A Modest Proposal To Instigate A Totally Fare-Free Transport System
Throughout The United Kingdom

Some Necessary Preamble

In 1968, the actress Anita Harris recorded an Andrew McMaster song called We're Going On A Tuppenny Bus Ride. Having grown up during the Swinging Sixties, I can remember going on a tuppenny bus ride. That is 2d in old money; the adult fare was 3d. At that time there were twelve pennies to a shilling, and two shillings – two bob or a florin – became tenpence in modern money. Ten new pence it was called then.

My second job after leaving school was working for what was then the London Transport Executive. Round about late 1975 I had a discussion with a fellow workmate at the White City depot where I was then based regarding free travel, which was probably the major perk of the job. As anyone who knows me will tell you – especially my solicitor - I have never been slow to claim a free lunch, but by the same token, I have always thought sauce for the goose, sauce for the gander, so it seemed to me only fair that other people should free travel too.

Of course, we would all like free travel, and free everything else, but the stumbling block is that in practice free usually means “free to us”, and that somebody else has to pay. Socialism promises free this, free that, but in order to provide these free goods and/or services, somebody else has his pocket picked, usually the taxpayer. Mostly it turns out that far from being provided with a free service, free this, free that, we are actually paying for it through our taxes, and that if the same service were provided commercially, it would cost us less.

There are though, exceptions. While most of my Libertarian friends believe the whole state should be sold off, there are some services which can only be provided by the state – in my humble opinion. For example, although we can and do have private security services, investigators, etc, most people agree that the police should be employed by the state, the Crown, the local authority or whatever, and that there should be some mechanism of public accountability, including to Parliament. Similarly, many people view private prisons as unethical, and the state – in its role as servant of the community – can and perhaps should provide various other services.

At various times and places – including in contemporary Britain – the state, either through central government or local authorities, provides subsidies to services for the public good. The state has at times subsidised basic foodstuffs. Although subsidies are always viewed by Libertarians as picking the pocket of the taxpayer in order to appease or bribe special interest groups, there is an up side. Subsidies can lead to economies of scale, so the goods or services in question can be provided more cheaply, or at a price that would be uneconomical for most of the consumers concerned.

Up until the Thatcher era, public transport in Britain was exactly that, ie it was publicly owned. Most of Britain’s railways were nationalised in 1948; having begun their existence as private companies with shareholders, as the network grew and with competition from the newfangled motor car, it simply became impossible for the majority of rail services to be run commercially.

Now, one would imagine that if the network is publicly owned, ie by the people, then the people have the right to travel on it for free. One may imagine that, but that never was the case. The term “public ownership” or declensions thereof is something of a misnomer; although the rail network was heavily subsidised, it was run in effect as a private company. Beware, anyone caught travelling without a ticket. (1)

Returning to White City, although I had originally voiced the free travel proposal while working in a signal cabin at Baker Street, it was met here with stiff opposition, namely that it would be too bureaucratic. I beg to differ. Now, with privitisation, we have not even the pretext that public transport is either public or for the public good. The train services have been sold off as franchises, and on top of that, they are subsidised. In other words, the taxpayer has the worst of both worlds. On the one hand he is subsidising the traveller, who is still paying through the nose. On the other hand, he is also paying the parasites who run these companies. Why should the non-travelling taxpayer subsidise both groups for no return at all? There are two ethical solutions. Either he subsidises nothing, and the traveller pays the full whack. Or he subsidises the lot, and in return he is granted fare-free, unlimited travel within the UK.

If there were no subsidies at all, there would be no trains, or at best far, far fewer trains running on far, far fewer lines, and the fares would be astronomical. But what if there were no fares at all? In October 2000, I sent a letter to then Mayor of London Ken Livingstone – which was ignored – in which I proposed a fare-free public transport system for Greater London. My letter included some mathematics which I had dug out from official figures. The following calculations, for this much grander scheme – a totally fare-free rail service for the entire UK – are based on figures provided by Paul Withrington of Transport-Watch in an E-Mail of November 7, 2010.

The Basic Mathematics

Mr Withrington advises these figures be applied with caution: “Recommend that whatever you do with the numbers you cite the sources and provide definition rather than a blanket statement like the cost of running the railways.”

With that caveat, here goes:

Gross Passenger revenue £6,179 million

Government support £5,213 million

Total: c£11.4 billion

This includes capital for new projects. “Then of course, the Train Operating Companies pay dividends out of fares and there is repayment of loans totalling circa £22 billion. I am uncertain as to whether the interest on that is included in the above.”

According to the Office For National Statistics, the total UK population for mid-2009 was a shade under 62 million.

Putting these two figures together, ie total cost of running the railways and total UK population, gives us the following: 11.4 billion divided by 62 million = 1900. Ie, if the traffic were the same, the cost of running a fare-free railway system would be £1900 per person, per annum. Not per taxpayer, per person.

I must stress that there are a few rail networks that are not covered by this calculation, eg the Keighley & Worth Valley Railway, but these are railway lines that are run by and for (steam) enthusiasts rather than for people who simply want to get from A to B.

Now, with no increase in passenger traffic (yes, there would be, but I’ll come to that shortly), with no increase, the actual cost or running the UK fare-free service would be greatly reduced.

With no paid passengers there would be no need for the following: booking office clerks, ticket collectors, ticket inspectors, auditors, etc. Sack ’em all!

Ticket machines and associated costs - the railways would need much less security.

Prosecutions for fraudulent travel - how much would this save in police and court time, fines, and the occasional prison sentence?

Dividends, interest payments - nothing of this nature.

In short, the entire fare side of the expenses equation would be eliminated. Now, the two principal objections.

The Pseudo-Moral Objection

This is the first objection I have received from Libertarians. It goes something like this: there is no such thing as a free lunch, or if there is, there shouldn’t be. What this really means is that other people shouldn’t have a free lunch. One critic said that he was quite happy for other people to pay extortionate fares, even if a relatively modest sum were to come out of the public coffers in order to finance these proposals. As I said earlier, if you are a taxpayer, you are already financing the rail network, whether you like it or not. If nothing else it is far more moral to finance out of the public purse a system that can be used (in theory) by everyone, rather than to put money in the pockets of parasites, ie the current owners.

The Tragedy Of The Commons

This is the main, indeed the only real, objection, on the face of it, but on closer inspection, it turns out to be not so. For the benefit of readers who do not have a scientific background (2) [which does not include economics!], consider the following. Your local supermarket announces that as of next Monday morning, it will be giving away cans of baked beans for the entire week. Bring a shopping bag and help yourself to as much as you can carry. No limit. Does anyone doubt that it would be “sold out” by Monday afternoon?

The major objection to a fare-free transport system is that suddenly, everyone would travel by train everywhere, and the system would grind to a halt. Not so! Appealing though it is to my detractors, the tragedy of the commons does not apply, for the simple reason that the population of the UK is limited – around 62 million in mid-2009, remember? - while the demand on cans of baked beans from your local supermarket is not. In fact, London does offer free outward bound travel in the small hours of New Years Day, and in spite of the crowds in Trafalgar Square, everybody seems to get home. (See also below re Hasselt).

What we see here is not the tragedy of the commons, but the free rider syndrome, that wonderful phenomenon which everyone hates – unless it applies to themselves. Let us take an analogy that everyone reading this will understand. A large number of Internet companies offer free rides to literally everybody. You can have a free E-mail address, free webspace, free social networking account (FaceBook, MySpace, YouTube), etc. Yes, absolutely free, in fact you probably have. Of course, most of these free services are more limited than premium services, but at the time of writing, Yahoo! (for example) allows you to send as many E-Mails as any reasonable person could desire, and attachments up to 25Mb.

Of course, if you do want a premium service, you can sign up and pay. That way you will be able to store bigger files on your website, have more traffic, and so on, but at the end of the day, countless millions of people worldwide have free accounts and manage with them entirely. FaceBook has over half a billion account holders, one company.

Do people who pay for their accounts with Yahoo! complain about the free riders?

Allowing free accounts also benefits these companies. Undoubtedly there is a certain amount of idealism attached to the freebies, but certainly none of them would offer free services if to do so were to their detriment.

With a fare-free transport system, free riders are a positive benefit, because the cost of actually running the trains (on a passenger-per-mile basis) plummets dramatically. If it costs say £1,000 to run a particular train which carries one passenger, how much does it cost to run the same train with 500 passengers? A bit more than £1,000 but nothing like 500 times as much.

More Costings, And Benefits Galore

On New Years Eve, I was informed that the cost of my off-peak travel card was rising from £6.30 to £7.30. On January 2, the 5.45pm BBC news programme reported an increase of more than 6%, some more than 12%. A number of people were interviewed on the programme.

One man, who travelled from Tonbridge to London saw the price of his season ticket rise £350. Another regular passenger, from Canterbury to London, was set to pay an extra £488. Another, Gloucester to Birmingham, £268 more. And a Welsh traveller, Cardiff to Bridge End, an extra £72.

Now, let us imagine that with the fare-free network, everyone jumps aboard. Let us imagine too the traffic quadruples. Obviously more rolling stock would be needed, and more train operating staff, maintenance staff, etc, but nothing like four times the staff, and the extra wages would very likely be covered by the redundancies of the revenue side staff. But let us imagine that the cost of running the network were to treble, to around £5700 per citizen. That sounds a lot, but it is not such a lot to the man who is paying £488 extra for his season ticket. And how about the motorist who leaves his car at home?

Think of all the other benefits too. Cleaner air by dint of less traffic on the roads, and far fewer accidents. Fewer police tied up with chasing motorists, and therefore available for more pressing matters. The country would require much, much less crude oil and petrol. It would be possible, even desirable, to scrap much of the UK’s internal air traffic.

The unemployed would be truly liberated. Instead of getting on their bikes, they could get on the train instead. With a fare-free transport system, not only would mobility increase, but people would be willing to work for less, which in turn would stimulate the real economy. And so on. Indeed, society would become totally restructured. I haven’t mentioned here the possibility of a fare-free bus system within major towns and cities. In the 1980s, the City of Sheffield introduced a heavily subsidised bus service. There was even a fare-free bus that operated in the city centre. This did not lead to Sheffield becoming overwhelmed with subsidised and free riders, but it did greatly increase the mobility of its citizens, and have a beneficial effect on the transport system generally. There have been similar fare-free public transport systems here and there, including in the Belgian city of Hasselt. Which begs the question, if it works in Hasselt, why can’t it work everywhere?

How Can We Not Afford A Fare-Free Public Transport System?

There is another, extremely important reason we should introduce a fare-free transport system; the world is running out of oil. This has led governments and oil companies to take desperate measures, such as drilling in eleven thousand feet of water. The recent Gulf oil disaster was an accident waiting to happen. The loss of life aboard the Deepwater Horizon oil rig and the damage caused to the American Gulf States may be the tip of the iceberg if, as some scientists claim, the Gulf Stream has been affected, or if the seabed itself has been fractured. As I write these words, it has been announced that the lunatics responsible for this eco-holocaust, BP, have signed an agreement with the government of Russia to inflict similar damage to the Arctic. We should all heed the words of Professor Bartlett before it is too late. (3) And it may already be too late.

How Would The System Be Subsidised Initially?

Last year, the Bank Of England created some two hundred million pounds of new money by a mysterious new process known as quantitative easing. At one time, this was called printing money or inflating the currency, but quantitative easing sounds so much more alluring. What has happened to this new money? Obviously it has not gone into the pockets of consumers or been used to finance entrepreneurs, because there is a massive shortage of money in this so-called recession. Except for bankers, of course. The short answer is that this newly created money has literally been given to the banks who will lend it to “investors”, ie sell government bonds, and then pay interest on them. Did anyone ever hear of such lunacy? They create money, give it to the banks, and then we all end up paying interest on it. If instead the government, or more appropriately the Crown, were to create this money and spend it into circulation, by creating new infrastructure – perhaps on upgrading rail lines, ordering new trains, and constructing new power stations, wind and wave powered in particular – and at the same time using it to subsidise the rail network totally, this would greatly increase the wealth of the community, and lift hundreds of thousands of people out of poverty.

An alternative way of subsidising the system would be to withdraw all our troops from both Iraq and Afghanistan; perhaps a few of them could be used to police the system, travelling up and down in plain clothes, just to ensure that Al-Qaeda don't plant any bombs on the new, extended network?

The International Aspect

The introduction of a totally fare-free domestic transport system for the UK would lead to a few anomalies, for example, international travel, especially by train, would not be covered. If the government felt tourists and other overseas visitors should still contribute to their travel within the UK, a small tax could be introduced at ports, but there is no reason this system should not be introduced gradually throughout the world. Certainly high speed train travel within the Continental United States would be preferable to either driving or air travel. And again, the eco-benefits would far outweigh the actual costs.

Conclusion

The first year of such a grand scheme would be both the most expensive and the most challenging, but the novelty of free travel for the sake of it, for the Hell of it, would soon wear off, and passenger traffic would swiftly stabilise, albeit at levels considerably above those we see today. More importantly, once the viability of such a scheme was demonstrated, it would spread to other countries, not necessarily like wildfire, but there is absolutely no reason that smaller countries such as Holland and Belgium could not instigate similar schemes. And the reduction in the consumption of oil would soon become not just significant but staggering. With all these pluses and no minuses (save a few dividend payments for parasites on the public purse), how can we not afford to instigate a fare-free public transport system for the United Kingdom as a first step to providing one for the entire world?

January 15, 2011

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To Notes And References

From www.financialreform.info
(UK)