Last Trains

by Charles Loft

  The unpopularity of part one of the levy, although significant, was easily overshadowed by that of part two; there were doubts as to whether it could be carried in Parliament. Fortunately, the haste with which this policy had been worked out proved unnecessary, as Churchill’s plan to extend the parliamentary session into 1953 was abandoned and the Transport Bill did not proceed. However, the government had to have a new Bill ready in October. Aware he was in the running for Maclay’s job and keen to remain at the Colonial Office, Alan Lennox-Boyd fled London for Brighton in the hope that if Churchill couldn’t find him he would give the job to someone else. His efforts to avoid becoming Minister of Transport failed, but once in post he diligently sought an alternative policy. By September he was plotting behind his officials’ backs to drop part two of the levy in favour of ‘drastic’ decentralisation and deregulation.57 The difficulty was that he had no way of proving this would enable the railways to survive the impact of road competition and his assertions that it would were denied by his officials, who put a paper to the Cabinet committee refuting the arguments of their own minister.

  Lennox-Boyd advocated a complete rethink on the railways’ commercial restrictions. He started from absolute freedom and asked that each restriction justify itself, an admirably radical approach which terrified his officials, who envisaged extortionate charges imposed on traffic such as coal, which was effectively tied to rail (and which could surely have been protected). Unfortunately, Churchill had rather undermined the government’s commitment to commercial freedom for the railways when, in order to improve the Conservatives’ chances in the London County Council eelctions, he forced Maclay to veto proposed fare increases planned for May. In so doing Churchill had defeated the BTC, the Transport Tribunal, the Central Transport Consultative Committee (CTCC), Maclay (this was a factor in his breakdown), Leathers, the initial advice of ministry officials that the move was unlawful and his own government’s nascent policy of increasing the Commission’s freedom to raise charges, which was amended as a result. It certainly did not help Lennox-Boyd’s case.

  In the absence of a commitment to denationalisation across the board, shifting power within the public sector from national to regional bodies – ‘decentralisation’ – had attracted the Conservatives in opposition as a means by which competitive principles could exist within the state sector; little thought had been given to what this actually meant, however, and Nigel Harris has argued that it involved attributing ‘magic qualities to the concept … designed to wish away problems’.58 Lennox-Boyd certainly offered little detail on what ‘drastic’ decentralisation actually meant in practice and the hope that it might stimulate competition through the publication of separate accounts for each railway region eventually fell foul of the complexities of railway accounting and was never implemented. If only Lennox-Boyd could have been transported across the river to the Southern Region’s headquarters at Waterloo where the region’s commercial superintendent, W. H. F. Mepstead, considering the Isle of Wight council’s memorandum late the previous December, had recognised both the power of some of its arguments and the effort the islanders would muster in opposition if the closure proposals went ahead. Correctly, he foresaw the damage such a fight might inflict on the Commission and suggested a coordinating officer be appointed to oversee and integrate the rail, bus and road haulage activities on the island. It was the sort of proposal the Conservatives had advocated in opposition, but there was effectively no channel by which the minister could draw on real railway experience to inform his policy, especially in the face of his officials’ opposition.

  By October ministers were completely divided over the levy and the Cabinet was unable to agree a definitive line in time for the party conference. Leathers told the Prime Minister that the committee now ‘felt forced to think out our policy again from first principles’.59 Twelve days and two meetings later the Cabinet reached agreement on what Housing Minister Harold Macmillan called ‘a really terrible tangle’, primarily to avoid the embarrassment of not having a Bill ready for the new session of Parliament.60 Part two of the levy was abandoned, leaving the railways reliant on the unknown benefits of decentralisation and the, as yet undecided, extension of their commercial freedom, in response to the denationalisation of road haulage and the abolition of the 25-mile limit from the end of 1954. The Cabinet Secretary’s note of the meeting shows that Churchill and Sir Arthur Salter (Minister for Economic Affairs and former chair of the conference that led to the creation of the haulage licensing system in 1933) saw a railway deficit as inevitable anyway; none of their colleagues disagreed. A revolution in transport was coming anyhow, said the Prime Minister; ‘is it wise to seek to slow down the change artificially?’ Predictably, the attempt to sell off the entire RHE failed and failed in particular to attract the small man back into the business. Another Act was required in 1956 to legitimise the retention of unsold vehicles; the RHE’s long-distance haulage survived and prospered as British Road Services. Nor did the Act fulfil Lennox-Boyd’s hopes of commercial freedom or radical decentralisation, as we shall see. Its real failing, however, as some Cabinet members recognised, was that while it was clear that integration was not the Conservatives’ answer to the implications for the railways of growing road competition, it did not really set out what was, nor did it address the fundamental question of what sort of railway the nation wanted and was willing to pay for. Having rejected Labour and the levy, and watered down Lennox-Boyd, what was left? ‘Breathing space for four years before the government has to aid the railways,’ was Churchill’s view.61 He was spot on.

  Although far less attention had been paid to buses than lorries in framing the Bill, its proposals in that respect ended attempts at integration on the passenger side as effectively as the more controversial proposals on freight.† The 1947 Act had not nationalised all bus services, but had given the BTC the power to establish area bus ‘schemes’, under which it could in effect take control of all bus services in an area, a possibility that had been considered on the Isle of Wight. The first version of the 1952 Bill stripped the Commission of these powers and prevented any further acquisition of bus companies; the second version added powers allowing the minister to direct the BTC to sell its bus assets. Although ministers were not irrevocably committed to denationalising buses and although no ‘scheme’ had ever been implemented, these proposals put a new perspective on integration. If the Commission lost control of bus and haulage services it would find it difficult to offer an alternative by road when closing branch lines in future, which probably explains the ambivalence evident in the Commission’s closure policy by the middle of 1952. On the one hand it was pushing the Railway Executive to press forward with its branch line investigations and then move on to look at lightly used secondary lines; on the other, it asked the Executive to consider cost-cutting measures and improved services before recommending a line for closure. The difficulty in providing alternative services if the Transport Bill became law certainly strengthened the Executive’s doubts about rationalising secondary lines, some of which represented ‘national, social and economic obligations’ which the Executive saw no means of escaping.62 By December the branch line committee was concerned that closures would either lead to criticism of the Commission for failing to provide alternative road services, or would hand traffic to and strengthen road competitors. It wanted closures deferred unless the case was ‘absolutely clear and no competitive issue is likely to arise in future’ and began to consider whether some lightly used railways might be converted to tramways, free of signalling and with reduced staff, in preference to surrendering traffic to road.63

  By the end of 1952 then, the impetus that had been behind the branch line committee’s efforts in 1951 was fading as a result of the Transport Bill. Such doubts encouraged the Commission to consider retaining the Freshwater and Newport–Sandown lines using cheaper operating methods, but it appeared that there was no prospect of eliminating the loss (a significant factor being the unwillingness
of local highway authorities to authorise unstaffed level crossings) and, as lightweight diesel railcars would be unable to carry the summer peak traffic, the idea was ruled out. In November, Hopkins informed the Isle of Wight County Council and the Chamber of Commerce of the decision to close the Bembridge, Freshwater and Newport–Sandown lines, expressing his

  regret that I have to convey such a decision because the Southern Region, and its predecessor the Southern Railway, have always taken a warm and even sentimental interest in the Isle of Wight services and can fairly claim to have done a great deal for these services.64

  When he wrote these words it is doubtful whether any group of rural railways in Britain had ever been studied as thoroughly as those in the Isle of Wight and, whatever shortcomings the study suffered from, a predisposition towards closure on the part of those conducting it was not one of them. Yet, implementing these conclusions was to bring accusations of dishonesty, bogus figures and a disregard for the public against not only the Commission, the Executive and the region, but Hopkins personally. His letter sparked outrage on the island and within days local papers were claiming that the ‘bombshell’ decision to close the Cowes line ‘within five years’ had been taken behind the back of the council, which had believed negotiations were ongoing.65 The island representatives’ meeting with Hopkins and his colleagues in December was a rather tense affair. The railwaymen had been put out by the islanders’ reaction, given that Hopkins’s letter had said the Cowes line would be retained for at least five years, not closed within that period, and that the conclusion of their investigation was the one they had warned the islanders to expect the previous year (and about which the island delegates’ leader had said ‘there could not be much serious complaint’66). However, the consistency of the region’s position raised islanders’ suspicions – wrongly – that their views had simply been ignored. The region’s refusal to share their report to the Commission reinforced this impression.

  The council and the chamber briefed a QC, Melford Stevenson, to act for them at the public hearing the TUCC had agreed to hold and prepared two substantial memoranda setting out the case for retention, suggesting alternative operating methods for all the island’s lines. They wanted the TUCC to take these memoranda as the basis for the inquiry and a context for the railways’ proposals. Aware that the council’s primary concern was to ensure the long-term future of the lines from Ryde to Ventnor and Cowes, it was clear to Mepstead and Hopkins that by discussing their plans – and therefore revealing the original possibility that all the island lines would be proposed for closure – they had added significantly to the opposition they now faced in seeing through more limited proposals. Mepstead warned of the council’s ‘adroit manoeuvring’ and Hopkins ‘was sorry to have talked at all to these people’; he even suggested that the passing of the Transport Act be used as a reason to withdraw the proposals.67 The railways felt it was vital to prevent the TUCC hearing turning into a tribunal, a fear strengthened by the fact that the TUCC chairman appeared favourable to such a development, and decided against engaging counsel. Convinced that any delay would be a victory for the opposition, the railways refused to provide details of the calculations supporting the case for closure to opponents they believed would simply use them to prolong the process.

  By the time the TUCC public hearing began at the county hall in Newport in May 1953, the closing down of railway lines was ceasing to be the curiosity it had been when Douglas Macdonald Hastings stumbled across Singleton. The Railway Development Association had been established as a focus for opposition. In the same month as it put forward the Isle of Wight proposals, the Commission decided not to restore services over the Brightlingsea branch, which had been severed by flood damage in February. A TUCC hearing that summer was attended by three MPs. Accepting that the line lost money, the committee nevertheless recommended that services be restored because local roads were inadequate, although they were good enough for half of the 1938 traffic to have deserted the line. None of the improvements in traffic forecast by objectors materialised and the line closed in 1964. Even the proposal to close the tiny Woodstock branch (average train loading: five passengers) brought forth letters to The Times containing the soon-to-be-familiar allegations that the Railway Executive had deliberately diverted traffic to roads in order to make the line seem uneconomic and that a combination of social need, the scope for cheaper operations and the increased traffic that lower fares and future housing developments would bring meant that the line should not be closed. Objectors’ complaints about the opacity of railway figures had led the East Midlands TUCC to raise the issue with the Commission in the autumn of 1952 and in early 1953 the CTCC accepted the BTC’s offer to provide estimates of gross savings, traffic loss, additional delivery costs, net savings and any additional savings in all cases. The Commission warned that it would be impossible to treat branch lines as entirely separate businesses for which a profit and loss account could be produced and argued that, as it only put forward cases where the case for closure was obvious (because revenue fell short of even direct costs), the Railway Executive’s accountants were instructed not to waste time preparing detailed figures. This was a question of expediency, as the complaints from the Southern Region’s accounts department about the burden the Isle of Wight investigation placed on it demonstrate, but it left the railways vulnerable to criticism if they tried to argue the case for closure pound by pound, which was exactly what Hopkins ended up having to do.

  It is worth digressing slightly at this point to consider the complexities of calculating railway costs and the savings from closures. These were always at the heart of debates over closure in the 1950s and the Isle of Wight case brought the issue to the fore. The first difficulty in pinning down the finances of a particular service was collecting the data – no small task in 1953. The timing of surveys was always open to criticism; objectors demonstrated that the Isle of Wight survey taken in July 1952 showed much lower levels of traffic than were found in August, when the Newport–Sandown line saw an extra 400 journeys each way a day. Once the data was collected, a series of assumptions had to be made about shared costs. If different services use the same track (or staff, or signalling, or stock) how are the costs of providing them attributed to each? This is a particularly pertinent question given that calculating the cost of a service is not the same as calculating the savings from its closure. For example, if the cost of providing track on a branch line is X, and the reduction in that cost by withdrawing passenger services is Y, then the withdrawal of all the remaining freight services and complete closure of the line will save track costs of X minus Y, which we will call Z. If, on the other hand, the freight service is withdrawn and the passenger service continues, this will not produce a saving of Z, but a much smaller saving we will call A, because it does not in general cost much more to carry freight on a track already maintained to passenger standards. So in attributing track costs to the freight service, should we choose Z or A? The answer is either or neither depending on the purpose of the calculation. The point is that costs and savings are different and that neither calculation is necessarily straightforward. In the case of the Isle of Wight, many of the railways’ figures for individual lines had been arrived at by dividing the island total between the various routes on the basis of train mileage, which threw up a variety of anomalies and did not necessarily represent the likely outcome of closure. For example, the number of locomotives and coaches required and the consequent maintenance bill would not necessarily fall in exactly the same proportion as the reduction in train miles produced by a particular withdrawal. Bearing in mind that, as a whole, the island system lost money and it was the social and economic consequences that prevented the whole system being closed, this was not quite as slapdash or dishonest as it could be made to look, but it could be made to look very slapdash and dishonest by a good barrister, and Melford Stevenson was certainly that. Long-term costs posed similar problems. Objectors pointed out that about a third of the anticip
ated saving in the Isle of Wight case arose from ‘interest’, which included a notional payment of 4 per cent on a notional fund set up to cover depreciation costs. Not only did this fund and the payment to it not actually exist, but it was based on a ‘replacement cost’ approach to depreciation, while the Commission’s own accounts used ‘historic cost’ depreciation. Using replacement cost made the case for closure look better, but objectors made much of the apparent absurdity that depreciation was being charged on locomotives that were clearly so ancient as to be ‘life expired’ – and not incurring depreciation charges – as far as the Commission’s accounts were concerned.†