Transport Act 1947
Encyclopedia
The Transport Act 1947 is an Act
of the Parliament of the United Kingdom
. Under it the railways, long-distance road haulage and various other types of transport were acquired by the state and handed over to a new British Transport Commission
for operation. The commission was responsible to the Ministry of Transport
for general transport policy, which it exercised principally through financial control of a number of executives set up to manage specified sections of the industry under schemes of delegation.
agenda of Clement Attlee
's Labour
government, and took effect from 1 January 1948. In Northern Ireland
, the Ulster Transport Authority
acted in a similar manner. The government also nationalised other means of transport such as canals, sea and shipping ports, bus companies, and eventually, in the face of much opposition, road haulage. All of these transport modes, including British Railways, were brought under the control of a new body, the British Transport Commission
(BTC).
The BTC was a part of a highly ambitious scheme to create a publicly owned, centrally planned, integrated transport system. In theory the BTC was to co-ordinate different modes of transport, to co-operate and supplement each other instead of competing. This was to be achieved by means of fare and rate adjustments. In practice, very little integration between modes ever materialised.
. Once the Conservatives were elected in 1951, road haulage was soon de-nationalised and de-regulated, but the still heavily regulated railways and buses were left under the control of the BTC.
railway companies of the grouping era had effectively been bankrupt, and the Act was intended to bring about some stability in transport policy. As part of that policy British Rail
ways was set up to run the railways.
Shares in the railway companies were exchanged for British Transport Stock
, with a guaranteed 3% return chargeable to the BTC.
The level of compensation paid has proven to be a matter of historical controversy.
Some commentators maintain that because the government based the levels of compensation for former railway shareholders on the valuation of their shares in 1946 (i.e. a time when the whole railway infrastructure was in a run-down and dilapidated state because of war damage and minimal maintenance)the railways were acquired comparatively cheaply.
However, others point out that three of the Big Four
were effectively bankrupt before the onset of war in 1939 and were only saved from the ignominy of actually declaring bankruptcy by the guaranteed income provided by the wartime government and the temporary surge in rail traffic caused by the restrictions on other forms of transport during and immediately after the war- the exchange of potentially worthless private stock for government gilts
based on a valuation during an artificially created boom could thus be considered a very good deal.
Whatever the case, it is clear that the 3% guaranteed return paid by the British Transport Commission
was to become a substantial drain on the Commission's available capital in years to come.
See list of constituents of British Railways.
Despite nationalisation and the creation of British Railways (BR), the rail system changed little, and was left in much the same way as it had been before nationalisation. BR was divided into six administrative regions:
These closely mirrored the regions covered by the former companies in England and Wales, although with the addition of a separate Scottish Region. At first there was a separate North Eastern Region, although this was eventually amalgamated with the Eastern Region, reflecting the English operations of the 1923-1947 London and North Eastern Railway
.
, Harold Macmillan
's Conservative
government dissolved the British Transport Commission and created the British Railways Board
to take over its railway duties from 1 January 1963 and the Transport Holding Company
to take over its bus operations from the same date.
Act of Parliament
An Act of Parliament is a statute enacted as primary legislation by a national or sub-national parliament. In the Republic of Ireland the term Act of the Oireachtas is used, and in the United States the term Act of Congress is used.In Commonwealth countries, the term is used both in a narrow...
of the Parliament of the United Kingdom
Parliament of the United Kingdom
The Parliament of the United Kingdom of Great Britain and Northern Ireland is the supreme legislative body in the United Kingdom, British Crown dependencies and British overseas territories, located in London...
. Under it the railways, long-distance road haulage and various other types of transport were acquired by the state and handed over to a new British Transport Commission
British Transport Commission
The British Transport Commission was created by Clement Attlee's post-war Labour government as a part of its nationalisation programme, to oversee railways, canals and road freight transport in Great Britain...
for operation. The commission was responsible to the Ministry of Transport
Department for Transport
In the United Kingdom, the Department for Transport is the government department responsible for the English transport network and a limited number of transport matters in Scotland, Wales and Northern Ireland which are not devolved...
for general transport policy, which it exercised principally through financial control of a number of executives set up to manage specified sections of the industry under schemes of delegation.
Overview
The Act was part of the nationalisationNationalization
Nationalisation, also spelled nationalization, is the process of taking an industry or assets into government ownership by a national government or state. Nationalization usually refers to private assets, but may also mean assets owned by lower levels of government, such as municipalities, being...
agenda of Clement Attlee
Clement Attlee
Clement Richard Attlee, 1st Earl Attlee, KG, OM, CH, PC, FRS was a British Labour politician who served as the Prime Minister of the United Kingdom from 1945 to 1951, and as the Leader of the Labour Party from 1935 to 1955...
's Labour
Labour Party (UK)
The Labour Party is a centre-left democratic socialist party in the United Kingdom. It surpassed the Liberal Party in general elections during the early 1920s, forming minority governments under Ramsay MacDonald in 1924 and 1929-1931. The party was in a wartime coalition from 1940 to 1945, after...
government, and took effect from 1 January 1948. In Northern Ireland
Northern Ireland
Northern Ireland is one of the four countries of the United Kingdom. Situated in the north-east of the island of Ireland, it shares a border with the Republic of Ireland to the south and west...
, the Ulster Transport Authority
Ulster Transport Authority
The Ulster Transport Authority ran rail and bus transport in Northern Ireland from 1948 until 1966.-Formation and consolidation:The UTA was formed by the Transport Act 1948, which merged the Northern Ireland Road Transport Board and the Belfast and County Down Railway...
acted in a similar manner. The government also nationalised other means of transport such as canals, sea and shipping ports, bus companies, and eventually, in the face of much opposition, road haulage. All of these transport modes, including British Railways, were brought under the control of a new body, the British Transport Commission
British Transport Commission
The British Transport Commission was created by Clement Attlee's post-war Labour government as a part of its nationalisation programme, to oversee railways, canals and road freight transport in Great Britain...
(BTC).
The BTC was a part of a highly ambitious scheme to create a publicly owned, centrally planned, integrated transport system. In theory the BTC was to co-ordinate different modes of transport, to co-operate and supplement each other instead of competing. This was to be achieved by means of fare and rate adjustments. In practice, very little integration between modes ever materialised.
Road transport
The road haulage industry bitterly opposed nationalisation, and found allies in the Conservative PartyConservative Party (UK)
The Conservative Party, formally the Conservative and Unionist Party, is a centre-right political party in the United Kingdom that adheres to the philosophies of conservatism and British unionism. It is the largest political party in the UK, and is currently the largest single party in the House...
. Once the Conservatives were elected in 1951, road haulage was soon de-nationalised and de-regulated, but the still heavily regulated railways and buses were left under the control of the BTC.
Railways
After the war the Big FourBig Four British railway companies
The Big Four was a name used to describe the four largest railway companies in the United Kingdom in the period 1923-1947. The name was coined by the Railway Magazine in its issue of February 1923: "The Big Four of the New Railway Era".The Big Four were:...
railway companies of the grouping era had effectively been bankrupt, and the Act was intended to bring about some stability in transport policy. As part of that policy British Rail
British Rail
British Railways , which from 1965 traded as British Rail, was the operator of most of the rail transport in Great Britain between 1948 and 1997. It was formed from the nationalisation of the "Big Four" British railway companies and lasted until the gradual privatisation of British Rail, in stages...
ways was set up to run the railways.
Shares in the railway companies were exchanged for British Transport Stock
Gilts
Gilts are bonds issued by certain national governments. The term is of British origin, and originally referred to the debt securities issued by the Bank of England, which had a gilt edge. Hence, they are called gilt-edged securities, or gilts for short. The term is also sometimes used in Ireland...
, with a guaranteed 3% return chargeable to the BTC.
The level of compensation paid has proven to be a matter of historical controversy.
Some commentators maintain that because the government based the levels of compensation for former railway shareholders on the valuation of their shares in 1946 (i.e. a time when the whole railway infrastructure was in a run-down and dilapidated state because of war damage and minimal maintenance)the railways were acquired comparatively cheaply.
However, others point out that three of the Big Four
Big Four British railway companies
The Big Four was a name used to describe the four largest railway companies in the United Kingdom in the period 1923-1947. The name was coined by the Railway Magazine in its issue of February 1923: "The Big Four of the New Railway Era".The Big Four were:...
were effectively bankrupt before the onset of war in 1939 and were only saved from the ignominy of actually declaring bankruptcy by the guaranteed income provided by the wartime government and the temporary surge in rail traffic caused by the restrictions on other forms of transport during and immediately after the war- the exchange of potentially worthless private stock for government gilts
Gilts
Gilts are bonds issued by certain national governments. The term is of British origin, and originally referred to the debt securities issued by the Bank of England, which had a gilt edge. Hence, they are called gilt-edged securities, or gilts for short. The term is also sometimes used in Ireland...
based on a valuation during an artificially created boom could thus be considered a very good deal.
Whatever the case, it is clear that the 3% guaranteed return paid by the British Transport Commission
British Transport Commission
The British Transport Commission was created by Clement Attlee's post-war Labour government as a part of its nationalisation programme, to oversee railways, canals and road freight transport in Great Britain...
was to become a substantial drain on the Commission's available capital in years to come.
See list of constituents of British Railways.
Despite nationalisation and the creation of British Railways (BR), the rail system changed little, and was left in much the same way as it had been before nationalisation. BR was divided into six administrative regions:
- Eastern Region of British RailwaysEastern Region of British RailwaysThe Eastern Region was a region of British Railways from 1948. The region ceased to be an operating unit in its own right in the 1980s and was wound up at the end of 1992...
- London Midland Region of British RailwaysLondon Midland Region of British RailwaysThe London Midland Region was one of the six regions created on the formation of the nationalised British Railways and consisted of ex-London, Midland and Scottish Railway lines in England and Wales. The region was managed first from buildings adjacent to Euston Station and later from Stanier...
- North Eastern Region of British RailwaysNorth Eastern Region of British RailwaysThe North Eastern Region was a region of British Railways from 1948. It was merged with the Eastern Region in 1967. It was the near direct post-nationalisation descendant of the North Eastern Railway, that had merged with the LNER just over 20 years early....
- Scottish Region of British RailwaysScottish Region of British RailwaysThe Scottish Region was one of the six regions created on British Railways and consisted of ex-London, Midland and Scottish Railway and ex-London and North Eastern Railway lines in Scotland...
- Southern Region of British RailwaysSouthern Region of British RailwaysThe Southern Region was a region of British Railways from 1948. The region ceased to be an operating unit in its own right in the 1980s and was wound up at the end of 1992. The region covered south London, southern England and the south coast, including the busy commuter belt areas of Kent, Sussex...
- Western Region of British RailwaysWestern Region of British RailwaysThe Western Region was a region of British Railways from 1948. The region ceased to be an operating unit in its own right in the 1980s and was wound up at the end of 1992...
These closely mirrored the regions covered by the former companies in England and Wales, although with the addition of a separate Scottish Region. At first there was a separate North Eastern Region, although this was eventually amalgamated with the Eastern Region, reflecting the English operations of the 1923-1947 London and North Eastern Railway
London and North Eastern Railway
The London and North Eastern Railway was the second-largest of the "Big Four" railway companies created by the Railways Act 1921 in Britain...
.
Transport Act 1962
Fifteen years later, under the Transport Act 1962Transport Act 1962
The Transport Act 1962 is an Act of the Parliament of the United Kingdom. Described as the "most momentous piece of legislation in the field of railway law to have been enacted since the Railway and Canal Traffic Act 1854", it was passed by Harold Macmillan's Conservative government to dissolve the...
, Harold Macmillan
Harold Macmillan
Maurice Harold Macmillan, 1st Earl of Stockton, OM, PC was Conservative Prime Minister of the United Kingdom from 10 January 1957 to 18 October 1963....
's Conservative
Conservative Party (UK)
The Conservative Party, formally the Conservative and Unionist Party, is a centre-right political party in the United Kingdom that adheres to the philosophies of conservatism and British unionism. It is the largest political party in the UK, and is currently the largest single party in the House...
government dissolved the British Transport Commission and created the British Railways Board
British Railways Board
The British Railways Board was a nationalised industry in the United Kingdom that existed from 1962 to 2001. From its foundation until 1997, it was responsible for most railway services in Great Britain, trading under the brand names British Railways and, from 1965, British Rail...
to take over its railway duties from 1 January 1963 and the Transport Holding Company
Transport Holding Company
The Transport Holding Company was a British Government owned company created by the Transport Act 1962 to administer a range of state-owned transport, travel and engineering companies that were previously managed by the British Transport Commission ; it came into existence on 1 January...
to take over its bus operations from the same date.