Daniel Andrews, please return public transport to the people
The Guardian, 7 February 2017
The privatisation of Victoria’s train and tram system has not delivered savings to the public – so why not bring it back under state control?
Travelling in the UK this week, I paid £131 ($213) for a rail ticket from London to Newcastle. For a ticket of the same distance in Australia on the government-owned V-Line intercity service from Melbourne to Albury, I’d pay around $75.
I rarely agree in matters political as expressed by the UK’s Daily Mail, but that publication and I are travelling on a joint ticket when it comes to criticism of privatised railways. In 2015, the Mail called out privatisation as the reason British rail ticket prices have trebled, and later that same year ran a scathing piece on railway service decline that truly surprises from a newspaper that so firmly backed in the Thatcherite ideology that delivered it. As that ideology yet holds firm in the UK government of conservative Theresa May, any window to renationalise the overpriced and inefficient British rail system is presently shut.
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But a similar window has opened wide for Daniel Andrews, the current Labor premier of Victoria. Our state’s public transport system was sold off in 1999 – and as something of a parting gesture – by Victoria’s own Thatcher acolyte, then Liberal premier, Jeff Kennett. He rammed it through a mere eight weeks before his turfing from office.
Melbourne’s Metro suburban rail service and its iconic trams have remained privately operated to this day. The intercity V-line trains were returned to public ownership only because their private operator walked away from their contracts in 2002, allowing the-then Labor government to legally regain control.
Now, the last of all the remaining contracts are up. With the future of the tram and track contracts to be decided by June, diverse forces are agitating for re-nationalisation. Should he pursue it, the premier will not merely be restoring lost efficiency and effectiveness to state public transport, but recapturing for Labor some old-school community populism by doing so.
In the first case, there are powerful economic arguments for returning metro trains and trams to public hands. By 2007, Richard Allsop – a transport adviser in the former Kennett government when the system was privatised – had turned up as a research fellow at the Institute of Public Affairs, acknowledging in a paper for them that there has been “no substantial savings to taxpayers”.
Eight years later, Fairfax reminded Victorians of Kennett’s promise “that taxpayer subsidies to run trains would gradually disappear. But subsidies have soared, from $651m paid to former franchisee Connex in 2007 to $1.18bn last year.”
According to Victoria’s Rail, Tram and Bus Union, these amounts have accumulated into $10bn paid to Metro and Yarra Trams over the eight-year term of the last contract. The increased cost has not delivered greater customer satisfaction. It’s shockingly low, and unsurprisingly, the commercial squeeze on services has resulted in avoidable mistakes, service reductions and compromised safety standards.
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It’s understandable why the union is campaigning for re-nationalisation. State secretary Luba Grigorovitch says that with $350m of profit sent offshore to the train and tram operators’ foreign owners in the past eight years, our system “is being drained of resources that should be going into improving standards.”
Indeed, if ever there was an argument to be made for re-nationalisation, it’s the power that can be wielded by state-owned transport corporations – because the majority ownership of Melbourne’ Metro trains is the Hong Kong government-owned MTR Corporation while Yarra Trams returns profit to majority investor SNCF, the French state-owned rail company.
The potential of a state-run system to serve other community policy priorities is why environmental campaigners are backing the union in.
“Metro Trains is among the largest carbon emitters in the state,” says Leigh Ewbank, from Friends of the Earth. He cites a City of Melbourne report revealing trams alone make up 10% of local emissions, and explains: “The narrow focus of a private model puts profit ahead of addressing the network’s contribution to climate change. Perhaps putting the public transport system back in public hands would deliver better outcomes for our environment.”
It would almost certainly improve political outcomes for Daniel Andrews and the Labor party more broadly, for if there is even only one great truism of local politics, it’s that Australians hate privatisation. Fondness for privatisation destroyed Anna Bligh’s Labor government in Queensland, and then obliterated Campbell Newman’s Liberal-National one that followed it. The sale of the Commonwealth Bank and Qantas under a federal Labor government knocked the social democrat shine off Paul Keating, and it’s a shine Labor should seize a precious opportunity to regain.
Because while Andrews has amassed urban popularity and credibility for his bold action on social inclusion policies, what the phenomenon of Brexit, Trump and the return of One Nation are showing the electorates of the English-speaking west is that it’s actually economic power-to-the-people gestures that swing votes and shift governments.
The likes of Trump and One Nation, of course, are big on symbolism with absolutely no interest in making structural changes to share economic opportunities or equalise wealth.
But social democratic parties like Labor are ideologically capable of challenging the hollow promises of the new rightwing populism to demonstrate there are alternatives to the neoliberal orthodoxy that people hate so much.
Re-nationalising public transport in Victoria is a timely opportunity to restore a powerful asset to public hands. It’s a precious chance to remind the electorate of the possibility for governments to restore systems that share wealth. Andrews, his government and party would be mad – in these mad, mad times – to choose not to get on the train.