Nationalisation : III
ByOSCAR R. HOBSON
IN two preceding articles I have discussed what seem to me the main defects of the nationalised industries as they are at present organised, namely, over-centralisation and bureaucra- tisation, and in the light of that general view I have discussed the working of the National Coal Board. Now I pass to transport, and in particular the railways. Their problem is basically the same as that of the mines, but it is complicated and aggravated by the specific character of the Transport Act of 1947. In pursuance of its election programme the Labour Government decided to nationalise the railways because they were a monopoly, which they weren't, but proceeded to incorporate them in the most comprehen- sive transport monopoly which any country this side of the Iron Curtain has ever possessed.
This new super-monopoly of inland transport embraces railways, canals and docks, road-haulage and road passenger transport. The running of all these different forms of transport was placed in the hands of the British Transport Commission, and, in the words of the Act, " all the business carried on by the Commission shall form one undertaking." Subordinate to the Commission (though by a curious anomaly appointed not by it but by the Minister of*Frans- port) are the various Executives—Railway Executive, London Pas- senger Transport Executive, Road Passenger Executive, Inland Waterways and Docks Executive, Road Haulage Executive, Hotels Executive—which were designed to " assist the Commission in the discharge of their functions.' The Executives derive all their powers from the Commission under " schemes of delegation," and the ex- pectation when the Act came into force was that the Commission would leave them free to conduct the operation of various transport services, confining its own energies to matters of high policy. It has not worked out that way. The Commission has exercised a far more intimate and detailed control over the Executives than was ever expected. Even on such matters of railway operation as the summer services mileage the Railway Executive has to consult the Commission. As things have turned out, therefore, we have in the • -ailways over-centralisation in an exaggerated degree.
We have, too, the " functionalist " trouble, just as in the coalfields. The Railway Executive is composed of members each responsible, apart from the chairman and two part-time members, for a " func- tion "—operation, labour, engineering, etc. To these individual members of the Executive questions come up from the chief officers of the respective " function " in the regions. These same chief officers are, however, subordinate to the Chief Regional Officer in each region, who in turn is of course responsible to the Executive for all that happens in his region. We have thus the same criss- crossing of authority and of responsibility as in the Coal Board organisation—with, in the case of transport, the additional tier of the Transport Commission at the top.
The obvious remedy for, or alleviation of, the over-centralisation here would be for the Commission to delegate complete manage- ment, including price policy, to the Executives and reduce that inter- ference in their day-to-day or month-to-month working which is a cause of such constant friction. There is, however, certainly a difficulty here. The Transport Commission is not only bound to regard all its businesses as one undertaking and to direct its chang- ing policy to securing " overall balance " (but not necessarily indi- vidual balance) between their outgoings and income ; it has laid upon it the duty of " integrating " the whole transport system of the country. How, it might well ask, can it discharge all those duties unless it keeps a pretty tight hand on each of the individual forms of transport ?
My feeling is that the whole future of British inland transport is likely to be bedevilled and jeopardised by this elusive and illusionary notion of integration. Doubtless we need a certain co-ordination of different kinds of transport, a degree of co-operation between them ; but I am perfectly sure that we do not want any form of integration which gives the Commission the right either to choose the form of transport it will use for a particular consignment of goods or so to adjust its charges as to make the efficient forms pay for the inefficient forms. The people of this country, I judge, are dead against road-transport charges being raised merely for the purpose of covering the losses of the railways. If for strategic or other national purposes it is decided to keep unremunerative railways in operation, then the proper course is a subsidy out of national funds. " Integration," meaning some composite form of inland transport whose " efficiency " transcends profit-tests or the users' preference, is a mere will-o'-the-wisp.
My view is that we should get rid of " integration," wind up the Commission and let a reconstituted Railway Executive and London Transport Executive take full responsibility for running the main- line railways and London Transport respectively. I doubt whether an Inland Waterways and Docks Executive is needed. I am sure that a Hotels Executive is not. It is difficult to believe that the doctrine of efficiency requires that traffic carried by one public corporation into a dockyard should be handed over to the charge of another public corporation on entry. It seems an absurdity that the meals served on the 'restaurant cars on trains run by one public corporation should be provided by an entirely separate corporation.
My preference would be to wind up the Road Haulage Executive and restore its vehicles and undertaking to private ownership, but, if it is retained, it too should become an autonomous body. I can see no advantage at this stage in the Commission taking over road passenger transport or independent docks, and I regard it as absolutely imperative that there should be no restriction on private transport. The functionalism of the Executives will need to be eliminated or at any rate moderated. There is a case for retaining it temporarily in the Railway Executive, while the job of standardisa- tion of rolling-stock, track-equipment, etc., is being completed. Subject to that, the Executives should be established as boards of directors with control of finance and high policy, and the powers of the " regions," each of which constitute transport undertakings of great magnitude and complexity, should be strengthened.
When the problem of the railways is being discussed, one question remains—in the light of recent experience in this and many other countries—always in the background. It is this. Whatever you do to the railway system, however you may reorganise it and its administration, is it possible that it can be made financially self- sufficient ? Can railways—in the political jargon of the moment— ever become " viable " again ? Personally, I have no doubt about it. Other forms of inland transport—roads, air, canals—cannot possibly become capable, within the foreseeable future, of providing the nation's needs. Therefore, the railways can be made viable. They must be relieved of gratuitous and unnecessary forms of con- trol, and must be set free to work out their own salvation. Where the State requires services from them, be it in the form of cheap tickets for " workmen " or the retention for " national " purposes of uneconomic lines or services, the State must foot the bill. And without doubt the introduction of new blood and new ideas into railway management is a sine qua non of salvation—which, of course, is something that it is always easy to say and hard to accom- plish. There is a case, too, for restoring the old annual efficiency reviews conducted by Railway Rates Tribunal under the Act of 1921. They provided both the railways and the public with a safety- valve and, on occasion, with a means of removing grievances and difficulties.
But there is one negative condition of railway recovery which at this time seems important. It is that the railway unions' claim, or rather the claim of the chief railway union, the N.U.R., to be given " joint participation in management," should be resolutely and firmly resisted. I can imagine no single step which would more surely condemn the railways to a state of perpetual inefficiency and bankruptcy than the formal association of the N.U.R. with their administration. All the union's influence would inevitably be cast against reforms calling for displacement or increased mobility of labour It would be an irony if the British Railways were forced to adopt syndicalism just when the French Railways have at last escaped from it
In conclusion, let me summarise in three sentences my interim " verdict " on nationalisation. The.principles on which the nationalising measures were based were never properly thought out and were over-hastily formulated. The result has been a top-heavy organisational structure which will have to be extensively overhauled and remodelled. A retreat towards the procedure and principles of private capitalist business is essential if most of the nationalised undertakings are not to be a permanent or constantly recurring charge on the Exchequer. Finally, a question. So far as concerns those nationalised industries which no political party desires to denationalise, need reform of the present administrative structure be made a party political issue ?
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