East Coast train arriving at final destination. Photo 87019Chris (Creative Commons)

The East Coast Mainline: Why was the government so quiet about one of its great successes?

01 Mar 2015, by Ripped Off Britons Guest in Public services

Organisations generally want to celebrate their successes. A bit of boasting burnishes an organisation’s public image, as well as boosting the reputations of its staff, management, and promoters. Some organisations even celebrate their failures. The Royal Bank of Scotland, majority owned by the UK government, celebrated its £4.2 billion loss in 2014 with £421 million of bonuses. Presumably on the basis that it had achieved a level of ghastliness less than its earlier ghastliness.

In contrast, the great success of another government owned company was met with embarrassed silence and extinction. As of the first of March 2015 the company has had its responsibilities taken away and handed to others. If you thought this company was hoping nobody would notice its successes, you’d be right. To be more precise, its owner didn’t want anybody to notice how well it had done.

This secretive organisation is the East Coast Mainline Company Ltd (East Coast). East Coast is the government owned Train Operation Company (TOC) that took over the re-nationalised East Coast Mainline after that franchise was abandoned by the private sector, first by GNER (2007) and then by National Express (2009). It is a company celebrated in the Guardian and the Daily Mail for returning a whopping £1billion to the taxpayer since the franchise was nationalised in 2009. And yet its bashful bosses box on, according to their annual report, on their modest Civil Servant salaries (East Coast CEO earned £236.8k in 2014. Peanuts compared to CEOs of similar sized companies (FTSE250 CEO average pay = £1.56 million) and with no bonuses and no share options.

While the newspapers tooted the whistle for East Coast’s success in the first week of August 2014, the only press releases made by East Coast itself that week were:

(10th Aug) Donna Air (TV personality) launching “I love trains” week

(1st Aug) Launch of its “bold new” website.

So why did East Coast cover its triumphs under a layer of soot and cinders worthy of Thomas the Tank Engine on wet straw? The smoke surrounding this mystery clears when you consider East Coast is a subsidiary of Directly Operated Railways, which is itself a wholly owned subsidiary of the Department for Transport.

The success of East Coast is nothing less than a shower of hot coals on the heads of a succession of Labour and Tory Transport ministers since privatisation started in 1993. It is an accidental head on collision between public and private sectors that the public sector embarrassingly won.

Apart from the £1billion East Coast paid to the taxpayer, other statistics from the Office of Rail Regulation (ORR) show the success of this nationalised company:

1) Percentage of trains cancelled or significantly late improved:

2) Passenger complaints down:

From the 2014 National Passenger Survey, comparing all Train Operating Companies for percentage of passengers who were “satisfied or better”, East Coast performed as follows:

1) The overall service: 6th out of 23

2) Value for money: 5th out of 23

3) Punctuality:11th out of 23

4) Enough room to sit down: 4th out of 23

This whole thing is a terrible embarrassment for both Labour and Tory. But particularly for the Tories, who ran the competition to re-privatise East Coast, as well as renewing several other franchises in the 2015 General Election year.

Even on its last day of operation the East Coast “latest news” didn’t mention it’s demise.

Even if its political masters won’t allow the public sector East Coast to proclaim its success, the rest of us should.