Renationalising the railways

This week in the New Statesman, former Labour Minister Kate Hoey has published an article headlined “Here’s the real reason we can’t renationalise the railways” (http://www.newstatesman.com/politics/2015/08/renationalise-railways-what-no-one-will-tell-you-we-cant-while-were-eu), though in fairness in the article itself she only seems to go as far as to pose the question “could either Andy or Jeremy deliver on such a promise?”, which they have both made. She answers her own question with, “I’m not so sure”, because “neither candidate have said how they would address the big obstacle that their promise faces: the European Union.”

The root of the problem, according to Ms Hoey, is the EU’s aim of “Opening up national freight and passenger markets to cross-border competition“, operationalised by the First Railway Directive (most recent version in 2012) which enshrines the role of the private sector “by making it a legal requirement for independent companies to be able to apply for non-discriminatory track access on a member state’s track” and in the more recent 2012 version stating the aim of “boost[ing] competition in railway service management“.

The Directive is also “calling for: “separating [of] the management of railway operation and infrastructure from the provision of railway transport services, separation of accounts being compulsory and organizational or institutional separation being optional” and it is here the wheels really start to come off Ms Hoey’s train.

First of all, the Directive does not even require track ownership and train services to be in separate ownership – in terms of EU law there is no need for Network Rail – it could quite easily be a subsidiary of the service-provision business, though they would need to be organizationally distinct and publish their own accounts.

Secondly, Ms Hoey seems unable to appreciate the irony involved in her own argument, when she subsequently goes on to refer to Deutsche Bahn which, while nominally a private company has only one shareholder – the Federal Government of Germany. In other words, renationalising Britain’s railways could be achieved on the German model without, presumably, offending EU law.

So what is it that is going on in EU law? One of the fundamental aims of the European Commission has been to create markets which are genuinely European. For instance freedom of movement has as one of its aims to create a European Labour Market. In the same way, the Directive that Hoey refers to aims to create a European market in rail services. For instance, that when goods are being sent from, say, Germany to Spain by rail, they will have to pass through France. The aim of the Directive is that the exporter from Germany can select their own provider and will have no hindrance in using the railtrack in Germany, or France or Spain. Certainly its aim is to prevent the situation where, for instance, the train is stopped at the border with France to be hitched to an engine provided by French railways. This is hardly the same thing as wholesale privatisation, which has landed the UK with the idiotic situation where rail services in Scotland are provided by Abellio, a subsidiary of the Dutch national railways Nederlndse Spoorwegen.

An important part of the EU requirements quoted by Hoey is this that it is “a legal requirement for independent companies to be able to apply for non-discriminatory track access on a member state’s track”. But this is the case for the UK just now, so it should, in EU terms, be permissible for another rail company to apply to offer services in competition with those provided by, for instance, ScotRail. But no one does, or ever has. What has happened is that the UK rail system has been divided up into franchises/ regions, and fixed term contracts have been allocated – competitively as long as the public sector doesn’t get carried away with itself and apply – to private sector companies, who receive increasing amounts of public subsidy for the privilege of providing our rail services (and not always well). This, it should be clear, goes way beyond the requirement of allowing non-discriminatory access. It would be perfectly possible for the old BR to continue to exist and operate, just as long as other providers were given access as well. Current practice suggests that this is much more likely for freight services, whether between countries or different parts of the UK, than it is for passenger provision.

Essentially, Hoey is over using some EU regulations to argue that nationalisation of Britain’s railways is not possible, when the fact is that we could follow the German or the Dutch model of railways, still effectively in public ownership.

She concludes her article by arguing that “It would be hyperbole to say that all efforts to renationalise the railways would be blocked by the EU, but it would be equally naïve to dismiss the problem“. It would indeed be naïve – certainly remiss – to imagine that the EU does not create issues, but as the German and Dutch models show these issues can be managed, and managed effectively, to the extent that the Dutch national rail company can come over to the UK and manage our services at a profit to themselves which, no doubt is recycled back into the Dutch national rail system.

Hoey goes on to argue in her conclusion that “Honest politics demands detail“, and an honest politics on this matter would be to recognise that while the EU might create constraints, it is possible – as the Dutch and the Germans have shown – to live well and prosper within those constraints. These constraints must be recognised and need to be managed, but they are no argument to sustain the view that British railways cannot, or should not, be renationalised.

But that omits the final question I want to address, which is “why Kate Hoey” who is after all a Labour MP, and while Labour have given up on “secur[ing] for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service“, we might ask why a current Labour MP should actually argue against it. Perhaps the truth of this is contained in the following quote from a then member of the Conservative Shadow Cabinet (2008), that “Although Kate would sit very comfortably on the Conservative benches, in a way she’s far more useful to us haranguing the Government as a Labour MP,” (http://blogs.telegraph.co.uk/news/jonathanisaby/3668691/With_foes_like_Kate_Hoey/) Either we have to express astonishment that a Labour MP can misuse EU regulation to argue against nationalisation of a public utility, or we have to ask why this person remains a member of the Labour Party at all? Perhaps we should ask both questions?

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The forecast price of oil

Further to my views on Alex Gallagher’s claim that the SNP should apologise for getting the price of oil wrong, the following diagram, giving the forecasts of various luminaries such as the World Bank, OECD, IMF etc, shows that a lot more people should be apologising. Only one of the estimates is even anywhere like the current price, and that is EIA’s “low estimate”, while their high estimate would have it up at $100 more than it actually is today. Even a cursory glance shows that the dominant view was somewhere around $100.

David Torrance – what a laugh!

I mentioned David Torrance in my first entry here. David is currently punting his updating of his book about Salmond, which seems to me to be rather like a rabid Old Firm fan writing a book about whichever side is the other side for him (or her?).

To engender a wee bit of interest he wrote an extra article for his friends at the Herald (usually we only have to put up with him on a Monday, but this week we got him twice). This article was headlined – perhaps to show how even-handed he is – “Salmond: The man who gave a new lease of life to uncompromising tribalism.” (click on the headline and it will take you there.

The thing with David is that he is one of these guys who has set himself up as a “great thinker”, but actually he’s a sloppy thinker whose argument falls apart before we have got through the first quarter of the piece. This one is no better.

He writes, in the third paragraph,

But although often [don’t you just admire that “often” – with a single word he reminds us that Salmond perhaps wasnt always impressive – I rather suspect though, he would struggle to nominate anyone for whom the modifying “often” would not be appropriate] impressive as First Minister between 2007-14, Mr Salmond was perhaps best understood as an opposition politician and the SNP as an oppositionist party, more comfortable defining themselves in terms of what they were against rather than what they stood for“.
However, in the preceding paragraph, he has reminded us that Salmond changed the terms of debate in Scotland, moved his party toward gradualism, professionalised the SNP (though here, I think, he understates the role of John Swinney) and developed the talent pool (citing Nicola Sturgeon).
I appreciate Salmond is a complex figure with a complex career. I have my own differences with him, but as a simple matter of logic are these two judgements really consistent with each other?

For instance, while a politician who was essentially “oppositionist” might develop the talent pool, would he professionalise his party? It might seem that these two things are consistent, until there is an appreciation one does this with an aim in mind. Certainly it’s hard to find consistency in the charge of “oppositionism” (the noun from David’s new word) and the SNP’s move to gradualism from where the SNP had once stood, and most certainly in terms of setting the debate, as both these things require some sort of aim that goes well beyond stopping the other side – the ruling side – from achieving their aim.
Moreover the evidence that Torrance adduces to defend his claim is weak. For instance he argues

The Scotland’s Future White Paper published neatly encapsulated Salmondism: a triumph of style over substance, debating points over detailed policy.”,

This of course, cheerfully (indeed necessarily) ignores that because Westminster stoutly refused to come up with any detailed figures or information, far less pre-negotiate on what situation would apply on any matter (eg currency) in the event of a Yes vote, the “detailed policy”, required “detailed” information and that simply was withheld by the Unionist side that Torrance cleaves to.
However, he is to be congratulated for putting up that one example of evidence, for there are no others – the rest, at best, are “wink, wink, know what I mean”. In fact, I would like to thank David for at least giving me a good laugh here, as he can produce several paragraphs of assertion of his own, but still criticise Salmond for indulging in the “politics of assertion”. Maybe taking the plank out of your own eye would help here David.
I was trying to think how to summarise this, and in this respect too, David Torrance has been remarkably helpful, when he writes that for Salmond “it looked as if politics to him was little more than a game and the “truth” whatever happened to work in the moment…… inevitably tempting him “to busk, to rely on his immense native wit rather than always attend to the tiresome detail”. This entire piece exemplifies the same fault in David Torrance. It reads almost as if he started off from the headline (my admittedly vicarious knowledge of journalism suggests that the headline usually comes after) and wrote something to suit, without ever feeling the need to offer up much in the way of evidence, other than a superficial misunderstanding of much of the WP and an edited quote by Harry Reid.

In fact, I ended up wondering what this whole thing was about, and then when I got to the end I found the explanation “A fully revised and updated version of David Torrance’s book Salmond: Against the Odds is available from Birlinn. ” Perhaps, it being the summer recess, Salmond will spare the time to write to the Herald again. Last time he concluded

“First, I hardly know David Torrance. And secondly – and much more problematically for a biographer – he doesn’t know me at all.” (you can find this here http://www.heraldscotland.com/opinion/letters/13181351.Alex_Salmond_s_reply_to_David_Torrance/)

What Nicola knew, according to Alex Gallagher. Or not?

In today’s Herald, the well-known Labour supporter and Councillor Alex Gallagher claims Nicola Sturgeon was informed about the future dramatic fall in oil prices three months before the referendum. This is what he says

IN June 2014, at the annual oil conference held in Aberdeen, Nicola Sturgeon was told by industry insiders that the market price of North Sea oil was about to fall dramatically and would likely settle around $60 per barrel. A year ago this week Sir Ian Wood cautioned that the SNP’s valuation of Scottish oil reserves was “around 60 per cent too high”. Nevertheless, against all the evidence and expert opinion, the SNP continued to claim that a predicted future price of $113 per barrel was a reasonable basis for planning and, if we voted Yes for independence, the resultant revenues would sustain the Scottish economy at current levels for the foreseeable future. In reality oil revenues have fallen by a whacking 75 per cent this year. The consequences of such a fall in oil revenues for a Scottish economy divorced from the economic strength of the UK, and for our public services in particular, would have been disastrous.

You report that former FM Alex Salmond is demanding apologies from BBC reporters and pardons for historical figures (“Salmond calls for pardons for 18th century radicals”, The Herald, August 25). Wouldn’t it be nice, just for once, for Mr Salmond and the leadership of his party to desist from all the hand-waving and concentrate on their own performance?

The first anniversary of the SNP’s referendum on independence is fast approaching. Rather than demanding apologies from all and sundry for real or imagined or historical slights I would suggest that they designate September 18 as “SNP independence apology day” and issue their own mea culpa to the people of Scotland for the shocking level of their misdirection in this matter. A quiet thank you from the SNP to the majority who voted No for saving them and us from the consequences of their wilful foolishness wouldn’t go amiss either.

Alex Gallagher,

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Labour councillor, North Ayrshire Council,

12 Phillips Avenue, Largs.

To most of us with any recollection of the referendum debate, it must be obvious that there must have been some moratorium on that information – certainly well beyond a D notice – since I can really not believe that the Unionist press and the BT campaign would not have alighted on that with the greatest delight at that point in events.

We might also ask who it was who was making those forecasts, since I have, several times asked for anyone (and I think of Alex Gallagher as well) who was forecasting prior to 9/14 anything like the price that oil has fallen to.

As for Wood’s comment, that, as I recall was debated much more in the context at the time of just how much more oil could be extracted from the known fields in the North Sea. I don’t recall price being seriously debated, other than around whether it would be $90, or remain within the $100-$120 range that it had been in for the preceding four years.

Then there is the difficulty of the order of events. As I am sure Alex will recall, the White Paper, “Scotland’s Future”, was issued in 11/13, and it was this document that made use of the $113 price per barrel – put another way, the White Paper was issued 8 months before the forecast by people/ organizations unknown, was made known to Nicola Sturgeon.

Perhaps even more problematically for his argument, the forecasts being used by the SG in the WP were those made by none other than Department of Energy and Climate Change. One of the more amusing aspects of the debate around oil price during the referendum was that Better Together and Westminster were being critical of forecasts made by another Whitehall dept, on the basis of the more supportive (from their pov) forecasts of OBR (who, of course were wrong as well – just a bit less than others).

The discovery of Sturgeon being given the information claimed by Mr Gallagher is of course excellent from the pov of the narrative that he supports. However, as above, it suffers from a number of difficulties,

  1. not least that such a forecast – even if it had entered the public domain (and I have absolutely no recollection of that) was way, way out of line from anything else that was being suggested at the time. Sir Donald MacKay was defending the $100-$120 view. Even OBR was suggesting only $90. The forecast suggested by Alex Gallagher is 33% less than that, which was roundly criticised at the time for being far too pessimistic.
  2. Therefore, is he really arguing that if a forecast like that had been made by any kind of well-respected organization (or even not well-respected) during the referendum debate we wouldn’t have heard? Given the propensity of Better Together to make things up – especially bad news – this would have been too good an opportunity to allow to go by.

Jackie Baillie frequently makes the same argument about oil price, but then comes unstuck when she is faced with the question of who forecast the sort of price ruling now. Mr Gallagher is claiming that such a forecast did exist, but makes no attempt to tell us the source, or – even more surprisingly – why this was never exposed in the press at the time. His claim of course suits the unionist narrative, but like far too much of that narrative lacks detail beyond the claim, or supporting evidence –

“IN June 2014, at the annual oil conference held in Aberdeen, Nicola Sturgeon was told by industry insiders that the market price of North Sea oil was about to fall dramatically and would likely settle around $60 per barrel”.

Not as much as a hint of who told Sturgeon this, but no doubt we can expect the claim to be repeated. If or when it is, the source should be demanded, as well as an explanation of how the Scottish Government were able to keep this highly damaging information away from a press corps which could hardly be said to be supportive of their position.

The good Herald

Some weeks ago the Herald launched a new online format, which changed how comments appeared. Some of the changes were just clumsy – instead of threads with comments nicely nested one below the other as authors commented on each other’s contributions, each comment is quoted so that by the time a particularly interesting or contentious post has been commented on five or six times it has become tediously long because its repetitive. Where there are large number of posts like this it’s easy to lose the will to live while scrolling through.

More serious though is that there appears to be a harder, unionist line being applied in moderation. Under the previous regime posts would be removed for being abusive (fair enough) or for being directly critical of the journalist in question. The latter is a bit more contentious since how can you comment on David Torrance without being critical of David Torrance?

Or to take another example, the other day they ran a story that Michelle Thomson’s email address had appeared on the Ashley Maddison site. The problem with the story was of course that Ashley Maddison, I am told, does not validate email addresses, so someone else could put your email address on that site, and you would never know. For pointing that out my post was removed (or perhaps it was my suggestion that someone might do the same with Kate Devlin’s email address? We will never know).

Anyhow, this morning a letter by that redoubtable Labour councillor and supporter, Alex Gallagher was published – it appears in a subsequent post to this one. The essence of it appears to be that the SNP knew in June last year that the price of oil was about to fall to the sort of level its at today, but said nothing. Gallagher is calling on the Scottish Government to apologise for this.

There are multiple problems with Gallagher’s argument – which I go into in that post – but, and this is my point for now – this post too has been removed.

Has unionism hacked its way so far into the Herald that any sort of extended critique of the unionist position (in this case presented by Alex Gallagher) will not be allowed?

To date I have been an assiduous contributor to the Herald’s forum over the last two or three years, but no more. My only regret is that my sub has another ten months to run (renewing just before the change of format). The paper’s content is moving rapidly to rivalling the content of the Scotsman in being a cheerleader for the Unionist cause, but to edit the thoughts of readers for being inconsistent (or too inconsistent) with that policy is going much, much too far.

Therefore, in order to maintain my own sense of intellectual independence, I intend to make use of this blog to comment on the Herald without the threat of censorship (funny thing to say after Robinson’s comments about Putin, isn’t it?).

Hope anyone who reads this enjoys it.