Opinion
These improvements haven’t gone unnoticed. Grand Central and First Hull Trains ranked first and second in the Autumn 2012 passenger satisfaction survey, scoring 96 per cent and 95 per cent, respectively, overall. And they also came top in the value for money category.
While competition has brought benefits to passengers, it hasn’t led to higher subsidies for the main operator, as some might have feared. The premium paid by East Coast to the DfT has risen from £46 million in 2009-10 to £188 million in 2011-12. Smaller fare rises, faster passenger growth and fewer subsidies may sound too good to be true, but competition has also benefited the freight sector.
Rail freight has been open access since privatisation, and there are now five registered freight operators. Between 1998-99 and 2008-09, the CPS report found that the freight operating companies reduced their unit costs by 35 per cent, while the passenger operators saw increased costs of 10 per cent. Since privatisation, the number of freight tonne kilometres has risen by 50 per cent, while the number of locomotives has halved and the number of waggons fallen by a third. Other countries are waking up to the potential of competition. Germany now allows independent operators to run some regional lines, Italy’s NPV competes with the state-owned incumbent on the busy intercity high speed routes, including from Milan to Rome, and LEO Express started open access services in the Czech Republic in December. After the West Coast debacle, the delays to the franchise schedule were probably unavoidable. But if passengers are to be rewarded for their patience, as sometimes poorly-performing incumbents continue to hold onto key routes, then the DfT should seriously consider allowing more open access operators to run more services to more stations.
Competition could be the one good thing to come out of this whole episode. Corin Taylor is a senior economic adviser at the Institute of Directors (
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