£75 million wasted on rail franchising since 2003

RAIL UNION RMT today slammed the government for “presiding over a culture of private waste” on the railways after new figures obtained by RMT parliamentary convenor John McDonnell revealed that the cost of designing and tendering rail franchises since 2003 is a staggering £75 million.

In a series of parliamentary questions John McDonnell had attempted to find out the full costs of franchising since privatisation in 1996. Incredibly, the government have been unable to provide financial information between 1996 and 2003 but in a parliamentary answer transport minister Chris Mole has confirmed that the price of private rail franchising to the public purse between 2003-2005 was £42.4 million and between 2005-2009 was £33.8 million.

RMT have released the new financial information exactly two months after the East Coast Mainline franchise was seized back from National Express and taken in to public ownership. The union have renewed their call for an end to the “expense, waste, disruption and fragmentation of rail privatisation.”

RMT General Secretary Bob Crow said:

Tens of millions of pounds that could have been invested in the rail network has been squandered on drawing up and tendering train operating franchises. When you add in the hundreds of millions soaked up in public subsidies by the train operating companies, and the huge amounts extracted from the system in profits, dividends and bonuses, we can see the epic scale of the publicly-funded rip off which is rail privatisation.

While precious resources are being wasted on propping up the failed policy of rail privatisation nearly 1500 safety-critical rail maintenance jobs are being threatened with the axe. That’s the distorted priorities of the current UK rail system – unlimited funds to keep privatisation afloat while safety is compromised out on the tracks in a dash for cuts.”



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