'South West rail services underpinned by ^290m taxpayer subsidy'

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South West rail services underpinned by ^290m taxpayer subsidy

Taxpayers pumped a ^287 million subsidy into much-criticised railways in the South West last year, according to a report from rail regulators.

The figure represents around a quarter of the running costs of the western route against claims the region is badly-served by an inadequate service underlined by the recent collapse of the line at Dawlish.

Nationally, Government funding for the railways amounted to ^4 billion, representing 31% of the industry^s total income.

Trade unions said the figures, published by the Office for Rail Regulation for 2012-13, underlined that privatisation was failing. But the Government argued the heavily-subsidised rail services provided a lifeline to rural communities.

First Great Western, the major operator on the western route, made clear it does not receive the net ^420 million state subsidy given to the Network Rail quango to maintain the track, and that it returned ^165 million generated from tickets to Whitehall. But critics seized on the data showing how much subsidy goes in varies massively depending on where passengers travel.

Some ^843 million in fares paid by South West Trains completely offset public subsidies. But 69% of the costs of Northern Rail are funded by the state. Around 20% of the costs of First Great Western services came from subsidy, a net figure of ^219 million.

The proportion was higher ^ just over 24% ^ on the entire western route, which is used by South West Trains and CrossCountry as well as First. By this measure, taxpayers picked up the tab to the tune of ^287 million.

The total cost of running Britain^s railways was ^12.3 billion in 2012-13, a figure that has remained consistent over the past three years.

Government policy is to ease the pressure on taxpayers and let passengers take more of the strain. And Britain^s railways are being funded increasingly by passengers, who accounted for 59.2% of rail industry costs last year. By contrast, the figure was 57.4 per cent the previous year.

A Department for Transport spokesman said: ^Many services would not be commercially viable without taxpayer funding, and we subsidise them because they deliver wide social, environmental and economic benefits to their communities.^

TUC general secretary Frances O^Grady said: ^The figures show just how dependent rail firms have become on the public purse. All bar one of the UK^▸ ^s private train operators rely upon public subsidies to run services.^

The report showed that Government funding in the year varied from ^2.19 per passenger journey in England to ^7.60 in Scotland and ^9.33 in Wales. The western route was ^3.01 per passenger and Great Western ^2.25.

First Great Western generated ^860 million in passenger income in the year, and gave back ^165 million to the Government. The report showed its services are equal to just 4p per km that each passenger travels ^ the seventh lowest of 18 train operating companies in Britain.

A company spokesman said: ^As the ORR^» ^s report highlights, we generated ^860 million in passenger revenue in 2012/13, 20 per cent ^ or ^165 million ^ of which we returned to the taxpayer as net premium payments. Our route saw 4p of central funding for every passenger kilometre travelled, amongst the smallest of all the UK's rail networks. We know the railway plays a vital role in the economy of the South West ^ something that the closure of Dawlish earlier this year attests to. Since taking over the franchise in 2006 we have helped deliver more than ^100 million in station improvements, introduced more services, improved performance and increased demand. This has allowed more people across the region to access jobs, education and leisure, which is good for the economy, the environment and the travelling public.^