LIVING OFF RAIL

RMT helpline 0800 376 3706 :: september 2023 :: RMTnews 16 According to an RMT report the private train operating companies who are currently closing ticket offices, calling for driver-only operations and cancelling services are racking in the money while the government bankrolls their hard line in the rail dispute. In fact, train company bosses take little risk with their capital but have benefited from profits before tax of 126 per cent of the capital invested. Moreover 65 per cent of profits are locked away in shareholder dividends instead of being redistributed into improving the railway or upping workers’ wages and improving conditions. RMT general secretary Mick Lynch said that the public needed to understand that train companies invest little or nothing in the railways and make completely unjustifiable profits which they squirrel away in shareholder dividends and bosses pay packets. "It is a scandal that the travelling public is being ripped off by greedy rail privateers while at the same time the government oversees a corrupt system and prolongs a rail dispute for political reasons. "It is high time this profits bonanza gravy train was halted, a deal done with the RMT and the railways returned to public ownership for the good of the country and railway workers,” he said. PUBLIC SUBSIDY The stark fact is that public investment in rail has dwarfed private sector spending since privatisation. Public spending has surged over the period since privatisation. On average over the last 15 years, the private sector has contributed just eight per cent of what government spends. 76 per cent of that eight per cent is spent on rolling stock by the ROSCOs and as we’ve shown before, even this supposed spending on rolling stock has been mainly subsidised by government funding. Franchise subsidies have risen in the last decade in large part to cover the rising costs of rolling stock. As the authors of Rebuilding Rail say, ‘while technically considered as private expenditure, this is underwritten by franchise contracts which are only rendered financially attractive by the public subsidy to Network Rail and in most cases a public subsidy to the TOC that will be leasing the trains’. While the private train operating companies don’t like LIVING OFF RAIL Train operating companies take little risk and only invest one per cent of the money spent on rail