TRANSPORT AND THE STATE
By MORRIS STEPHENSON
THE future of inland transport has become an immediate political issue. The Labour Party promises a comprehensive scheme of nationalisation ; the Conservative Party, which in this at least appears to be truly conservative, wishes to see a reversion, without any fundamental change, to the position which existed before the present war. Yet, from the point of view of the public, the adoption of some middle course is clearly desirable. Consider first the interests involved, before seeing how they may be reconciled ; firstly, the transport-user, that is, the public ; secondly, the railway com- panies and road-transport operators ; thirdly, the canals, coastal shipping and inland-airway companies. Between the railway com- panies and the road-transport operators there has been an acute conflict ever since motor transport was established. The result of this conflict, expressed in general terms, has been that restrictions have been placed upon motor transport, sometimes in the public interest, sometimes in the interest of the railway companies ; and if the railways are to function successfully, still further restrictions will have to be imposed upon road transport, or the railways will have to be supported by direct or indirect subsidy. One of the latest suggestions is that the railway companies should be relieved of the burden of maintaining the upkeep of their railway tracks. There is clearly no justification for this in any system which purports to stand by itself ; for a system operated in the public interest this is equally clearly no more than a pis alter.
The answer to this dilemma is that. unrestrained competition between road and rail is not in the best interest of the public ; and that, the various forms of inland transport being complementary to each other, the whole should be operated as efficiently and economic- ally as possible in the national interest. So far, however, action has been restricted to endeavours to reconcile the various competitive interests concerned, and in the meantime many anomalies have been created. Moreover, keen competition continues to exist between the various interests involved, and little attempt (viewing the matter as a whole) has been made to convert them from the phase of competition to the phase of co-operation.
Yet unification of rail, long-distance road-passenger, certain forms of road goods transport and canal and inland air-services without nationalisation would provide a satisfactory solution to the whole problem. The distinction between unification and nationalisation is that, in the first case, the transport authority would require to be entirely self-supporting, whereas in the second case there would be a grave danger that sooner or later the National Exchequer would 'be called upon to meet a deficiency. So far as the railways are concerned, unification was in a large measure brought about by the Railways Act of 1921 and by the consequent formation of the four main railway companies. London again offers another example of unification in the formation of the London Passenger Transport Board. The only sound solution of the still larger problem as it exists today is unification of those types of transport already referred to, and bringing in at a convenient time coastwise shipping. The experience already gained as a result, of unification already carried out in London and as a result of the Railways Act of 1921, will enable the mistakes which were made in these early essays to be avoided. Unification, in the national sphere, does not mean one big
authority which would control' the whole of the railway, road trans- port and other interests. It means, firstly, establishing a National Transport Authority which would take over the main-line railway companies, together with all long-distance services by publk-service vehicles and all long-distance goods-haulage services. Canals should be included in its authority ; it might be desirable also to bring in coastwise shipping and internal air services.
Secondly, there should be set up a number of purely local passenger transport-boards to co-ordinate as public utility services the existing local passenger-transport services, municipal and private. Under the present system of licensing, local operators of public-service vehicles have a virtual monopoly, and operate.without any effective competi- tion and equally without any definite limitation of their profits. On the other hand, other local monopolies, such as gas, water and electric power, are limited by the constitution of their authority and equally limited in the profits they earn. In many cases, surpluses are disposed of by way of reduced charges, or in some other manner advantageous to the consumer. Goods-haulage of a purely local kind is in a different category. A licence to operate is necessary, but there has been no attempt to regulate this business and it would not be practicable to do so. The operators perform a useful function ; there are many thousands of them ; and it would be impractical to impose upon them a regulation of activities beyond that which now exists ; the only further control at present desirable is to limit the areas in which they are allowed to operate.
Thus the first step in the unification of transport should be the establishment of a National Transport Authority, and the second the establishment of local transport-boards, while in the sphere of local goods-haulage there should be no control except in the delimitation of areas. In this way we might hope to retain the benefits of war- time co-ordination, which should not be allowed to go to waste after the war. These benefits apply to the country as a whole. The existing main-line railway companies labour under the disadvantages inherent in any vast and unwieldy industrial organisation, and a complete merger would produce advantages which would more than offset the arguments which, it is to be expected, will be advanced by the opponents of the course here advocated. A complete merger. with a larger degree of decentralisation than the present main-line companies permit, would allow a closer local and personal contact than exists today if the various transport divisions were given wide authority within prekribed geographical limits.
So far, no claims have been put forward for the important organi- zational benefits to be obtained by unification. At the present time each of the four main-line companies has its own head-office organi- zation, its own locomotive works, carriage-building works and other expensive departments. In war-time, pooling of resources in loco- motives and rolling-stock generally has proved essential ; in normal times, however, there has been no provision for this. For in normal times each of the companies is concerned with its own particular undertaking only as distinct from the interests of the traffic as a whole (which necessarily includes the interests of the transport user). The economies to be obtained from unification are too obvious to need elaboration. There remains the objection that there would not be the same exertion of personal effort if the railway companies were to lose their individual identity. But this argument had already been abandoned with the passing of the Railways Act of 1921, which re- presented a partial approach to the objectives which have been advo- cated in this article. The necessity for some degree of unification was recognised then, and if partial unification was right in principle more than twenty years ago, there is a good case now for carrying the principle forward to its logical conclusion. The railway companies now are managed by salaried railway managers, by paid officials and employees, and there would be no lessening of initiative, nor indeed of incentive, should the services of these same people be transferred to a unified transport authority.
Lastly, regarding the capital structure of that authority, it is assumed that the existing stockholders would receive in satisfaction of their present interests various categories of stocks in the new authority. If the details were carefully .worked out in an equitable manner, the capital value of the new interests acquired by the stock- holders would be at least equal on the market to their present value.
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