Fire and Steam (37 page)

Fortunately, the Board's services were never called upon, apart from having to rubberstamp agreements thrashed out between the companies. How these crusty old railway directors, used to ruling their fiefdoms, must have choked at having to co-operate with their local enemies to avoid the indignity of a forced merger. The Act set the deadline for amalgamation in July 1923, but several railways merged voluntarily long before that date. There was no easy principle by which the territories could be established, although of the three the Southern was the most straightforward, taking in the London & South Western, the London, Brighton & South Coast and the combined South Eastern & Chatham railways. Even so, getting the railways to merge together by government fiat was a painful process. As the biographer of Sir
Herbert Walker, the first chairman of the Southern, put it: ‘Innate rivalries do not slacken because a government passes an act of Parliament.'
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The South Western was dominant and the South Eastern and Brighton men had to fight hard for their corners with disputes over everything from electrification methods to, crucially, assessment of the relative financial value of each business so that the new shares could be apportioned fairly.

There were similar battles in the other two companies. The London & North Western had moved quickly, absorbing the Lancashire & Yorkshire, but merging with its old rival, the Midland, proved more difficult and two Scottish railways, the Caledonian and its old enemy the Glasgow & South Western, also had to be reconciled. The Scots were more willing to hand over their railways to an English-dominated concern than merge with one another, which may explain why the country did not get its own railway at this stage. The name, too, was a long source of debate with the London, Midland & Northern being put forward initially, but since it ignored the sensibilities of people north of the border, London, Midland & Scottish was chosen for what proved to be the largest of the Big Four. Again, as well as the larger railways, twenty-seven ‘constituent companies' (subsidiaries) had to be incorporated, including tiny railways like the charmingly named Garstang & Knott End in Lancashire, an eleven-mile line near Preston, built in 1863 to take farmers' produce to market.

There was much controversy over the name of the fourth grouping, which took in seven large railways including the North Eastern, the Great Northern and the Great Eastern, all of which suggested that North and East should be in the title. In addition there were twenty-six smaller subsidiaries, including tiny railways such as the nine miles of the Gifford & Garvald railway company of East Lothian, which carried strawberries, pit props and malt whisky.

Because the mergers had taken place voluntarily, albeit under pressure of the Act, they were largely completed by the beginning of 1923, six months ahead of the official deadline. Eric Geddes, meanwhile, a man who had cut his teeth on the railways and steered through the legislation, left them to their own devices, perhaps sensing that the future of transport lay elsewhere. He went off first to a directorship in
the motor industry, with Dunlop, and then into aviation, becoming chairman of Imperial Airways, the precursor to British Airways.

The only significant railways to be left outside the system were the Metropolitan and the London Electric Railway, which in 1933 became part of the London Underground, and a few joint lines that had been operated by more than one company. The forty other railways were insignificant, averaging just nine miles each. The amalgamation brought to an end the haphazard system created by the Victorians, which had survived because of successive governments' reluctance to allow consolidation, out of fear of monopoly and encouragement of competition. With hindsight, it is easy to be harsh on this sprawling, cumbersome structure. After all, the system delivered a remarkably good service to virtually every community in the land, all built with private capital and no recourse to the taxpayer. But the old system, based on competition rather than coordination, would never have survived the competition with the road network that the railways were about to face.

The failure of the government to compensate the railways fully for their war effort meant the four companies started out with one hand behind their backs. To some extent the 1921 grouping was ‘a disguised nationalization'
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because the railway companies – artificial constructs formed by legislation – were forced to charge fares set by the government. They had to start rebuilding their railways, and could do so only slowly thanks to the lack of cash, rather than devoting all their energies to preparing the railways for the threat they faced from lorries and cars. That legacy of underinvestment was to hold them back for the next two decades until they faced a second world war that was to prove even more damaging.

TWELVE

COMPROMISE – THE BIG FOUR

So then there were four. The era of the ‘Big Four' companies that was to last precisely a quarter of a century is often portrayed as a golden age thanks to the exploits of the record-breaking expresses on the East and West Coast Main Lines. In truth, that reputation owes more to the skill and originality of the advertising departments of the Big Four than to the experience of train travel for most passengers. The vast majority of services were far more mundane than these posters suggested. From the CJ) outset, the amalgamated companies suffered from a number of handicaps including the shabby treatment of the railways at the hands of government in the aftermath of the war and the growing threat of competition from motor vehicles. Just before the mergers, the rail companies had fought unsuccessfully to be allowed to become road hauliers, but the nascent road transport industry successfully lobbied against the idea, arguing that the railways would kill off private initiative and keep costs high. As a result, the government barred them in the interests of competition, allowing them to offer road services only to feed freight into their rail heads. Worse, in the run-up to the war, the government had introduced subsidies for the purchase of petrol-powered lorries in return for allowing them to be called up in wartime: before that, there had been virtually no long-distance transport of goods by road. Moreover, thousands of former soldiers, who had learnt to drive in the services, were able to turn themselves into one-man freight haulage businesses by buying cheap ex-army vehicles with their demob money and greatly undercutting the railways. The post-war era saw the
rapid development of a new road haulage industry based on small and highly competitive firms, largely consisting of very flexible owner-drivers helped by the low cost of petrol. Indeed, road users were lightly taxed and unlike the railways paid little towards the cost of the construction of their infrastructure. Within a few years, road transport had wiped out many local freight services on the railways, though rail still retained an advantage for longer distance traffic.

For their part, the railways suffered the additional disadvantage of being common carriers, a remnant of the Victorian rules that obliged them to transport everything from small packets and perishable fruit to whole farms and circuses. Road hauliers were not bound by such regulations and could not only pick and choose whatever load they reckoned might be profitable but also set their own prices. It was not until the 1930s that the railways began to be aware of the extent of the threat they faced and started to lobby against the unfair terms of competition set by the government. Amalgamation was undoubtedly a sensible idea given the wastefulness of the old system, but the railways were still burdened with a network that was clearly too large for such a small country. Surprisingly, the division into four groups, which was designed to bring about coordination rather than competition, still left several main traffic arteries with two routes served by rival companies. For example, from London, there were alternative routes to cities such as Birmingham, Manchester, Sheffield, Exeter, Edinburgh and even far-off Aberdeen, while conversely there was only one company covering Bristol, Cardiff, Liverpool and Newcastle. In some cases this continued duplication appeared quite deliberate. The Great Eastern and the London, Tilbury & Southend both offered pretty similar timetables to Southend from Liverpool Street and Fenchurch Street stations respectively but while the former was incorporated into the London & North Eastern, the latter, bought by the Midland in 1912, became a virtually self-contained fiefdom within the London, Midland & Scottish. In other words, many of the nineteenth-century rivalries were perpetuated rather than ended by the regrouping and would continue for the quarter of a century that this system survived.

To compound the difficulties for the companies to establish themselves, passenger numbers were in decline and, as we shall see
below, would fall by 8 per cent in the inter-war period. While this was not catastrophic, such a decline was a disincentive for investors and a sign that the heyday of the railways was finally over. On the whole, the service provided by the railways in terms of timing, punctuality and passenger comfort was not much to boast about except on certain key routes. The Big Four tended to concentrate on a few show trains, whose shorter timetabled journey and comfort were widely publicized, but which were in sharp contrast to the rest of the services. This was not unlike the situation in France today where there is a great difference between the much-lauded high-speed lines and the often decrepit and infrequent provincial services. This was particularly true on the Great Western where a few fast through trains offered the fastest timings in the world while the rest provided the lackadaisical ‘take it or leave it' service typical of monopolies. The exception was the Southern which, throughout the inter-war period, concentrated on improving a large proportion of its services through electrification.

The railways were thus hamstrung by their past and by the onerous government regulation. Moreover, the two northern companies faced tremendous difficulties in assimilating their disparate empires, while the Great Western was parsimonious to a fault. Only the Southern showed the kind of enterprise needed to retain, and indeed increase, passenger numbers. The apparent hostility to the railways by the government was, in part, left over from the distrust felt towards them in the days when they were monopolists needing to be controlled and also a failure to recognize the extent of the revolution created by the advent of the internal combustion engine. The amalgamations had been designed to give the railways receipts from freight equivalent to 1913 levels, but that was never achieved, which weakened their financial situation and, in any case, constituted unnecessary state interference. Freight was crucial to the profitability of the companies but the amount being carried began to decline as the economy became less reliant on the heavy industries of the north, such as coal and steel. A lengthy coal strike in 1921 had, too, dented the railways' profits and was a portent of the further decline in freight revenue that was to come.

There was more to this bias against the railways than fear of the old monopolies. The railways may not have been nationalized but they
were perceived as a quasi arm of the state. They were a mature industry, with little scope for expansion and frequently seen as old-fashioned. Unlike the motor industry, they were perceived as neither innovative nor entrepreneurial. Cars and roads were exciting, young, aggressive and ‘became the flagship of those opposed to state intervention'.
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They supported an individualized method of transport in contrast to the railways which were public and inherently more socialistic.

The Big Four, then, were born at a difficult time when the industry faced an increased need for investment and renewal just as traffic was beginning to decline. They each had different characteristics and different styles. The largest was the London, Midland & Scottish with a network of close to 7,000 miles, nearly two thirds of today's total, stretching from Southend to north-west Scotland and taking in parts of Wales as well as most of the west side of England north of London. It employed 275,000 people, owned 10,000 steam locomotives,
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20,000 passenger carriages and 207,000 freight wagons – and 9,000 horses (astonishingly, 7,000 were bequeathed to British Railways a quarter of a century later). Given the rivalry between two of its main constituents, the London & North Western and the Midland, with their longstanding differences in policy, it was hardly surprising that it took some time for the railway to be melded into anything like a coherent unit. It was not until the arrival of Sir (later Lord) Joshua Stamp as president
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three years after amalgamation that there was any attempt to create a unified business. Stamp, who soon became chairman, was an economist rather than a railwayman and his focus was very much on the bottom line: his ‘economics were those of the tax inspector'.
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He ran the company in an autocratic way that gradually blended together its component parts into an effective, yet largely unexciting, railway.

Early on, Stamp wondered why the LMS
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expresses out of Euston required ‘double-heading' (two locomotives) while those operated by the Great Western and the London & North Eastern were invariably headed by just a single engine. The answer was that various attempts before the war to design a locomotive that could have done the job alone had failed for a variety of reasons. Stamp then commissioned his locomotive engineer, Sir Henry Fowler, to produce a new class of locomotives, the Royal Scots, which eventually did the trick, though
they took some time and several modifications to attain the right level of performance.

The LMS excelled at the backroom tasks, like repairing locomotives and building carriages, but was not so good at what is known today as the ‘customer-facing' role. Stamp was parsimonious to a fault, which meant that there was an effective moratorium on many types of expenditure, big and small. The letter paper was famously thin and staff were encouraged to use both sides of every sheet; on a larger scale, only one major station – Leeds – was fully refurbished during the twenty-five-year existence of the company. Stations tended to be cleaned infrequently, and most lacked a lick of paint, giving the railway a rundown feel. Carriages, too, were dirty, and in terms of services the LMS was the worst of the Big Four at speeding up its timetables back to prewar levels. Alone of the four companies, the LMS had no planned modernization programme, although on paper its officers delighted in producing grandiose schemes that they knew would never meet with the parsimonious Stamp's approval. The company was also ‘surprisingly unprogressive'
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and showed scant interest in electrification or in modernizing its freight wagon fleet.