Half of Britain’s rail services would be brought back within public control under a plan to strip train companies of the right to set fares, timetables and quality standards across London and the Home Counties.

Ken Livingstone, the Mayor of London, is preparing to submit a bid next year to take over most of Southern, one of the biggest train franchises, from 2009. He is also drawing up plans to take control of all commuter trains that terminate in the capital, including those that start their journeys well beyond Greater London.

The move would reverse one of the basic principles of rail privatisation, which was that companies should have the right to set open and off-peak fares and to keep all the profits.

The Government is committed publicly to maintaining the current franchising system, but ministers believe privately that Mr Livingstone’s model may deliver a better long-term structure for the rail industry.

The mayor wants to introduce a unified ticketing system for the entire London commuter network, ending the current confusion over the different restrictions and pricing polices set by 14 train companies. Frequency would be increased to give most stations a train every 15 minutes.

Transport for London (TfL), Mr Livingstone’s transport authority, has already taken control of three lines and rebranded them as London Overground. The North London, Gospel Oak to Barking and Euston to Watford lines transferred to TfL last week, and the extended East London line will become part of Mr Livingstone’s rail empire when it reopens in 2010.

TfL is more than doubling capacity on London Overground, with a new fleet of trains operating at eight-minute intervals on the busiest stretches from 2009. For the first time on the national rail network, passengers are able to use Oyster electronic payment cards. Some fares have been halved.

Speaking to The Times, Mr Livingstone said: “I am optimistic that TfL will end up controlling all the franchises in Greater London. We want to get the same standards we are introducing on London Overground on all services and I am confident of getting a sympathetic hearing from the Government.”

Mr Livingstone said that once he controlled the wider network, fares would be set at a level to attract passengers rather than to maximise profits. He ruled out raising fares sharply soon after winning a franchises, such as the 20 per cent increase on South West Trains in May.

But Mr Livingstone admitted that the quality of service he wanted would require a continuing high level of public subsidy. “If you try to run these services for a profit you get a pretty miserable level of service. Every time I got on a North London Line train, half the seats weren’t even bolted to the base and fell off when you sat down.”

The mayor accused train companies of operating “scams” to maximise profits. “It’s disgraceful the way train companies have stationed revenue staff at stations where there is an interchange with the London Underground so they can fine people using Oyster cards.”

Mr Livingstone said that two directors would be appointed to the TfL board to represent the interests of passengers who began their journeys outside Greater London.

London TravelWatch, the passenger watchdog, welcomed Mr Livingstone’s plan. Brian Cooke, its chairman, said: “The network would be much easier to use if it was run by one organisation under a single set of rules. If London Overground proves a success in the next year, it will provide a powerful argument for reintegrating the network.”

Mr Cooke said that Mr Livingstone could choose to fund rail improvements by raising council tax, increasing the congestion charge or borrowing against future fare income.

Anthony Smith, chief executive of Passenger Focus, the national passenger watchdog, said that safeguards would be needed to prevent Mr Livingstone from sacrificing fast services by making trains stop more often en route. “There needs to be a balance because the rail network serves both London and the South East,” he said.

Under the plan, private companies would still operate the trains, but would have very little commercial freedom. They would receive a management fee and pay penalties or receive a bonus depending on their success in achieving standards set by TfL.

Clickety-clack

Pros
A simplified fare structure and an end to conflicting restrictions on different routes
Greater frequency – a train every 15 minutes from most stations
One brand, London Overground, ending the costly repainting of trains in new colours every seven years
Oyster pay-as-you-go cards accepted on all routes
Staff at all stations whenever they are open

Cons
Risk that passengers within the Greater London boundary may be given priority over those living beyond it
Council tax and congestion charge may be increased to pay for improvements
Private sector innovation could be lost
A different Mayor of London may seek to make passengers pay more of the true cost of services

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