The Conservatives are,
of course, the party of free markets… when it suits them. Rail services have
been privatized and are run by independent private companies. Yes, the
franchise contracts give the government the ability to regulate some fares
(off-peak fares and commuter costs, but not the ability to determine what times
are off-peak). If the Conservatives were dedicated to free markets and economic
principles of good governance, they would propose not to use this ability, or
even to sell it to the rail companies (allowing them to buy their way out of
the obligation to obey).
If
unregulated business is the universal good that policies such as ‘one-in,
one-out’ on red tape imply, then the rail operators should be free to raise
prices. They would increase prices until enough people stopped using the
railways that they lost money, and everything would be gloriously efficient.
I have
no doubt that most people can see a few reasons why this is a bad idea; there
are plenty of them. Rather than try to list them all, I’ll simply point out
that every justification for this policy is simultaneously a nail in the coffin
of ‘regulation is always bad’.
I do
have one point to make, though, which is that the cost of travel is not
isolatable from the wider economy. If travelling is kept artificially cheap,
our housing market will be distorted, with people more willing to buy new
houses in the suburbs rather than reuse and refit central buildings and live
more densely. Similarly, suburban living tends to involve more car use in
addition to efficient rail travel, and this affects pollution and emissions.
The
distortion in travel has knock-on effects across the whole economy. This is why
it’s important to get every policy right.
As for
other parts of their rail-fare policy, they’re equally foolish. Part-time
season tickets will disrupt rail pricing because unregulated prices are so much
higher than season tickets that part-time season tickets will often be cheaper
than single journeys. In a way, this might help expose the farce of our rail
system and make the operators back out, but it will probably just make them
claim even more subsidy from government.
Finally,
investing millions in fitting out trains is exactly what privatization was
intended to achieve. The whole point was that British Rail had under-invested
and private companies would have a profit incentive to invest. That the
government is doing it shows just how parasitic rail franchising is.
The cost of this policy is put at £80 per commuter per year. About 30 million people are in work, so if I ignore self-employed people etc. and assume that they’re all commuters, and that about 45% of commuters will be affected by the freeze, this policy will cost about £1 billion. The rail companies aren’t charities, and will get that money elsewhere; either from government subsidy, or from leisure travellers. That means expensive holidays, fewer visits to see your family and so on.
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