Leading Article: All change in BR's culture

BRITISH RAIL enjoys a position in the British psyche similar to that of the National Health Service. Both inspire endless complaints, be it from commuters treated like cattle or patients treated like numbers. Yet for both institutions there is considerable affection. In this, nostalgia for some allegedly halcyon era plays its part. So does admiration for the daunting scale of both enterprises, and the obvious strains it imposes on their staffs. Both organisations are, furthermore, seen as victims of the Government's determination to hold down public spending.

The BR privatisation Bill announced yesterday is indeed much more similar to the reorganisation of the NHS than it is to the vastly simpler conversion of the nationalised public utilities into limited companies. There is a comparability between, on the one hand, BR, the new Railtrack authority and the private operators of the future, and, on the other, the semi-autonomous GPs and hospital trusts, the regional and district health authorities and the rest of the NHS. Among the main aims of the Government's NHS reforms was to make that vast organisation more responsive to patients' needs, less top-heavy, and less driven by the demands of the public service unions and other 'producer' groups.

So it is with BR. It was no coincidence that John MacGregor, the Secretary of State for Transport, yesterday described BR's 'monolithic' culture as 'more about keeping the trains running than the market-oriented thrust of identifying what the customer wants and then being flexible enough to deliver.' As with the NHS, the public knows in its heart that reform is needed, yet it fears change and - given the low prevailing confidence in the motives and efficiency of government - suspects it may do more harm than good.

In one crucial respect the two sets of reforms are very different. Those affecting the NHS were rushed into effect with no local trials or preliminary education process. Rail privatisation, by contrast, was in the air throughout the Eighties, and became a Tory commitment in 1990. Alternative approaches have since been examined and rejected in what often resembled a thinking-aloud process; and certain aims, such as competition between operators on most tracks, have been abandoned. This process has been widely interpreted as muddled thinking, panic, U- turns and the like. Yet it could also be seen as a form of dialogue, and commendably pragmatic. Now that the vast, complex Bill is out, it is easy for its critics to seize on some apparent deficiency to condemn the entire exercise. Yesterday's abusive reaction from the railway unions underlines the validity of Mr MacGregor's attack on BR's producerist culture.

None the less, the Bill fails to lay to rest some serious fears. One, as with the NHS, is the level of bureaucracy the new regime will spawn. All companies wanting to operate an available part of the system will require a licence from the new Rail Regulator, which will lay down stringent conditions to ensure safety and financial viability. Other important elements will be the franchising authority, private sector train and station operators, a body to regulate through-ticketing and a Health and Safety Commission. The prospect of interacting with all these may deter would-be operators.

The relationship between subsidised franchise-holders and the unsubsidised Railtrack promises to be particularly fraught. If, for example, Railtrack fails to provide a high-quality signalling service, trains run by private operators may be unable to achieve promised levels of performance. Another serious anxiety concerns continuity of investment. So far potential operators have been interested only in leasing existing BR rolling stock, rather than in ordering their own. When buses were privatised, there was a considerable time gap before the new companies gained the confidence to start investing. Lead times for new rolling stock run into several years.

Experience will provide the answers to some questions. Unlike the NHS reforms, this metamorphosis is, after all, expected to extend over more than 10 years. The biggest hole of all - the gap between the price of a rail ticket and the marginal cost of going by car - may be at least partially plugged when road pricing is introduced: a Green Paper is planned for May. On balance, the likelihood seems to be that, just as the NHS reforms are becoming accepted, so, too, will the injection of private enterprise culture into the railway system. Should a net deterioration in services result, the Government will pay a heavy political price for getting it wrong.