Socialist Worker

Tories and Labour have always let bosses ride free

Published Tue 15 Jan 2013
Issue No. 2336

Britain’s rail network was nationalised 65 years ago—for the second time.

Britain had the world’s first complex rail network.

It was built by private firms—but they soon found that maintaining and modernising it was not profitable.

By the early years of the 20th century they were demanding government subsidies. And the rail network was vital to the economy so the government obliged.

During the First World War the government took control of running the rail network in order to run the service more efficiently. But they returned it to private hands in 1921 with £60 million compensation.

During the Second World War the rail network was managed as a single unit. It was starved of investment and the service deteriorated under private control.

Compensation

By 1948 it was no longer profitable. But when it was nationalised again the rail companies still demanded high compensation—and got it from the Labour government.

In the 1950s British Rail carried 50 percent of freight transport. But the service ran at an annual loss of £22 million.

The Tories put forward a limited modernisation plan, while spending £212 million on roads.

By 1960 the Tories appointed Dr Richard Beeching to look into how to restore profitability. He decided that the solution was not investment but massive cuts to restore profitability.

In opposition Labour denounced Beeching’s plan. But once it returned to government in 1964 it speeded up the closures.

Far from returning the railways to profitability, losses grew in the following years.

In the mid 1970s Labour finally embarked on a massive programme of modernisation. It was enormously costly because the system had been starved of funds.

The Tories blamed nationalisation for the higher costs. Throughout the 1980s they tried to find a way to privatise the system without it collapsing.


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Background Check
Tue 15 Jan 2013, 16:32 GMT
Issue No. 2336
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