UK rail industry reaches key political junction

a London North Eastern Railway train approaches King's Cross rail station in London. (File/AFP)
Updated 08 September 2019
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UK rail industry reaches key political junction

  • “Better transport links across the country will be a crucial part” of rebalancing Britain’s London-centric economy, says minister

LONDON: Britain’s historic rail industry is destined for the biggest shakeup in decades that could end in renationalization and significant investment to vastly improve services amid costly fares and delays.
Full state-control of the industry is a distinct possibility should a looming general election triggered by Brexit turmoil result in victory for the main opposition Labour party.
At the same time, British Prime Minister Boris Johnson is awaiting the conclusions of a passenger-focused review of the UK’s entire rail sector described by the Conservative government as “the most significant” since the Tories privatised British Rail in the mid-1990s.
“It isn’t good enough that so many commuters spend their mornings staring at a delayed sign at their train platform,” British finance minister Sajid Javid said last week.
Delivering government spending plans for the next year, Javid added that “better transport links across the country will be a crucial part” of rebalancing Britain’s London-centric economy.
Johnson has meanwhile ordered a separate review into the High Speed 2 (HS2) railway linking London with other major English cities, but which has been beset by soaring build costs and massive delays.
Both reviews will deliver their findings by the end of the year, by which time Labour leader Jeremy Corbyn could be prime minister.
Full nationalization of the rail industry that once helped to drive the Industrial Revolution “is undoubtedly a vote winner for Corbyn and Labour,” said Gwilym David Blunt, lecturer in international politics at City, University of London.
While Britain’s rail tracks remain in state hands, the trains are run by mostly private companies enjoying large government subsidies.
“The railways were once a point of pride in this country and now they are absolutely dire compared to the rest of Europe,” Blunt told AFP.
“UK trains are crowded, expensive, often delayed, and of extremely old stock. Voters are angry at receiving little value for money.”
Rail passenger journeys in Britain have hit a record annual high at almost 1.76 billion, fueled by commuters who have no choice but to take the train to work.
The government’s “root and branch” review of the rail sector, including improvements to freight travel, is chaired by Keith Williams, a former chief executive of British Airways.
Presenting an interim update, Williams noted that UK customer satisfaction with Britain’s train services is at a decade-low.
Williams’ review “could be used to bolster the case for taking the railways back into public hands,” said Blunt.
“However, if the review is pro-private ownership it won’t necessarily stop renationalization.”
He added that “the most plausible strategy” for Corbyn would be to wait for the franchises running the train routes “to expire and take them back into public ownership.”
Another headache lying ahead is HS2. The Department for Transport last week said that the cost of the project was set to soar by more than £20 billion ($24 billion, 22 billion euros) to up to £88 billion owing to the complexity of building works.
And rather than its first phase opening in 2026, trains now face not running until 2031.
The initial phase of HS2 — Britain’s first new railway north of London in 150 years — plans to connect the capital in southeast England with the country’s second biggest city Birmingham in the Midlands.
The second phase, which the government has said may now not open until 2040, is for trains to travel further north to Manchester and Leeds.
Another major new railway line — the Crossrail project offering an additional fast direct route between Heathrow airport and central London — has also been hit by significant delays and surging costs.
Due to have opened last December, Crossrail is now not expected to begin services until 2021, lifting construction costs by £3.0 billion to about £18 billion.
To be known officially as the Elizabeth Line in honor of Britain’s queen, Crossrail will serve also towns to the east and west of the capital.


Saudi market regulator in talks with Aramco on IPO rules

Updated 18 September 2019

Saudi market regulator in talks with Aramco on IPO rules

  • Kingdom’s stock market regulator typically requires firms offer at least 20% to 30% of their shares when floating
  • Aramco’s primary listing will be on the Saudi stock exchange (Tadawul) in Riyadh

RIYADH: Saudi Arabia’s Capital Market Authority (CMA) is in talks with Saudi Aramco and its advisers about the regulatory requirements for listing on the domestic stock exchange, its chairman Mohammed bin Abdullah Elkuwaiz told Reuters.
“We continue to have discussions with the company and its advisers on both their readiness, as well as our regulatory requirements for the market,” Kuwaiz said on Wednesday.
Asked whether there will be any waivers or exemptions for the company’s listing, Kuwaiz told Reuters in an interview that the CMA is “still having those discussions.”
The Kingdom’s stock market regulator typically requires firms offer at least 20% to 30% of their shares when floating.
Aramco, whose chairman Yassir Al-Rumayyan said this week that the IPO would be ready within the next year and preparations were continuing despite Saturday’s attacks on its facilities, is yet to file its prospectus with the Saudi regulator.
“We receive waivers or exemption requests where needed and we review them on a case by case basis,” Kuwaiz said, in reference to those discussions.
Aramco’s primary listing will be on the Saudi stock exchange (Tadawul) in Riyadh, but the government is still considering a secondary listing overseas, Saudi finance minister, Mohammed Al-Jadaan told Reuters in an interview on Wednesday.