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- Oct 5, 2019
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Well Scotrail is certainly not run for profit, as the most subsidised rail company in the UK. But you're assuming it's a zero-sum game, when I gave an example above of how "maximum value" (and more reliable trains) came from a private company making borrowings that a nationalised company would not be allowed to do.I would much rather they were run not for profit to ensure maximum value for customers and investment in rolling stock.
So how much competition is there when the government runs things?No I am not a communist far from it I believe in free competition.
Well that's partly a question of capacity - there are routes in England where there is direct competition between companies. But the real problem in Scotland is that ticket sales account for just 22% of running costs so there's no way to have fair competition as Scotrail is so massively subsidised, in fact it's the most subsidised train operating company in the UK accounting for 16% of all TOC subsidies.Problem is you very rarely have a choice of what train or bus company to use. There is no competition to keep them honest so for me not for profit or public ownership is a better option.
But actually the point of franchising was to try and introduce competition into a natural near-monopoly. Even if it's not practical for customers to choose different trains on the platform, there was still competition for the right to run the service in the first place. The problem was that as Holden described, it got too competitive (and government was being too restrictive) and there was <2% profit to be had, so companies weren't interested in the competition.
Sorry - no, you were very clear "Making profits from essential public services is morally wrong". Not much room for debate there. The fish fingers or biros can be provided more cheaply to the taxpayer if they're provided at cost, so surely that's what you want them to do?Your analogy of fish fingers or biros no issue with free market competition provided it's value for the taxpayer.
Whereas I would recognise that it's just not very efficient to have everything provided by the state, just as there's some things that are best done only by the state (like operating nuclear weapons), for me it's just about finding the best option for each situation rather than being dogmatic about it.
And just to be clear - I just want what works best, regardless of whether it is done by the state or private sector or something in between. But what I would say is that I do have a massive bias towards things being decided locally, a lot of the problems from nationalisation and privatisation come from over-centralisation and remoteness from customers.
Scotrail may not be perfect, it may take £697m/year in subsidy, but at least that's Scotland's choice to do rather than spending the money on eg dualling the A9, which at the current rate of a mile per year may be done by 2090, when the Scotrail subsidy could have done it all in 5 years.