Posted 16th November 2020 | 1 Comment

Monday essay: A political problem (conclusion)

THE Department for Transport has agreed to provide financial help for Transport for London until next year, but the agreement has not been reached without a price. In the second of two essays, Sim Harris looks at the effect politicians can have on the business of running transport services.


‘I would rather have private ownership than nationalisation, if nationalisation means the conduct of public services by Government Departments’—Lord Reith, 17 June 1942

THE  leadership of Ken Livingstone had meant that the GLC pursued strongly socialist policies after the 1981 election. This was almost guaranteed to spark hostilities between the GLC and Margaret Thatcher’s government, which was strongly Conservative.

By 1983 the government was arguing for the abolition of the GLC, claiming that it was an unnecessary layer of local government whose functions could be delegated more efficiently to the individual boroughs. Although highly controversial, a Local Government Act was passed in 1985, paving the way for the abolition of the GLC on 31 March 1986.

Among other things this would leave London Transport without a home, as it could hardly be an Executive of a body which no longer existed. This recalled the last days of the British Transport Commission in 1962, when LT had also been an Executive of an organisation which was about to be wound up.

On that occasion LT had been reconstituted as a standalone body – the London Transport Board – and, with the imminent ending of the GLC, history more or less repeated itself. This time the chosen name was London Regional Transport, which became official from June 1984 – comfortably before the GLC itself would go.

The politicians were still making a contribution, because the London Regional Transport Act 1984 obliged LRT to set up subsidiary companies to run the Underground and buses, which in turn could be seen as a first step towards privatisation: ‘London Regional Transport shall, in the case of such activities carried on by them as they may determine to be appropriate, invite other persons to submit tenders to carry on those activities for such period and on such basis as may be specified.’

Bus services began to be tendered in 1985, but London Underground Limited remained untouched.

Margaret Thatcher was forced out of office in 1990 and replaced by John Major, who largely left London Transport alone and concentrated on privatising the national railways. (One minor effect of that reform was that London Underground Limited acquired the Waterloo & City Line, which until 1994 had been part of British Rail.)

So far, political clashes involving London Transport had been on conventional Conservative/Labour  lines but, ironically, another major dispute was on the horizon, and this time the opposing sides were both Labour-based.

Labour, led by Tony Blair, was elected in 1997. One of its objectives in the manifesto was ‘a new public/private partnership to improve the Underground, safeguard its commitment to the public interest and guarantee value for money to taxpayers and passengers’.

In 2000, a new Greater London Authority was created – a ‘next generation’ GLC but with a truly executive Mayor – but strife was almost designed into its foundation stone.

Ken Livingstone was nominated as a Mayoral candidate, representing the Labour Party. Tony Blair tried to prevent this by nominating an alternative official Labour candidate, but Livingstone stood as an independent instead, although this resulted in his expulsion from the Labour Party. Nonetheless, he was elected to be the first executive Mayor of London.

Meanwhile, the government was proceeding with its plans for public/private partnerships to maintain and upgrade the Underground, which Livingstone opposed.

The parallel plans to replace London Regional Transport with a new body – Transport for London – which would include PPPs on the Underground and be directed by the Mayor – were thrown into confusion. If Ken Livingstone had taken charge of the Underground at City Hall before the PPP deals were signed, he would have refused to confirm them. The only solution for Tony Blair and his Chancellor Gordon Brown was to keep London Regional Transport, as the owner of London Underground Limited, going for a little longer, even though TfL existed by now.

The Greater London Authority started functioning on 3 July 2000, but LRT was not wound up until 15 July 2003, a few hours after control of London Underground Limited, with its newly-signed PPPs, had been transferred to Transport for London – at one minute after midnight.

The day before, transport secretary Alistair Darling had said: ‘This is an important day for the Underground. £16 billion will be spent upgrading and maintaining the Tube over the next 15 years. The Public Private Partnership is a substantial programme to deliver a modern service that Londoners rightly expect and deserve. It is now for the Mayor and Transport for London to deliver this.’

At the same time, Ken Livingstone said: ‘Major improvements cannot be delivered overnight and the privatisation of Tube maintenance under the Public Private Partnership imposed by the Government will make the management and improvement of the system more difficult.’

That turned out to be a considerable understatement. The three PPP ‘infracos’ – two run by Metronet and one by Tube Lines – had collapsed within a few years, victims of differences of opinion between them and TfL about how much they were supposed to spend on improving the Underground. In the case of Metronet BCV (Bakerloo, Central, Victoria), the gulf was as much as £1 billion.

Metronet went into administration in 2007, and Tube Lines shareholders voted to sell out to TfL three years later. The PPP era was over.

As a project, it had not been exactly a triumph for the politicians in Tony Blair’s administration – particularly PPP advocate Gordon Brown as well as Blair himself.

At about this time, Ken Livingstone was far more successful in creating London Overground. The first routes of this new TfL business, inherited from the delapidated operation which had been National Express’ Silverlink Metro, were launched in 2007. After several years of sustained investment in trains and stations, the system was transformed and has since grown considerably.

But since then the politicians have interfered again. The present Mayor Sadiq Khan had wanted to acquire still more suburban routes for Overground, but was blocked in 2016 by transport secretary Chris Grayling. 

Did Mr Grayling doubt the practicality of further conversions? Did he feel that the lines being targeted were better off as part of the existing franchises?

Well, maybe. But a leaked letter which he had written to Mayor Boris Johnson in 2013 revealed that Mr Grayling (who was nothing to do with transport at the time) had doubts about further Overground expansion on the grounds that ‘I would like to keep suburban rail services out of the clutches of any future Labour Mayor’.

And that is how many politicians make their decisions. 

Perhaps Lord Reith had a point.

The next print edition of Railnews, RN286, will be published on 3 December. That edition and some previous issues can be obtained by calling 01438 281200 from UK numbers or +44 1438 281200 internationally, and selecting Option 2.

Reader Comments:

Views expressed in submitted comments are that of the author, and not necessarily shared by Railnews.

  • david c smith, Bletchley

    It seems there is a "scale factor" re. rail organisation. TfL is an example of a transport provider that is compact enough for direct democracy to be effective especially, and at the same time where , as a natural monopoly, cannot make use of interoperator competition. Similar considerations apply to other commuter / shorter distance operations mostly around conurbations.

    On a national level, though, the converse tends to hold, with users too far - flung and numerous for effective democratic accountability and where interoperator competition would likely be most appropriate.

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