Labour is ready for a fight over rail – but do the sums add up? | Politics News

Today’s rail plan by Labour is a landmark moment. 

Unlike many aspects of party’s policy offers to date, it is detailed, comes with a blueprint for what will happen on day one, and Whitehall will understand how to implement it.

It is, after all, winding back the clock.

Even the rail companies themselves say change to the train network is needed – though they inevitably don’t like this version of their future – and it is not without controversy.

But the row is a fight Labour want to have.

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After months of a pro-business love-in from Rachel Reeves and the Labour leadership, it is the single most concrete measure worrying business so far, according to figures from FTSE 100 firms I talked to this week.

They are watching closely to see whether the tendency to squeeze and bash business, evident under ex-leader Jeremy Corbyn, remains in the party’s DNA, even if it is well hidden.

Sir Keir Starmer’s plan allows the railway companies to come back into public ownership within five years. But will it leave the railways better off?

One key argument advanced for scrapping the old British Rail under Sir John Major’s government in the 1990s in favour of privatisation was that it would make investment in new and upgrading trains much easier.

Under the old system, in effect, the trains were competing for cash with schools and hospitals – and too often found themselves losing out.

An incoming Labour government – if we get that far – would not only find money tight, but have committed to eyewatering fiscal rules restricting their room for spending.

How much of a priority will modernisation be?

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Louise Haigh, shadow transport secretary, says the current system doesn’t work because too much money is being wasted – including on shareholder dividends, the payments to the owners of the private companies – and this needs to change.

But when I pressed her, she revealed that she has not secured any promise from Rachel Reeves, the shadow chancellor, that efficiencies found on the railways are reinvested in the service.

The danger is that the Treasury nabs that money and spends on public services they deem a bigger priority.

Sir Keir later suggested to broadcasters the savings would go all back into the railways – curious that his choice for transport secretary was unaware of this, however.

Even the rail companies themselves say things need to change. Whether this new alternative improves services for passengers remains to be seen.