Mere Outposts of Other Countries' Empires

John Harris writes:

By the time you read this article, the UK will probably be in the grip of that recurrent national malady known as travel chaos. At the time of writing, in addition to warnings about the perils of driving, trains were being cancelled en masse, while would-be travellers were instructed to follow news from that array of corporate names which still feels like some alien imposition on national life: First TransPennine, CrossCountry, First Capital Connect, c2c. There will, it seems, be leaves on the line, and then some.

Even the most efficient set-up can probably not do much about what one firm was predicting to be "localised flooding, fallen trees and debris on the tracks". But still: as rail travel is disrupted, thousands of people will once again seethe with fury at the operating companies' shortcomings, whether unfairly or not. Public anger, moreover, will also reflect a firmly embedded belief: that the approach of politicians to the railways is lily-livered at best; and at worst, completely barmy.

If you want a good example of the latter, consider the fate of the east coast mainline, which runs between London, the north-east and Scotland. In 2006 GNER lost its contract to run trains along the route when its Bermuda-registered parent company filed for bankruptcy. The franchise then went to National Express, which soon defaulted on its payments. So the then-Labour government created a not-for-profit public operator called Directly Operated Railways, which has run the service for the last four years with much success.

Since 2009, DOR has paid £602m into public funds: over £200m more than National Express did, and £209m more than Virgin Rail – the franchise-holder for the west coast mainline – has managed during the same period. Its public subsidy is comparatively minimal – seven times less than that paid last year to Virgin. Its record on safety improvements is jaw-dropping: "major customer accidents" are down 81% since 2009. And customer satisfaction and punctuality are at unprecedented highs.

Now, of course, the government wants to re-privatise it – which is where things get truly absurd. Among the top bidders for the franchise is a consortium split between Eurostar and Keolis, both majority-owned by the French state firm SNCF. As well as Virgin, another probable contender will be Arriva, the British train company wholly owned by Deutsche Bahn, which is in turn wholly owned by the German government. As is increasingly the case across a whole range of national infrastructure – from power stations to water suppliers, via airports and bus companies – supposed free-marketeers are gleefully happy about state ownership of British assets, as long as it's somebody else's state that's doing it. In the case of the railways, moreover, you end up with the inevitable consequence of profits being skimmed off and invested in trains and tracks overseas.

This is another of the insanities at the core of an economic model that George Osborne in particular wants to develop. Labour argues that the east coast mainline should stay in public hands and that DOR should be allowed to bid for other train franchises, following the same revenue-generating model as publicly owned firms from Germany, France and the Netherlands.

But is that really enough? The Greens' Caroline Lucas, a rare voice of sanity, recently tabled a private member's bill outlining a simple alternative: that over time, as rail franchises expire, they should be restored to public ownership – which would cost peanuts, repatriate a fair bit of money, and commence the abolition of all the complex and costly stupidities that privatisation produced (topical note: before the rehabilitation of John Major goes too far, let's remember that it was his government that did it). This would at least slow those outrageous ticket price rises. And just imagine: we would also get the kind of integrated railway system to which politicians could finally apply some joined-up thinking.

This Thursday, after the publication of a new business case, there will be a Commons vote on the so-called paving bill for HS2, which will enable the government to release funding for the "preparation" of the project before later legislation grants full planning permission. The HS2 project is the grimmest embodiment yet of how awful railways policy has become, whereby tens of billions will be frittered on services for which there is no obvious demand – while existing routes will suffer, links between cities outside London will be as poor as ever, and commuter and branch lines will remain under-resourced and overcrowded.

For the moment, Labour is sticking to a depressingly familiar approach: why have a clear policy when nods, winks and mischievous opacity will suffice? With David Cameron now insisting that HS2 depends on all-party support, shadow ministers still claim to back it, though Labour MPs will be under no obligation to actually turn up and vote, and Ed Balls may yet decide to turn tail and offer to spend the money on other things. There will certainly be Conservative dissent this week, though Tory rebels are likely to come out in their largest numbers a little later. Whatever, support for HS2 is palpably weakening.

Who will eventually supply the trains and actually run HS2 remains unclear. But as well as the prospect of state-owned European firms getting involved, the China Railway Group and China South Locomotive and Rolling Stock Corporation – again, government-owned enterprises – have registered an interest in bidding for contracts. So, off we may well go again, handing yet more chunks of infrastructure to interests whose chief responsibilities lie far away from the UK, swaths of whose profits will be invested at home.

Storms permitting, I will be among the stressed-out crowds this morning, trying to get from the West Country to Stockport on a family ticket that – even with a railcard, booked several weeks in advance – cost me a wallet-threatening £125, a good deal of which will be going straight into the coffers of Deutsche Bahn, and will presumably contribute to such projects as the redevelopment of the central station in Stuttgart and the improvement of services from Mainz.

How remarkable that railways which once embodied the British genius should have become not just overpriced and lamentably run, but mere outposts of other countries' economic empires.