ITALIAN STATE TAKES OVER C2C

RMT helpline 0800 376 3706 :: february 2017 :: RMTnews 16 R MT has revealed that over 70 per cent of Britain’s private rail franchises are now partially or wholly owned by foreign state railways after the state-owned Italian company Trenitalia entered the market. A House of Commons transport committee also demanded an independent review of the privatised rail network, which is subsidised to the tune of £4 billion a year by taxpayers while shareholders raked in hundreds of millions in profits. In the latest sell-off National Express flogged off its C2C Thameside franchise between London and Southend to the primary train operator in Italy Trenitalia for £70 million. National Express had the contract to operate the Essex franchise until November 2029. Dutch state railways Abellio also recently sold off 40 per cent of the Greater Anglia franchise to the giant Japanese corporation Mitsui which first made its fortune in the heroin trade and using US prisoners of war as slave labour. Under the current privatised set-up Britain’s rail services are operated by taxpayer-subsidised franchisees most of which are subsidiaries of state-owned rail operators in France, Germany and the Netherlands. RMT general secretary Mick Cash said that the latest sell-offs made a mockery of the expensive Department of Transport franchising process. “The checks and balances for both passengers and the taxpayer, which the DfT claims are enshrined in its multi- million pound franchising programme, are clearly lacking when the winning bidder can simply walk away, share out its responsibilities and choose its replacement whenever it sees fit. “Britain’s railways are being sold off to European state- owned outfits with the profits from British fares – amongst the highest in Europe – subsidising operations abroad. “Trenitalia is the latest to jump at the chance to fill its boots on the C2C routes,” he said. The transport committee report also condemned “serious shortcomings” in the Department for Transport’s handing of franchises to profit- driven contractors and it’s overseeing of their failing operations. “The current model fails to deliver for passengers, to drive industry efficiencies, promote competition, reduce the taxpayer subsidy or transfer financial risk to the private sector,” the report stated. Labour MP for Liverpool Riverside and Committee chairwoman Louise Ellma said that the franchising system was “no longer fit for purpose”. Shadow transport secretary Andy McDonald MP said: “Privatised rail has left us with a fragmented and inefficient network that drives up costs and under-delivers. “A railway works best as an integrated network but privatisation and franchising have meant breaking it up to create opportunities for companies to extract a profit, resulting in costly inefficiencies.” He said that the system had a “confusing fare structure” and that services were “disjointed and difficult to use for passengers. “It is time for our railways to be run under public ownership, in the public interest as an integrated national asset with affordable fares for all and long-term investment in the rail network,” he said. The union welcomed the report and said that evidence showed that franchising was a fiasco beyond reform which needed to be replaced with a publicly-owned railway that puts people before profit. The company taking over C2C services, Trenitalia, is owned by Ferrovie dello Stato Italiane a government-owned holding company that manages infrastructure and services on the Italian rail network. It was created on June 1 2000 following the imposition of an EU directive demanding the deregulation of rail transport. The European Commission's First Railway Directive from 1991 (91/440/EC) also prohibited the same company managing the rail infrastructure and provide rail transportation. As a result Italy created Trenitalia as the primary rail transport company and in July 2001 established Rete Ferroviaria Italiana to maintain the rail network itself. However, the separation was only formal as both are subsidiaries of Ferrovie dello Stato Italiane which is wholly owned by the government. Trenitalia gained notoriety in early 2012 when it promoted its change from two classes of train compartments into four classes. Passengers travelling by the lowest class were not permitted to use the on-board cafe or enter the carriages reserved for the other three classes. ITALIAN STATE TAKES OVER C2C As most rail franchises fall under foreign control, MPs say franchise model ‘not fit for purpose’ SELL-OFF: National Express has struck a £70 million deal to sell its c2c rail operation to Italy's Trenitalia, increasing the number of UK franchises in EU member states hands