Impact on the Railways of Leaving the EU

[Peter Kazmierczak]

Trenau Arriva Cymru - Parent Co. Deutsche Bahn AG

Chiltern Railways - Parent Co. Deutsche Bahn AG

Cross Country Trains - Parent Co. Deutsche Bahn AG

Freightliner - Parent Co. Genesee & Wyoming

 

I could go on.....

[Steadfast]

One thing that will probably vanish is the requirement for any major contract to be competed across Europe (which brought us Siemens EMUs, etc.).  This might help the surviving UK train makers.

 

Canadian Bombardier? Japanese Hitachi? Alstom are meant to be building a site in the north west, but leaving the EU will they bother now? Hitachi are widely quoted as saying they'll seriously consider moving their European operation from the UK to the mainland, probably Italy as they bought Ansaldo Breda.

Don't get me wrong, I fully appreciate that building a product in the country keeps people in work, however it's also worth baring in mind the UK content in European produced products. Knorr Bremse, nee Westinghouse, brakes. Brecknell Willis pans. Petards comms equipment. BMAC lighting. Arrowvale data recorders. Axiom bogies and suspension. Oleo buffers. Eminox Exhausts. Every Pendolino and Voyager has Alstom's motors and traction systems from Preston and are also used Europe wide.

I guess what I'm getting at is that although it's great to have assembly plants, the real value to the country is in the technology and skills behind the development and design of new products. I can't find the reference at present, but I've read previously that there's more UK content in a Desiro than an Electrostar. Whilst it's good to buy British products, they need to be the best item, not just buying because it's British. A prime example of an every day product that's British and is actually better than the competition - Dyson.

The mess with Thameslink was a joke, the papers baying for blood because a superior and cheaper product won. I just hope when we've left that we won't be foisted with lower quality, over priced products - not just rail, but as a country, because of a desire to buy British above all else. Whilst it's a probably overused comparison, but British Leyland typified this attitude, with a captive audience there's no desire to further develop products and quality can slip.

 

Jo

[Kenton]

 

The Norwegians have no manufacturing industry to speak of, just extractive industries like oil, gas, iron ore and fish which are specific to the location. They don't compete with anyone in EU, just sell them stuff they want and buy stuff in return - mostly food and engineering manufactures of various kinds.

 

 Not quite true. They used to have a thriving furniture manufacturing industry. There are villages just outside Trondheim (classic one industry towns - just like over here) for example that have been devastated by being undercut by cheap imports and cheap labour issues. Also farming has been badly hit. But Norway is a bad example for many reasons, not least of which a strong socialist system and no national debt to speak of.

[Peter Kazmierczak]

Let's look to some future goodies.....

 

Morris Marina

Austin Allegro

[Colin_McLeod]

I'm sure the railways can be improved but bringing them under the control of the dead hand of the government and it's departments is not the way forward. The British governments of the past have never been great for the railways. A revised and streamlined form of privatisation would be miles better. IMHO.

[The Stationmaster]

Hmm Dyson - designed in Britain, 100% manufactured in the Far East because Dyson wanted to make more money for himself.

 

Simple fact is that offshore owned manufacturies in Britain are partly here because of access to the European market.  If that market is protected by tariff barriers (as it already is as far as imports from non EU countries are concerned) then those manufacturers will move, they have no sort of ties or conscious to keep them in Britain.   What would happen to the Bridgend plant if Ford has to pay duties on components entering Europe to get to their other factories?

 

Simple fact is we don't know but with already high unemployment in many EU countries does anyone actually think they will cheerfully allow in imports when they could actually have the factories and jobs?  Same applies to the railway manufacturing industry (not that it exports much anyway nowadays).

[Colin_McLeod]

One thing that will probably vanish is the requirement for any major contract to be competed across Europe (which brought us Siemens EMUs, etc.).  This might help the surviving UK train makers.

That is not necessarily a good thing. If the British suppliers are any good they would already have the contracts. Failing to tender across Europe only restricts the choice and may well exclude better suppliers abroad.

[Coryton]

I'm sure the railways can be improved but bringing them under the control of the dead hand of the government and it's departments is not the way forward. The British governments of the past have never been great for the railways. A revised and streamlined form of privatisation would be miles better. IMHO.

 

Except that under nationalisation the railways were far more free of the "dead hand of the government" than now. Under BR the government held the purse strings but didn't try to manage the railways themselves.

 

Under the current system, far more decisions are made by the government. Look at the incredible level of detail laid down in franchise invitations to tender . Or compare the HST (all the government did was - grudgingly - agree to let BR spend the money) and the government-procured IEP/SET/Azuma etc. where the privatised companies get to choose what colour they paint it and that's about it. We've yet to see how the IEP turns out (although it doesn't seem to come cheap) but it's hard to argue that the HST wasn't a tremendous success.

 

Or have I been mislead and it's really the other way round?

 

Interestingly, for the next franchise in Wales, the Welsh government seems to want to go for a far less prescriptive approach on the grounds that they don't have the expertise to determine what they want. An interesting approach...but how do you then choose the winning bidder if the bidders all know more than you do about what you want?

[EddieB]

I think Norway (non EU, of course) pioneered the separation of track and train approach, but no one else embraced it quite so enthusiastically as the UK government which created railtrack. So I doubt it'll be changing back any time soon.

Likewise, privatisation is a British thing. DB, SNCF, NS, SNCB... All nationalised (as far as I know).

Sweden in 1988, with the creation of Banverket to manage the infrastructure?

[The Stationmaster]

Except that under nationalisation the railways were far more free of the "dead hand of the government" than now. Under BR the government held the purse strings but didn't try to manage the railways themselves.

 

Under the current system, far more decisions are made by the government. Look at the incredible level of detail laid down in franchise invitations to tender . Or compare the HST (all the government did was - grudgingly - agree to let BR spend the money) and the government-procured IEP/SET/Azuma etc. where the privatised companies get to choose what colour they paint it and that's about it. We've yet to see how the IEP turns out (although it doesn't seem to come cheap) but it's hard to argue that the HST wasn't a tremendous success.

 

Or have I been mislead and it's really the other way round?

 

Interestingly, for the next franchise in Wales, the Welsh government seems to want to go for a far less prescriptive approach on the grounds that they don't have the expertise to determine what they want. An interesting approach...but how do you then choose the winning bidder if the bidders all know more than you do about what you want?

 

But that is not necessarily the consequence of privatisation - merely a symptom of the way it is done at present.  The original model with a regulator and the SRA was arguably much better thought out and was in fact a result of the structure being thought out instead of knee-jerk politicking.  And of course the problem of any state involvement without a strong layer of higher level management to deal with them can be as you describe.

[Coryton]

But that is not necessarily the consequence of privatisation - merely a symptom of the way it is done at present.  The original model with a regulator and the SRA was arguably much better thought out and was in fact a result of the structure being thought out instead of knee-jerk politicking.  And of course the problem of any state involvement without a strong layer of higher level management to deal with them can be as you describe.

 

Yes I agree privatisation doesn't have to work the way it does at present.

 

But this was in response to a comment "I'm sure the railways can be improved but bringing them under the control of the dead hand of the government and it's departments is not the way forward." when in fact what I see is that the railways have already been brought under the "dead hand" and I don't think they have ever been under such strong government control - at least in peace time. Whereas a move back to British Rail as it was (and I know there are reasons both practical and ideological why this isn't going to happen) would involve less government control than at present.

 

Incidentally, was the SRA part of the original structure? I thought Labour brought in the SSRA which in due course became the SRA?

[jjb1970]

If there is one positive of the current mess it might be that as a country we have to look in a mirror and stop scape goating Europe for everything we do not like about the things around us. However, unfortunately I suspect that the unreasonable behaviour we will see from the EU in not simply agreeing to everything that the brexiteers demand will give us enough grievances to keep us going for a good few years. Like the Stationmaster I've spent quite a bit of time studying European Directives and in general they're far better written than equivalent UK documents and most of the problems arise from their transposition into UK law. However it is much easier to blame Brussels.

 

I do think the Norwegian example is very pertinent for us. The brexiteers are claiming we will get a free trade deal. Norway has such a deal but they have to pay a hefty fee for the privilege, have to adopt primary EU legislation and it is clear we would have to agree to the continued free movement of people. So we'd "take back control of our country" but a big chunk of the mythical £350 million a week would be handed back to Brussels and we'd still have an open door to people from Europe which I'm guessing would upset quite a lot of people who voted to leave. The alternatives go down a graduated scale to having no agreement with the EU and falling back on WTO rules in which case I think railways will be far from our biggest concern.

[Coryton]

I do think the Norwegian example is very pertinent for us. The brexiteers are claiming we will get a free trade deal. Norway has such a deal but they have to pay a hefty fee for the privilege, have to adopt primary EU legislation and it is clear we would have to agree to the continued free movement of people. So we'd "take back control of our country" but a big chunk of the mythical £350 million a week would be handed back to Brussels and we'd still have an open door to people from Europe which I'm guessing would upset quite a lot of people who voted to leave. The alternatives go down a graduated scale to having no agreement with the EU and falling back on WTO rules in which case I think railways will be far from our biggest concern.

 

And of course we were already part way down a sliding scale that had full membership at one end and no membership at the other, given our (unique?) status as not being required to be on a path to join Schengen or the Euro. 

[SwissRailPassion]

Angela Merkel has acknowledged we want to leave the EU and also the single market. If we take such a drastic step and have to leave the single market then rail will suffer. Investment will be put on hold or disappear and freight will be hammered.

There will be doubt about extending electrification and, very possibly, HS2 will be shelved.

 

It's ironic that the axe will fall hardest in the strongest Brexit areas.

[The Stationmaster]

Yes I agree privatisation doesn't have to work the way it does at present.

 

But this was in response to a comment "I'm sure the railways can be improved but bringing them under the control of the dead hand of the government and it's departments is not the way forward." when in fact what I see is that the railways have already been brought under the "dead hand" and I don't think they have ever been under such strong government control - at least in peace time. Whereas a move back to British Rail as it was (and I know there are reasons both practical and ideological why this isn't going to happen) would involve less government control than at present.

 

Incidentally, was the SRA part of the original structure? I thought Labour brought in the SSRA which in due course became the SRA?

 

Sorry yes - originally it was the Regulator and the Franchising Director.  The latter was abolished and the former effectively became a major part of the SRA.  But the thing is that it worked far better than now because the Civil Servants and Ministers were kept at arms' length.  The Civil Service seems incapable of doing that hence the present messy situation.

 

We can hardly reinvent the BRB as a buffer zone' as the experience and knowledge to establish it is not really around or if it is has been retired for some years.  Also DafT has changed out of all recognition and the original railway team has gone and with it the understanding of a light touch and the equivalent of the Governor of the Bank of England's eyebrow.  The past is a foreign country to many people now involved in the industry.

[Pacific231G]

Let's look to some future goodies.....

 

Morris Marina

Austin Allegro

I'm rather afraid that the "Sunderland Trabant" made in a corner of the former Nissan plant may be more likely.

http://www.sunderlandecho.com/news/business/nissan-says-no-comment-on-future-of-sunderland-plant-after-brexit-1-7980813

 

I noticed this yesterday in the online Washington Post's technology section "switch"

 

"The British are frantically Googling what the E.U. is, hours after voting to leave it

 

....despite the all-out attempts by either side to court voters, Britons were not only mystified by what would happen if they left the E.U.— many seemed not to even know what the European Union is. 

"What is the EU?" is the second top UK question on the EU since the #EURefResults were officially announced pic.twitter.com/1q4VAX3qcm

— GoogleTrends (@GoogleTrends) June 24, 2016

[4630]

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[101]

Potentially one of the most significant impact on the railways will come when Brexit starts to unpick/modify some of the EU employment legislation. I'm thinking particularly of TUPE legislation, any changes to which, will affect all employees of passenger train franchises when a change of franchisee takes place.

 

Unfortunately so, ISTR ASLEF have already quoted the government as saying TUPE was 'unecessary red tape'

[Coryton]

Sorry yes - originally it was the Regulator and the Franchising Director.  The latter was abolished and the former effectively became a major part of the SRA.  But the thing is that it worked far better than now because the Civil Servants and Ministers were kept at arms' length.  The Civil Service seems incapable of doing that hence the present messy situation.

 

We can hardly reinvent the BRB as a buffer zone' as the experience and knowledge to establish it is not really around or if it is has been retired for some years.  Also DafT has changed out of all recognition and the original railway team has gone and with it the understanding of a light touch and the equivalent of the Governor of the Bank of England's eyebrow.  The past is a foreign country to many people now involved in the industry.

 

Yes the world has changed a lot since BR and I'm sure it would not be trivial to put it all back even if there was the will to do so.

 

But there seems to be a lot of misunderstanding around. Those opposing nationalisation on the grounds that the government running the railways would be a bad thing appear not to realise that to a very large extent this is what is happening now (and pretty much didn't under BR).

 

I think BR also gave the lie to the view that a nationalised industry is inevitably inefficient and incapable of innovation. I believe that privatisation showed that BR was had actually been pretty efficient, and it would be very hard to argue that BR couldn't innovate.

 

I don't know what the best way to run the railways now would be but I'm not at all convinced that the current system is it. 

[stewartingram]

I seem to recall back in BR days, there were many quotes in the magazines (Modern Railways perhaps?) stating that the railways had a non-level playing field compared to road. In the latter case, a journey by road included road fund licenses, but a bus or lorry operator (subject to the required rules) basically paid no more and was free to roam the road network. Rail had to provide its own network, the permanent way. Surely the privatisation model (theoretically at least) evened that up?

 

As for leaving the EU, as we are one of the richer nations I reckon they might just miss our contributions, I wonder what the impact will be from their point of view?

 

 

Stewart

[slilley]

Trenau Arriva Cymru - Parent Co. Deutsche Bahn AG

Chiltern Railways - Parent Co. Deutsche Bahn AG

Cross Country Trains - Parent Co. Deutsche Bahn AG

Freightliner - Parent Co. Genesee & Wyoming

 

I could go on.....

 

On the infrastructure side Thales GTS who do a lot of work for LUL and Network Rail and TfGM is French owned.

[big jim]

So what about my European train driving licence and ERTMS course I've just completed?

[SwissRailPassion]

I seem to recall back in BR days, there were many quotes in the magazines (Modern Railways perhaps?) stating that the railways had a non-level playing field compared to road. In the latter case, a journey by road included road fund licenses, but a bus or lorry operator (subject to the required rules) basically paid no more and was free to roam the road network. Rail had to provide its own network, the permanent way. Surely the privatisation model (theoretically at least) evened that up?

 

As for leaving the EU, as we are one of the richer nations I reckon they might just miss our contributions, I wonder what the impact will be from their point of view?

 

 

Stewart

Our EU contribution is significant to them, perhaps less significant to us. It's the cost of a small government department. Just as Brussels bureaucracy is seen as bloated by some when in fact our Civil Service is 12 times larger.

 

The privatisation model foisted on the railways cannot be compared with road where lorries etc don't pay anything like their costs. Track access charges are very significant. The Channel Tunnel would see much more rail freight if the astronomical track access charges set by Eurotunnel were reduced.

[number6]

On the infrastructure side Thales GTS who do a lot of work for LUL and Network Rail and TfGM is French owned.

I can only assume that losing the advantages of the owner and the company both being within the EU trade zone will be an increase in cost and complexity of operation. A cost which will consequentially be passed to the tax payer and passenger.

 

Article in the Guardian today about Ebbw Vale (new £30m station, college, regeneration project) as the recipient of more net EU money than any other small UK town (pop 18,000) which voted predominately leave - you couldn't make it up:

http://gu.com/p/4myfh/sbl

[Pacific231G]

I seem to recall back in BR days, there were many quotes in the magazines (Modern Railways perhaps?) stating that the railways had a non-level playing field compared to road. In the latter case, a journey by road included road fund licenses, but a bus or lorry operator (subject to the required rules) basically paid no more and was free to roam the road network. Rail had to provide its own network, the permanent way. Surely the privatisation model (theoretically at least) evened that up?

 

As for leaving the EU, as we are one of the richer nations I reckon they might just miss our contributions, I wonder what the impact will be from their point of view?

 

 

Stewart

That was the case in many countries. The US Interstate Highway network was largely funded (about 90% according to Wikipedia) by the Federal government on the grounds of its strategic value for defence and States could only get match funding for highways if they were toll free. Once built they were of course mainly used by civilian cars, buses and trucks.

Even where road usage charges are imposed (such as tolls and road fund licences) they rarely equate to the full costs of providing roads but, perhaps more important, is that a commercial road user only has to fund the capital for their vehicle whereas a railway generally has to fund all the capital required for infrastructure. If I build a factory some distance from a railway and want to ship my goods out by rail I'll probably  have to pay all the costs of building a branch line, sidings, signalling etc. if I decide to use trucks then I'll have to buy or lease them but I probably won't have to pay for any upgrades needed  to local roads. In most countries the road system is regarded as a public good but the railway including its infrastructure is regarded as a commercial enterprise- even when it's run by a state agency. The old adage that public  money spent on roads is seen as investment but on railways it is seen as subsidy is still largely true.