‘A Very Costly Industry’: The cost of Britain’s privatised railway

Abstract

reposit] 'A Very Costly Industry': the cost of Britain's privatised railway ABSTRACT 'A Very Costly Industry': the cost of Britain's privatised railway This paper is concerned with the financial performance of the British passenger rail industry since privatisation in the mid-1990s. This experiment, which not merely transferred a state-owned and fully integrated industry into the private sector, but dismantled it into over 100 separate entities, has generated considerable and highly critical academic literature. A major contention of this literature is that, contrary to the predictions of its proponents, privatisation has largely failed to improve efficiency and has actually increased costs, or more exactly, costs are higher than they would have been, had privatisation not taken place. However, although various writers have put forward diverse arguments to support this position, robust data on the overall costs of the (now highly fragmented) industry have been lacking. Further, a proper assessment of the additional costs (or otherwise) of privatisation can only be made in light of 'counterfactual' estimates (necessarily speculative) of the costs of the state-run industry if privatisation had not occurred. This paper aims to fill this literature gap by: (1) constructing a robust series of the overall operating costs of British passenger rail services since privatisation, (2) projecting, using reasonable assumptions, what operating costs would have been if privatisation not taken place, and (3) estimating the increase in such costs arising since privatisation. The results, whilst they can only be broadly indicative, are nevertheless clear. Even after conservative assumptions, rail privatisation has resulted in considerable additional costs: it was a major public policy error.

A new perspective on personas and customer journey maps: Proposing systemic UX

“…In terms of this specific environment, with a wealth of challenges and criticism currently surroundings issues in rail transport, much of the blame is being placed on the corporatisation of what was once a nationalised sphere. Calculations of costs and benefits guided the British rail privatisation programme, a project with questionable results (Jupe and Funnell, 2017;McCartney and Stittle, 2017). By using a utilitarian approach, it was given the diverse components of the industry accounting values, and entrepreneurial freedom was seen as the solution to bring about improvements to the industry.…”

Transforming the public sector: 1998–2018

“…Within a continued interest in government, there has been research which can be regarded as innovative. This includes work on the effectiveness of government policy as cost saving, specifically in the context of the UK railways (McCartney and Stittle, 2017); the global financial crisis which triggered the Great Recession from 2010 onwards which attracted scholars who worked on the special case of Greek financial crisis (Morales et al, 2014) and the Actor-network theory (Latour, 1987) Lowe ( 2000) Bourdieu (Wacquant, 1992) Kurunmaki (1999) The system of professions (Abbott, 1988) Kurunmaki ( 2004) Mythology (Barthes, 1973) Froud et al (1998) Social forces model (Burchell et al, 1980) Jones and Mellett (2007) Stakeholder theory Scott et al (2003) Habermas (Broadbent and Laughlin, 1997) Van Peursem (1999) Theoretical pluralism: Dual reference points 1. Risk (Beck, 1992) and identity (Giddens, 1998) 2.…”

Transforming the Public Sector

“…It also includes the Habermas et al, (2012) study of Austrian universities which is informed by NPM and accountingization. Also, the study by McCartney and Stittle (2017) is pure NPM (an assessment of the effects of privatisation) but NPM is not mentioned in this paper.…”

“…The McCartney and Stittle (2017) paper is a significant innovation because it identifies a major public sector policy (rail privatisation in the UK) as a costly failure. Turning to government accounting, Becker et al (2014) examine the reconfiguring of the identities of public sector accountants in the shift from cash to accrual accounting.…”