BRINGING IT ALL BACK HOME

RMT helpline 0800 376 3706 :: march/april 2025 :: RMTnews 12 Following the introduction of Passenger Rail Services (Public Ownership) Act by the government in December, a programme has been launched to ‘transition passenger rail services currently operated by privately-owned operators into public ownership’. The first three franchises to come into public ownership would be c2c, South-Western and then Greater Anglia. It is further expected that a franchise would come into public ownership every three months according to the expiry of their contracts or core terms. As the Transport Secretary Heidi Alexander noted in Parliament this would create immediate savings from management fees paid to private train operators: "At the moment, we pay roughly about £150 million pounds in management fees to the train operating companies". Under the previous government private contractors turned these fees into dividends with the agreement of the Secretary of State and, not surprisingly, they were particularly hostile to Labour’s plans to nationalise passenger operations. One vocal critic has been Dominic Booth, the CEO of Transport UK which runs the Greater Anglia franchise, which will be transferred to public ownership in the Autumn. During the passage of the Act, Transport UK lobbied for amendments that would have wrecked Labour’s carefully worked out timetable for public ownership. This is perhaps understandable as Mr Booth has a lot to lose. Transport UK’s four franchises made bumper dividend payments last year, totalling a record £90 million. Transport UK was formed in March 2023, following a management buyout of Abellio occasioned by the decision by the Dutch state operator Nederlandse Spoorwegen to divest itself of foreign transport subsidiaries. Transport UK controls four UK franchises: Greater Anglia, East Midlands, West Midlands and Merseyrail. (table 1) Transport UK and its four English rail franchises are now owned directly by Dominic Booth and two companies, Grosvenor Walker Investments and Norton Green Investments, one of which is owned by one Dominic Booth. PRIVATE DIVIDENDS UP While the scale of Transport UK’s value extraction may be eye-catching, the fact is that private sector dividend payments are up across the board. Between them, private sector train operators paid out £246 million in the year to March 2024, the largest figure since 2018-19. Over the period from 2016, they paid out dividends worth £1.8 billion (Table 2). Particularly interesting for hard-pressed passengers and rail workers will be the dividend payments made by failing franchises Cross Country (£7.3 million) and Avanti (£8.1 million). However, the year also saw some alarmingly large payouts from other franchises such as Thameslink, Southern and Great Northern’s £62 million, Greater Anglia’s £43 million and Merseyrail’s £42 million. This largesse toward their shareholders is more BRINGING IT ALL BACK HOME Returning passenger rail services back into public ownership would save £150 million a year