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Comment by dvdkon | Hacker News Reader

This is an interesting conclusion to a problem other countries are facing as well. The Czech Republic fully divided its railway infrastructure (under SŽ) and national train operator (ČD) sooner than most of the EU. SŽ being incompetent is a favourite topic of railway fans here, but most everyone agrees that this kind of split was for the best, at least for long-distance trains.

Pretty soon after the railways were opened to non-state operators, quality of long-distance train routes improved, both by new trains by private operators and increased competition forcing ČD to improve. On regional railways, where the state pays for train operations, costs have gone down thanks to competition. It seems to me like this model can work well, you just need an infrastructure operator that's receptive to its "customers" (which SŽ often isn't), or a political structure that can force them to listen.

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> On regional railways, where the state pays for train operations, costs have gone down thanks to competition.

German here. Yes, costs have gone down thanks to competition, but at what cost?

IMHO, the cost of "competition" on regionals has been massive. A lot of infrastructure has had to be rebuilt (e.g. maintenance shops), a huge expense and waste of space (think about how long a regional train is - easily 150 meters [1], which means the shop has to be at least that long). Some operators chose to run with old, run-down rolling stock or go for the absolutely cheapest options. Others, and that has happened at least twice in the last few years, calculate their offers to be barely profitable and then a crisis (Covid, Russian invasion and energy cost explosion) hits, forcing the companies into bankruptcy. Cleanliness of trains, regular expulsion of toilets takes a hit as that's a very easy way to save a few hundred euros. In the case of demand surges (e.g. soccer games, Oktoberfest, Karneval), there's no way to ad-hoc add rolling stock and drivers because there are no spares and modern rolling stock isn't compatible with anything other than its specific model and configuration.

And some regional tender processes have gotten even worse, where the state prescribes or outright buys the rolling stock... and suddenly the only way the providers can compete is staffing cost.

Thanks but no thanks, I'd rather like the old system back!

[1] https://de.wikipedia.org/wiki/Siemens_Desiro_HC

Complaining about disastrous and unnecessary competition has a long and proud tradition.

> And some regional tender processes have gotten even worse, where the state prescribes or outright buys the rolling stock... and suddenly the only way the providers can compete is staffing cost.

Sounds pretty bad.

In Czechia, competition was a huge boon for the railways. I still remember the rusty, hopelessly dirty Communist trains with fake leather seats that glued your buttocks with sweat, "open hole" toilets that stank to high heaven in summer and froze your ass off in the winter. Nowadays, we usually ride in nice and clean trains, and on the main lines of some operators, there is a delivery service where you can order small snacks or even warm meals to your seat and get them. Compared to the past, it is a freaking luxury.

Maybe the problem that you described is German-specific. Over my lifetime, as I visited Germany, I noticed a steady drift towards lower quality in almost all public services, not just trains. As if the German voters just somehow stopped to demand or value quality of governance. IDK why, but it can be seen everywhere. And there is already a visible contrast in public cleanliness and order when you travel, say, from Zurich to Munich. Germany looks like a has-been.

That wasn't the case in the 90s. Back then, the difference between BRD and Schweiz was negligible.

My pet theory is that Merkel's 16 years of sleepy rule was too much. Most politicians need to fear replacement in order to do something. If the nation votes for the same person over and over again, there will be no real political competition.

But IDK how that works on the Länder level.

Absolutely the same change happened in Russia over the past 30 years or so, but it had nothing to do with privatisation or competition, all trains are still operated by the same state-owned corporation.

> some regional tender processes have gotten even worse, where the state prescribes or outright buys the rolling stock

Isn't this done in an attempt to resolve some of the issues you mentioned?

If you don't want the absolute cheapest old run-down toilet-less rolling stock, the tender has to be quite specific about the minimum requirements the rolling stock is expected to meet. This in turn means an operator switch leaves the new operator having to quickly obtain a bunch of highly-specific rolling stock with the old operator having to get rid of a bunch of now-worthless highly-specific rolling stock.

The logical result is that the old operator sells the rolling stock to the new operator. Or, you have the rolling stock owned by a holding company, who leases it to whoever happens to be operating the tender. Same with the maintenance shops.

So why not cut out the middle man and have the rolling stock and maintenance shop be government-owned? The end result is the same, but it's cheaper for everyone involved.

You might the Wikipedia page on the impact of British Rail privatisation at https://en.wikipedia.org/wiki/Impact_of_the_privatisation_of...

Looking at graphs with clear improvements on many metrics straight after privatisation, you might think the change would be universally acclaimed. High fives all around. Instead, it's one of the UK's most hated things the government has ever done.

I especially like the almost miraculous recovery in rail's share of passenger transport. Or just the very first graph on the page, that shows the total number of passengers.

> Looking at graphs with clear improvements on many metrics .. one of the UK's most hated things the government has ever done

This is a classic of metrics driven management, isn't it. Customer satisfaction isn't in the metrics so people stand around saying "well they should be happy!"

Mainly about the cost, but the overcrowding on certain lines and the unreliability are also major factors. Commuters end up using the train because they're more or less forced to - you're not going to drive into rush hour London, and there's nowhere to park; and that's also a matter of policy to get people on the trains for sustainability reasons.

The "playing at shops" market setup exacerbates the problems. Original comment says "costs have gone down due to competition", but since the UK's operators are little regional monopolies they don't actually compete. The operators own neither track nor rolling stock; most of the money flows to the "train landlords", the ROSCOs.

Privatising the track, through "Railtrack" was the big disaster. They cut maintenance, but when you enshittify railways eventually people get killed, and nationalization was inevitable after Hatfield.

They managed to increase rail's share of overall transport. Reversing long running trends from before.

> Commuters end up using the train because they're more or less forced to [...]

Rail transport had been losing passenger share. Did the private companies somehow figure out how to 'more or less force' people to take the train? Why couldn't the government rail do that before?

> Why couldn't the government rail do that before?

They didn't want to. Privatisation was the era of Thatcher and Major, the discovery of North Sea oil reserves, and of the same general desire to culturally align with US (including car culture) that to the uban design found in Milton Keynes 30 years earlier.

I agree privatisation did indeed cause a massive revamp of train usage, and I feel like the nostalgia is sometimes rose-tinted and misplaced because 80s BR by all accounts was pretty bad even in the context of the UK in the 80s.

On the other hand, from about the 90s onwards there was a huge increase in London employment relative to the rest of the country, and also a huge (5x or more over that time) house price increase in London. This pushed a lot of people into the commuter belt. and As you basically cannot drive into London from there, those miles can only be provided by rail.

It would be interesting to know how much of the effect is in the South east, and how much is showing labour migration into a rail-centric region after industrial sectors outside the South-east were dynamited in the 80s.

And privatisation does usually have a cycle: influx of cheap capital in a boom phase, followed by a slow ratching squeeze as you struggle to exceed that great initial growth every year thereafter.

Could you have it backwards? Viable rail transport could have increased the amount of people who can work in London, and increase the radius in which they can live.

Indeed, it's possible. It's probably a mutual thing, and the existing rail-centrism of London would certainly have helped fuel the financialisation of the UK economy. You couldn't build Canary Wharf if no one could get to it.

London always had the better railway lines anyway, privatisation or not. In particular, radial London commuter lines mostly escaped the Beeching cuts. Post-industrial financialisation in London was the crown jewel of the 90s economic strategy. So it feels (feels/reals alert) unlikely that it was specifically the railways being private that led to the boom, but injecting private investment right then could well have been some grease on the wheels.

Of course every private cash injection comes with the long term squeeze as the initial YoY becomes hard to sustain over decades.

> London always had the better railway lines anyway, privatisation or not.

Well, they were first privately built, anyway. At least most of them.

It was always viable? It may not have been as comfortable or safe (slam-door trains) as people liked, but it was always crucial to London working for the 20th century.

Privatization didn't increase capacity, did it? It certainly didn't build any new lines.

I'm not sure it injected any capital either, subsidy was maintained throughout? Arguably paying dividends while receiving public subsidy has been taking capital out of the system.

Well, a well run mature company should return money to shareholders. That's why shareholders give money to companies in the first place.

> Privatization didn't increase capacity, did it? It certainly didn't build any new lines.

I don't think they privatised the rails themselves, only the trains.

They did. Then later on nationalised them again.

New Zealand sold the national network to Toll of Australia, who slowly ran it into the ground (I suspect one underlying problem is that it just wasn't at all profitable). Labour later bought it back from Toll (costing about $550 per working person). Passenger service is a very minor component of the national service (mostly the interisland ferry, which is a complete cockup).

Upthread comment: >[privatisation is] one of the UK's most hated things the government has ever done

In New Zealand, a lot of the political fallout from privatisation came from older people who love trains and talk a lot of crap about how good they are. They are uneconomic in New Zealand, regardless of how efficient people think they should be.

Voters don't like reality (few have any working knowledge of business), and most politics seems to be about finding alternative acceptable ways to present reality to voters.

> They are uneconomic in New Zealand

And why is that?

Mostly it's a consequence of population density. There's just not enough large cities close together.

I think it's probably also correct to say that New Zealand could sustain a larger passenger rail network if made the right investments. For example, Auckland <-> Hamilton <-> Tauranga could profitably support at least a few trains per day in each direction... _if_ it was electrified, with passing loops where needed, and with well-sited stations, and with the ability for trains to run into Britomart or at least Newmarket (both being stations close to central Auckland). However, there's a chicken and egg problem: unless you make investments like that, the service you can offer will be pretty crap and no one will want to ride your slow trains.

> Well, a well run mature company should return money to shareholders. That's why shareholders give money to companies in the first place.

Sure, but what does any of that have to do with TOCs? They're badly run, transient shells, which are given money by the government.

It should be illegal for any company to take public subsidy and pay dividends at the same time.

> I don't think they privatised the rails themselves, only the trains.

See the sad history of Railtrack Plc.

BR was deliberately underfunded throughout the 70s / 80s prior to privatisation

They did some fantastic work on high speed trains etc but it was all scrapped

>Looking at graphs with clear improvements on many metrics straight after privatisation, you might think the change would be universally acclaimed. High fives all around. Instead, it's one of the UK's most hated things the government has ever done.

I could tell at the time that they were itching to tell a narrative like yours coz they sent me a survey asking me about every aspect of the service except price and value for money, the one thing I and everybody else who routinely used the service was most furious about.

As a narrative shaping device it does seem to have not been completely wasted though.

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