Wednesday, 18 February 2015

Rail (and energy?) under Labour - public and proud!

The shadow transport secretary has announced that sections of our railways will be in public hands as soon as possible! This is fantastic news for Labour supporters and the public in general. Most of the public - including Tory supporters(!) - support bringing the energy companies and the railways back into public hands. Even if Labour isn't planning wholesale renationalisation they are far more in line with public support to the rest of the Westminster establishment (and UKIP); not going with full renationalisation will keep people who want to cut the deficit in the very short-run and the Blairites happy enough to stick with the party.

According to the YouGov article in the second link, the public would also like to see energy companies renationalized. Again, this would be too costly for a few years for it to be do-able given Labour's target to balance the budget in five years, however Labour do want to set prices until 2017 (as the public support) and want to attempt to increase competition to reduce the prices. Hopefully the idea of scrapping franchising in rail and replacing it with something more public will be translated into proper energy reform.

The reason why the public wants the public sector more involved in energy and public transport services is (quite obviously) because we have to accept the prices that the companies give us - competition doesn't matter much since it is tricky to switch providers. As we have seen in even the food market (one which most believe should stay private - and rightly so), the prices were just too high with Aldi and Lidl simply joining the market in the UK, cutting the prices and putting the other supermarkets under a lot of pressure. If even the highly competitive food market wasn't giving us competitive prices for a long time, then what hope is there for energy? It is harder for an energy company to join the market than it is for a food chain to join their market - as the German chains demonstrated.

Rail has a separate problem - if you want to get somewhere via. rail, you have to use the company that provides the service. You have no choice but to accept their prices. Of course you could find another means of getting to your destination, but rail is probably the most efficient and good value means of getting to your destination - it's why you've chosen it. The company knows this and can raise the price significantly knowing that you have no choice but to go with it. This is why rail prices have soared.

It's also ridiculous that rail is privatized because foreign governments have shares in our rail and are making profits from them that our government could be making if it owned it. Money is flowing out of the country for no logical reason.

The private franchises have improved quality to an extent but this may be down to natural technological innovation anyway. Even if they have improved quality, Labour are only planning to bring sections of the rail system into public hands - presumably as and when private franchises expire (as the Green Party proposes) or when they are doing badly. This way successful private franchises won't be stopped for the time being.

In summary - this Labour policy will prove to be a massive vote winner if Labour trumpets it enough.