Fragmented railways will never work, public or private

Imagine going into a restaurant, sitting down and giving your order to the waiter. The order is then passed into a back kitchen, where someone employed by a different owner is contracted to cook it, arguing all the time with his lawyers and accountants over the recipe and the price. That is Britain’s rail system, born of idiocy and ideology in Whitehall 25 years ago. It is demoralised and it is broken.

This week’s report by the rail regulator, the Office of Road and Rail, on this year’s timetabling chaos could hardly be clearer. “Nobody took charge.” In a time-sensitive service industry, chopping up the supply chain is fatal. Restaurants must run their kitchens. Train companies must run their tracks and stations. As the crisis mounted everyone thought someone else could take the blame.

At times like this, people salivate and crave a resignation, like some medieval purging of sin. But what needs pinpointing is the error, not the blame. As the rail regulator’s chair, Stephen Glaister, says, this is the product of a systems failure. The transport secretary, Chris Grayling, was right that privatisation is not the issue. A railway is a parastatal monopoly.

UK trains were more independently managed when nationalised as British Rail than now, when every service failure drags the minister to the dispatch box. Besides, the worst performers have been the nationalised bits: Network Rail and the officials monitoring the franchises. Whitehall’s railway chief, Peter Wilkinson, is paid twice what Grayling gets and has a staff of far more than what it was under nationalisation.

This shambles goes straight back to John Major’s government, which invented it in 1993, and Tony Blair, who refused to change it. Connoisseurs of cock-up should read Terry Gourvish’s nightmare history of BR as it headed for the privatisation scaffold. The Treasury was fixated on “smashing” it. Millions were spent on consultants, nothing on consulting the railway.

Since then, a doubling of passenger travel has, until now, concealed the trouble. In reality, Britain’s railway lags far behind the continent. Half its signals are still manually operated, costing an estimated 40% in capacity forgone. While the world discusses driverless cars, no one dares mention driverless trains, which are far simpler to run. Rail subsidies are over four times what they were under nationalisation. Ministers endlessly tweak franchises. Yet they spend wildly on low-priority vanity projects such as HS2 or an Oxbridge link. The present railway is the worst sort of pseudo-nationalisation.

With almost comic frequency new ministers – arriving almost annually – blame the lack of management integration of trains and infrastructure. They do nothing about it. In 1997, Labour’s John Prescott merely savaged the privatised track company Railtrack, nationalising it in 2002 as Network Rail. The government set up, then abolished, a strategic rail authority, which feuded with a separate rail regulator and with Whitehall. None of them ran trains.

In 2004 Alistair Darling as minister seemed to get the point, and announced eight regional rail tsars to “reintegrate” the railway. South West trains and Network Rail settled into a joint office at Waterloo, to “pilot” an integrated management scheme – one that had previously worked perfectly well for a century. Nothing came of it. In 2011 another minister, Philip Hammond, decided Network Rail should be nine regions. Again nothing happened.

Four years later Nicola Shaw, boss of HS1, was called in to advise on a “new structure” for the industry. She too suggested to another minister, Patrick McLoughlin, that he break up Network Rail. Silence. Cynics could be forgiven a yawn when Grayling now declares that perhaps track and train need reintegrating.

Every sensible report on Britain’s railway for 20 years has reached this same conclusion. A railway needs one managerial unit, one loyalty, one leader. This can be achieved by going back to a single vast industry, accountable to a minister, which is what Labour appears to favour, but with a split still between a track company and operators. Today’s culture is strongly, and rightly, against such megalithic organisations.

The alternative is to go with what almost everyone agrees is now best. Break up Network Rail properly and distribute its civil engineers and geographical divisions to operating companies. There will of course be a flourishing industry in raising objections. There are issues at regional boundaries. But the regions worked before. Devolution is hardly news. These companies can be private or public – a mix might deliver “competition by esteem” – but there can be no free market in railway lines. The franchises will require careful regulation. In any public utility, there is no dodging oversight of fares, investment and subsidy. The railway needs a strategic authority, but not a Whitehall department.

Britain’s trains are a fashionable but minuscule transport mode, catering for just 2% of journeys (not those of the poorest) and 8% of passenger miles. Their blessing, and now their curse, is to cater for noisy, upmarket London commuters and business travellers. It is Britain’s desperately congested roads, used by the overwhelming majority of travellers, that are now being starved and need investment.

But railways there must be, and they must be properly structured. The argument is no longer what needs doing, but who has the guts to do it. Grayling says he wants the same thing his predecessors wanted, an integrated and coherent management for each railway. The trouble is not money – there are billions floating round the railway at present – but how to correct 1993. It will be difficult and time-consuming, for Westminster and Whitehall alike. It may be tough on them, but it was their fault in the first place.

• Simon Jenkins is a Guardian columnist