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Page 80
Page 81
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Railway begging bowl
RAILWAY advertisements showing lengths of line stretched out pleading for traffic are not, it can now be seen, purely an exercise in black comedy. The customers have been leaving and they are not being replaced. The story can be read between the statistics in the BR report for 1971.
The words in the report are few, and become fewer each year, although the price goes up, Perhaps there can be read into this some kind of allegory of railway misfortune.
The brevity is assisted by what must surely be a deliberate refusal to say anything, either in praise or blame, about that odious alternative form of transport to which BR reports traditionally attribute most of the railway misfortunes. The sole indirect reference is to the "special attention" paid by the public relations and publicity department to "emphasizing the environmental advantages of railways".
Perhaps this point was emphasized because no other advantage immediately sprang to mind, The report goes on to deal with the other campaign devoted to putting the case for investment in railways. The whole document can plausibly be
considered .as an extension of that campaign.
With one significant exception, the consequences of the 1968 Transport Act are ignored. Silence on the twin subjects of quantity licensing and operators' licensing may be contrasted with the attention paid to these two topics in previous reports.
Well ahead of legislation, the 1969 report urged "a strong case for the early introduction of quantity licensing", in particular for the short-distance haulage of heavy bulk traffics such as aggregates. The 1970 report recorded the abolition of carriers' licensing and suggested that it was "bound to affect rail carryings adversely in future years". No echo of such forebodings disturbs the 1971 report.
Instead it concentrates on the exception I have mentioned. Finance is the main theme, perhaps the only theme.
When the railways are so much indebted to the provisions of the 1968 Act, the subject could hardly be avoided. The report makes clear that the financial defences erected by the Act are crumbling away. The railways have an obligation under the Act to break even on revenue account, taking one year with another. They no longer keep up a pretence of meeting the obligation.
A favourable balance of £14.7m in 1969 fell to £9.5m in 1970. In 1971 there was a deficit of £15.4m, and they report describes the prospects for 1972 as "bleak". It is now "questionable," the report continues, whether the railways will be able to meet their remit over the five years 1969-1973.
Ample credit is taken for the agreement by the railways during 1971 to keep price increases within the 5 per cent limit recommended by the CBI. The report has to admit that. by way of compensation, the Government is giving special assistance amounting to £27m for the year 1972.
This will not be the end of the matter. As the report points out, "the effect of price restraint will continue to affect corporate profit adversely even after restraint is lifted". When prices have been artificially held down it is seldom feasible to raise them to their proper level immediately.
So that the Government will not miss the point, it is repeated in slightly different words. "If increases in rates and fares are restricted until the end of 1972," the report explains, "it will not be possible to raise them at the beginning of 1973 to the level at which they would have been had there been no restraint." Consequently, the adverse effects will continue after its termination and will operate for several years.
After all this comes the long-delayed punch tine. "In view of this the Board will be seeking further special assistance for the continuing effect of price restraint." When in only the next paragraph the report suddenly cheers up with the statement that "the total outlook for the future contains some promise," the reader may be forgiven for wondering who has made the promise and how much.
Even readers engaged in one of the other unmentionable forms of transport should not perhaps judge too harshly. The report begins with a plea which might have come direct from the age of the dinosaur. It is impractical, says the report, "to expect such a vast and complex organization as the railways, with high inescapable fixed costs, to adapt itself completely to rapid fluctuations in the national economy".
Road operators may think, nevertheless, that the railways are adapting themselves remarkably well, with £27m on offer and a hope of more to come. Hauliers are not too gratified at the indirect tribute to their flexibility. If the volume of traffic declines, they can lay up part of their fleet or some of them can go out of business. Neither prospect is particularly attractive.
If at the same time costs rise and rates are slow in following, the road haulage industry may survive in a somewhat attenuated condition. They must expect no financial assistance. The railways have the advantage there. They show sound judgement in building their report round the call, which will continue to be sounded, for more and more money to keep the dikes intact against the rising tide of losses.
by Janus