As Britain’s Labour Party closes the gap with its Conservative rivals in the June 8th general election, there’s at least one part of the party’s platform that’s widely popular: nationalizing the railways.
According to the party’s manifesto, a Labour government would end the outsourcing of passenger services to private companies, a practice that began in 1994. The idea might seem complex and expensive, but it has become a significant feature of Britain’s current election campaign—and it’s an idea that many U.K. citizens seem to like a lot: A recent survey found 52 percent of respondents favored renationalization, versus 22 percent against. That makes the idea currently more popular than the party that proposed it. [...]
The short answer is yes, the long answer is maybe. A state takeover might be easier than it sounds, because Britain’s train companies aren’t truly private enterprises. Britain’s railways currently have a fiddly, tripartite structure that already mixes public and private ownership. In a vital difference from the United States, the tracks are still owned by the state, via a body called Network Rail. The trains are owned by private companies known as ROSCOs, or rolling stock companies. Actual passenger services, meanwhile, are run by another set of private companies, including Virgin Trains, Arriva UK Trains, and Abellio ScotRail, among others who bid to run services on five- to seven-year leases granted by the government. [...]
There’s also a curious trans-European twist to Britain’s privatized rail system. Many of the passenger companies are joint ventures with, or offshoots of, European rail companies that remain in public hands. Arriva Trains, for example, is owned by Germany’s Deutsche Bahn, while Abellio Scotrail is a subsidiary of Dutch national carrier Nederlandse Spoorwegen. Both of these companies charge lower fares in their domestic market (despite Britain’s flexible pricing offering some bargains) leading to accusations that profits skimmed from privatized British rail are essentially a subsidy for more affordable public fares on the European mainland.
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