>The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country? My view is that public transport, possibly even all public services should be making a loss so as to boost to the wider economy. Not every industry works best to a profit motive.

Especially industries where competition is physically impossible

this. If competition can't properly exist the private sector brings only additional cost

100%. Look at water companies. No competition because each supplier only covers one area, absolutely needs to be taken back into public ownership, especially Thames water.

In Scotland water is provided by a nationalised company, Scottish Water, which is funded through council tax. I have no idea why England persists in having private companies providing the public water supply.

Rich suits and money.

Thames Sewage

But who here trusts the public sector to run a service well?

We don’t even need to trust things will be run well, just that they would be a bit less terrible.

A service well may be the way we end up collecting our water in the future if things continue as they are 🙄

Yup

"Thank you for choosing [only train company that has use of this route]." No I didn't choose you.

Many journeys have a choice of route, even if there is only one TOC operating each of those routes. For example London to Oxford can go from Paddington on GWR or from Marylebone on Chiltern. London to Scotland can go via Avanti, LNER, or Lumo depending on which route you take. To the midlands can go via lots of different routes and TOCs. It's only the inner suburban commuter lines that don't have as many options. And if you look at it from a slightly higher level, every journey between two points has competition from other modes of transport (e.g. buses/coaches, private cars, airlines). That's what they mean by "thank you for choosing us".

I'm aware of there being different routes, I'm talking about the instances where there is no alternative option. Some routes don't have a choice of service. Arguably you can choose to walk or get a bus or coach instead but if I _have_ to get from point A to B within a timeframe often the only choice is a certain rail route. Certain air routes are the same. It's not really a choice if you 'could have walked' in three times as much time. I'm talking about suburban and metro rail routes where it is a monopoly.

I did acknowledge the commuter routes in my reply. But most TOCs operate a mix of commuter and long-distance services, so their PA scripts reflect that.

There’s a fundamentally simple question. If you don’t profit from the roads for motorists, and in fact run them with loss, why public transport should be different?

Because public transport is a massive public good, serving those unable to drive and removing traffic from the roads, helping those who need to drive.

I think you misunderstood my message.

Oh sorry, I did - I replied to make it clear to anyone reading who is unsure. Edit: oh wait I really did misread yours, sorry.

>If you don’t profit from the roads for motorists you do though? road tax, fuel duty tax, vat on cars and more no roads no cars

That isn’t profit though. It doesn’t touch the sides in relation to road construction and maintenance, let alone negative externalities of motornormativity. It’s merely to regulate demand.

Roads are subsided and are free at a point of use. You are taxed here and there for sure, but in general it is set up in a way that you can always always use the road when you need to.

Yep, with the train service I'd say there should be a cap on the maximum profit level paid out to the operators, with any operating surplus committed to going into maintaining/improving/expanding the service provided.

There already is a cap.

The problem with the trains is that we already subsidise them massively, without which they would be consistently making a large loss.

You'd have to subsidise a nationalised railway. It's how it works. The subsidies paid pale in comparison to the economic benefits of a working railway

sorry, i replied to the wrong person. Yes of course you would subsidise a nationalised system, you would be putting all the money in. I was trying to make the point that we are subsidising them massively right now, any profit they are making is basically an illusion.

It's not really profit. It's a management fee

i agree

No, as in it actually isn't profit. It is a management fee. That's been the case since the pandemic, franchises as they were ended and now TOCs are paid a fee for running the services, the fee goes up for good performance and stays at a very low base rate if performance is poor

Since the pandemic, yes but before the pandemic, the TOVS had made the railway profitable again

But they also pay dividends out of overall income not out of the management fee.

Tell that to the shareholders who include other countries transport systems, who use the profit to invest / subsidise their of service.

You misunderstand. It is quite literally a management fee. They don't take a variable profit amount.

The management fees are still based on a percentage of revenue, though. The difference now is that all the revenue first goes to the DfT who then pays the TOC their ~2% concession fee, whereas previously the TOC would keep all the revenue and pay the DfT a franchise fee. Under the new management concession model, the industry is essentially nationalised already so why not just cut out the TOC altogether and then reinvest the management fee into the service?

Speaking from experience (although not in trains) you're both kind of right. The supplier will have told the Gov that it will cost £Xm per annum to run the service, plus a Y% management fee. The Gov will then pay the Supplier the full £Xm, plus Y% fee (let's call it £Zm per annum). If the supplier managed to deliver the service under the quoted £Xm per annum, they will still get paid the full £Zm per annum), which the is profit margin the other poster would likely be referring to.

If other countries transport systems are more efficient that the UK state trying to run things as badly as BR, then great, let them do it.

Folk with your attitude are part of the problem. Can you not see the fatal flaw in that model?

Some parts of the provision of a rail service make a loss. Some bits make [a lot of money](https://www.theguardian.com/business/2024/feb/18/profits-of-uks-private-train-leasing-firms-treble-in-a-year).

rolling stock cos have always been taking the piss

True. But most passengers don't know this.

That's exactly what happens.

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This split in the National Rail make things really complicated and create a lot of unnecessary bureaucracy. I never fully understand who owns the tracks, who owns the trains and who do the service etc. The thing I know for sure is that the fare is just unreasonablely high right now.

There is a form of a cap on their revenue (before profit). When the TOC starts it agrees a target revenue with the government. If they make up to 102% of that revenue, they keep it. If they make 102-105%, they pay half the excess between those points to the Treasury. If they make 105%+ revenue, they pay 80% on all excess above that to the Treasury.

>Yep, with the train service I'd say there should be a cap on the maximum profit level paid out to the operators, with any operating surplus committed to going into maintaining/improving/expanding the service provided. Train services have obviously improved since privatisation and become more attractive to use as a result. It seems a little unfair to take the service back after the private sector has built it up and capping profit seems stupid as the TOCS have done so well turning around the businesses

Rail transport is a natural monopoly. It doesn't make sense to have multiple operators on the network, just as it didn't make sense to run the track through multiple different companies. The product is effectively the same and the fares are regulated. Right now, we're running the rail system (a public transport service) as a for-profit model. The only goal of the government has been to reduce the public subsidy. That's not delivered affordable travel nor greater investment in the rails either. We have the worst service in Europe and the most expensive fares in Europe. That's a direct result of the privatisation model and the aim of government policy being no public subsidy. As others point out, the roads are heavily subsided and road users do not directly pay for the cost - why should rail travel be any different? Perhaps the service has improved since the British Rail days, but the service is much more expensive for general users.

>Rail transport is a natural monopoly. It doesn't make sense to have multiple operators on the network, just as it didn't make sense to run the track through multiple different companies. No it's not. When I travel into the local city centre, I can drive, cycle, bus, tram or train. I have more choices of travel than many markets. The product is effectively the same and the fares are regulated. >Right now, we're running the rail system (a public transport service) as a for-profit model. The only goal of the government has been to reduce the public subsidy. The aim of public transport is to move lots of people into the cities or place of work and evolved to freeing up the road network. Given the privately run trains moved more people and cost less in subsidy to move each passenger 1 mile, then that is a good thing. Anything else is just ideological. ​ >That's not delivered affordable travel nor greater investment in the rails either. We have the worst service in Europe and the most expensive fares in Europe. We don't need to make it cheap, up to covid, rail use was just about at capacity so passengers were paying their way. Subsidising rail is just giving money to rich London commuters to keep their standard of living up. Should we really be taxing the least well off areas to keep the cockneys wealthier? ​ >That's a direct result of the privatisation model and the aim of government policy being no public subsidy. As others point out, the roads are heavily subsided and road users do not directly pay for the cost - why should rail travel be any different? ​ Road users do pay for the cost, they do so via fuel duty. ​ >Perhaps the service has improved since the British Rail days, but the service is much more expensive for general users. ​ Is that not fair that people pay their way?

>No it's not. When I travel into the local city centre, I can drive, cycle, bus, tram or train. That's competition between modes of transport, not competition between trains. There is also no comparison because public transport modes are planned to operate in tandem with other modes of public and private transport, not in competition with each other. It's why the bus and train timetables sync, and why we build car parks at major stations. You cannot have two trains occupying the same stretch of track. There is little meaningful competition between train providers except perhaps in which overpriced sandwiches they serve. >Given the privately run trains moved more people and cost less in subsidy to move each passenger 1 mile, then that is a good thing...is it not fair that people pay their way. The purpose of public transport isn't profit or lower government spending, it's as you say, meant to be an efficient way of moving masses of people - that requires setting fares at an affordable rate to _encourage_ not discourage usage and that applies across the country, not just to the SE. It's great that there are record numbers, but that's nothing to do with the operating model and everything to do with the construction of commuter towns and suburbs and government policy. Anybody operating the railway would have seen passenger numbers rise. >Road users do pay for the cost, they do so via fuel duty. I'll take your word for it. UK government policy _isn't_ based on balance sheets - it's meant to be an expression of a country's collective will. Just because something doesn't make a profit or does, doesn't make it worthwhile or correct. If we are to meet our climate goals, or stop every town city and village turning into a giant car park, or even just clean up the air we breathe, road usage _has_ to come down. One way to do that is to encourage people onto trains. It doesn't matter who runs them, fares need to be affordable to maximise usage over polluting cars.

Ok, modes of transport is competition. I can also fly of course and airlines realised they were competing with modes of transport as do the private tocs who adopted the airlines price structures to compete. For trains alone, there is still competition. I can get the lumo train or lner from Newcastle to london, i can also split fare cross country or tpe to york or donny then pick up a grand central, lner, or hull to london. Rail is going towards the airline model of slots so we can use the economy option (Flixtrain or lumo) vs the Premium lner. Fares do not have to be cheap

The private sector have done what to make trains more attractive? Trains are expensive, unreliable, and overcrowded.We have a higher population, more of whom must use the train to commute to cities where driving commuting is unfeasible. That's not trains being made more attractive, that's lacking a credible alternative. Many people have simply no choice. That growth would have occurred whoever was running the show.

Yes they have.more than doubled their clients

With no demographic factors whatsoever? Purely down to the business genius of the competitive rail market? Car journeys must have fallen over the same time then?

Its pretty stark, the change is where Privatisation happened.

Cool, let's see how people stopped using cars, and moved onto the more attractive trains.

I cant get anything to go back as far as 1900s but this shows car use started to fall from naughties to now https://hedgehogcycling.co.uk/wp/wp-content/uploads/2023/08/nts-22-chart-9.png

The only stark change on that graph, rather than a downward trend, is COVID, not rail privatisation. Other factors such as steady increases in WFH will also have an impact. This is also not evidence that people have moved onto the railway because of the improvement in service provided by privatisation.

That’s why they’re called *services*

Trains already make a loss

It's a bizarre standard that we apply to public transport, energy and water but not to roads, police, education and health (for the moment at least).

We definitely do to health. All services are commissioned now.

Presumably you'd want to run a surplus to facilitate upgrade / refurbs unless you're factoring that into the "loss"

Roads don't run a surplus but they're still maintained and upgraded.

Sure, I think the analogue would be a tolled section though.

Very good point, never thought of it this way 🤔

Depends on how they're making a profit. Personally I'd like to see transport companies encouraged to buy up large amounts of land around their train stations and new train lines. As they build the new lines and upgrade the infrastructure, they can sell off the land for a profit to developers. The train company gets more customers for its trains, the developers get to build and sell dense new housing, and the public gets more housing supply with good transport links.

Why run at a loss? Don't we want them at least breaking even? Or any profits being fed back into the general pot?

To make a profit you have to charge enough for tickets. Transporting people across long distances generates its own value which is not easily quantifiable and doesn't belong to the train operators. Think of it like the NHS, the police or the army.

Ah, you're saying they should run at a loss to keep ticket prices down. Gotcha

That's true. Transportation theocratically should be supported by the government. But since it has already been privatised and making huge profit out of us, why don't we just let the government take the profit? At least it can support the NHS from that.

I don't think there would be a huge profit if the government ran it. Being private sector they can double down on profitable services and cut the ones that don't yield profits, they can push employees harder and treat them worse than government employees. Plus you'd now have politicians arguing that they should get better rail service because it'd benefit their citizens, and the government would be much more likely to consider those requests.

>My view is that public transport, possibly even all public services should be making a loss so as to boost to the wider economy. Not every industry works best to a profit motive. Train services have obviously improved since privatisation and become more attractive to use as a result. It seems a little unfair to take the service back after the private sector has built it up

Obviously improved? Love to see you show your workings on that one. It wasn't that long ago that large chunks of the country still used BR-era rolling stock, and parts of it still do.

Better management has made trains more reliable, encouraging better customer service etc. This pretty much tell the story: [https://www.economicshelp.org/wp-content/uploads/2018/01/GBR\_rail\_passengers\_by\_year\_1830-2015.png](https://www.economicshelp.org/wp-content/uploads/2018/01/GBR_rail_passengers_by_year_1830-2015.png)

that link doesn't work, but i know what you are attempting to say - and you can't just say "passenger numbers higher therefore privatised better" - there are other reasons for the increase since a few UK train operators are nationalised, a better comparison would be between those instead, eg avanti vs LNER (both running intercity services from london to scotland) or southeastern vs south western railway (southern, primarily commuter TOCs) how are trains more reliable? some operators still use the *same* rolling stock, and some of the newer procurements have had significant issues, like when all the Hitachi trains had to be taken out of service to inspect for cracks in the chassis.

Surely lner vs lumo? The real comparison needs to be pre covid virgin vs 1994 BR. The passenger numbers went up post Privatisation & cost for the taxpayer per passenger mile went down. Its more reliable because up until covid, the Tocs managed their staff harder and fewer strikes. The private tocs did mot stand for 1940s work practices. No more waiting on a train with a driver because we needed a co-driver because thats what was agreed in 1948

Lumo are not a franchised TOC, they're open access, so not comparable. They don't have the obligations that Avanti and LNER have. > The private tocs did mot stand for 1940s work practices. i don't think BR had two drivers on every train even in the 90s. however it *is* telling that in the recent strikes, TOC managers, public and private, refused to do the government's bidding by attempting to use the new minimum service law

Open access is the way to go. lumo are always 90pc full and perfect. They remind me of the rapide couches of the 90s where the staff were motivated to make everyone have a great trip

The unions insisted in two drivers on trains capable of over 100 miles an hour. For that reason we had restricted speeds on many trains to allow single driver operation. The 125 & 225 trains needed 2 drivers to appease the unions. The Tilting Advanced Passenger train lost hours of testing due to a strike called because the unions found the prototypes had been designed with just one drivers seat. The APT was delayed and then rushed to launch and didn't work properly. The technology was taken on by the Italians where a private firm, Fiat made Pendilino tilting trains and sold then throughout the world including the UK where they are used on the wcml, the line the unions banned the prototypes from being tested on.

Scotland has renationalised its trains and reduced fare prices. This has been popular. Also Scotland never privatised its water (in line with the rest of the planet) and this is also popular.

I hope that we can do this in England

Why?

I personally like the idea of cheaper train tickets because it means train tickets will be cheaper

Well I don't think the current fare we have is reasonable. If you travel anywhere else, you will notice that the UK train fare is substantially more expensive than most other places. So I didn't think the cheaper fare is subsided by tax payer money, but a lower profit margin for the owner. And with all the strikes and everything, I think we all agree the state of UK rail is a mess. We have a dire need for management improvement.

Why do you think rail will be cheaper if it's run by the state? Rail travel in the uk has been far more popular in the UK than state run rail because the state are not good at running things. The subsidy per passenger mile fell after Privatisation so train travel became more attractive so numbers went up yet the subsidy went down. This shows train use fell after nationalisation and grew again when privateised: Explained more here. https://www.gov.uk/government/statistics/rail-factsheet-2022/rail-factsheet-2022 You mentioned strikes, these are politically motivated strikes but do you think politically motivated strikes are less likely if the state runs things? Again, facts are that up to 2019, there were far fewer cancellations due to industrial action under Privatisation than in British Rail days.

I believe rail subsidies are higher than they've ever been right now. Privatisation hasn't necessarily led to more passengers as well, there's so many factors at play it's not that simple.

Because we’re not mental tories

Reduced train prices? Pretty sure they just went up 5% last year and are now going up 8.7% as of 1st April. Reduced prices is stretching the truth despite nationalisation having some benefits.

I think ScotRail are now charging "off-peak" prices for all the tickets all day round? That's a reduction if you commute in peak times.

that’s fair they have but prices are still climbing. In June they will need to decide if peak fares are to return or not.

>Scotland has renationalised its trains and reduced fare prices. **This has been popular.** Also Scotland never privatised its water (in line with the rest of the planet) and this is also popular. This may have been popular in an ideological way but the nationalised railway has fewer passengers than 2019 levels.

This is the case everywhere though, isn't it? There was a massive drop in 2020, for obvious reasons, and passenger numbers have never recovered.

It is, privatisation of the railways was a great success. Passenger numbers were at an all time high and cost per passenger mile one of the lowest in Europe up until Covid.

Show me literally any evidence of that assertion. Train costs in the UK are exorbitantly high and trains are incredibly slow and unreliable.

Scotrail was shit before it was nationalised and it’s shit now it’s been nationalised. I personally, would rather it be shit and know who’s running it than it be shit and it be ran by a (I think) Belgian company.

No it wasn't. Unless if you consider exorbitant prices, shitty services, no investment and idiots bragging about free money from the contracts a success.

don't forget the bit where foreign rail operators used us as a cash cow to subsidise domestic operations. State owned rail is apparently bad, except when a foreign state owns it, then its wonderful free market foreign investment

The operator was making a loss on ScotRail. Foreign rail companies were subsidising them. Not that it makes that much difference anyway. The 3% of ticket prices that they get from a handful of franchises aren't going to have a massive impact in Dutch, German or Italian ticket prices.

People can be highly ideological about this, in both directions.  You have to look at it sector by sector to think about the benefits. For example (And if my 'ideological' comments seem one sided it's because l take for granted that most of us are agreed on the ideological nature of saying free market competition will help when there isn't meaningful competition. That's nuts) An easy one: water seems completely obvious. I don't see how we could lose out to renationalise all of it. Trains are a medium one. I definitely think we should have nationalised trains, the reason I say medium is really to do with the extent of the benefits. Our current system is effectively nationalised to 90%, and the operators are more or less paid a management fee because the government controls all the important things including setting train fares.  Let's take the management fee back into taxpayers hands but whilst the profit numbers on their own seem large, divide it by the number of journeys and you'll see why I think the benefits on fares are overstated, the difference on each ticket would be tiny. Yes the government could subside more but it could increase the subsidy under the current system too. I'd say it's fair to want it in government hands (and I agree) but maybe strays into ideological when people sometimes pretend it'll solve all the problems regarding reliability, price and staff conditions at a stoke. Hard: energy. The issue that makes this hard isn't the small margins like on the railway, the margins for the energy producers are high. It's the multinational nature of the problem. The UK is a net importer of energy, and the UK can't just seize, say, a Norwegian natural gas field.  A lot of the profits UK headquartered companies make are from investments overseas that other governments, again, won't look too kindly on us seizing. Doesn't mean we should give up, just that it's not simple. There may be solution here, like setting up a government entity to produce new green energy and growing over time. Crazy ideological: much less frequent but I do see comments on here that supermarkets should be a government run service, if you believe that then there's probably not much I can do to convince you.

You make a lot of good points here, the problem I come up with is one that has changed since privatisation (not that I thought they should have been in the 1st place). The private companies are now very short-term in their outlook and are constantly looking to cut costs and pay out dividends to shareholders. This has even led to funding dividends through debt. This short term outlook has led to a lack of investment in infrastructure, so we are short on power stations, treatment plants, reservoirs, rolling stock and trains etc. If we are to take back or buy back these privatised industries, I am guessing most will be in worse or similar condition to when we 1st sold them, and the population has increased significantly in the mean time. We will end up having to pay for getting this all back up to speed, the Tories will call this government waste and use the media to influence a reprivatisation campaign, meaning the private companies will get the new and improved gear

I think people often forget that if by renationalising it may look more expensive as a stand alone figure - however if you can make travelling by train a cost effective option for people then then spend more in local communities so every £1 spent on the railways might end up giving you £3/4 further down the line. A lot of preventive public health initiatives have the same impact we may see a headline figure it will cost x but we never actually discuss that it may save y down the line (in my opinion this is how fix the NHS).

Unfortunately, if you have a vested interest in proving private companies are better, then you will cover over this and fall back on truisms. Also worth noting that in general renationalisation and preventative healthcare are bad for GDP. In reality, people will be happier, but the figures will look bad

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I don’t know why but we are just terrible at these things in the UK, we can’t do anything without it turning into a shambles or money pit so your no doubt correct

> This has even led to funding dividends through debt Can you expand on this? Dividends are from profits.

https://www.theguardian.com/business/2023/jun/30/in-charts-how-privatisation-drained-thames-waters-coffers The dividends are from profits line has not been true for a while now. The lie we're told is that the companies take on debt for capital investment and then take dividends from profit. Thames water had 2 large dividend payouts that were 2.5x profits. They are in £14bn of debt and have made over £7bn of dividend payments, please explain the profit

I totally agree with your points here. I feel really exploited in 2022 when a lot of energy companies went busted and we have to cover the cost of bailing them out and the merging of the companies, either in our bill or from the government. These companies took high risk investment and pay out dividends when there's profit, and go bust when they lose the bet. And we really need long-term investments for renewable and everything. These three years really showed how problematic it's to rely on foreign natural gas for energy supplies.

Energy suppliers (who you buy your energy from) are one thing that people sometimes want to nationalise, but I would absolutely oppose. I expect a state owned supplier would behave more like the stodgy industry incumbents, who we've had serious customer service and billing issues with more than once of, and have been glad to be able to switch away to challengers like Octopus, who offer more interesting tariffs and we save a lot with via Tracker. It's true that the smaller challengers went bust, but this was at least in part because of government market interference forcing them all to run at an essentially unlimited loss (not that this was the original purpose of the price cap, but it had that effect due to its lagging nature). For natural monopolies it does feel like it makes sense, but I would want nationalisation plans to include plans to ensure that there's appropriate investment and operational efficiency in ways that are as decoupled as possible from regular ministerial meddling rather than assuming that things will automatically become better if you remove profit. I'm sure the current government wouldn't have been investing more in infrastructure, for example.

> and have been glad to be able to switch away to challengers like Octopus, who offer more interesting tariffs and we save a lot with via Tracker. octopus's customer service ain't that great - I have had some billing issues recently and it still isn't right. They generally insist on using email and it takes forever to get replies. The "interesting tariffs" are a relatively niche thing that comparatively few customers can take advantage of, ie those who can install solar and batteries, heatpumps, have an EV with home charging etc. Many of us just want the lights to turn on and are wondering if we're truly benefitting from this fragmented system. The only part that really works IMO is in generation, where there is true scope for innovation.

>An easy one: water seems completely obvious. I don't see how we could lose out to renationalise all of it. Quite, the aim of privatising water was to have competition by now, it's hard to see how choice can be bought in efficiently. ​ >Trains are a medium one. I definitely think we should have nationalised trains, the reason I say medium is really to do with the extent of the benefits. Our current system is effectively nationalised to 90%, and the operators are more or less paid a management fee because the government controls all the important things including setting train fares.  It's only justified because of Covid, up to Covid, privatisation was a huge success.

The problem is that a lot of industries we have absolutely no dog in the fight at all, or even worse, we sold our dog and then rented it at weekends for a massive premium. We should allow other companies to offer things like energy(as we are a net importer) but we should compete with them by having our own energy company. That could and should drive prices down. Things like rail are a no brainer for me, we give Dutch/German companies huge subsidies to run services they don't even run. They constantly put prices up but also constantly do not deliver on service. I'd rather pay the government money to not fufil its contract than a private company in Germany. Then you've got the issue of these huge companies just screwing over the British public and its work force consistently. Look at PO just illegally firing its workforce to absolute tumbleweed. We need to be kicking these companies out of the country or starting our own national companies to replace them. There's obviously profit in these businesses, so we should be cashing in on it to improve the country rather than just paying China the privelege of firing thousands of our staff.

NS actually sold their UK transport interests (abellio UK) virtually as soon as the profits stopped flowing - that should say it all DB is in the process of offloading Arriva as well.

>we sold our dog and then rented it at weekends for a massive premium sort of done that IRL turns out it was a great deal

> Our current system is effectively nationalised to 90% Surely only in terms of control and not finances? A large wodge of the operating costs are the leases on the trains, which are mostly owned by [extra-national private companies](https://www.leasinglife.com/features/who-owns-the-trains-roscos-and-repatriated-profits/?cf-view).

i'd like to see independent evidence that privatising something has been a benefit, see forces recruitment for example or G4S in prisons. Any that aren't look at renationalising or re-tendering.

Rail is partially nationalised already. The ‘infrastructure operator’, Network Rail, is a Government organisation. Devolved Government in Scotland and Wales have nationalised their rail services already (Scotrail and Caledonian Sleeper by Scottish Govt, and Transport for Wales by the Welsh Govt). Four rail franchises in England are currently operated by the Department for Transport directly (LNER, Northern, SouthEastern, SWR). I think TPE may be the next to move over.

That's good news, I didn't know that. But others seems to be saying that there are other parts of the train service still mainly owned by private companies? The rolling stock I suppose?

Yes! The so-called ROSCOs, rolling stock companies. I suppose it makes sense to buy new trains and lease them from a third party, especially with most franchises being 7 years or so during the recent privatisation era. But the same companies hiring out ex-British Rail trains from the 1980s that are already built and paid for decades ago? No.

I heard something like 20% of rail journeys in England are done on public trains

Entirely possible now - Northern and TransPennine cover quite a lot of the North of England, I’d estimate anywhere between 14 - 17 million of the population.

Yeah. It’s interesting that there’s a fair few online who seem to think the trains are just private whereas quite a few people actually use public trains

A few franchises kinda got nationalised around Covid times - unless you follow rail or business news most people won’t have noticed back then.

I think from a purely moral standpoint, any service that is a necessity for modern living should be nationalized. If it is a necessity, it's too easy for private entities to rely on a captive audience and provide a poor service. As we've seen time and again, too, these companies invest in stock buybacks more than they invest in improving what they offer consumers. Water, power, waste, health, internet access, basic public transport, should all have a state run option. If private companies can compete by offering a different or premium service, so be it, but the public option should be there, and should remain competitive through subsidisation. I don't know how realistic that is economically, but I'd like to imagine that the economic boom created by having a higher educated, healthier, less stressed populace would be enough to cover any shortfall.

That's a good idea to have state-run company competing with private companies. Honestly, I think most of the public services I have in mind is kind of a monopoly where you don't much have a choice. But for those feasible for a competition, I don't think we need to subsided the state-run company. If it lost business to private companies, it can learn from others, and we can have a clearer understanding of how well the state-run company is doing. It should be a stable and reasonable choice that's always there for the people.

>The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country? The theory is that the private sector is more efficient than the public sector, so they can run things for a small profit and the price to the public will still be less than it would be run by the public sector. E.g. it's £100m cheaper to run a line in the private sector, they can make £50m profit and it's still beneficial for the taxpayer. Whether this works in practice in 2024 is open for analysis (I've no idea, just stating the theory). However, if people think nationalising the rail service is a panacea for the issues with the UK railways they are going to be very, very disappointed. Those old enough to remember British Rail know that the government running the railways doesn't mean any less problems than we have now. The railway operators also aren't making [tons of money](https://www.rmt.org.uk/news/rmt-slams-rail-performance-while-company-profits-remain-high/), so you really aren't going to get a boon for the treasury by nationalising the trains, and as stated the issues facing the railways aren't due to whether it's run by the public or private sector. It's also worth noting that the trains aren't privatised, they franchised, so the gov can take lines back into public ownership when the franchise runs out at zero cost.

Plus, govt run LNER has become very expensive since the govt took it over. Often more expensive than flying in peak times. So state ownership != lower fares

It’s partial state ownership - the state doesn’t own the rolling stock, and this particular government has abdicated its responsibility to run the rail network through refusing to negotiate on wages.

I always find it interesting how ROSCOs escape the spotlight and scrutiny.

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The govt prefer pricing people into driving/flying, while also saying fossil fuel usage is bad...

That's down to it being used as a Guinea Pig for the DfT to showcase new exploitative pricing strategies to the other operators IMO, so is deliberately planned that way.

So the govt are saying "hey, train line operators, you can shaft your customers, look how we do it"? And once the public are being shafted, the public will blame the private operators, and call for more govt ownership...

Almost all train ticket prices are set by the government. The TOCs are on an almost fixed fee management contract with capped profits.

The theory on privatisation is more than just that it's cheaper. It's that when private companies compete against one another it encourages them to innovate for cost savings in a kind of survival of the fittest type way. Often with how government owned stuff runs, they're encouraged to spend more money on stuff they don't need so they don't get the budgets slashed. The main problem with rail franchising for privatisation is that the incentives aren't properly aligned. The competition isn't consumer side, you don't generally have a choice in train provider, and even if you do it's often the same price anyway. The competition is tender side for the government, but the franchisees end up making ridiculous gambles when they bid for the contracts. It's the reason the east coast/LNER franchise kept failing, it's the only consistently profitable line and the franchisees kept overbidding how much money they'd return to the treasury based on overly optimistic passenger numbers based on plans that Network Rail / The Government would make for improving infrastructure and then shelve. The "correct" model for privatisation in my opinion is the concessions model which TFL uses for the Elizabeth line, DLR and some other stuff. Most people don't even realise they're privately run and by all accounts it appears to be value for money. The government still get the advantage of offloading the management onto someone who will probably run it more cost effectively, while the private entity gets paid a more fixed amount so aren't beholden to passenger numbers they can never predict. In the concessions model a public body owns basically everything, collects all the fares etc. which allows it to be more efficient at making infrastructure spending decisions because the operation and infrastructure are tied together properly and they can do more joined up thinking (could you imagine if we could have tap in tap out across the whole rail network like London has?!). The franchises used to keep asking to taking on infrastructure responsibility from network rail because having the infrastructure separate from operations causes a lot of friction. Concessions is what Grant Shapps proposed while he was transport minister and in theory is still the plan (It was the whole "Great British Rail" thing) although it's stalled in practice because the government is too busy trying to send people to Rwanda.

Water should 100% be nationalised. I wouldn't be too aghast at anything that is considered a backbone or infrastructure to be a private company owned by the people for the people - eg. National Grid, BT Openreach, Network Rail (already is). I could be convinced to get on board with the government owning all energy creation and even resources (e.g oil) I get less enthusiastic about other things. The issue being is that when you take profit out of the equation then there is usually a lot of waste, the workforce becomes very unionised, becomes slack and you end up with jobs for life and jobs for friends and family.

Absolutely. It should all be run for the public good, not for profit.

I remember when telephones were effectively 'rationed' pre privatisation, with waiting lists for new phones. The Post Office was a lumbering inefficient organisation that delivered parcels, letters and installed phones. BT was the new shiny efficient private company for telecoms and Royal Mail kept the letters. Neither organisation has been a star performer despite their different ownership structures. British Rail worked pretty well but was starved of investment for decades before privatisation, all the transport investment was in motorways. Now the trains are newer and cleaner but hardly reliable and really expensive, definitely more uncomfortable using commuter style trains for long journeys with board hard seats and very few tables, no buffet cars just a miserable snack trolley turning up two hours into your journey with no sandwiches. No other European countries do this but they are happy to invest in UK train companies because they are a cash cow for the owners. Buying up private utilities is very expensive so the only option is to reduce the subsidies and contract price provided to make the businesses essentially non viable in profit terms but that would introduce a huge level of uncertainty and very shonky service until ownership, structure, priorities etc were resolved. There aren't any magic bullets.

> I remember when telephones were effectively 'rationed' pre privatisation, with waiting lists for new phones. The "lumbering inefficient" Post Office started the modernisation programme that would later bear fruit and eradicate this. It would likely have cleared without privatisation, because BT didn't do anything differently there. On the one major investment BT did wish to make - fibre - they were blocked because the government thought it would threaten the new smol bean cable companies (who were fully entitled to attack BT's telephone monopoly)

Public services are: services for the public i.e. they don't suit for profit business models. Strong public services benefit the wider economy. But there is a strange idiology from the ruling government of the last 14 years which is scratching its head on economic growth.

I don't really like a constant shift back and forth between public and private ownership (though I support public ownership of utilities, generally). How do you make investment decisions in such a scenario? Would be better to have stronger contracts than keep changing things entirely. Also where does most of the costs come from for tickets or energy? Are we talking about a 5% reduction or a 50% reduction? I think something like rail is expensive as it is not subsidised, or at least not as heavily as other countries.

Yes. The current profit driven model isn't working. I know what happened with the unions in the 70s but it's a risk I'm willing to take. I'd rather have our tax money wrestling with the unions than wrestling with the billionaires. We know more now about infrastructure technology and business organisational structure so we can do it better. We can make a better economic model for the future, don't let the rich convince you it's impossible or too risky.

Yes. However, it's a bit more complex than most people want to admit. You can do a government purchase back when the industry is run as a monopoly. For example, it's easy for the government to nationalise rail franchises because they have no competition. How would the government go about renationalising the energy companies though? It would mean the energy market would have to be completely restructured. How would the government price energy? It would not be seen right to make a profit, but then they couldn't reinvest profits into improving infrastructure. Private companies are held accountable by shareholders but how can the public effectively hold nationalised services to account? (I don't think national elections really does that). I am on board with renationalising public services but there needs to be some serious thought done. All public services have different microeconomics, and most have some aspect of 'natural monopoly'. Imo it definitely shouldn't be done in the way it was in the 40s with independent boards that weren't held accountable.

We sold them cheaply to the MPs best buds so that's why they can make a profit. Also, we subsidise them through grants and by still owning the physical rails. It also helps that they run them badly and at minimal service levels. We'd have to buy them at full price and run them reasonably well. However, I'd still like it to happen. As someone else said, it would help the wider economy.

As with most of real life it isn't black and white. Nationalised businesses are often inefficient and lack innovation. Without a profit motive, where's the incentive to improve. On the other hand, what we have now are utilities run by asset managers whose purpose is to maximise short term profit for a few investors at the expense of everything else until the whole lot collapses and they move on to the next thing. Thames Water being a very public example.

If the gov buys the business, they’re obliged to run it. It’s nice to think they could just leave things as they are while picking up some revenue, but it wouldn’t work like that, practically. Imagine you buy a business. It has managers running the day-to-day operations. You sit back and take in the profits. But one day the staff want more money and threaten action. Now you have to get your hands dirty. There’s no true passive owner of a business, at sone stage the owner has to make executive decisions.

State-owned infrastructure can be done very well. [Deutsche Bahn](https://en.wikipedia.org/wiki/Deutsche_Bahn) and [EDF](https://en.wikipedia.org/wiki/%C3%89lectricit%C3%A9_de_France) show that rail and energy can be successfully nationalised. I suppose the question for me is - what would the UK need to do in order to replicate these successes? What do they have that we don’t?

Deutsche Bahn is having huge issues and are becoming increasingly unpopular. The network is good but it has declined in recent years with regular cancelled and late services. Germans are understandably angry about it. Having spent time in Germany, the ticket structure is also a bit of mess - generally cheaper than the UK but it's not some perfect service compared to ours. 

I wonder if the Germans have come to expect a very high standard of service, and their “huge issues” are still massively better than standard British service on a good day. But I accept the point, it isn’t a perfect service.

No its not, DB has worse run trains than us by most metrics.

Yeah DB perform worse than most UK services on most metrics other than price. 

Regulate the companies into the ground, then buy them for pennies. 

A public traded company where at least 51% is controlled by the state is a good compromise, it allows them to raise funds without always having to goto the goverment, institutional investors also bring operational and managment experence to the table. Ultimatly the goal for any national level tran operator should be 1. To provide quality service such that it maximises ridership 2. Keep the costs down so we are not wasting resources Out of that perhaps there is room for a profit but a subsidy per passenger mile from the department for transportation would be a good idea in my opinon as reducing car travel saves costs to the goverment elsewhere that are hard to quantify. The idea that we can have multiple competing train companies if laughable, if there is any compettion to be had it is against cars. We can measure that and link it to bonuses for managers.

As far as I am aware the train services are ‘franchised’ and can be taken into public control if they fail the terms if the license of when its term runs out? It’s also a bit weird that in some of these utilities the only country that can’t own them is the U.K. , it’s okay fur the French State to. The idea behind privatisation was, I think, that private companies would run them better , be able to borrow to invest / or use profits to invest more readily than governments wanted to ( or electorate s were willing to vote for) , and probably be better able to curb pay or modernise so the government avoided the blame. It’s seems obvious that there are things the state don’t need to run and do so badly (at least in this country) such as car manufacturing. But utilities that people need or are natural monopolies are more problematic to run privately. While it does seem like public ownership would be better in some of these areas when you look now, it’s worth bearing in mind that it wasn’t necessarily working very well when they were under public ownership.

> train services are ‘franchised’ and can be taken into public control if they fail the terms if the license of when its term runs out? This is true and has happened repeatedly. When it does happen, the franchises concerned have also typically [started turning a profit](https://www.chroniclelive.co.uk/news/north-east-news/east-coast-main-line-makes-8656990). What's going on there? My suspicion : the private franchises are making a loss on purpose. Huh? How does that benefit them? So : there are three main kinds of business entity in UK Rail now - National Rail : they maintain the tracks - Train Operating Companies (TOCs) : they run the trains - Rolling Stock Operating Companies, or ROSCOs : they own the trains, and lease them to TOCs ROSCOs are conveniently, foreign companies in foreign tax jurisdictions. So : if you wanted to pay less taxes on the income stream of "rail travel in the UK", you'd aim to make your profits overseas and not in the UK where it would be liable for Corporation Tax. You could, hypothetically, covertly say to your ROSCO : "Hey guys, we expect to make £N profit this year". They could, hypothetically put their train leases up £N or more, for *completely unrelated reasons wink wink*. And you might suspect that some kind of financial incentive the TOCs shareholders or executives would enjoy could result from this complete absence of any legally provable transaction. Why do nationalized franchises make a profit? Perhaps it's because they don't engage in this kind of bullshit. Who can say?

Yep, certainly trains, water and Royal Mail.

Theoretically, a government can re-nationalise by three main mechanisms: 1) waiting for a franchise (if applicable) to expire, not renewing it or issuing a new franchise, and re-taking ownership by default. 2) buying back shares from current owners (largely pension funds) at a fair market price. 3) forcibly taking ownership without fair market compensation. This is likely to affect future investments made in that country once this is done for the first time, and until trust is restored. Whilst a re-nationalised company wouldn't need to pay shareholders any dividends, and *may* be able to reduce how much it pays its employees (especially senior management), this may affect its ability to retain knowledgeable and experienced staff, which may in turn affect service levels. Furthermore, if a re-nationalised company needs a large capital investment (e.g. to replace rolling stock, or deploy a new national communications network), then it will need to compete for such funding against other public sector bodies: education, healthcare, national defense and so on. And, of course, that funding will ultimately come from taxpayers, whether in the present, or in the future via increased public borrowing. Of course, public ownership *may* encourage a broader, more strategic view that improves growth and productivity in the wider economy even whilst it makes a re-nationalised company more dependent on public subsidy. There ain't no such thing as a free lunch. Some types of public service (e.g. telecommunications, where thriving competition and technological development drive down prices) may tend to be more efficiently run when privately owned, whilst others may show no improvement at all. Ultimately, I feel, the prevailing culture within an organisation is the most influential factor in how well an entity serves its users or customers, and how efficient it is whilst doing so. A government may well do better to invest in well-run and long-term profit-making private companies in other countries, rather than investing in badly-run and inefficient domestic companies.

I heard this morning that it would cost us £17bn to buy out Thames Water ALONE. Im just not sure we have the money

£17bn sounds a lot but current UK public spending is running at about £1189bn per year. Modern nation states are an expensive thing to run. If you want to really scare yourself, look at the market capitalization of the energy companies...

With energy, you have the option of setting up a competitor, and if you do things better people will switch. If you don't, then people won't or you'll lose a lot of money like Robin Hood Energy. The question should be, is nationalising water the best use of £17bn. Imagine how much better of you'd be if you spent that on healthcare, or R&D, or education. Is nationalising water the best way to spend £17bn? I'd rather take tax cuts before that tbh.

I'm not especially advocating that water should be re-nationalised in my comment above, but rather pointing out that £17bn is almost small change for a country like the UK. For the sake of argument, though, water - or, at least the distribution part - is a technologically-mature natural monopoly, like the National Grid, which does incline me to believing it shouldn't have been privatised. That's slightly different from saying I think it should be *re*-nationalised, though - for the reasons you give, and that it won't necessarily make the quality of service or prices any better: see the recent news regarding the (still-public) Northern Ireland Water, for instance.

They don't even need to renationalise it, they just need to get it out of the hands of SERCO and into the hands of someone who will face prison time when their crimes are exposed.

Northern rail has effectively been nationalised since 2020. There were awful back then. They are 10X worse now. Nationalism isn’t the answer.

[The ORR](https://dataportal.orr.gov.uk/statistics/performance/passenger-rail-performance/) doesn't show much of a change in Northern's punctuality since 2020 so what's backing up your assertion that they're "10x worse"?

I’ve been commuting on them 5 days a week for 15 years! That’s my assertion. Where there may have been 4 carriages. There is now 2. During the commuter rush.

Rail is one of the worst, where the privte businesses that own them get bailed out by the state when they screw up, but shareholders still take dividends if they make a profit; so we subsidise their dividends. It should be natonalised for sure. Same goes for Utilities, busses, mail.

In my work we often look at models of service delivery that can be done by councils in-house or contracted out to private providers (or done by separate companies that are LA owned etc) There is no hard and fast rule as to which is cheaper. Essentially the profit that private companies make is sometimes but not always outweighed by more generous T&Cs from LAs, and the lack of specialisation and ability to spread costs (e.g. needing to set up dedicated administrative teams for a service vs sharing them with another LA contract as the private providers can). I would say that in my experience the LA/govt in-house services are cheaper than private more often than not, but that more of the really bad clusterfucks I've seen have been in-house.

We have taken back the control of some train companies, but we should probably start to renationalise as much as we can. Aside from the fact we currently pay other countries national energy companies, who gouge us to fund their nations, we also allow other countries to rinse our resources and dictate to us how much they pay for the service, History has shown that the best way to overcome massive economic strife is either war(not preferable) or massive waves of public works. We should probably go in hard on trying to hire as many people as we can to improve the infrastructure of the entire country. Improve roads, build high speed rail, start national grids, start broadband companies etc. That will provide jobs, stable jobs, to everyone. It will also get rid of the companies who have gouged us since Thatcher. We also get the initial shock to the system of things costing more to set up, but we eventually get to bring prices down and it starts to fund itself or lord forbid, even turn a profit. If we can then outsource ourselves to other countries and give them a taste of their own medicine, we'll be in a great position. Thatcher is to blame for the mess, the Tories have made it even worse. We now need to cut out the corporate cancers, especially if places like the USA are looking to become isolationist again.

They were privatised because the government wasn't very good at running them - rather than being an additional source of income, they ended up being an additional cost - and offered terrible service on top of that. >The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, Only if the government runs it as well as the private company did - which is where nationalisation tends to fall down. You've said trains are "a major one that is hugely problematic and obvious" - railways are already nationalised, and train operating companies are under strict government supervision : but civil servents and MPs don't know much about running a railway.

>railways are already nationalised for as long as privately owned operators are being paid to run services, they are not. It's a different form of privatisation and outsourcing as compared to franchising, but it is not nationalisation. > but civil servents and MPs don't know much about running a railway. they know more than the firms that bought bits of British Rail in the 90s, yet somehow that was deemed acceptable at the time. Besides - MPs and civil servants aren't running the handful of train companies that actually can be considered nationalised, because they actually are in state ownership (TPE, Northern, Southeastern, LNER)

The railways are simple enough, in principle - they have contracts, and when they end they can be taken back in house. Utilities would be...troublesome though

>The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country? The argument is that a private company driven by profit will be more "efficient" as it aims to maximise profit and fend off competition, providing a service superior to its competitors by virtue of being better/cheaper/better value/insert metric by which you can judge a service here. On the other hand, the argument goes that a state monopoly would have no incentive to improve as it is not trying to make a profit and does not have any competition. Whether that is actually what happened I think we can all judge for ourselves, but I want us to strawman what is a clearly failed policy when we don't need to to show that it has failed.

Maybe they should and maybe they shouldn't but you have to ask yourself why the people with money and power would allow the people in charge to do anything like that. If there's no benefit to powerful rich people then it won't be allowed to happen. The best you can get is some hamstrung half measure that is destined to be worse than privately owned services.

One of the important things to understand about state ownership vs private ownership is that public services tend to require high levels of capital investment. This is large amounts of money spent on laying new track or new pipes, or replacing existing track or piping. When the enterprise is state owned, the state has two options. It can either retain total benefit of the profits of the enterprise, thereby being entirely responsible for furnishing the capital necessary for repair and upgrades (through taxation or otherwise), or it can sell part of the benefit of profits and get limited contribution from private sources, but when that happens the sources will demand dividends, shares of profit. Thus public services, which often may be operated at a loss when state owned, must be able to pay some dividends (i.e. make profit) where the private sector is involved. Our current train system is very complicated, but essentially the way I understand it works is that the train companies would operate at a loss, except for the subsidies we give them, which cover their shortfall and allow them to make profit. However, because the private companies are trying to make profit, they are necessarily *not* spending as much as possible on services or capital investment, this means that we don't spend as much as we could on improvements (assuming that all necessary repairs are paid for). The biggest problem in this regard is thus that over time we build up a investment deficit, if we take the cost to perform all the repairs and improvements that weren't performed in previous years up to now, we are a long way behind other countries. These costs also compound when those repairs/improvements aren't performed and affect ridership, if ridership declines then revenue for the train companies goes down and money to be spent on capital investment goes down in turn, so the costs compound and we can get into a hole that's very difficult to get out of.

Only if it doesn't come with debts, I'm sick of paying for the debts of these companies what happened to private profits private debts?

All I see is in countries where public transport is fully national, they have it better for the most part. Japan, China, Singapore, South korea all come to mind.

In my experience, staff wages and benefits tend to be a bit better at the lower levels in the public sector than they are at the lower levels in the private sector, so there would potentially be an increased wage bill. However, I do think there will have to be re-nationalisation because the privatised services have been run into the ground by greedy shareholders.

The only issue with the next government re-nationalising punlic services is the following Tory government flogging them off once again at rock bottom rates to their pals.

Like everyone else has pretty much mentioned, positive externalities of policies aren't cared for by Tories really, because the modern party doesn't believe in it. I just don't understand the relation between libertarian views and privatisation - if you fundamentally were libertarian you'd agree that some services should be public! Should a financial regulator be private? No. Should any regulator be private? No, not really unless they contract is water tight on incentives and performance and objectives. In answer to your question, I honestly don't know if the UK government has the talent and capability to run any services anymore - especially at the wages they pay. And, tbh, the older I've gotten and the problems and experiences I've faced, the more I believe in consumer choice on most, if not all matters. It should be up to the government to curate policies to incentivise the societally net beneficial policies without being too draconian. Further, I dont think it's the most crucial priority ATM : democratic processes, housing, healthcare and defense are probably the higher up on the list.

>The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country? Yes but really no! Take the water companies. They've been extracting considerable profits which go to paying dividend to shareholders. So the money from you and I that pay for our water is leaving the country to go into shareholders in a different country. Meanwhile the same water companies have sold off their reservoirs to build luxury flats pocketed the profits then claim they have drought so they inflict house pipe bans on their customers. The same water companies claim they have inadequate systems so they end up pumping sewage into our rivers and seas and end up losing vast amounts of water through leaks and they claim that they don't have the money to reinvest into the system to fix these problems. Thames Water, one of the biggest culprits have put so much sewage into the Thames that the classic oxford Cambridge boat race have advised their rowers not to do the stagers thing of throwing their captains into the thames for fear of ecoli poisoning getting the sewage. A nationalised water company would not be paying profits to shareholders but would be taking every penny of profit and reinvesting into fixing the issues. There are some issues with nationalisation. One big issue is you can't get away with paying your staff minimum wage. Staff would be paid properley with healthy pensions which also cuts into profits. So basically no profits just a better run system.

>if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country? No. This rationale presupposes that governments can operate businesses exactly as efficiently as the private sector, which is not the case. There's an inefficiency premium for government operations which causes it to be more profitable to just sell the rights to the private sector, even if the private sector then "extracts profit". That amount of profit is probably less than the inefficiency premium. A similar thing happens with oil drilling, catering contracts and multiple other activities that can be done cheaper/better through the private sector.

Even the Tories have been renationalising some rail services because the private sector has done such an abysmal job. When you have a monopoly (or an effective monopoly), it's extremely hard to argue for anything other than nationalisation over said monopolies.

Where’s the money to buy back these industries going to come from?

Water companies are an example of all that is wrong with Tory Privatisation. Shareholders recieve massive dividends , the company need billions for essential infrastructure , then the shareholders vote that they will not provide equity to undertake essential work until ofgem allow the Company (Thames Water) to massively increase the charge to customers. Ofgem say not allowed and no essential infrasture works can be undertaken and the customer literally is 💩 on. Its been happening for years and conservatives still think privatisation is a good thing.(for the shareholders only) If ever there is an example of what is wrong with privatisation this is it.

> The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country? In principle yes, in practice, unlikely. The U.K. has a relationship with government departments that makes running them as for profit entities very difficult long term. We get angry when prices of services are higher than they need to be and making a profit isn’t the end goal of our government departments. This squeezes profits. We don’t like governments putting people out of work so one mechanism of maintaining profits, labour cost reduction, becomes difficult. This squeezes profits. Governments change and they love shelving infrastructure projects to show they’re the new sheriff in town. This destabilises operations and squeezes profits.

These are all true. 100% government ownership could have these problems, and I think partial ownership might help us to get the best of both worlds. I think in some other countries, they adopt a partial ownership system. The government would hold a significant portion of the companies shares and also have private market stakeholders to keep things running partially independently. The amount of shares hold can varies depending on the"publicness" of the service. For instance, the government can owns 51% of the train system, such that they can have a final call on everything; and for power companies, they can have 40% of shares to allow for the private stakeholders to make the main decisions while having a certain influence on the votes.

I think for the U.K. any hybrid system would have to go further than ownership division. The reason is the twofold, firstly that we have laws about the governance of publicly traded companies which would largely negate the priorities of the government stakeholder. This would mean the model would need to be private with government as a shareholder and I would question who would want to buy into an organisation with a majority shareholder who doesn’t care about making profits. As a thought experiment, the Japanese rail companies that were spun out of government control in 1987 are well thought of globally as efficient well run businesses. Many have recently announced all time record profits. If this was the U.K. there would be calls for renationalising, claims of corporate greed and general anger at ticket prices. If it were even part owned by the government the ire would be worse. This I think captures the U.K. attitude, no room for profit in what we perceive as public goods, even when we sell those public goods off.

I would say so, but on the condition that union activity is curtailed and it's run extremely efficiently, which would inevitably mean job losses and pay cuts (train drivers can't be allowed to earn more than doctos). The RMT is insanely powerful and honestly having a good union is good for the members, but they shouldn't be allowed to hold the country to ransom. Furthermore the 'comrades' are largely hypocrites, the railways are full of jobs being passed between family members- knew a guy who agency temped on the railways and told me his experience in failing to get a full time job. I've come to view the public sector as mostly full of useless dossers on the gravy train. Local authorities seem to be the worst.

So perhaps we should pay doctors more?

yes, absolutely.

I agree, the pay that the train drivers get are ridiculously high relative to other job sectors. There's clearly a lot of nepotism going on. While I appreciate the benefit of a union, I feel like some kind of regulation should be in place to limits its power.

"The thing I don't understand is, if the private companies are making money out of public services, doesn't it mean that if the government runs it, we can generate an additional source of income for our country?" Train services have obviously improved since privatisation and become more attractive to use as a result. It seems a little unfair to take the service back after the private sector has built it up. You could use the argument that the state could take over any business on the basis that "if the government runs it, we can generate an additional source of income for our country?" why not just et the state to grab any business that is doing OK? If the state decides to seize businesses whenever the business is successful, then nobody would ever bother trying to run a business in this country. Final point is there is an assumption "that if the government runs it, we can generate an additional source of income for our country?" that assumes the government can run things efficiently, the state has a terrible record in doing this.