PASSENGERS will be hit with a 15 per cent rise in train fares if the Tories privatise Network Rail, new research released today reveals.
Rail union RMT made the warning before this week’s publication of the Shaw Report on the future of Britain’s not-for-profit rail maintenance group.
As exclusively reported in the Morning Star, Transport Secretary Patrick McLoughlin has held secret meetings with potential investors on privatisation of the most profitable parts of Network Rail’s operations.
If the service is sold off, the union say buyers prioritising profits would require a £1.4 billion-a-year subsidy from the government or a huge fare rise.
RMT general secretary Mick Cash said: “Our research shows that not only would such a move hammer down on safety it would also hit passengers in the pocket with massive increases in fares to pump up the private-sector profit margins.
“In the week when the country is braced for even more austerity from Osborne’s Budget, passengers who already pay the most expensive fares in Europe will be appalled when they find out that the real burden of delivering returns to the private sector will fall directly to them.”
The union based its calculations on the “mark up” returned by Network Rail’s privateer predecessor, Railtrack, and the additional costs of outsourcing rail maintenance work.
RMT’s calculation follows the warning of Dr John Skittle in his report Network Rail Staying on the Right Track: “Full or partial privatisation will result in higher fares for passengers because Network Rail will no longer be a not-for-dividend organisation.”
The union said that having a directly employed workforce currently saves £581 million a year under public ownership.