British Rail was privatised in 1996. The track and infrastructure was devolved to a company called Railtrack, whilst ticketing and passenger and freight operations were franchised to individual private sector operators (originally 25 passenger and 4 freight operators). The government claimed that privatisation would see an improvement in passenger services: this outcome has yet been realised, although passenger levels initially increased to the level they had been at in the late-1980s.
A series of major rail accidents after privatisation – at Ladbroke Grove, Hatfield, Potters Bar, and Selby – caused widespread loss of confidence in the safety of rail travel. After the Hatfield crash, speed limits were drastically reduced throughout Britain and train travel was seriously disrupted for months. Railtrack came close to bankruptcy due to the enormous cost of additional safety measures and was effectively re-nationalised, when ownership of the railway system was transferred to the newly-created “not for profit” company limited by guarantee, Network Rail on October 3, 2002.
The private rail companies are heavily subsidised but much of the investment has not gone into regeneration or modernisation. However, the government has resisted public pressure to return the network to the public sector. 2 3. Structure of the rail industry The UK rail industry is made up of a number of market sectors and trade associations, which have to work together to ensure the smooth running of the industry. Below is a diagram showing the structure of the rail industry and a brief description of the organizations that make up the industry.
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It is responsible for non-operational railway land and the British Transport Police. It also provides advice on rail policy. Also uses the familiar “double arrow” British Rail logo. Department of Transport and Regions (DTR): The DTR sets the national strategy and framework for Britain’s rail system. The public money which goes to subsidise the rail companies – an amount which should decrease year on year – comes from this department to the SRA which then passes it on. The department also appoints the SRA and the Rail Regulator.
HM Railways Inspectorate: Part of the Health and Safety Executive, the Railways Inspectorate is responsible for ensuring that new track and trains meet safety standards, and for investigating crashes, particularly serious ones. Network Rail: The not-for-profit company founded to maintain track and stations after the collapse of Railtrack. Office of the Rail Regulator (ORR): Headed by the government-appointed “industry watchdog” Tom Winsor, the ORR can impose heavy penalties on train operating companies and Railtrack should they fail to reach the required standards.
It also sets out the minimum service levels which customers can expect from their train lines. Passenger Transport Executives (PTEs): In seven metropolitan areas – West Midlands, Greater Manchester, Merseyside, Tyne and Wear, South Yorkshire and Strathclyde – PTEs specify the minimum level of service, administer subsidy and are co-signatories to the relevant franchise agreements.
Rail Passengers Council (RPC): The RPC is charged with taking care of passenger concerns. Funded by the government, the RPC is a statutory consumer organisation that monitors and investigates the policies and performances of train and station operators. It has the legal right to make recommendations for changes and investigates passenger complaints that have not been satisfactorily resolved. It was formerly the Central Rail Users Consultative Committee (CRUCC).
Rolling Stock Leasing Companies (Roscos): The British train fleet is owned by three leasing companies: HSBC Rail UK (parent Hong Kong Shanghai Banking Corporation), Angel Train Contracts Ltd (parent Royal Bank of Scotland Group), Porterbrook (parent Abbey National). These companies lease the rolling stock out to the train operating companies. Strategic Rail Authority (SRA): Responsible for promoting rail use and strategically developing the rail network, the SRA was behind the newly announced Strategic Plan.