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IEA - Rail announcements are a step in the right direction but could go further
IEA reacts to the announcements on overhauling England's rail network
Commenting on the Transport Secretary’s announcements on overhauling England’s rail network, Dr Richard Wellings, Head of Transport at the Institute of Economic Affairs, said:
“The Transport Secretary’s announcements today go in the right general direction, but are not radical enough. Chris Grayling has correctly analysed why our rail networks are inadequate, and whilst he is showing some sense in trying to solve these problems, political interference is still likely to hamper efficiency gains.
“There is strong evidence that having the same company owning the tracks and running the trains would reduce costs on the railways, potentially reducing the £5 billion a year taxpayer subsidy. But the structure of the industry should be determined by the market, not imposed from above by ministers.
“This half-hearted attempt at reform risks creating new inefficiencies by disrupting existing maintenance arrangements and operating at too small a scale to deliver significant benefits. It doesn’t represent the full integration needed to encourage the private sector to make long-term investments in new infrastructure.”
Notes to editors:
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The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
The IEA is a registered educational charity and independent of all political parties.
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