UK’s Southern Western Railways first to be back in public ownership

The new UK government is putting its money where its mouth is: the private rail company Southern Western Railways will become a public transport company again.

After all, before the election, Labour had indicated that if the party would be again in government, it would nationalize the entire UK train network within five years. “Our broken railways are finally on the fast track to repair and rebuild a system that the British public can trust and be proud of again,” said a pleased Transport Secretary, Heidi Alexander.

‘Major shake-up’

By renationalizing Southern Western Railways (SWR), Labour shows that it is serious about its announced plans. More to the point, several ministers have said that May’s transfer of SWR into public ownership will pave the way for a “major shake-up” of Britain’s railways.

According to the Starmer government, a state-owned railway will improve reliability and make it easier to boost economic growth by encouraging more people to use it. At the same time, the government is also making the case that by taking control over the rail again, it will end “unacceptable levels” of delays, cancellations, and waste seen under decades of failing franchise contracts.

The decision would save up to 150 million pounds yearly in fees to private shareholders, which can now be spent on services.

Subsidies kept SWR afloat

SWR, one of the UK’s biggest commuter services, provides train service in south-west England. The rail company is the joint ownership of FirstGroup (70%), a British multinational transport group, and MTR Corporation (30%), a Hong Kong rail operator. It has been operating since August 2017 as the successor to South West Trains, which was operated by Stagecoach.

The company runs the suburban service from London Waterloo station in central London to south-west London. SWR also runs suburban and regional trains in Surrey, Hampshire, and Dorset counties, as well as regional services in Devon, Somerset, Berkshire, and Wiltshire. The Island Line on the Isle of Wight is also part of this concession.

In recent years, SWR was one of several train operators impacted by strikes, the first national rail strike in the UK for three decades. The strikes were about pay and working conditions. There were also protests to the potential introduction of DOO (driver-only operation) on SWR’s new fleet, which would thereby nullify the role of the guard.

SWR recently reported an operating profit of 12,2 million pounds for the last financial year, backed by a 140,9 million pounds subsidy. Before the COVID-19 crisis, it had been among the most profitable franchises, making net payments to the government.

‘Privatize British Rail was foolish’

Mick Whelan, general secretary of Aslef, the train drivers’ union, can endorse the plans of government Starmer Transport Secretary Heidi Alexander. “‘This is the right decision, at the right time, to take the brakes off the UK economy and rebuild Britain,” Whelan said. “John Major’s decision to privatize British Rail in 1994 was foolish, ideologically driven, and doomed to fail. Even arch-privateer Margaret Thatcher described it as ‘a privatization too far’ and so it proved.”

Rail, Maritime and Transport union general secretary Mick Lynch’s comments are similar. “This is a significant step forward for passengers, rail workers, and those who want to see an efficient rail system run for the public good rather than private profit.”

‘Simply an ideological undertaking’

However, the Tories are uncomfortable with the plans to reverse the privatization experiment. “Labour has voted against our plan to strengthen the rights of passengers and commuters,” said Gareth Bacon, the Conservative shadow transport secretary. “We are concerned that the Government’s plans are simply an ideological undertaking that does not put passengers first. Keir Starmer’s latest Transport Secretary has a worrying record of failure when delivering projects on time that improve passenger services. We will closely monitor the impact of these plans.”

GBR

So, starting in May, SWR will come under the control of the Department for Transport’s operator of last resort, DOHL, shortly to be renamed DfT Operator Limited. But the Starmer government’s privatization plans do not end there: two more commuter operations out of London will follow, with C2C, the Essex service, expected to be in public hands by July and Greater Anglia to follow in the autumn of 2025.

According to The Guardian, all operators will eventually be nationalized within the next three years under the provisions of the public ownership bill championed by Haigh, which became law last week.

In the future, passenger trains in the UK—there are at least 25 passenger operators—are expected to run under the Great British Railways (GBR) banner. The plan is that all UK track and trains will be brought together under one “directing mind” to improve reliability, among other things.