LONDON OUT OF STEP

RMT helpline 0800 376 3706 :: september/october 2026 :: RMTnews 13 R MT condemned Transport for London’s decision to award privateers FirstGroup a lucrative eight-year £3 billion contract to run London Overground from May this year. First Rail London Limited (FRLL), a subsidiary of FirstGroup, took over the contract over from Arriva Rail London even though TfL still owns most of the Overground rolling stock and sets the routes, timetables and fares. At the time RMT general secretary Eddie Dempsey said that despite London Labour mayor Sadiq Khan claiming to back public ownership of rail, London Overground was re-privatised on a lucrative deal that put profit before passengers. The union has argued that by taking the Elizabeth Line and London Overground into public hands, Londoners would see more of their fare revenue reinvested into the network, pointing out that private operators like MTR and Arriva Rail London had paid out millions in dividends. MTR paid out a dividend of £7.6 million, equivalent to a 2.4 per cent cut in Elizabeth Line fares while Arriva Rail London paid a dividend of £9.6 million, equivalent to a 4.4 per cent cut in Over- ground fares. Mayor Rotheram recommended public ownership pointing out that one key benefit was “the removal of profit payments to private operators, enabling greater reinvestment into the network”. The option of privatising it again, by contrast, not only meant more profit leakage but “did not provide the same level of long-term strategic control, integration or value retention as a publicly owned operating model”. The Mayor’s proposals also recognise that public ownership would “align to the rail reform agenda being progressed at national level, where greater public control, clearer accountability and reduced contractual complexity are seen as the vital ingredients to improving the passenger experience”. Finally, the paper states that public ownership could deliver more social value by enhancing control of procurement. This approach recognises the fact that you can do more good in the community if you directly control the purse strings. Londoners might justifiably wonder why what’s good enough for Liverpool and the whole of the rest of the country is not good enough for them? GOOD ENOUGH FOR LONDON Many of the arguments made by Mayor Rotheram were made by RMT to Transport for London back in 2024 but were ignored in favour of more privatisation. The union has concluded that this occurred due to a measure of corporate capture inside TfL which is not the case in other transport authorities. TfL spends around £4 billion on procurement of which half goes to a group of around 30 transport and construction companies. TfL executives are more comfortable selling and managing contracts than operating services directly and have established close relationships with the private sector over time. But why should this cosy nexus of unelected executives dictate London’s transport policy? RMT general secretary Eddie Dempsey has written to the Mayor of London Sadiq Khan pointing out that he has the power to change this situation. In the letter he said: “I do not see why Londoners should have to support the profiteering of companies like FirstGroup and Govia, when this model has now been decisively abandoned across the rest of the country. Surely, it is time that London too was able to spend all its transport funding and revenue on frontline services for the capital’s people?”. RMT believes that the Mayor can direct TfL to work up proposals for running its services in public ownership, learning from the growing fund of experience in the rest of the country and utilising break clauses in the contracts. It’s not too late to stop the privateers taking London for a ride, but it’s a tragedy that the capital has so far been left behind. LONDON OUT OF STEP