British Railways was Balkanised in the 1990s. The EU had issued a directive that, following a successful split between physical network and service operation in Sweden, all railway systems should be run in a similar manner. In the UK the physical network remained in state ownership, the rolling stock was transferred to several companies, and the rights to run services on particular stretches of the network were offered up for bidding.
The result: railway service operators rented their trains from one company and paid another, a government enterprise, for the right to let them move.
My recollection at the time was that BR was actually operating reasonably satisfactorily before the re-organisation. There had been two successive BR chairmen who had managed to rescue the state railway system, resolve many of its problems and to begin to get the system working effectively. The first was named Sir Robert Reid and he was followed in the position by Sir Robert Reid.
My recollection is also that there were many criticisms of the re-organisation: that it was an example of John Major showing that he could do something that Margaret Thatcher could not; that it was going to be a lawyers' charter (because of the sheer number of contractual relationships it would create); it was too concerned with trying to get competition into railway operation etc.
The most spectacular lack of success has been on what is probably the most glamourous and famous route in the whole system: the East Coast Main Line, the line of the Flying Scotsman, of Mallard and the Gresley pacifics. Starting with Sea Containers, it has had operating company after operating company fail.
There are many who believe that the franchise system should have been scrapped a long time ago.
