Reform Under The Labour Government
The Labour government (elected in 1997 after the majority of the privatisation process had been completed) did not completely reverse the railway privatisation of the previous administration. Initially it left the new structure largely in place, however its main innovation in the early years was the creation of the Strategic Rail Authority (SRA), initially in shadow form until the Transport Act 2000 received Royal Assent.
In the wake of the Hatfield rail crash in 2000, Railtrack entered into financial meltdown and the industry was in deep crisis. Labour refused to continue to bail out Railtrack and the company was put into Railway Administration in 2001 and a new company, Network Rail emerged to replace Railtrack in 2002. Network Rail is a nominally private "not for dividend" company. However, its borrowing is backed by the government (which allowed better interest rates on loans), so its status is a confusing one.
The Strategic Rail Authority lasted just five years. Following the passing of the Railways Act 2005, its business was wound up and its functions transferred to the Department for Transport Rail Group and the Office for Rail Regulation. Further changes have followed, which has seen the government take back a greater degree of control but the early demise of the SRA suggests that the right formula for the long-term health of the rail industry has not yet been agreed.
Another important development occurred in the aftermath of the Potters Bar accident in May 2002 when a commuter train derailed (coincidentally on the same stretch of the East Coast Main Line as Hatfield) due to poorly maintained points. This resulted in Network Rail taking all track maintenance back in house and the industry went on to enjoy the longest period in modern times without a fatal accident due to industry error. This came to an end in February 2007 when a Virgin Pendolino derailed near Grayrigg in Cumbria, killing one person. The cause of the accident was identical to that in Potters Bar nearly five years earlier - once again calling into question Network Rail's maintenance procedures.
Read more about this topic: History Of Rail Transport In Great Britain 1995 To Date
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