Ed Miliband speaks to supporters at Redbridge on May 1, 2014. Photograph: Getty Images.
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Labour's new rail plan: the full details

Party vows to end "ideological obsession" with privatisation by allowing the state to bid for franchises. 

One of the biggest decisions that will be taken at Labour's National Policy Forum, which opens in Milton Keynes tomorrow (and runs until Sunday), will be over the party's rail policy. As has long been known, Labour will pledge to reform the franchising system to allow state and not-for-profit firms to bid for contracts as they expire (in contrast to the coalition's dogmatic allegiance to the private sector). But transport unions have been pushing the party to go further and promise to automatically return franchises to public ownership. 

Ahead of the NPF, however, a source close to Jon Cruddas has said that "there is now general agreement across the Labour movement" around the package proposed by the leadership. This includes a pledge to legislate to allow a public sector comparator to compete with private firms for franchises "on a genuinely level playing field". 

Billed as the biggest proposed reform of the railways since privatisation, it also features a commitment to create a new overarching body, accountable to parliament, tasked with implementing a national strategy for the railways. This would bring Network Rail and a new passenger rail body together to co-ordinate passenger operations, manage infrastructure, oversee stations and ticketing, and ensure customer satisfaction across the network. 

As part of its plan to ease the living standards crisis, Labour will also pledge to cap annual fare rises on every route, simplify price structures and create a new legal right to the cheapest ticket. And it will promise to devolve regional and commuter services in an attempt to improve local transport, integrating trains, buses and trams - a plan modelled on Transport for London. 

A source close to Cruddas said: 

There is now general agreement across the Labour movement around Jon's bold package for how we reform the way our railways are run. We want to get rid of the Tories’ failed franchising model and an ideological obsession which puts privatisation ahead of common sense - without going back to the old days of British Rail.

Instead, Labour is determined to face up to the need for bigger reforms which meet the challenges facing our creaking transport system in the 21st Century. 

The package being discussed by the NPF this weekend goes beyond the public versus private debate. It would deliver a broader, radical reform agenda to save money and stop passengers being ripped off. It would allow us to plan railways that will serve our country as a whole and local communities better.

Above all, it would put right the mistakes made 20 years ago and put the taxpayer and rail passengers first.

Since 2010, commuter fares have increased by 20 per cent, leaving UK fares at least 30 per cent more expensive than those in other countries. Labour concedes that the franchising model adopted after privatisation in 1994 has delivered some improvements, but argues that a one-size-fits-all approach has failed to secure the best deal from private operators, with the collapse of the West Coast franchise process costing more than £50m. 

The task for Miliband will now be to build a consensus around this package. The proposal will be discussed in amendment meetings tomorrow followed by a vote of delegates on Sunday. Based on conversations with Labour sources tonight, the leadership is now confident of winning majority approval for the plan. 

Here's the motion that will be debated tomorrow:

"Since the late 1990s there has been significant investment in the railways and passenger numbers have grown sharply. But it is now clear that the rail system is not delivering a fair deal for passengers or the taxpayer, almost 20 years on from the botched privatisation of the railways. Both public subsidy and fares are higher than in other countries, and there is no 'guiding mind' overseeing the railways, planning investment and ensuring results. We have also seen a chaotic franchising process in recent years that has cost millions. To tackle these problems the next Labour government will:

"Review this government's failed franchising process as a priority, after the chaos of recent years, to safeguard taxpayer and passenger interests and put in place a system that is fit for purpose.

"Learn the lessons of East Coast, where we have seen the benefits of a not-for-dividend operator running rail lines, by legislating to allow a public sector operator to be able take on lines and challenge the train operators on a genuinely level playing field to secure value for money for passengers and taxpayers.

"Devolve decisions over the running of regional and local services, including to Scotland and Wales, so that areas can bring together trains, buses, ferries and trams into a single network.

"Tackle the monopoly market for rail rolling stock by giving Network Rail greater responsibility for developing a long term plan for procurement and leasing of new rolling stock.

"Create a new guiding mind for the railways, bringing Network Rail together with a new passenger rail body to contract routes, co-ordinate services, oversee stations and ensure customer satisfaction across the network.

"Ease the pressure on fare payers with the efficiencies these reforms release and by capping annual fare rises on every route, simplifying fare structures and creating a new legal right to the cheapest ticket."

George Eaton is political editor of the New Statesman.

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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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