Transport Secretary Heidi Alexander has announced a strategic shift to allow Great British Railways to directly own new trains. The policy aims to reduce long-term costs associated with leasing rolling stock, which currently accounts for roughly a third of daily railway operating expenses, as the government moves toward a default model of public ownership.
The Shift to Public Rolling Stock Ownership
The government plans to move away from the long-standing practice of relying on private rolling stock companies, known as ROSCOS, to supply trains. Transport Secretary Heidi Alexander framed the potential move as a necessary measure to address the hidden challenges that hold the railway back
and to better serve passengers and taxpayers.
In 2024 alone, franchised train operators spent more than £4 billion on leasing and maintaining trains they did not own. According to the Transport Secretary, this figure represents approximately one-third of the total daily running costs for the railway network, with every contract including transaction costs and investment returns that ultimately fall on the public.
“Because I say again conference, who should the railway serve? If GBR owning trains would best serve taxpayers and passengers. Then we should do it.”
Heidi Alexander, Transport Secretary
Defining the Future of Rail Nationalization
The announcement clarifies the government’s approach to nationalization, which has often been confused with a return to the historic British Rail model. In practice, the current process involves returning passenger services to public control as existing private contracts expire. Various operators, including LNER, Northern, Scotrail, and Transport for Wales, are already under public or devolved control.
Industry experts, including Prof Glaister, have noted that the rail system was never fully privatized, as infrastructure manager Network Rail has remained under public control for over two decades. Even during periods of private operation, government control remained high. Scotrail, Transport for Wales, and the Caledonian Sleeper are controlled by devolved national governments, while even those operators on Department for Transport contracts have been heavily controlled by the government for years. During the Covid pandemic, private operators were paid a fixed fee to run services, with the taxpayer assuming the financial risk.
Despite the current push for nationalization, Prof Glaister argues that for a few years during the 1990s, the old privatized system actually functioned well, with falling subsidies and rising passenger numbers.
Union Support and the Avanti West Coast Transition
The move toward direct ownership has received backing from rail unions. Dave Calfe, general secretary of Aslef, described the announcement as a big step forward
for the network. He argued that the current system allows billions of pounds to leave the railway in the form of profits and dividends paid to foreign-owned rolling stock companies, rather than being reinvested into lower fares or improved services.
This policy shift coincides with the planned nationalization of Avanti West Coast services, scheduled for March next year. Ms. Alexander stated that the decision to take the service into public hands was prompted by years of underperformance, which she noted left passengers paying the price
for inadequate service levels.
While the government has committed to a case-by-case approach for future procurements—considering private investment alongside public ownership—the clear intent remains to prioritize the state’s role in asset acquisition. As the industry prepares for the full implementation of GBR, the government maintains that the strategy is driven by the need to best serve taxpayers
by curbing the long-term costs associated with leasing.
