Following our rail event with Maria Eagle MP last week, Joe Fortune reports on the National Audit Office's report on the Department for Transport stating that the massive cuts lack strategy and may benefit rail companies at the expense of passengers.

The Co-operative Party and SERA jointly hosted an interesting session with ASLEF and the Shadow Secretary of State for Transport in Westminster last week, chaired by Co-operative MP Louise Ellman, Chair of the Transport Select Committee.

The consensus from the session was that accountability between the rail franchising structure and the passenger and taxpayer was not well balanced. The privatised system will continue to require large amount of subsidies. With this in mind, many attendees at last week’s event wondered where the benefits of private sector operators were within the current system; moreover, whether there was adequate transparency in the industry and rail franchises to allow full judgements to be made on the benefits the system gave relative to the level of public finances the industry required.

It seems that the attendees of the event are not alone in this pondering. Today the NAO released a report titled: ‘Reducing costs in the Department for Transport’ – this report is not *wholly* critical of the Department’s work to achieve its politically motivated 15% swingeing cut in its budget over the next four years. The Permanent Secretary will presumably feel pretty satisfied. However, there is one glaring area of its work the NAO is not content with; that area of policy is, of course, rail franchising.

Worryingly the report states:

‘The weakest understanding of the relationship between cost and value was in rail, where there was no analysis of the relative benefits and costs of reductions in the scope of rail franchises or increases in passenger rail fares.’

As the Guardian puts it, cutting through the civil service language, the ‘report warns that [the] Department of Transport sacrificed sustainability in favour of speed when making spending cutbacks… Swingeing spending cuts made by the Department for Transport lack strategic understanding, have no long-term plan and may well end up producing higher costs for road and rail users… It also warns there is no guarantee that future rises to rail fares will not profit operating companies rather than just raise revenue for the DfT.’

This is not good news for the travelling public or tax payer. This is why the Co-operative Party is putting forward a radical new long term approach to rail service delivery namely a mutual system which is transparent and reinvests. This policy deserves proper rigorous investigation.

It is clear that this Government and its Ministerial team is not in a place to come up with a long term strategy for rebalancing the rail franchising structure and accountability and value for money. That not a biased view – the NAO itself stated:

“[there is] no comprehensive strategy for prioritising resources based on a full understanding of costs and value.”

As this Government fails, it must be the Labour Movement, Co-operative Movement and Labour Party will fills the void and offers the country a new approach and set of values with regard to passenger rail.