is BBC Radio Scotland’s flagship morning news programme.
The Friday 24th October edition carried an article about how Network Rail is to assume control of routine maintenance contracts from private contractors. During the article, which was a conversation between the news ‘anchor’ Alex Bell and the BBC Transport Correspondent Tom Simons, the BBC got a chance to show it’s economic illiteracy.
BELL: “I suppose that costs will be reduced because they [Network Rail] will no longer have to pay the profit margin?”
SIMONS: “Yes, but the savings from that may not be that great…the contracts were being negotiated down anyway”
I enjoyed this exchange because it shows the marvellous ignorance from commerce which is key to success as a BBC journalist. That a private company might be capable of operating more efficiently, or with some degree of innovation even in an area like rail maintenance, simply does not come into it. On this basis you have a good argument for the nationalisation of the whole economy, so that you would not need to pay the ‘profit margin’ to companies like Easyjet, Tesco, BP and so on.
Equally strange to me was the fact that any sane person could use the terms ‘cost reductions’ and ‘Network Rail’ in the same sentence not as an obvious oxymoron. Network Rail has overseen truly breathtaking rises in costs (costs guaranteed by the taxpayer), and only a few days ago was censured by the regulator Tom Winsor for it’s wasteful performance – but that’s OK this time as we won’t be paying a profit margin. As you would expect, this point was not made during the article.