Rail subsidies must end, says minister preparing to spend £17bn on rail subsidies


Philip Hammond, the Transport Secretary, says he wants to end the government subsidy for rail use:

"In the long term the taxpayer will not be prepared to just continually increase the level of subsidy that they give to the relatively small number of people who ever use trains – something like only 12% of the population. And of course those who use trains tend to be better off anyway," he said.

Wow – robust stuff, and great to hear from a senior government minister. But, sadly, other areas of transport policy don't reflect this. Consider this article by Hammond on the High Speed Rail 2 project:

The evidence from abroad is that high-speed rail is the only effective sustainable answer to our intercity transport challenges. Many of our competitors recognise the huge benefits of high-speed rail, and are pressing ahead with ambitious plans. Britain cannot afford to be left behind.

And this response to the businessmen who argued that HS2 was a white elephant:

Our railways are increasingly crowded, and more and more people are having to stand. We need to invest in new lines and new trains – sticking our heads in the sand, as these people seem to wish, is simply not an option.

No mention of cost anywhere – £17bn for the first leg, and up to £33bn for the whole project – or of why this portion of “the relatively small number of people who ever use trains” should enjoy a public subsidy. Hammond says he understands how silly it is to favour one mode of transport over others, but the HS2 project does exactly that. The government cannot pick winners, nor should it try to – the prestige of HS2 should not obscure the economic realities that make it a waste.