W HAT a way to run a railway! That as my
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first reaction to the " Report from the Select Committeeo on Nationalized Industries" (British Railways), published last week. Perhaps I am being a trifle harsh,•but the Government seem to me to emerge from the inquiry with little more credit than a punter who has put the family savings on a three-legged horse.
It is a sad tale. It tells of prodigal expenditure of taxpayers' money based on false premises, and of inadequate Government supervision of public funds. The Transport Tribunal have hobbled the British Transport Commission and, adding insult to injury, Government interference with the Commission's proposals to raise fares and charges cost between il5nri. and £23m. The committee believe the Government should compensate the B.T.C. to this extent.
The committee also paint a picture of over-optimism by the Commission about the fruits of a modernization Scheme which has now lost its glitter—enthusiasm engendered by inadequate statistical information. There have been disagreements between the Ministry of Transport and the Commission on the basis of vital calculations, and an obvious lack of drive by railway manage ment. Never have the blind more successfully led the blind. • .
Despite the discouraging evidence, the committee have no doubt that a large-scale British railway system cart be profitable. Its size and shape mu.st, they say, be such as can enable the Commission to carry out their statutory task of balancing their accounts, taking one year with another. " But," they add, "if the Commission are to know which of their services are justifiable on grounds of direct financial return, they must first have some form of accounts by which the profitability of regions and services can be judged." It. appears that the railways still have much to learn from road transport about effective management.
Direct profitability is, however, not the only consideration. "Because of the cost of the roads and of the congestion on them, the national interest may require railway services which do not in fact pay directly for themselves, but which may cost the nation less than the alternatives."
Social need may be a third consideration. If Parliament specifies that certain unremunerative services must be undertaken, the cost, says the report, should fall on public funds and be paid in advance. Subsidies of this kind should be provided openly for specific purposes, and not disguised either in public accounts or the Commission's accounts.
Tribunal Cut Commission's Revenue
The Transport Tribunal's decisions and. the time taken to reach them are stated to have cut down severely the Commission's earnings. The committee believe that in all fields where the railways are meeting effective competition, there is no need for the Tribunal. If the Tribunal are to be kept in being, the criteria governing their decisions should be clearly laid down. Moreover, they should in future publish their full reasons for each decision on fares and charges.
There is little reference in the report to road transport, but the committee finally explode a 40-year-old argument about costs of rail tracks and roads. They say that rail tracks create the conditions of speed, density of tfaffic and salety which form the main advantages of railway travel.
"Their costs, therefore, should be paid for by the railway user, and must be taken into account in any economic calculations about railways, and in any calculation about the true cost of a particular railway service, beit freight or passenger," the report comments.
"The argument that railways should be relieved of the track costs is based upon the belief that the burden of them is unfair when viewed in the context of the railways' competition with road users. But in fact the road user pays each year in taxes for the use of his vehicle and its fuel considerably mire than the annual cost of road maintenance, signalling and construction."
The committee do not believe that there is a case on the ground of fair competition to relieve the railways of track costs.
Road transport operators may find satisfaction in the knowledge that the Ministry of Transport are on their side in this argument. The Commission argued that they were having to pay between_ 6s. 6d.• and 7s, on track cost for every 2s. 6d. that the haulier and bus operator paid in fuel duty. A member of the Commission had calculated that whereas the railways paid 0.7d. per passengermile and 0.5d, per ton-mile in track cost, the coach operator paid ,about 0.2d. per passenger-mile and the haulier about 0.3d. per tonmile in tax.
The Ministry deny that the haulier is paying insufficiently. Their attitude is that this kind of difference in operating expense is merely a manifestation of the difference that exists between the two forms of transport."
I am surprised that the select committee should have fallen for the Commission's old and transparent argument that long-distance coach operators are able to charge lower fares than the railways because "coach services are limited by licence in their volume and scope." The committee do not, however, mention that objections by the railways have been substantially responsible for the restriction of coach services. The statement that. long-distance operators "do not have to provide services at other than the most popular times," also begs the truth.
By A. E. Sherlock-Mesher
Unreliable Evidence
• The committee try to draw a comparison between road and rail goods rates„ although they admit the unreliability of the figures. According to the Commission, the following are the distances for which, on average, different types of carrier will haul a ton of freight for £l:—British Road Servisaes, 37 miles; other public road transport, 33 miles; private transport, II miles; and British Railways, 60 miles.
But the committee hasten to add: "These figures,-so far as road transport is concerned, are acknowledged to be very imprecise. Furthermore, the fact that the railways carry so much heavy coal and mineral traffic makes a straight comparison between their average rates and those of road hauliers somewhat questionable."
Perhaps, however, the comparison is no more questionable than some of the calculations made by the Commission in connection with the modernization scheme and blindly accepted by the Government.
The committee "are astonished at the way in which the Commission have been able to set in motion great modernization schemes without the [Government] departments comparing the economies of them with those of the possible alternative schemes; that in giving a banker's sanction to the expenditure on the London-Midland electrification, for example, the Ministry did not know what the alternative expenditure of using diesel locomotion would be."