Written evidence from ASLEF (TE 48)
1. The Associated Society of Locomotive Engineers
and Firemen (ASLEF) is the UK's largest train driver's union representing
approximately 18,000 members in train operating companies and
freight companies as well as London Underground and light rail
systems. The union has 130 years knowledge and experience of the
railways.
2. ASLEF welcomes the opportunity to contribute
to this Transport Select Committee Inquiry into Transport and
the Economy. Investment in the UK's infrastructure, particularly
rail, is crucial to reducing the deficit and stimulating economic
growth in the current economic climate.
3. The union also asserts that a key aim of investment
in the railways has to be cultivating a modal shift from air to
rail and from car to train in line with Coalition's Programme
for Government commitment to make the transport sector greener,
more sustainable and reduce carbon dioxide emissions. An increase
in rail capacity is strongly linked to a decrease in car journeys
undertaken with the result that there is less carbon emissions.
Decisions must therefore be determined by what will best deliver
these outcomes.
4. The UK's economic conditions have certainly
deteriorated since Rod Eddington published his transport report
in December 2006 with slow economic growth and increasing unemployment
and inflation levels. Notwithstanding the outcome of the Chancellor's
20 October spending announcement the public finances are likely
to be significantly restrained. ASLEF's concern is that transport,
and particularly rail investment as a long term infrastructure
project will disproportionately suffer from any proposed cuts.
5. Profits and revenues across UK train operating
companies (ToCs) have remained strong throughout 2010 despite
the impact of the recession on the UK rail industry. This is not
surprising given that ToCs received nearly £1 billion
from the government in 2009 as part of the cap and collar payments
that top up revenues at those franchises which fail to meet turnover
targets. ToCs are likely to receive even more in 2010 as the recession
continues to bite. Given the likely increase in fares in January
2011 ASLEF takes the view that such a continued level of subsidy
is a financially unsustainable and must be reduced.
6. ASLEF once again reiterates its belief that
rail investment should be prioritised rather than cut. Independent
research commissioned by the CBI on behalf of the construction
industry last year showed that every £1 invested in rail
generates £2.20 of economic benefits, more than any other
sector of the economy with, for instance, banking and finance
producing £1.70 per £1 spent and defence creating £1.30
worth of enhancements for each £1 expended. Rail is a uniquely
placed sector to offer a counter-recessionary economic stimulus
as well as boosting economic and social mobility.
7. ASLEF wishes to place on record our opposition
to any proposed cuts to the Crossrail scheme or the electrification
of the Great Western line and a section of the rail network in
the North West. We believe these schemes are vital developments
for increasing economic growth and social mobility in the South
East, the South West and South Wales.
8. ASLEF disagreed with Eddington's finding that
new rail infrastructure was unnecessary. Moreover we believe the
prevailing economic conditions make the case for high speed rail
greater than ever. The West Coast Mainline is likely to be at
full capacity by 2020 preventing the much need expansion of rail
travel. Network Rail has said "by 2020 we will be turning
away passengers." The high speed line proposed by Network
Rail would cost £34 billion but lead to £55 billion
of value. In addition it has the potential to reduce domestic
air travel due to the reduced journey times to the north of England
and Scotland.
9. The union supported the Eddington analysis
of the need to identify and tackle bottlenecks on the railway
and improve signalling. For example, the C2C line from London
to Essex is a vital economic link yet a stretch of the line around
Limehouse is only twin tracked. Four tracking of this section
of line would bring significant capacity benefits but requires
significant investment. Short infill projects, for example, can
also give extremely high value for money. Elsewhere routes exist
which are electrified except for a short stretch often have diesel
locomotives running under electric lines. A small infill would
allow electric traction and has the potential to give similar
value for money as a whole line being electrified.
10. The union also believes that more consideration
should be given to disused lines in order to enhance the capacity
of the rail network. In the southern region, for instance, reopening
the Lewes Uckfield line could reduce many of the capacity issues
around Gatwick Airport.
11. Rail freight has a vital role to play in
the economic recovery, reducing road congestion and providing
low carbon transport options for British business. ASLEF urges
the Government to spend the limited resources it has in the most
sustainable way possible and support the development of rail freight
through network enhancements on key routes, including to ports,
through grants to help reduce road congestion, pollution and exposure
to road accidents; and through a supportive planning regime for
rail freight terminals that acknowledges their strategic importance.
12. ASLEF believes that the cap and collar system
of payments to franchises must be radically reformed as part of
the current franchising review currently being conducted by the
Department for Transport. One of the supposed purposes of rail
privatisation was to increase the efficiency of services as a
result of the financial and commercial risks undertaken by the
winner of the franchise. The idea was that the service had to
run well or the company would lose revenue leading to financial
loss. However these basic rules of the market do not apply to
the system as currently constituted. Franchises who do not meet
their revenue targets are eligible for tax payer subsidy. Typically,
if revenue falls below 94% of the target, the tax payer provides
80% of the shortfall. This means that the public subsidise failure
and the incentive for running a good service simply disappears.
13. The revenue protection arrangements also
have a negative impact on industrial relations. A consequence
is that there is little incentive for a company to promote positive
union dialogue when they can claim lost revenue from strike action
back from the taxpayer. This scenario subverts the natural order
of industrial relations make it entirely and absurdly possible
for a franchise to make a profit as a result of strike action.
During a strike period, a company can save money through the lower
costs of not running services and lower wages whilst claiming
for the loss of ticket sales. ASLEF would be greatly concerned
for there to be a collapse in industrial relations prior to the
Olympics, for example, where the provision of good services is
essential. Surely risk must be on the side of those who make profit
and not the taxpayer.
14. ASLEF does not believe that the current
methods for assessing proposed transport schemes are satisfactory.
The appraisal should ensure that all external costs of the different
modes are fully considered which is not the case currently with
NATA, the model used by the DfT. There should also be a consistent
model of appraisal used across Whitehall.
15. Compared to air and road, rail is the most
benign form of transport in environmental terms. Investment in
rail is not only vital to greening the economy but also to stimulate
demand in a range of linked industries from steel to car manufacturing.
16. To conclude ASLEF would again point out that
investment in rail can deliver a counter-recessionary economic
stimulus as well as boosting economic growth and social mobility
and should be a key tool in the Government's overall deficit reduction
strategy.
September 2010
| 
