26 November 2008
Fare hike outrage
Patrick Crozier

Every year (or near enough as makes no difference) the government allows the rail companies to increase those fares that they, the government, control.  Result? Instant outrage.  “Why should we pay more when the trains are so overcrowded/unreliable/expensive etc...” Sometimes there are feeble attempts to justify these rises along the lines of “Oh they are needed to pay for longer trains, taller trains, newer trains, more trains, faster trains etc.”

If you want to see the absurdity of this situation you need only compare this state of affairs with that state of affairs at Tescos.  There’s none of this outrage when Tescos puts up the price of, say, a tin of peaches and no attempts to justify it on the grounds of “Oh we need to raise prices in order to fund the new store at Banbury.” No, there’s just the acceptance that if Tesco is putting up the price of something it is either because it costs them more to buy or because they want to prevent empty shelves.  The store at Banbury will be expected to pay for itself.

Actually, you don’t even have to look as far afield as Tescos - simply look at those times and places when fares have been free.  There was none of this outrage in the past when fares (for the most part1) unregulated.  Mind you in those days fares for the most part were coming down and conditions improving2.

You don’t even have to delve into the history books.  Currently, first class, most inter-city fares and freight rates are completely unregulated and there are few complaints.

The simple fact is that none of this outrage would exist if we had a true free market, with private rail companies having absolute freedom to charge whatever they liked.

So, why don’t we just return to that system as quickly as possible?

Vested interests.  Or the man on the 0822 problem.  He’s the guy who needs the 0822 to get to work but if fares went up dramatically (as they probably would if they were free) he would either have to lose his job or move home.  Clearly he wouldn’t be very happy and would resist any dramatic move to a proper free market.  And I can’t say I’d blame him.  The point I’d make is that when you fix a problem it often involves pain but do you blame the person trying to fix it or the person who got you into that problem in the first place?

Notes

1.  100 years ago regulation such as it was extended only to what were known as Parliamentary Trains and Workmen’s Fares.

2.  See the story of Midland’s abolition of Second Class.  Also here

Feedback

  1. But as each operator has an effective monopoly on each route, it wouldn’t really be a market at all, let alone ‘free’!

    Posted by Jake on  26 November 2008 at 09:41 am

  2. A free market just means being free of government interference. Or being “free” as I like to call it.  Even if that leads to apparently monopolistic outcomes.

    Not that I am particularly bothered about monopolistic outcomes.

    Posted by Patrick Crozier on  27 November 2008 at 03:29 am

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