Beeching: context and implications

Few figures in British society are as pilloried as Dr Richard Beeching. As Chair of the British Railways Board (BRB) in 1963, he was responsible for the report “The Reshaping of British Railways” (a.k.a. the ‘Beeching Report’), as well as subsequent decisions leading to the closure of 2,000 British railway stations, and 8,000 miles (12,875km) of track in the space of four years. For context, the Office of Rail and Road reports 2,570 stations served by mainline rail services in the year ending March 2022.

It’s important to recognise that Dr Beeching was clearly asked to do a job by the politicians of the day. As referenced in the foreword to the ‘Beeching report’, the Prime Minister of the day, Harold Macmillan, had said to the House of Commons on 10th March 1960 that “the industry must be of a size and pattern suited to modern conditions and prospects…the railway system must be remodelled to meet current needs”. Ultimately, Beeching’s report envisaged the network being subsidy-free by the end of the 1960s.

By way of further context, the report presents a summary of British Rail’s accounts at the time. On a revenue base of ￡474m (￡8.77bn in March 2023), the network was costing ￡562m (￡9.58bn in today’s money), and additionally paying interest of ￡49m (￡835m). The total subsidy requirement of ￡2.3bn in 2023 terms, or 29% of revenues, was clearly deemed unsustainable (to coin a phrase I will return to below) at the time. I note that, in contrast to 2019/20, when passenger revenues made up over 90% of income from rail’s customers, the situation was very much the reverse at the time of the report—when 65% of income from customers was earned by freight.

It's remarkable that the line closures that caused so much controversy, and over the following 60 years, made up a relatively small proportion—10%—of the annual savings the Report was expected to deliver. Of course, in ongoing terms, the savings amount to substantial sums of money, and the re-use value of the land (often for roads!) cannot be ignored. However, in the context of the major loss from the closure programme of what economists call ‘option value’—the idea that closing part of a network prevents future uses developing—as well as the ongoing social, environmental and economic value that was lost, perhaps in retrospect lines could have been mothballed for a period of a decade or so, with a view to re-opening as new markets emerged. Indeed, the network effects of the closure programme harmed not only the lines that were closed, but also those that remained open, due to the loss of feeder services.

As well as the axe-wielding he is synonymous with, however, Beeching and his Board recognised the importance of growing markets that rail was well-positioned to develop. His ‘liner trains’ concept formed the basis of the development of today’s 6.2bn net tonne kilometre intermodal traffic in GB rail; his suggested measures for already-profitable coal services focused on improving profitability further; and he also quantified additional profits that rail could obtain through testing new markets.

It is remarkable how apposite the context of the BRB report is to today’s railways—especially in England and Wales (the funding settlement for Scotland is greater than Network Rail's CP7 planning assumptions). Deemed financially unsustainable by the Secretary of State for Transport, the rail sector is reverting to the Beeching-era emphasis on supporting profitable markets.The industry is not going as far as the BRB recommendations in the 1960s to close routes and stations, but Network Rail’s latest Strategic Business Plan does focus maintenance and renewals activity on areas with higher revenues, and growth potential. The ORR's latest assessment shows that asset condition won't return to levels seen today until CP11 (2044-2049) in England and Wales, and CP12 (2049-2054) in Scotland—bearing in mind that asset sustainability was forecast to decline in the current five-year period, and the required renewals in future control periods aren't yet funded.

As the network deteriorates, there are also limited or no plans for improving services on today's network, while there is no overarching plan for rebalancing services between markets. We're looking at a network with less connectivity in the regions, compared to the provision of commuter services, which doesn’t seem to fit with travel patterns we are seeing across the modes of transport today. If there are fewer services that, pound-for-pound, create the greatest opportunities for people to drive less, rail's role as a core contributor to the decarbonisation of transport is undermined. We probably need to find the money for those renewals ahead of the 2050 net zero target, or people won't be wanting to swap their electric vehicles for the train any time soon, despite projected increased road congestion.

Finally, rail has a capital investment programme that seems out of kilter with this context.?It has been 18 months since the Government’s ambitious ￡96bn Integrated Rail plan, which in addition to HS2 Phases 1 and 2a confirmed plans for large scale improvements for rail in the Midlands and the North. The big question now is does it continue to make sense for this scale of investment in improvements to the railway in a context where parts of the network are in a managed decline? The government has answered this question in part by delaying some elements of HS2 to reduce expenditure, including decisions not to proceed to construction on Phase 2a (West Midlands to Crewe) and the expected southern terminus of the line (London Euston) in the next two years.

In a subsequent article, I’ll suggest some ways in which the industry can react to the challenges of today, avoiding major reductions in services, and service quality, while preserving the case for major investments where relevant.