OK, today has seen a fascinating (frightening?) White Paper, which looks like completely changing our NHS. I am probably going to talk a lot about back-door privatisation and the threat to our health system, but I thought I would actually read the White Paper first, and as always I encourage others to check the facts for themselves, rather than relying on media spin or what bloggers have to say. So I hope once you have had a look at my little piece you will actually look at the proposals for yourself.
So why am I bothering to blog on the subject at all? Because a sense of proper outrage generally requires one to have some idea what you are talking about, and unsurprisingly most end users of the National Health Service have absolutely no idea how it is organised or run. So what I am going to present here, courtesy of the notes of Lisa Langood and my own thinking, is a quick guide to the organisation as it stands, so that when you read about the reforms you fully understand what is being suggested, and what is there already to be changed. I am sure this may count as the most boring thing I have ever written in many people’s eyes, but hell, I think it’s important. This is a rare thing, a CJ/Lisa Langood co-written piece, though Lisa is at work and does not know I have used her notes!
The National Health Service (henceforth NHS) came in to existence in England with the National Health Service Act of 1946, forever linked with Aneurin ‘Nye’ Bevan who fought to establish the service in a very limited time frame against initial opposition from large parts of the medical establishment (but mainly the GP’s who were at that time private practitioners You wanted a doctor, you paid for it, or went to a charity hospital). The Scottish NHS was brought in to existence by the National Health Service Act (Scotland) 1947, and after 1967 Wales came to organise its own NHS which became autonomous of the NHS England. Health and Social Care in Northern Ireland (HSC) has many similarities, but its structure is sufficiently different that I will not discuss it here at all. I will focus primarily on the NHS in England, with differences in the Welsh and Scottish mentioned passing.
OK, look complicated? I will briefly run through what each bit does…
The Department of Health
The overall responsibility for the NHS in terms of planning what it needs to do and meeting statutory requirements (making sure it obeys the law) and government policy is the Department of Health, a large Civil Service organisation, which deals with advising, formulating and implementing government policy and directives on matters of Health. The Department of Health is headed by the NHS Chief Executive, supported by the Chief Medical Officer, who advises the government on medical issues and public health policy and the Permanent Secretary, a civil servant who manages the Department of Health. A number of doctors are appointed to senior positions, acting as civil servants and serving successive governments. These include the Chief Medical Officer already mentioned, the NHS Medical Director, the Director General Research and Development and the Director of Medical Education.
Some government ministerial positions involve a role in the Department of Health, changing with each election as parties appoint their candidates to the roles. These are the Secretary of State for Health, who is a Cabinet member, and include the Minister of State for Health Services, Minister of State for Public Health, the Minister of State for Care Services, and the Parliamentary Under Secretary for Health Services. A Departmental Board of highly qualified individuals provides oversight, but the Department of Health’s main role is the implementation of legislation and creating of policy, as well as oversight of the Strategic Health Authorities. (see below).
Summary: The Department of Health consists of civil servants and politicians advised by high ranking doctors who set policy in line with the Government objectives. So this is the department of Government who has proposed the changes in line with Cameron’s vision for the NHS, a sone might expect and is their duty.
Strategic Health Authorities
There are ten Strategic Health Authorities (SHA’s) in England. These regional bodies are tasked with oversight of performance of local NHS Trusts (but not Foundation Trusts, both explained in a minute!) and implementing national policies and directives at a local level, as well as ensuring that the correct decisions are made at regional level, taking in to account the different local context. So rather than have specialist care in every regional hospital, certain regional centres specialise – Frenchay in the Southwest for example for head and spine injuries. With a key objective of improving performance and staff development, (and checking all staff are properly trained to the required standards) they form a middle tier of authority between the Department of Health and the local Trusts.
“Created by the Government in 2002 to manage the local NHS on behalf of the Secretary of State, there were originally 28 SHAs. On 1 July 2006, this number was reduced to 10.” – from the Office of the Strategic Health Authorities Website (http://www.osha.nhs.uk/)
The ten SHA’s established in 2006 are (1) NNS East of England, (2) NHS East Midlands, (3) NHS London, (4) NHS North East, (5) NHS North West, (6) NHS South Central, (7) NHS South East Coast, (8) NHS South West, (9) NHS West Midlands and (10) NHS Yorkshire and the Humber. Gloucestershire NHS Trust is within the NHS Southwest Strategic Health Authority region.
Primary Care Trusts
There are currently (2009) 152 Primary Care Trusts (PCT’s) in NHS England, which answer to their regional SHA; before October 2006 there were 303, but the number was reduced for efficiency purposes and to redraw boundaries to match those of many local authorities.
A Primary Care Trust is a commissioning body, whose purpose is to ensure local health needs are met in accordance with the targets and objectives set by the regional SHA, and each Trust has a smaller area which it is responsible for. PCTs manage their own budgets and set their own targets and strategies, in line with the directives from their SHA and the Department of Health. They are responsible for commissioning the provision of the full range of health services . These include hospitals, mental health services, ambulances and paramedic services, GP practices, opticians, community pharmacies, dentists etc. (McCay & Jonas, 2009) They commission smaller NHS Trusts such as a Hospital Trust (see below) or from the private sector to meet these needs, and are responsible for allocating 80% of the NHS budget. (McCay & Jonas, 2009)
NHS Trusts & NHS Foundation Trusts
Within the area of a Primary Care Trust there will be a number of individual NHS Trusts, which are commissioned to provide one type of service to the region. These generally cover one area, such as a Hospital or Hospitals (Acute) , Mental Health, Ambulance and paramedic services, or Community Health Services such as district visiting, health visiting etc. There are two special kinds of Trust – Care Trusts, which are multi-agency task forces which only exist as partnerships between health and social care providers in a region, ensuring both services work fully together to provide a unified care plan. The second are Children’s Trusts which were created under the Children’s Act 2004, which again are multi-agency Trusts working to bring Education, Social Services and Health care provision together to address cases. (McCay & Jonas, 2009)
A Trust is managed by a board, often of eleven members, who provide direction, monitor performance, deals with the financial integrity and management of the Trust. Trust boards usually have a number of non-executive directors who may not be form a medical background but who bring other expertise or the public’s voice to the meetings, which are also open to the interested public if any wish to attend. Trusts have a legal requirement to break even financially, meet specified quality standards and meet other SHA targets.
A Foundation Trust is a newer initiative from the old New Labour government, designed to give increased local autonomy to the Trust. Since 2005 Trusts who have met certain levels of financial and other target success are able to apply for Foundation status, which exempts them from SHA and Monitor control, and allows them to “run their own financial house”. They are able to set local wages and conditions, borrow money to meet short term needs under certain statutory limitations and to manage how they meet targets and performance benchmarks in their own way, as long as they meet the somewhat higher financial and quality control goal posts. They are regulated directly by a supervisory board called the Monitor which reports directly to Parliament. The aim is for all trusts to move towards Foundation Trust status, but as of August 2009 the number achieving this was 122 (the Reforms announced today will make ALL Trusts Foundation Trusts by 2013.)
A special type of Foundation Trust is the Foundation Trust equivalent, (FTe), all of which are specialist psychiatric trusts such as the one that covers Rampton Hospital for the Criminally Insane. They are still regulated by the SHA, but the Secretary of State has a personal remit to review cases and provide oversight to problems arising here.
Primary Care Providers
This group, often the first point of contact for patients, are businesses who work within the NHS structure but are privately owned and managed in accordance with legislation. They include GP’s surgeries, NHS dentists, optometrists, community pharmacies, etc. They are still subject to Primary Care Trust supervision and must work within constraints and parameters laid out to meet patient needs. It is for example not just possible to open a new pharmacy, especially in a rural area which may already have dispensers attached to a local GP’s surgery, but the new pharmacy must meet certain requirements to ensure it meets a perceived need in the neighbourhood and is properly run by a fully qualified pharmacist. Receipts, prescriptions and payments from the PCT and the constant supervision of the latter body mean that these primary care providers work closely alongside the licensing PCT in support of the local plan, at least in theory. Also working in this area are Voluntary and Charitable groups and Social Enterprises who meet specific needs but work closely with the PCT to fulfil the overall health needs of the area.
Lisa wrote in 2009 “The NHS structures have evolved over time, with the creation of the NHS Trusts replacing the older Health Authorities and the introduction of SHA’s being major changes. Alan Milburn’s 2002 creation of Foundation Trusts, which came in to effect in 2005 have sparked considerable controversy, with opponents claiming that the setting up of the monitor and allowing them to stand outside the existing NHS plans of the Department of Health and SHA’s is a stealth move towards privatisation. More importantly some claim this removes the cohesiveness of the National/Regional/Local plan, and reduces SHA’s ability to draw upon needed resources and create a regionally effective structure. Some of the heaviest criticisms have been directed at the financial targets which it is claimed may lead trusts to specialise in cost effective and profitable health care options, leaving expensive but necessary services underfunded and pushed out to other providers. As with any complex management structure there are obvious issues when the various Trusts and commissioned Primary providers must engage in multi-agency work, such as in the case of children with severe mental health, family and educational problems, and even within the NHS structure different trusts must create working guidelines for how to share information and responsibility on specific cases, while maintaining client confidentiality and abiding the provisions of the Data Protection Act.
Any multi agency approach runs the risk of the “somebody else’s problem” issue, where the relevant organisations and individuals assume that the needs are being addressed elsewhere, but do not check that this is actually occurring. Faced with busy case loads and many issues it has frequently occurred in the past as we see from many high profile cases which eventually became newspaper tragedies, where a lack of coordination led to unfortunate oversights. Communication between the parties involved is absolutely key. Many health care authorities are working to create regional multi-agency teams to deal with exactly this sort of case, but this has led to new challenges. For example, when one steps outside of sole practice and works as a team, where does accountability lie? Who is ultimately responsible for the decisions taken by the team? Some GP’s are already concerned about the professional repercussions of decisions made by multi-agency teams they comprise part of, and the GMC has issued guidelines - http://www.gmc-uk.org/guidance/current/library/accountability_in_multi_teams.asp
These problems can plague the attempts for various Health Care Providers to provide a unified and consistent approach to a problem.”
So what is actually changing?
I still need to read the White Paper properly, but the Strategic Health Authorities and Primary Care Trusts are being abolished. So everything will devolve to local level, and the GP’s will be asked to form consortiums instead to run the local areas doing the work of the now defunct PCT. For this they are being granted an £80 billion pound budget, and the provision of services currently provided by the Primary Care Trusts will pass to the GP Consortiums. Overall responsibility for Public Health campaigns and services passes to the Local Authorities (by which one assumes county and town councils, and hence one might cynically assume, our Council Tax bills). ALL NHS Trusts are to become Foundation Trusts by 2013. To allow this to occur the current caps on Trusts taking on fee paying private patients are to be lifted, and Trusts which fail to achieve profitability and go bankrupt will be allowed to go under, not be bailed out. (So yes, hospitals can now go bust and be closed down, if they fail to break even.)
I am unsure if the new GP consortiums will consist of solely NHS employed doctors, or include GP’s in the private practices that treat NHS patients and are paid by the NHS for providing that service currently by the PCT’s. If the latter, it means that the doctors consortiums will be able to award contracts to their own practices, set their own fees etc, etc? I really need to read this paper! I’ll write more once i have properly read and digested it in a future post.
Anyway I appreciate this has been a bit dull (understatement I guess!) but hopefully if you took the time it read it you have a little more idea of the background, and a better understanding of the news coverage of the NHS reforms announced today.
OK, it’s been a while. Let’s just say life has been filled with sick neighbours needing caring for, loved ones with serious work hassles – about as serious as they get actually – and CJ trying to get some work done. I have also lost a couple of days to POLTERWOTSIT, my little poltergeist based blog, chronicling the “Doncaster Poltergeist” (Parts 1, 2, 3, 4). I have been strangely absent from my favourite forums, and have barely responded to comments on this blog, even the interesting discussion on Eostre, though I was pleased to read Cavalorn’s excellent Live Journal article where he writes much sense.
Still I suppose it’s time to comment on the General Election, and talk politics. Please don’t change the channel — you all know that I am an old lefty who will vote Lib Dem because I live in Cheltenham, but for reasons to do with economic policy and supporting the public sector (I’m still likening our position in some ways to 1947, and see public sector spending as one potential way out: I’m sure the economists among you can tell me why this is a hopelessly naive assessment) I want to see Brown re=elected. Bet that really scares and outrages a lot of people? Hey we can differ.
Anyway I had a good laugh at this —
And here Labour effectively capitalise on my fears – the fear of a return to Thatcherism. I lived through the eighties, and I must say that my thinking is still scarred by it — not so much by Thatcher, as by the fear of thermonuclear annihilation at any moment, that wonderful gift to my generation of the Cold War. You wonder that religions and apocalyptic cults boomed in the period after the horrors and genocide of WW2? When has fiery eschaton (‘end of the world’) coming out of a clear blue sky, with a four minute warning heralding the final Trump, ever seemed more realistic? It’s hard to disengage and be realistic about the strengths and weaknesses of Thatcher’s experiment with Libertarianism without taking that constant unease in to account…
So why were the eighties bad? They weren’t. For CJ, it’s in some way forever 1987, and I’m still an 18 year old student leaving home and living through “interesting times”; still dress a bit like it’s the eighties, and my musical tastes have not really evolved much beyond the goth/indie/alternative scene of those years. In some ways I’d like to see a return to the eighties; not the real eighties of urban riots, the miners strike, the housing boom that was to end catastrophically in the early 90′s, or terrible sitcoms on TV — no the eighties I miss are the times I was a student, discovered girls (I was a very late developer) and made many of the friends I still hold dear today. Nostalgia is not what it was…
So why do I bang on about the dreadful legacy of Thatcherism? For the same reason it’s hard to find a New Labour supporter among the twenty somethings and teenagers of today. We lived through a long period of Tory rule, and while i quite liked John Major as a bloke from what I saw of him, and many Tories were brilliant politicians and great thinkers, the social experiment that was conducted in those years scarred many of my generation. So why this feeling among my younger friends that we need to have a change of government?
The human heart seems to hanker for change; “the grass is always greener” as the proverb has it. After three governments of any party one wants to try the alternative, wants to see if they can do better. We all have Messianic Expectations – the new guys will get in, make all right with the world. It’s why like many other traditional Labour supporters who welcomed the 1996 victory of Blairite Labour as if we had all our birthdays and Christmases come at once, disillusionment soon set in. When Labour stopped being “Socialist”, when Labour seemed to turn it’s back on students and followed the old Tory funding plans, when Labour seemed to fail – and they did in my eyes – to meet working class British interests, I realised what we were seeing was not Labour at all. Blair was a Democrat, as in the US party: he took us back to the Thatcherism that Major and IDS had repudiated to some extent. Blair’s Britain was the party of Middle England, and there is much to be said for that I suppose…
So I became a fierce critic of Blair, but in years when the Tory party self destructed over Europe: now under Cameron they seem to be mounting a credible alternative. What of Brown? I have said before Gordon Brown saved the world, and I’ll say it again: Gordon Brown saved the world by his bail out plan. While the Americans dithered, little old Britain again, perhaps for the last time, became a world power, as Brown and Darling (sounds like something from Blackadder IV doesn’t it?) hammered out a plan that prevented the banks collapsing and complete melt down. I don’t know how far we were from no food in the shops, but I do know that a lot of people would probably not have been paid and things got very hairy indeed if it was not for that commitment to a plan. They may have failed to forsee the disaster – they had a couple of years notice, and failed to act, and for that they should be rightly criticised – but when they finally acted, it was decisive. The only question is does the parent who rescues the baby from the burning house deserve the praise when their carelessness allowed the baby to be their in the first place? In thsi case the conflagration was general – the fire started in the USA, and no one had tried to regulate efficiently for fear of stifling the market and causing a recession – so we trusted the bankers…
So Brown was the man with a plan. Sure it’s a plan that has plunged us in to massive debt – still insignificant compared with the USA’s – but that worked in 1948, when we borrowed through the Bretton Woods agreement and set up the NHS on the yankee dollar; it can work now. The trick is to keep the public sector expanding, so we have a safeguard against the vagaries of market and private sector failures.
A brief digression in to Theory…
I’m surprised by how many people i know who seem to not understand the most simple economic and political ideas. I humbly forgive those who know all this: I’ll offer a short synopsis.
Capitalism believes in a free market.State intervention is kept to a minimum: the market sets prices, and so competition will always lead to an efficient market price. The job of the state is to regulate and protect that free market, and allow people to prosper through their own hard work. It’s a beautiful idea, and since Adam Smith put it forward in 1776 it has proven its worth. Huzzah for Capitalism! The problem is that a free market is subject to ups and downs – boom and bust. Gordon promised an end to boom and bust, and then presided over a bust, and I don’t mean Edwina’s bosom – that was the Major years…
Communism is more complicated, because it is far more than an economic theory, it’s also a theory about history, sociology and the nature of reality. The basic idea however is that the State looks after workers, and sets prices, taxes, and has huge amounts of control of every aspect of citizens life. Eventually it will wither away and be replaced by a utopian paradise, but er, that never really happened. Still Communism is complicated like I said – but think State control, representing workers interests through the Party.
Socialism (in the UK sense) has strong links with the cooperative, Trade Union and though many do not relaise it Christian movement of the 19th century. The basic principle is that social justice prevails, reigning in the excesses of capitalism. It does not endorse the Free Market as Capitalism, or State Regulation as in Communism: instead it favours a Mixed Market approach – some industries such as water, power, trains, postal services, and other necessary parts of the infrastructure are controlled by the State directly – much like our NHS (National Health System, or the US postal service), and other parts are in the hands of private companies, and subject to competition and the market. This process is called a planned economy, because in theory the government has some control over what happens in the long run. Unfortunately the results of Labour’s policies will come to bear on the Conservatives if they win: many economic policies, like business management strategies can only be fully understood years later when the consequences become apparent. It’s not so much planned as do something, hope it works and hand it on to the next guys…
There is another factor involved here, that I briefly touched on in my discussion of Brown and the Credit Crunch above – globalization. The bonuses and problems inherent in this can be discussed another time; but the internet, phones, and a shrinking world has meant that now we do far more business than ever with the rest of the world, and whatever the British politicians do, a boom or bust may be as much to do with events on the far side of the world as events here. The role of government has changed from trying to control their own country by dictating a management strategy, to trying to weather the ups and downs of global events.
There are other types of economic system – of which perhaps the most important is Anarchism. Anarchism is the ultimate end of communism in Marxist theory, where the State ceases to exist, and it’s a utopian in many ways ideal where people don’t need a Government at all: all state regulation is removed, and a genuinely free market develops, where people govern themselves, and while you still have laws, you don’t have any kind of State at all. There are many many types of anarchist thought — left anarchists such as Anarcho-syndicalsist where workers running their own industries and setting up communes which trade with others; Right Wing anarchists are generally today called libertarians, and they believe in the Free Market, being super-capitalists – let the Market decide, get rid of all state regulation, and people will strive to get rich and better themselves. As Thoreau wrote “that government is best that governs least”…
Thatcher the Anarchist?
So what was acceptable in the eighties? Why does the spectre of Margaret Thatcher still arouse such strong feeling in many of my generation? And why do New Labour think that poster might work? Down here in Cheltenham the eighties were boom years, likewise in the City of London. Why would others fear a return to the decade of Duran Duran and Spandau Ballet, other than fashion sense?
The most important thing to recognise was that Thatcher was a revolutionary. What she created was basically “New Conservatism”: while she could be authoritarian, imperious, and a promoter of a mythic England she loved, she also had that small business hatred of over-regulation and bureaucracy, a fear of Big Government that tried to impose answers from above. Thatcher was in many ways an anarchist – she dismantled the State, and tried hard to reduce governmental control in every sector, from finance to industry. Thatcherism has often been described as the politics of “I’m alrtight, Jack” — self interest, everyone out for themselves – but it was far more than that. One of the basic principles of Free Market capitalism is that there si an “invisible hand” that regulates the markets – I’m not sure if Smith felt it was the hand of god, but basically it is self-interest – give people the mean to make money and better themselves, cut any red tape in their way, lower taxes, and everything will work out fine – because people will act rationally in thei rown economic best interests. Get rid of the “nanny state”. This was actually a radical departure from older Conservative theory, which had seen paternalism – where the State looks after peoples best interests – as key.
So Thatcher adopted a lot of libertarian ideas, from right wing think tanks in the States — she gave people new options, new possibilities, to sink or wim. And let’;s face it, huge numbers prospered amazingly. She pretty much reversed the ratio of people who rented to people owning their own homes – give people a nice home of their own, and hey what happens? They become better citizens, because they are stakeholders in society. They become wealthy, and prosper. This was a miracle that benefited a generation; but it was at the expense of a credit based mortgage driven society, and the sale of the council house stock. When you sell someone their council house they benefit, but when you need council houses you ain’t got none. New Labour compounded this disaster by failing to build new council houses – it’s all downhill…
But Thatcher presided over an economic boom. She followed a fiscal policy that ended post war austerity and the drab misery of the 70′s – a decade we would all probably happily forget – and she made us a nation of entrepreneurs. There were scandals, there were bad times – but she made people rich, allowed them a shot at their dreams, made the yuppie work ethic and aspirational culture leave the City and New Romantic clubs and gave Britain a kick in to the 21st century, two decades early. It was a golden age – marred only by the shadow of the Cold War…
Except — she did this at a terrible price. To dismantle the nationalised industries meant huge redundancies – as unemployment headed for one in ten again, pretty much the situation when she came to power, everything fro the buses to British Telecom was effectively flogged on E-bay. Thatcher distrusted the State so she dismantled it, and as the pit closures and the privatisation led to a wave of industrial action similar to that in the Winter of Discontent of 1979, she smashed the unions power, tilting the balance in favour of the employer over the employee. The result was a Ravaging of the North not seen since William the Conqueror — whole communities shattered as their traditional industries failed to be competitive when the government relinquished control and allowed them to be privatised. New Labour have followed in this path: but interestingly while Blair brought in more and more employment legislation to give rights to workers, Brown has largely dismantled it, and replaced it with “Guidelines” and “consultation”. No one is interested it seems in employees rights any more – the emphasis these days is on supporting the employers, as wealth-creators.
Now to understand why Thatcher destroyed the unions, you have to understand that the unions were in the 1970′s still a major political force. Old style commie union leaders used strike action as a way to bring down governments, and in fact it was this kind of mass industrial unrest in the Winter of Discontent (1979) that brought down Labour and allowed Thatcher to sweep to power. Thatcher believed that the unions prevented economic growth, and she took decisive action, and used the police to try to prevent what she saw as revolutionary action by striking miners and flying pickets.
Hugh used to ask me with each new sell off “given that we owned this company as a people, and can’t afford to buy shares in the stock market in the new privatised one, where is our pay off?” I liken it to parents who decide to sell their children’s inheritance; the new privatised companies were not run for social benefit, but to make a profit for the shareholders, obviously enough. Has competition brought down the price of phones, gas, water, in real terms while providing a more efficient service etc, etc? I honestly don’t know, I have never seen the figures. I do know that many of the coal mines closed in the eighties would now be profitable again if they were not flooded, but hey, hindsight is easy.
What the eighties saw was sudden jump in the difference between the haves and the have nots in our society – a pattern that has continued relentlessly ever since, with the successful entrepreneurs, CEO’s, small business folk and managers seeing a greater and greater share of the pie. Wealth has become concentrated in fewer and fewer hands – not quite as much as in the twelfth century I suspect, but the disparity between rich and poor continues to grow. In fact we have new factors now like Information Poverty – why Brown’s “broadband in very home” pledge is so vital, however he manages to pay for it…
So the eighties was a revolution in British society: the breakdown of the old class system, the creation of a “new middle class” of home owners, the devastation of whole communities, the collapse of old certainties like “job for life”. Many prospered; if I had left uni a couple o years earlier I might have done well — many others sunk without trace. It was the decade fo the North/South divide, of boom-town London, and of immense wealth and immense poverty. It all came down crashing down with the collapse of the Stock Market and then housing market in the early 1990′s which were a hang over for the part of the decade before — all presided over by Conservative administrations who had to deal with the real cost of Thatcher’s experiment, and who repudiated Thatcherism in the same way the USSR repudiated Stalin. It’s been hard to find anyone with a good word for Thatcher for a long time, outside of neo-con Americans and Libertarians, and while I appreciate her courage (in the Yes Minister sense – her ideas were often “courageous”, the Poll Tax the most so) Thatcher was arguably a great success. You could probably say the same of Blair..?
To me, it’s all irrelevant now. We are stuck with the legacy of the eighties, and I’m too old to fight on the barricades if Thatcher Mk 2 comes along. I want a quiet life. Yet what was acceptable in the eighties is probably not acceptable in 21st century Britain…
A long time ago I got involved in a debate on a friends mailing list on rural transport issues, and for some reason felt moved to look it up and write properly on it. I then placed this on my website, and hell, it’s interesting enough to me to put up on the blog, just in case anyone else interested!
Introduction: The Rural Transport Dilemma.
Since the mid-seventeenth century the British population has progressively become more and more centred in urban areas, leading to a proportionately declining rural population. This demographic change reflects underlying industrial, agricultural and economic changes. Changes in economic conditions led the workforce to shift to the urban areas, and a subsequent grouping of service industries in those urban centres. The demographic relationship between city, market town and village has always been defined by economic forces, and the cultural and service industries are consequent to those economic processes, as depicted in the marxistant base-superstructure model.
The demographically proportionate loss of importance of the countryside has led to a decline in services available; examples are closure of village schools, shops and cottage hospitals which are considered economically unviable. In this sense there has been, some argue, a marked loss in the quality of rural life. Others have pointed out that historically rural life was ‘nasty, brutish and short’, and have pointed out that improved roads, telecommunications and working conditions have vastly improved quality of life in the countryside. There was a marked shift in the iconography of the rural in the years 1914-1939, associating the concept of Englishness with the rural, though this new interest in the landscape has its roots in the Romantic movement of the nineteenth century. (Barrell, 1977) This informs most modern political thinking and potentially privileges the countryside beyond its economic and demographic importance – hence the political importance of the Council for the Preservation of Rural England, National Trust, Rural Community Councils and most recently the Countryside Alliance. The iconography of rural England as a ‘green and pleasant land’ was a motif particularly notable in Thatcherite rhetoric.
Since the 1960’s (and arguably much earlier) rural Britain has undergone another change, in the shifting class balance of rural communities. Following the decline of agricultural labour the villages have seen an influx of prosperous middle class commuters and those who have moved there to enjoy the better ‘quality of life’ associated with the modern ‘mythology’ of the rural. These new residents almost always have cars, and a high enough income to offset the transport difficulty. They are often vocal in environmental protest against development of light industry or other commercial or infrastructure development which they see as changing the ‘essential nature of the village’, and act as a brake on development of new forms of employment. This has led to villages which contain two clearly distinct social groups with different agendas, and other villages which are little more than dormitory settlements or collections of weekend second homes. The lack of employment, escalating housing costs associated with this move to the country and lack of opportunities leads many of the rural young to migrate to the towns at the first opportunity.
What can not be disputed is that in terms of services people living in rural areas are immensely poorer than those who live in urban areas. This applies to the whole spectrum of service industries, from the emergency services to entertainment venues. Specialist services are concentrated in cities, and even an appointment with a GP may require a visit to the nearest market town, as may a visit to the theatre or cinema, the bank or the solicitor. Even weekly shopping may be unviable in rural shops; certainly far more expensive than a visit to a large out of town mall or hypermarket where competition and economies of scale pass on huge savings to the customer. Therefore life in the countryside requires adequate transport to allow visits to these services, and for most rural dwellers the obvious solution is private car ownership.
While private car ownership is an obvious solution it is not necessarily an ideal one. It requires considerable expenditure for purchase, fuel, tax, insurance and maintenance, costs which may be beyond the capacity of the rural poor. It is unsuitable to those whose age (all under 17 year olds and the very elderly), health or loss of license forbid car ownership.
‘Approximately one third of the population can not drive… nearly half of all women do not have a diving license (46%), compared to just under a fifth of men (19%).’ (Root, 1996, p.32) – based on Department of Transport, (1995), Transport Statistics Report, (HMSO, London).
As 10,033,000 people in England and Wales are under 14, and of the remaining 42,178,000, 33% do not hold a driving license we can estimate the number of persons currently at least partially reliant on public transport as c. 24 million. Just under half the total population of England and Wales! (46% overall). (Calculations based on Office for National Statistics, Monthly Digest of Statistics, December 1998).
In some car owning families one working partner may need the car most of the time; a second car is an unaffordable luxury. Even the cost of driving lessons may be beyond the rural young. There are of course other factors; for environmental reasons and traffic congestion we are often concerned with decreasing not increasing the volume of traffic on the roads.
The rural dwellers lack of services can be mitigated by decent transport, and this is why a great emphasis has been placed on the importance of rural public transport. Rural public transport brings all other services within reach. Rural Public transport however is often very limited. Railways are limited by where railway lines exist, and bus services are often infrequent. They are very rarely suitable for daily commuting to work; indeed many rural communities do not even have a daily bus service. This is because rural bus and rail services are often not economically viable – they operate at a loss.
The rural transport problem is not merely an issue in North Norfolk, Central Wales or the Scottish Highlands, all areas with low population density, and which people immediately think of. Rural transport problems arise in almost any county, where villages off major (inter-urban) bus and train routes experience a severe lack of service. What can be defined as a rural area? The simplest definition for a rural area that makes sense in a transport context is that by which the Shire counties (all except Greater London and the Metropolitan regions) are defined as rural. (White, 1995, p.142) Using White’s model in the 1991 Census 33 million, that is 65% of the UK population, lived in ‘rural areas’. The figure is offered here as indicative only – based on our earlier calculations, it would suggest that at least 15.6 million people were at least partially reliant on ‘rural’ public transport.
Government Policy and Rural Transport.
Governments facing the rural transport problem of uneconomic routes that serve a social need have adopted three main strategies -
- The market approach – where services are cut as unprofitable.
- Nationalisation of Public Transport, where the taxpayer directly supports unprofitable routes, or where cross-subsidization is used – the unprofitable routes are subsidised by profitable routes.
- Subsidisation- normally by Local Government, who give grants to service providers.
All three approaches have been tried, though often there is a mixture of all three in operation. Appendix One briefly describes the history of railway transport in the UK, and includes some major legislation. Glancing at the appendix should be sufficient to see that the railways have been full circle from private ownership to nationalisation and back to private enterprise. One of the reasons for nationalisation of the British railway system by the Atlee Administration given in the 1947
“public ownership of the principal forms of transport is needed to maintain minimum standards of service in urban and rural districts.”
(cited in Bagwell, 1984, p.viii).
This was held as a truism for three decades, and was based on long political experience. The perceived need to protect the transport infrastructure had led to the government control of the railways in the First World War, later state intervention and later nationalisation. It was seen as essential in any planned or mixed economy for the government to maintain a firm hand in the railway, haulage and bus industries, and the British mixed economy dictated that railways must be kept in state control was maintained until 1979 and the Thatcherite revolution.
Even in the period 1945-1979 there was an acknowledgement that rural bus services were often unprofitable in financial terms, yet still vital to the welfare of the communities served. The phrase ‘social economy’ was coined to refer to these intangible forms of wealth, such as access to services, health care, leisure facilities etc, which could not be measured in purely fiscal terms. For the good of the social economy it was deemed important to maintain services – hence the subsidisation and nationalisation of transport providers.
British Rail was created as a nationalised industry by the Transport Act of 1947, and a system of local authority licensing by Traffic Commissioners regulated the Bus Industry. The bus industry was provided with three types of subsidy – a fuel tax rebate, a new bus grant and an operational subsidy for which some central government funds were available to support loss making but socially necessary routes. (Moseley, 1979, p.118)
Owing to budgetary constraints and the fact that subsidisation is not always a desirable or realistic policy government has frequently looked for alternative methods of addressing the transport issue. In very rural districts, such as central Wales, North Norfolk or parts of the West Country passenger traffic would not justify even a limited bus service, so experimental schemes were adopted. Early experiments tended to revolve around minibuses, but it was soon discovered that the highest operating cost, the drivers wage, was just as high for a minibus as for a double-decker bus, and maintenance costs were also almost as high. Devon and Oxfordshire are currently experimenting with minibuses.
A more radical scheme was that implemented by Norfolk County Council in 1976. Eastern Counties Bus Company provided a fleet of minibuses that are driven by volunteer drivers, and after the Transport Act of 1978 they no longer require PSV licenses. This has become known as the ‘Community Bus’ approach. It does require significant public capital for provision and maintenance of the fleet, and a willing pool of volunteer drivers, but is extremely flexible in meeting the communities needs. (White, 1995, p.152) These buses are licensed by local authorities, and the scheme has continued and spread to the current day.
Other transport initiatives developed in the seventies included car-sharing, dial a ride, car hire and subsidised taxi schemes and a plethora of other experimental measures. The Department of Transport initiated an unconventional Transport scheme in 1976 which operated in Devon, North Yorkshire, South Ayrshire and Dyfed. (Blowers, 1977, p.53) Another initiative which is currently used in the Scottish Highlands and Devon involved the use of Post-Buses – the postman picking up and dropping off people from isolated rural communities while making their rounds, and experiments have also been made with using school buses to provide a limited service to such areas.
Experimental transport schemes were generally local initiatives, funded by County Council or District Council subsidies, with the exception of the limited DOT experiment of 1976. They were not regarded as a general solution, but rather a ‘top-up’ to provide services where the existing structure was pushed beyond feasibility.
County Councils have always had a requirement to make adequate provision and planning for public transport – many issue annual Transport Policy Programmes, though the legislation which calls for them has been relaxed since 1979. A good example is the Transport Plan for Gloucestershire (1996-2011) issued by GCC in 1996.
In essence, up till 1979 Public Transport was co-ordinated by Local Government, and in the case of the railways, British rail, both of whom accepted the existence of a social economy whose needs could not be met by market forces.
The Thatcherite Revolution
The importance of a unified system of Public Transport was considered self-evident until the 1980’s when the Thatcher administration began to question its value. In 1983, David Mitchell, Under Secretary of State for Transport stated
“Our philosophy and principle is that the pattern of transport should be decided by customer choice with competition providing the options.” (Bagwell, 1983, p. 36)
Combined with Sir Geoffrey Howe’s famous 1979 comment
“We need to enlarge freedom of choice by reducing the role of the state.”
this sets the underlying ethos of Thatcherite thinking on Transport and marked a radical break with all government transport policy since the Second World War. It led ultimately to a programme of privatisation of rail and bus industries. The New Conservatism adopted many core American Libertarian values – the free market, self reliance and individualism – Thatcher famously saying ‘there is no such thing as society’. The Radical Conservative assault on the ‘Nanny State’ was inspired at least in part by policy coming out of the Conservative economic think-tank, the Adam Smith Institute. Two hundred years before Adam Smith himself had famously advocated the free market in his book, The Wealth of Nations, and had suggested that there was an ‘invisible hand’ that regulated the market and would result in unbridled competition generating the best possible outcome. While it seems impossibly naïve, this political philosophy underlies the Thatcherite programme of deregulation.
The aims were laudable, and were set forward in Norman Fowler’s 1977 book The Right Track, published by the Conservative Political Centre, two years before he was appointed Secretary of State for Transport. Public transport should:-
“recognise that everyone needs access to public transport at some time”
“improve transport in rural areas”
“acknowledge that for millions without cars – the elderly, the young and the housewife – the bus is essential for mobility”. (Fowler, 1977)
which sounds like a call for greater state intervention. However, Fowler believed this could be achieved by :-
“…giving the user maximum choice and allowing the maximum of competition.” (Fowler, 1977)
This policy, which held that free competition would eventually result in the best possible service to the public, was implemented in the Transport Acts of 1979,1980, 1981, 1982 and 1983. The Thatcher government of 1979 sold off the NFC (National Freight Corporation) which was the first step in the deregulation of the bus and coach industry. Competition entered the rural bus market – and the result? In 1983 the Bus and Coach Council commented:-
“Thus far, there has been little response to the changes as far as conventional rural bus services are concerned. The hopes of the legislators have not been realised because the market has invariably not justified the commercial investment.” (cited in Bagwell, 1984, p.38)
The 1971 Town and Country Planning Act required that County Councils consider public transport in their structure plans (Barrow, 1978, p.8) but since 1985 they no longer directly run the services, with the exception of school buses which are maintained by Local Education Authorities. Their role today is largely supervisory and promotional, replacing the pre-1985 ‘co-ordination’ (White, 1995, p.2)
One eventual result of competition was that as companies clamoured to compete on the profitable inter-urban express market, such as Oxford-London, they were forced to reduce services in unprofitable rural areas. Also, in private hands, cross-subsidisation was no longer a reasonable option – pricing must be dictated by market; and this led to a rural fare rise in many regions. The Act did substantially reduce fares on the commuter and express routes. (White, 1995, p.74)
Are rural bus services really being cut back as a result of the Acts? Turning once again to the monthly statistics digest (December 1998) we find that from 1989/90 to 1996/97 vehicle kilometres for local bus services actually increased by 218 million km overall, and in the shire counties increased by 128 million km.
There has in fact been a consistent increase in service provision, while actual passenger use has continued to slowly decline. These figures indicate a development of the network – but are they proof that the Conservative free market policy is really working? Several points need to be taken into consideration. White’s definition of the ‘rural’ (White, 1995, p.142) as all shire counties is in many ways unsatisfactory – it includes large urban centres such as Gloucester, Leicester, York and Nottingham, and also includes large tracts of suburban England, such as for example Guildford in Surrey. Many of the journeys included in these statistics are likely to be urban or inter-urban routes, and transport brokers certainly do not recall seeing any significant increase in rural bus routes.
Perhaps the answer can be found in local government subsidies, intended to maintain existing levels of service. To quote –
‘When deregulation of local bus services was introduced in 1986, 85% of then existing service mileage was declared as commercial registrations. The County Council aimed to retain the existing service by awarding contracts for subsidised services at an annual cost of £420,000.’ (Gloucestershire County Council, 1996, p.39)
Since that time some services have been cut owing to lack of passenger traffic, and other services dropped by de-registering, but subsidy costs have continued to increase. District and Parish councils also make limited contributions towards maintaining essential services. GCC have undertaken to
‘provide socially necessary bus services, especially in rural areas, while maintaining value for money – Policy P18’ (GCC, 1996, p.41)
If this pattern of continuing to subsidise the local bus routes was maintained throughout the country it is hardly surprising that deregulation had such limited impact. The only difference is that the cost has been passed largely to local authorities, who no longer gain any of the profits which go to the bus companies.
Following the deregulation of the bus industry the next target was the privatisation of the railways. In July 1992 a government white paper New Opportunities for the Railways set forth the plan for the privatisation of British Rail, most of whose most profitable subsidiaries (ferries, hotels, etc) had already been sold in the 1980’s Transport Acts. The Railways Act of 1993 sold off British Rail, creating over 100 new companies, though only a small proportion are train-operating companies. However overall the privatisation of the railways has been considered a success – Department of Transport Notice 342 (Nov’ 96) claimed
“A clear trend of higher passenger numbers and lower subsidy costs is emerging in Britain’s newly privatised passenger rail companies…”
Many rail users would doubtless disagree with this rosy picture.
How this will affect rural rail services is not yet clear – we know that express and inter-city services make the most profits, but a pattern is emerging of reopening rural stations which fall along those profitable routes – a local example being Ashchurch, Tewkesbury. These open up rural districts to commuters who wish to work in the major urban centre – but they may ultimately also result in higher housing prices, displacement of the rural young and a further influx of urban dwellers who move to the countryside, commuting daily. Villages that have stations may become dormitory towns, but at least it opens up the possibility of employment.
- New Labour; The Blair Administration.
Labour came to power in a landslide election victory, and some have found within that victory further scope for concern about increasing poverty in rural districts. Bruce, Gordon and Kessell pointed out as long ago as 1995 that the –
‘greatest stimulus to concern about rural poverty is the changing political map of Britain. With affluent rural shire goes automatic Tory dominance… It would have seemed impossible only five years ago that the dominant political force would be reduced to controlling only a single English County Council.’ (Bruce et al, 1995, p.18)
The erosion of rural services has cost the Conservative Party dear, and New Labour has attempted to make it clear that it is not merely a party dedicated to the inner cities, instead making a strong attempt to reach out to the rural constituencies. With the current collapse and factionalism of the Conservative Party the Countryside Alliance is probably one of the most influential oppositional pressure groups, and Labour have to be seen to be considering the rural agenda.
New Labour have reinvented the Department of Transport, now the Department of Environment, Transport and the Regions. Their latest plans are set out in the White Paper Developing an Integrated Transport Policy. (1998). The major options explored are an image improvement in public transport, an attempt to balance transport needs against the environment and rural needs, and a desire to increase use of public transport and reduce private car use.
They are not proposing to re-nationalise any section of the transport industry, though they do suggest reintroduction of tighter regulation of bus and coach operations. The plan is largely however for quality partnerships between service operators and local government: the companies provided improved services, the local authority provides better operating conditions such as roads, bus shelter, and so on. Crucially the 1998 budget made generous allocation for rural transport for the first time in twenty years, when Gordon Brown pledged fifty million a year on rural transport. (BBC News, http://news.bbc.co.uk/hi/english/events/budget98/budget.htm, March 17 1998.) It has since been announced that £32.5 million will be available for rural bus subsidies, to e tendered for by Local Authorities.
New Labour’s strategy would appear to be an attempt to build upon the Thatcherite transport revolution, and improve conditions, rather than attempting anything particularly new. For rural transport, New Labour sees Community Buses, car sharing and other non-conventional transport project work as the essential way forward. These schemes have the advantage of operating on a local basis, and suiting local conditions, but are effectively grass roots responses to a problem which government seems unwilling to address. Instead they place faith in local experimental initiatives, a process which as long ago as 1976 was described in these terms –
‘It has to be recognised that unconventional services are not of themselves answers to the rural transport problem although the naïve optimism placed in them in some quarters may suggest otherwise. They may help to fill gaps in the conventional network…’ (Blower, 1977, p.53)
The Government White Paper on Transport (HMSO,1998) demonstrates this continuity of policy from the Conservative administration. Some attempts have been made to reintroduce a measure of government control – the creation of an advisory Strategic Rail Authority is proposed, as is a Commission for Integrated Transport. Both these however are effectively watchdog organisations, and the closest one comes to recreation of the pre-1979 system is in the placing of quality partnerships on a statutory basis.
Quality Partnerships are a New Labour buzzword, the idea being amelioration of social problems by joint public and private enterprise, or between local government and the voluntary or community sector. In a rural transport context, this represents some government funding being given to voluntary project schemes and agreements being drawn up between servile providers and Local Government. One example is that the Councils will promote bus services, create bus lanes to improve quality of service and improve bus shelters, in return for which the bus operating companies will invest in improving services. An interesting example of a quality partnership is provided by Cheltenham Borough Council who recently received many new bus shelters from the company Adshel, who in return raise revenues from selling advertising on their bus stops prominently placed billboards. However, this requires local government to make a series of management decisions about which partnerships to enter in to, and also to spend time and resources attempting to solicit suitable partners.
Traditionally partnership between voluntary projects, service providers and local government has often relied on Local Development Agencies (LDA’s) which are comprised of two main types of organisation, Councils for Voluntary Service and
Rural Community Councils. Already voices are being raised in the LDA’s about how their enforced new position as broker is ‘subverting their legitimate roles’ (Osborne, 1998, p.290) They are finding themselves trapped in the labyrinth of new funding processes, and are being forced to reallocate resources. One of the major dangers highlighted by Osborne for LDA’s is that of incorporatism, in which they become perceived as merely another arm of local government and lose their autonomy.
A Rural Transport Partnership scheme is to be created and given £4.2 million of central government funding, which is being used to fund a competition by which innovative experimental bus schemes are to be granted funds, providing local government is seen to be developing local partnerships.
The nature of rural poverty and the rural unemployment underlie all subsequent attempts to ameliorate rural transport problems. Rural districts are dying as living communities; a process which can be traced back as far as Elizabethan Enclosure Acts. The problems facing the village dweller today – a minimum wage economy, poor services, bad housing and high unemployment, have been part of the English political landscape since the advent of capitalism. In the country, the mixed economy favours few – only landowners and farmers have ever prospered, and today as services increasingly centralise car ownership is increasingly vital. Indices of poverty rarely show up rural poverty in it’s true depressing colours – car ownership in an urban area may be a sign of affluence, but in village communities it is a social necessity which reduces (via fuel, licensing and maintenance costs) disposable income and may actually exacerbate poverty.
If the countryside is to be anything other than a museum piece and a home for urban professionals and wealthy retirees, it is vital that we see a root and branch tackling of the problems of rural unemployment, service provision and welfare. The problem is, all of these rely on rural communities having adequate access to transport. The near insanity of introducing the free market to rural public transport has, I hope to have demonstrated, been offset by the heroic attempts of local government to maintain the funding necessary to keep services running. Unconventional modes of transport have their place, but they are not a universal panacea.
At least the Thatcherite transport revolution can be described as brave, albeit reckless and possibly disastrous. It is hard to believe any British government would be as foolhardy as to take the risk they did; yet New Labour has so far opted for low-key partnership ideas which leave a morass of paperwork to administrate, and are far from radical. Quality partnerships are placing a great strain on Voluntary and Community sectors, and it is hard to see how they hope to make unprofitable rural routes palatable to private enterprise.
The one piece of sanity in recent administrations thinking on transport is New Labour’s budgetary commitment to subsidisation, the £32.5 million granted opening up great possibilities for the provision of new routes. It may be too little too late. One can not help thinking however that transport is too important to be left at the hands of market forces; it requires integration, so that bus services and train services co-ordinate to make lengthy journeys possible. The market will not ensure that trains and buses are sympathetically time-tabled – only local authority control and nationalisation can achieve this, a lesson we learn from the complicated history of the railways.
Sometimes one can not measure the effects of a policy in purely fiscal terms – the social economy is a valuable concept. No one would advocate complete privatisation of all schools, and that the education of children should be a profitable endeavour. People do not ask that the police make a profit on law enforcement. These are prices we happily pay to live in a secure society, and we realise that in the long term there are lasting benefits from the provision of these services which outweigh the short term costs.
Rural transport opens up services to residents of the countryside, but it does something else as well. It offers them the possibility of employment, and hence offers knock on benefits to the whole community, as well as reducing the welfare costs which we pay anyway through taxes. Rural transport offers a scope for further education, for improved earnings and for the regeneration of the village community.
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Bannister, D, (1982) Public Transport for Rural Areas: Panacea or Palliative? In the Journal of the Built Environment, Vol 8, 1982, p.184-189
Barrell, J. (1977), The Dark Side of the Landscape, (Methuen, London)
Barrow, J.F (1977), Public Transport – A Key Issue in County Planning? in Cresswell, R (ed.), (1977), Rural Transport and Country Planning, (Leonard Hill, Glasgow, p.8-16
Blowers, A. (1977) Future Rural Transport and Development Policy in Cresswell, R (ed.), (1977), Rural Transport and Country Planning, (Leonard Hill, Glasgow, p.45-60
Bruce, A, Gordon, D. and Kessell J. (1995) Analysing Rural Poverty, in the Journal of Local Government Policy Making, Vol. 21: No.1, p.16-23
Cresswell, R (ed.), (1977), Rural Transport and Country Planning, (Leonard Hill, Glasgow)
Fowler, N. (1977), The Right Track, (Conservative Political Centre, London)
Gloucestershire County Council, (1996), Transport Plan for Gloucestershire, (Gloucestershire County Council, Gloucester.)
Harvey, G. (1998) The Killing of the Countryside, (Vintage, London)
Houghton, J. (Chair), (1995), Royal Commission on Environmental Pollution; Eighteenth Report – Transport and the Environment, (OUP, Oxford).
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Appendix One : A (Very) Brief History of British Trains.
The history of rail transport since is complex, and is most easily described in stages. I have briefly summarised the key stages below-
Stage 1 (1829-1914) Private Ownership
The British Railway system was the most expensive in the world to create. Independent companies scrambled to open profitable lines; the result was that many towns were served by more than one company’s trains. There were dozens of companies; a few owned as little as five miles of track! As rail ownership was profitable in this period an extremely extensive coverage was provided by the competing networks, with much duplication – there were three lines and three companies between Liverpool and Manchester. At one time almost no village in England was more than three miles from a railway station.
Stage 2 (1914-1921) Emergency Government Control
The First World War brought about reorganisation of the railway networks, which were placed directly under government control. This was originally seen as a short term expedient to improve the war economy; it was promised that after the war the lines would be returned to their private owners and shareholders. This period saw improvements in working conditions and services at little or no increase in operating costs; as a result 1921 saw considerable pressure for nationalisation.
Stage 3 (1921 – 1923) Private Ownership
The lines were returned to their owners as promised, but many companies faced financial ruin. Eventually in 1923 the government, while resisting the call for nationalisation, once again intervened.
Stage 4 (1923-1949) The Big Four (Consolidated Private Ownership)
The government’s solution was to consolidate the networks into four large regional networks, known as ‘The Big Four’. These were the LMS (London, Midland and Scottish), GWR (Great Western Railway), LNER (London and North-Eastern Railway) and the SR (Southern Railway). Some smaller independent companies continued to operate, a notable example being the Somerset & Dorset, but the ‘Big Four’ was a major move towards rationalising the system.
Stage 5 (1949-1993) British Rail
The nationalisation of the railways by the Railways Act of 1947 brought all services directly under State control. This led to improved rural services as extensive cross-subsidisation occurred; despite this rural line closures were inevitable, and under the Beeching reforms huge parts of the rural network were dismantled.
Stage 6 (1993-today) Privatisation
From 1993 the railways were privatised.
I’m going to be 5.5% worse off this year than last year, as food prices rise again sharply and yet I do not benefit at all from the mortgage drop which has helped many people, as I don’t have a house or mortgage, but rent. Rents of course remains static so far…
So the richer part of society gets bailed out, the poorest pay.
People with significant savings could end up even worse off – this really just benefits middle class home owners and those with huge personal debts and really screws those of us without significant personal debt or property, but no money.
Added to which people all around me are losing their jobs. Seriously, I am not impressed one bit!
If food prices had fallen, it would have been OK http://news.bbc.co.uk/1/hi/business/7959564.stm
Will you be better off or worse off? Find out here with the BBC Personal Inflation Calculator
I feel particularly for the poor sods, with or without mortgages, with large families.
What is really interesting so far is how much the Credit Crunch, which by wiping out billions in share prices and investments and hurting millions of unfortunate investors would have narrowed the gap between the rich and poor, has instead now owing to government intervention done no such thing, but seen another increase in wealth of home owners while those in rental, almost all the poorer elements of society, take another kicking. Wow! And I voted New Labour! (Well I’m still not voting Conservative yet – colour me Lib Dem for the foreseeable, unless New Labour actually have an ace up their sleeve and plan to do something about this… )
Anyway do comment on how all this will effect you. And good luck, whatever your position! I think we may all need it…