Railways

I was chatting to a friend yesterday (amongst others) who said that the British railways are very efficiently run: we have more trains travelling at over 100mph than any other country, we get more fuel efficiency from them than, for example, the French TGV (and the rest of the French rail network is poor), that diesel is better than electrification and that rail companies must be working very well for passenger numbers to have doubled in the last few years.

This sounds very much like the propaganda that the rail companies produce, and which I have seen criticised in print, mostly in Private Eye, so I want to summarise a few articles from PE here as a stored answer.

PE 1291: Northern Ireland Railways is protected from fare rises 3% above inflation because it is publicly owned and says that improved efficiency means it doesn't need more fare income. From 2004 to 2009 its subsidy dropped by 26% to about £2 per passenger. The privatised network received an increase of 13% to £4 per passenger. The 22% rise in passengers should have cut costs. Fares are already much cheaper. The recent rail value for money study (Roy McNulty) didn't even mention NIR, but did mention the rail industry's multiple misaligned incentives.
e.g rail companies are fined for being late, so they pad out timetables with waiting, so that all journeys are effectively late.
Or trains deliberately leave before the connecting train arrives because a train that has a long 'dwell time' at a station incurs charges to Network Rail.
NIR doesn't need complicated charging structures that cause mismanagement, because it's all one organisation with one board of directors and one aim.
Eye 1290: The 'value for money' study concludes that competitive tendering for track renewal has not yielded any greater efficiency, and that bringing maintenance in-house improved efficiency and safety, and that therefore there needed to be even more competitive tendering to achieve efficiency. It recommends another five agencies to oversee more benchmarking and comparisons, which will be paid for by the government and passengers.
Eye 1289: An in-depth look at how the franchise agreements allow rail franchisees to walk away without paying their debts to the government but ensure that subsidies are paid at the beginning of the franchise. The people in charge of each side swap around a lot, as in all areas of government and business, making cosy deals that benefit past or future employers rather than current ones. Revenue support makes the taxpayer liable for bringing revenue up to 80% of forecasts (and how accurate will those be!?). The recent study hasn't mentioned franchising flaws at all, instead recommending more fake competition. As a quick aside, the article also mentions some instances of rail companies breaking rules (e.g lying about statistics).
Eye 1288: This examines the huge bills for legal disputes apportioning blame between companies. For example, improvements in train brakes helps with punctuality targets of network rail, who receive fees for getting the franchisees trains around efficiently, and there was a large dispute over how much was owed by whom.
We also encounter hundreds of thousands each in retention payments for top management, who then leave anyway, having ensured that profits fell.

Eye 1281: Franchisees don't have to worry, as normal businesses do, about economic cycles and changes in demand: this is a financial risk that is outside the operator's control, and the government accepts that it must shoulder it. They are therefore free from worrying about overcrowding or providing additional carriages. Residual value left behind in train and station upgrades is currently unaccounted for, and changing that would require huge amounts of legal wrangling.
Rail lines are grouped together so that high-speed lines nudge badly-run lines above delay targets and no compensation is paid to passengers who couldn't use the high-speed line. Accidents are under-reported because of pressure to announce good statistics.

Eye 1288: The interim value for money study, that 'has confirmed privatisation made the railways more costly and inefficient and robbed them of leadership'. Trains offer better fares where they genuinely compete with each other on large, muli-track lines, and compensate by overpricing on monopoly lines.

Eye 1286: HS2 is poorly thought-out and planners should examine other countries such as France or Japan.

Eye 1284: Rail companies make money despite no capital investment, hiring facilities already in place and dumping risk on the government. There are huge cuts to ticket offices, forcing passengers to use machines and the byzantine fare systems with extraordinarily high prices for truly 'any-time' tickets and no help in finding cheap fares that companies are obliged to offer so that they can claim to have raised average fares by a certain amount. Complex systems like ticket pricing make it impossible for a consumer to achieve the best deal for himself without help from an expert in a ticket office.

Eye 1278: Despite encountering snow the year before, promising to learn lessons and improve services, rail companies cancelled most trains in the snow.

Eye 1273: Cheap advance bookings, where they are available, come with thousands of words of regulations, including not getting off early. A number of passengers have been fined for using less of a service than they have paid for; the punitive terms remain despite outcry. Cheap advance bookings and hideously expensive tickets at the time make people buy multiple tickets, inflating passenger statistics. If the train is empty, what purpose is served by charging more at the time?

Eye 1275: Manipulation of conditions that define when a service can be changed or fares increased. E.g making a route loss-making by adjusting times and carriage numbers, then being allowed to cancel services or raise prices. Private dinners with decision-makes get wrong decisions made.

And that's my Eye collection. I was rather hoping to find the article that examined the cunning incentive 'avoidance' surrounding crowded peak-time trains, cuts in services when in demand and peak/off-peak games in fare pricing and service provision. Yes, you could say that the misaligned incentives were set up badly by the government, just as poor franchising could be blamed on the government, and bad management plagues every type of organisation.

But if we're not to have franchising, what else will we have? Multiple railways taking up huge stretches of countryside? Demolished town centres in order to have multiple railways stations all near the centre? If fake competition, in the form of franchising, is so hard to implement effectively that we need huge amounts of legal experts, consultants (who we already have to advise the government to give out lots of money to everyone) and bureaucracy, then perhaps we're better off with the supposed inefficiencies of British Rail, which had similar rates of accidents, far cheaper services and more services.