| All Change, Please |
30 June 2003
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Connex Trains Meet Their Waterloo
Train travel in the southeast of England just got interesting with the decision by the Strategic Rail Authority to terminate the franchise of Connex a year early. The reason cited was poor financial management. The termination brings up the question of whether the railways should have been privatized in the first place, and the answer will lie in the resolution of this situation.
The franchise concerned connects London with Dover, Gatwick airport, Ramsgate and points in between. One in five trains runs late according to the most recent punctuality figures. After receiving 58 million pounds from the public purse last summer, Connex recently requested another 200 million. Rather than fork over, the SRA has told Connex to give up the franchise at the end of this year rather than in 2006.
Railways losing money in Britain is nothing new, nor is the idea of a public subsidy to keep people in trains and off roads -- British Rail managed to set records at both for years. However, the difference is that as a nationalized carrier, it was the government's duty to keep BR running. Now that southeast England is "served" by Connex, the public purse should not be as open.
The issue turns on whether the successor to Connex in the southeast can run the trains on time and at a profit. If so, then the matter is closed. If not, the renationalization of the rail system must be considered.
There is such a thing as a natural monopoly -- defense being the most obvious example. And all such monopolies are better in public hands than in private ones because the inefficiencies of monopoly are more fairly distributed in that way. Railways are a contender for such ownership and management, and if the next private operator can't run the southeast profitably, a strong case will have been made for reviving BritRail -- a government enterprise.