commuters, that Southern is actually introducing the change so that conductors can concentrate on revenue collection, but only from passengers who are prepared to pay since, working solo, the conductors cannot confront aggressive passengers. For me, none of these arguments cut much ice.

I know some of the senior management at Southern and its parent GoVia. In my experience it's a well run company, though not entirely free of being traditional railway. (None of them are). But management seems to have taken most of the flak, at least until recently. This was partly because of unofficial action taken by conductors, which led to many cancellations and a reduced service. The RMT "emphatically and categorically" denied this was the case, but the average number of conductors calling in sick each day nearly doubled, from 23 to 40 (and peaking on a daily basis at over 50) after the first one day strike in April. The commuters anger seemed definitely to be directed at management, at least early in the dispute.

The new London mayor has weighed in by claiming that Southern is a "failing company" and that, if Transport for London took over operation of the franchise, it could deliver a better service by "immediately assigning an experienced team to fix the service". Well, anyone could fix the short term service issue by caving in to the unions, couldn't they?

But there's no need to cave in. When I first worked in the rail sector, I was fond of pointing out to colleagues that, apart from the poor commuters into London, not many people would notice an all out rail strike. After all, about 90% of goods and people movements are by road.

I note in passing that pay in the rail industry is notoriously high, with significant perks including a traditional, public sector final salary pension and travel perks. Senior conductors earn more than the UK average salary (before perks) for a job which I personally wouldn't class as anything like more demanding than average.

The two sides are now talking at ACAS but don't hold your breath for anything more than a fudge. The rail industry has not been prepared to drive much change through in the last 20 years and there are still many out of date practices, despite privatisation. It's not a coincidence that new technology and working practices are hardest to introduce in the public sector and former public sector organisations that still, essentially, have the same culture.

Especially so in Network Rail, which isn't really private, though they liked to think they were before the government brought them officially back into the public sector. If you are in any doubt as to whether Network Rail is deeply dysfunctional, just ponder for a moment the remarkable fact that it lost over £1bn on financial derivatives, essentially currency swaps.  Why on earth a UK taxpayer funded company was gambling (they would say hedging) currency when essentially all of its costs and revenues are in sterling, you might reasonably ask. It was because they had been allowed to borrow money in the markets and chose to borrow in a range of currencies. Even when I worked in the industry I didn't realise this was happening, but the old Tory stager John Redwood has pointed it out many times.

Railways are generally regarded as a good thing. But they cost the taxpayer nearly £5 billion a year (£4.8bn in 2014-15, £3.8 bn of it paid to Network Rail). The subsidy has gone down a bit: it was over £6bn in 2007, but it was a lot lower in the 1980s and 1990s. It's a bit puzzling that the railway is carrying record numbers of passengers, who are paying all time high amounts in terms of the fare box (£8.2 billion in 2013-14), but the subsidy has only come down marginally in absolute terms. (It was about 50% of total costs a few years ago, whereas now it's more like 35%).

Intercity and busy commuter routes make money and the subsidy is needed mainly for rural routes though surprisingly (to me anyway) the highest subsidy per passenger kilometre is for Merseyrail, at 12.4p nearly half as much again as First ScotRail (8.6p) and Arriva Trains Wales (8.5p), followed by Northern, with its plethora of cross country routes (4.9p). If the regional railways didn't exist (say,  because we did a super Beeching type cull) comparatively small numbers of people would be hugely inconvenienced, though it would probably be cheaper to pay for them all to go by taxi. And better environmentally: an industry big cheese once said to me "you see, Phil, a full train is an environmental miracle but an empty train is an environmental catastrophe". And, of course, regional trains make many journeys practically empty.

Before I worked in rail I used to tease colleagues who did that it would be better to tear up the tracks, tarmac over the permanent way and use it to run convoys of lorries and buses. The reason they didn't like this jest is that it isn't totally daft.....  A right mickey take but not half as much as the RMT.

I'd leave the heritage railways of course, as working examples of industrial archeology.

There's a good summary of the issues involved in the Southern dispute at http://www.bbc.co.uk/news/business-37021504. 
The London Mayor's comments are at http://www.bbc.co.uk/news/uk-england-london-37057753
Statistics on rail costs are at http://orr.gov.uk/__data/assets/pdf_file/0005/18842/rail-finance-statistical-release-2014-15.pdf
For John Redwood on Network Rail and currency swaps see http://johnredwoodsdiary.com/2012/07/17/derivative-losses-at-network-rail-could-we-save-that-money-and-spend-it-on-the-railway/
As ever, the opinionated parts of this post are all mine.







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