What if Britain had never privatised the railways?

In this Britain, the railway is one thing you own, not a dozen balance sheets you rent.

On Wednesday a Southern service from London Victoria to Eastbourne left the rails near Lewes and three carriages rolled onto their sides, on the hottest day of the year so far. Around twenty people were hurt, two seriously. Less than twenty-four hours later a Greater Anglia train derailed south of Wickford in Essex. Nobody was seriously injured the second time, which is the only reason the week did not become a disaster. The immediate question was whether the heat had buckled the track. The longer question is the one this file is about: after thirty years and more than a hundred billion pounds of public money, who is actually responsible for the railway those trains fell off?

So we ran the counterfactual, except this one is not hypothetical. Britain is already answering it. One operator at a time, the government is taking the train companies back into public hands, and folding them into a single body called Great British Railways. The privatised railway is being dismantled by the same establishment that built it. This file is the invoice for the thirty years in between.

Start with an awkward fact, because it is the honest one. Both trains that derailed this week were run by publicly owned operators. Greater Anglia was taken back into public ownership in October 2025; the operator behind that Southern service returned to public hands at the end of May 2026. The track beneath both of them has been publicly owned since 2002, when the private company that ran it, Railtrack, collapsed after a run of fatal crashes and was replaced by Network Rail. So this was not a case of a greedy private operator cutting a corner. It is something stranger, and worse: a railway split into so many companies over thirty years that when two trains leave the track in a heatwave, no single organisation clearly owns the answer.

That is the real inheritance of privatisation. Not one villain, but a diagram. The track sits with Network Rail. The trains are owned by finance companies and leased to whoever runs the service. The service is run by an operator on a government contract. The fares are set partly by the state and partly by the operator. When something goes wrong, the structure that was sold as bringing private discipline mostly brings a meeting about whose fault it is.

This week is not the case against privatisation. The rail those trains left has been public for over twenty years, and the operators running them had just been taken back too. If anything it is the honest half of the story: public ownership does not cool a rail at thirty-eight degrees. The case against privatisation never makes the front page. It arrives monthly, in the fare, and once a year, in the subsidy. The track you can fall off is already yours. The bill you cannot escape is the part privatisation left behind.

The promise came in the words of its own architects. British Rail, they said, was a bloated state monopoly that soaked up taxpayers' money; hand it to the market and the subsidy would fall. It is the cleanest test privatisation ever set itself, and it failed it. British Rail cost the taxpayer around £2bn a year in today's money. The privatised railway, in a normal pre-pandemic year, cost about £7bn. The subsidy did not fall. In real terms it roughly doubled. Drawn to scale:

Read that chart next to the sales pitch, because they contradict each other. The one thing privatisation most loudly promised to do, it did the opposite of. Passenger numbers did roughly double after the mid-1990s, and defenders point to that, fairly. But the subsidy doubled too, and then some. Britain did not stop paying for its railway through taxation. It added a second bill, paid at the ticket barrier, and handed the difference to shareholders.

The most extractive part of the whole arrangement is the one nobody sees, because it is not printed on a ticket. The trains themselves, the physical carriages, are not owned by the operators or by the state. They are owned by three finance companies called rolling stock companies, or ROSCOs, and leased back to whoever runs the service. Angel Trains, Eversholt, Porterbrook. The public pays to run the trains; a private balance sheet owns them and collects the rent.

It is a good business to be in. In 2022-23 the combined profits of the three ROSCOs tripled in a single year, from about £122m to £410m, and their net profit margins jumped from 14% to 42%. Over the last decade they have paid out roughly £2bn in dividends, much of it flowing to overseas owners and through Luxembourg and Jersey. This is rent on trains the passenger already funds, extracted from a market with no competition, because the operator cannot shop around any more than you can. When people ask where the fare goes, a slice of it goes here, to own the metal you are standing on.

Then there is the ticket itself. Britain has the most expensive commuter season tickets in Europe. An annual season ticket into a big British city runs past £3,000, and by one comparison sits over £1,000 a year above the next dearest country on the continent. A December 2024 study found Great Western Railway charging around two and a half times the average of EU and Swiss operators for journeys of the same length. Meanwhile a commuter in Germany can buy the Deutschlandticket for €58, about £51, a month, and ride every local train, tram and bus in the country. A British season-ticket holder can spend that in a few days.

To be fair about it, the comparison is not perfect. Some British advance fares, booked weeks ahead, are competitive with France or Germany. But those are the fares of the leisure traveller with a flexible diary, not the commuter tied to the 07:42. For the person who has no choice about when they travel, the one who buys the season ticket because they must, Britain is the dearest railway in Europe to be a passenger on, running on a subsidy that doubled. Both bills at once, and neither of them small.

What the passenger and the taxpayer carry under the fragmented model, next to the benchmark it was meant to beat.

Notice that there is no version of this where the passenger comes out ahead. The commuter pays Europe's highest fare, the taxpayer pays a doubled subsidy, and a third slice pays rent to the finance companies that own the trains. Three bills for one railway, which is the exact opposite of the single, simpler thing privatisation was sold as.

And the subsidy is only the part that shows up in the Budget. It leaves out the fare premium the commuter pays on top, the £2bn of leasing dividends drawn out of the system over the decade, and the cost of running a railway as a dozen companies that must each be paid to talk to one another. This is not a bill you settle once. It is a standing order on a thing most people cannot choose not to use.

This is where rail articles usually pick a team, so we won't. Four things are true at once, and a file that tells you only one of them is selling something.

First, privatisation did deliver something real. British Rail was shrinking; after the mid-1990s passenger numbers roughly doubled, the fastest growth of any major railway in Europe. Private money did buy some new trains and busier services. Anyone who tells you the railway was better in every way in 1993 is misremembering.

Second, public ownership is not a magic wand, and this week proves it. The operators that derailed were already public, the track has been public since 2002, and none of that cooled the rail on a 38-degree afternoon. Renationalising the operators does not abolish the subsidy either; much of that money maintains a Victorian network that has to be paid for under any owner. Great British Railways will inherit the same heat, the same cuttings, the same ageing signals.

Third, the awkward remaining piece is the trains. Even after every operator is back in public hands, the rolling stock companies still own the carriages and still collect the rent. Bringing the operators into Great British Railways does not automatically end the leasing model, and the £400m-a-year question of who owns the trains is the one reform nobody has quite grasped.

Fourth, and this is the important one, the verdict is already in, and it is cross-party. Privatisation failed the test it set itself: the subsidy rose, the fares became Europe's highest, and the structure grew so complex it needed a rescue. That is why a model begun under one government is being dismantled under another, operator by operator, back into a single public body by 2027. The argument about ownership is over. The only live question is why it took thirty years, and why we are still leasing the trains.

Britain did not fail to run a railway. It ran one, then broke it into a dozen companies on the promise that competition would make it cheaper, and got the most expensive fares in Europe and a subsidy that doubled. The private discipline it was meant to import mostly arrived as complexity: a diagram of contracts where a single railway used to be, and a leasing bill on the trains themselves.

The bill for that choice is not filed in a consultant's annexe. It is at the ticket barrier every morning, the dearest season ticket on the continent, stapled to a tax bill that funds the same railway twice. Two trains left the track this week in the heat, run by operators the state had already taken back, on rails the state has owned for twenty years. The ownership argument is settled. What lingers is the cost of having taken the scenic route to the obvious answer.

Britain is buying its railway back, carriage by carriage, having sold it for a discipline that never came. The season ticket was the receipt. It is only now being cancelled, one operator at a time, and it never once printed cheap.

• Lewes derailment, 13 August 2026 and Wickford derailment, 14 August 2026: two derailments in under 24 hours during the heatwave; ~20 injured at Lewes (two seriously), none seriously at Wickford; Network Rail cited "exceptional challenges" from the heat, investigations ongoing.
• Office of Rail and Road / DfT rail subsidy data, with NEF and IEA: net government support ≈ £7bn in 2018-19, roughly double British Rail (~£2bn) in real terms; support rose to ~£16-20bn during the 2020-21 pandemic.
• Full Fact on UK rail fares and Railway Magazine: Britain's annual season tickets the highest in Europe, by one comparison over £1,000 above the next dearest country; a December 2024 study put GWR fares at ~2.5x the EU and Swiss average for similar distances. Germany's Deutschlandticket is €58 (~£51) a month for all local transport.
• We Own It / ORR on the ROSCOs: the three rolling stock companies' profits tripled from ~£122m to ~£410m in 2022-23, net margins 14%→42%, roughly £2bn in dividends over the decade, much repatriated overseas.
• Passenger Railway Services (Public Ownership) Act 2024 and the renationalisation timetable: Greater Anglia to public ownership October 2025, West Midlands Trains February 2026, Govia Thameslink (Southern) 31 May 2026, Chiltern September 2026, Great Western December 2026, all operators into Great British Railways by 2027. Network Rail (track) has been publicly owned since 2002.
• Operator ownership: until May 2026 the Southern/Thameslink operator was part-owned via Keolis (70% owned by the French state railway SNCF); Greater Anglia was previously run by Abellio, the international arm of the Dutch state railway, until 2024. Both are now publicly owned in Britain.
• Full model: British Rail vs privatised-era public subsidy in real terms (ORR); European fare gaps from cross-country studies (Full Fact, Railway Magazine); ROSCO dividends from company accounts. The calculator applies a conservative 40% UK-to-Europe fare gap, below the 2.5x found for some long-distance operators.