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From The Socialist newspaper, 22 May 2004


Put Privatisation Into Reverse!

A DISASTER - that's how most people see privatisation of public transport. This has not prevented Thatcher's "counter-revolution" spreading to most parts of the world. Indeed, Blair's government is still implementing the part-privatisation of London Underground.

A London bus driver

Public outrage at rail disasters and the catastrophic decline in service reliability has forced Labour to roll back slightly the privatisation of the rail industry. But buses are the most used form of public transport and outside London, buses were privatised in the mid-1980s.

The Tories saw privatisation as their magic cure for everything. But how little they understood the bus industry was shown when Nicholas Ridley, then transport secretary, asked a local bus manager: "How many of your drivers own their own buses?" When the manager replied that none of them did, Ridley sagely advised, "You should think about it".

Bus services outside London have deteriorated sharply since privatisation. In the evenings and on Sundays, they hardly exist outside the big towns and cities. And fares have shot up.

These cuts are continuing. For example, from 29 May, First Group intends to make 100 drivers - a third of its drivers in Cornwall - redundant. Its St Austell garage will close and the Truro depot will be moved to a smaller base.

The government wants to increase bus use by 12% nationally to cut road congestion but passenger numbers are stagnant outside London. Transport authorities in some of Britain's biggest cities recently called for new powers to try to make private bus operators improve their services.

Outside the capital, bus operations account for 25% of the turnovers of private transport companies, but 50% of their profits. Fares are too high to attract lower income families on to buses and reduce car traffic.

Success story?

YET BUSES in London seem to contradict this trend. London bus use is at its highest since the 1960s. Has London mayor Ken Livingstone succeeded where others have failed? Can he make a success of privatisation?

Its sheer size makes London different from other British cities. Londoners spend a huge portion of their day just getting to and from work. In 1999 the average time taken nationally to travel to work was 25 minutes. For those working in central London it was 56 minutes, almost an extra hour a day.

Buses have declined nationally since the 1950s as car use rose dramatically. But since the 1980s London has bucked this trend: car use is practically unchanged while it has risen by about half in the rest of the UK.

The capital became so clogged with traffic that parking costs and other restrictions meant a limit had been reached well before Livingstone introduced the congestion charge scheme last year. This cut traffic congestion in inner London, but at the cost of charging low-paid people who need to use cars 5 a day.

London's underground rail network is a wonderful system, but for decades it was starved of new investment. It has failed to expand as London has grown.

In the years before privatisation, London Transport (LT) buses were divided up into twelve separate subsidiaries. Each typically had four or five garages and around 1,500 workers in a particular part of London.

In 1994-5, the LT bus subsidiaries were privatised. Most went to various private bus firms that had already started to develop from earlier privatisations. A few went to management buy-outs, which within a few years were themselves bought out by the bigger firms.

The London Evening Standard recently said six companies control 90% of London's bus routes. It estimated their market shares at: Arriva (20%), Go-Ahead (18%), First (17%), Stagecoach (15%), Metroline (12%) and London United (10%).

The first four are also the biggest UK operators. The fifth bus firm nationally, National Express wants a slice of the lucrative London action. It is moving in as Travel London, having bought up the failed Connex buses.

Now Transport for London (TfL) oversees transport in the capital, including London Underground, Croydon trams, Docklands Light Rail, Red Routes (main roads with parking restrictions) and congestion charging, as well as buses.

Capitalist 'efficiency'

PRIVATISATION HIT bus workers very hard in London, just as it had in the rest of the country. This is exactly what economists mean by 'economic efficiency' - reduced costs. And the main 'cost' for a bus firm is wages.

Capitalist economic efficiency has nothing to do with running a decent service. That's especially true when most income comes from a regulator who sets one or two specific targets that are rewarded financially. All-round regulation means workers' control and management. Anyone who doubts this should look at the results of the bus privatisations of the mid-1980s.

So why is London different? Although LT buses were privatised, they remained highly regulated - unlike the rest of the country. This was a tacit admission that 'free enterprise' capitalism could not provide an adequate public transport system in the capital.

Indeed, it would mean a return to the chaos of private London bus firms in the early days of the 20th century with real on-the-road competition. If a bus on a particular route was almost empty but the crew saw a crowd waiting at a bus stop over the road, the conductor could ask passengers to kindly alight from the bus, change the blinds and ply the more lucrative route!

London buses were taken into public ownership and regulated as early as 1933 to overcome such problems. It had become blindingly obvious that laissez faire capitalism could not offer a workable transport service in a modern city.

Regulation and public ownership became the model for public transport after World War Two for two main reasons.

First, because private firms could not run it profitably. Second, the bosses needed an adequate public transport system in order to run the rest of the economy.

This was not socialism - the people who ran the public utilities generally came from wealthy backgrounds themselves, and ran them in the interests of the capitalist class as a whole.

By the 1970s, capitalists wanted these utilities privatised. The old Keynesian ideas of public spending and the welfare state no longer seemed to work in this decade of rising unemployment and high inflation.

These ideas were dropped - in favour of even older ideas of savage attacks on working class people's rights and conditions.

The election of Thatcher here, then Reagan in the USA began a new era of class conflict, which continues up to the present with Blair and Bush.

The organised working class - particularly the trade unions - were hampered in their attempts to repel this assault, by their own leadership (see article above right). In some senses, we are only just beginning to see a revival in workers' confidence.

The main reason for privatisation was to weaken the public sector unions. The unions were hit by privatisation - but mainly as a result of their leadership failing to build a serious resistance.

Ken Livingstone

SINCE HIS election as London mayor in 2000, Ken Livingstone has sought to do something big to make him electable for a second term (rejoining the Labour Party was not his most astute move in this process - despite being central to his strategy.)

He has tried to make a noticeable difference to transport - one of the biggest headaches for most Londoners.

He clearly feels it would take more than the electoral term of four years to make a substantial improvement to the ageing London Underground system.

So he concentrated on improving buses. Unfortunately, his approach does not challenge the private bus companies - indeed, it depends on them.

Bus workers have definitely benefited from more money being available. But his return to the Labour Party is a clear warning. Londoners voted Livingstone last time because we were sick of the main political parties. Does anyone seriously believe that in the last four years Labour has changed for the better?

Tory and Lib Dem candidates for mayor make it clear that they would slash investment on buses if they got in. But now Livingstone is back with New Labour and we have already recently seen a slowdown in investment growth.

Many contracts are being renewed with refurbished, rather than new buses.

The improvements in London's bus services over the last few years have come despite privatisation, not because of it.

The Tories dreamed that privatisation could inject new life into industries crippled by bureaucratic management. Competition, they hoped - if they really believed their own hype - would bring economic efficiency.

The only answer to the question, "Do London buses prove privatisation can be a success?" is "No". There is no such thing as a 'free market' - especially in the modern age of huge monopolistic corporations.

But in the bus industry, London is furthest removed from the economists' fantasy of a perfectly competitive market.

London buses are the most highly regulated in the country. And privatised bus companies only tolerate this regulation because of a colossal, unsustainable subsidy - a bribe.

We say:

Put the failed policy of privatisation of public transport into reverse.

Stop the privatisation of the tube, renationalise all Britain's bus services and immediately invest in improving services, wages and the vehicles.

Fight for major investment in a cheap, accessible, integrated public transport system.

If it was managed democratically by the workers who operate and use the system, it would be possible to plan public transport in an integrated way to meet the needs of the public, the transport workers and the environment.

Bus Workers Must Fight For Public Ownership

LONDON BUSES were privatised nearly a decade after buses in the rest of the country - in 1994-5. The delay was mainly because the Tories were wary of London bus workers' industrial strength and thought it would be easier to break the back of their union - the Transport and General Workers' Union (TGWU) - in the rest of the country first.

The run-up to privatisation in London was not the TGWU's proudest moment. Unfortunately, a decisive section of the bus workers' leaders - some of whom did very well for themselves, even ending up in the management of the newly privatised companies - gave up the ghost before privatisation.

Ballots were taken on whether to accept drastic cuts in hourly pay for - admittedly sizeable - one-off payments.

Where the offer was rejected, the ballot would be held again, until the morale of the most militant - but leaderless - bus workers was broken.

Before that bleak time, if you failed your probation as a bus conductor - never mind as a driver - LT would send you to work on the poorer-paid London Underground.

Now bus workers are the poor relation. Despite a modest recovery in recent years, bus drivers would still need a 50% rise just to catch up with our brothers and sisters on the Underground.

Declining pay and conditions

Bus mechanics can tell a similar story of declining pay and conditions, together with horror stories of how safety standards have been allowed to fall, especially as work has been ceded to outside contractors.

Once a London bus worker had a job for life. Today's 30% annual turnover in employees can obviously affect safety.

On privatisation, the coveted LT pension disappeared. Even the inferior final salary pension was only available to existing workers. New workers got even worse pensions.

Those starting just after the sell-off lost out with reduced holidays, too.

Last year, for the first time since privatisation, bus workers across London put in a common pay claim.

Naturally, as we still have different employers, we didn't get a common result.

Yet the results were still largely successful, with increases around 10% almost everywhere.

Now we must build on this success. We want an all-London rate of pay but this would challenge the private ownership of London buses.

For this reason bus workers should ally ourselves with tube workers fighting privatisation.

Buses are only a part of London's transport network. The unions representing TfL's workers need to fight together and also campaign together for a publicly owned, publicly accountable, integrated transport system across London.

Clearly this is a political campaign, but not the sort of activity New Labour would touch.

This campaign can be part of the effort to break with the funding of capitalist politicians who cut wages, work conditions and services.

We can then start to build a new workers' party that backs the interests and aspirations of all trade unionists and all workers, including bus workers.

Bristol Needs Planning, Not Price Hikes!

CHEAP, ACCESSIBLE, integrated public transport is key to the everyday functioning of society. In Bristol it has become obvious that foresight and long-term planning are necessary to build a local transport system not just to service the present needs of the people of the city, but to service the Bristol we will have in decades to come.

Jan Taylor

Unfortunately, planning is anathema to the short sighted market-driven philosophy of New Labour, Tories and the Liberal Democrats!

The recent fare hike by First Group has angered many Bristolians, but the root of the problem is much deeper. A necessary service to the public such as the bus service or the railways, when under the control of a private monopoly, will always serve the shareholders first, and the public second.

Bristol's bus service should be taken into public ownership immediately, with compensation to the shareholders only on the basis of proven need, and the service run in Bristol on a democratic basis, accountable to the drivers and staff, and the consumers, the passengers. A plan could then be drawn up as to what the present and future needs of transportation in Bristol are.

Big wheels and bigger problems

THE OWNERS of some private bus firms made fortunes from privatisation. Some feature in the Sunday Times Rich List 2004.

Stagecoach owners Brian Souter and his sister Ann Gloag make the list with 327 million. They reckon Sir Tom Cowie recently sold his Arriva shares and has 60 million.

Go-Ahead boss Martin Ballinger weighs in at 40 million.

AT THE same time, the big bus operating firms get huge government subsidies. From almost nothing in 1997-8 government subsidy - through TfL - has now reached more than 600 million and is set to reach 1 billion by around 2007.

With 1.5 billion passenger trips a year, that's about 40p a trip!

ALL THIS money floating around at the top has not helped Britain's transport systems with their ageing infrastructure that is struggling to meet public demand, according to a recent report.

Britain's big cities need about 70 billion to deal with 'grossly inadequate' transport systems, it concludes.

TRANSPORT'S SHARE of public funding has nearly halved over the past decade and as a percentage of GDP Britain spends only about half as much as other European countries.

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In The Socialist 22 May 2004:

Sanctioning Torture From The Top

Iraq: Desperately Seeking An 'Exit Strategy'

Iraq: what we say

Socialist Party news and analysis

What Is The Alternative To Blair?

Workers' Unity Can Win

FBU conference: Preparing For More Battles

Save our Special Schools

Say no to the tyre burners!

A socialist weekend in Sheffield

Buses: Put Privatisation Into Reverse!

International socialist news and analysis

New shocks cast cloud over world economy recovery

Ruling BJP is Swept Aside in India

Founding Meeting Of The Socialist Movement in Pakistan

A Working-Class Alternative Is Needed in Israel/Palestine


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