13 February 2025

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6


Industry Guide



Industry structure


Nationalisation

Transport Act 1947 >
Transport Act 1953 >



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Nationalisation



From 1 January 1948 the new British Transport Commission owned the railways and their subsidiary businesses, such as docks, shipping and hotels, as well as London Transport and most road haulage services.


As part of its takeover of the ‘Big Four’ railway companies, the Commission also acquired the railways’ shareholdings in many bus companies, which had been purchased after the railways had obtained new legal powers in 1928. In November 1948 the Tilling Association voluntarily sold its bus company shares to the Commission, so that a number of bus companies had now been wholly nationalised.

The shares in the former companies were exchangeable for British Transport Stock. This paid fixed interest, of mostly 3 per cent, and the payment of this interest was the responsibility of the Commission.

The Commission’s businesses were controlled through a series of Executives. The Railway Executive was the largest of these, and it traded as ‘British Railways’.


The emblem of the nationalised railway






For the purposes of administration, the Railway Executive divided its system into regions, which were broadly based on the former companies’ territories, except that the LMS and LNER in Scotland were combined as one Scottish Region, while the LNER in England was divided into Eastern and North Eastern Regions.

The London Midland Region inherited the routes of the former LMS in England and Wales, while the Southern and Western Regions took over the areas of the Southern and Great Western Railways. Some changes were made to regional boundaries during the first decade of nationalisation, particularly in 1951 and 1958.


One of the first timetables
issued by British Railways


A further Transport Act was passed in 1953 by the Conservative government which had been returned to power under the leadership of Winston Churchill in the 1951 General Election.

This Act reprivatised the road haulage industry and also abolished most of the BTC Executives, with the exception of the London Transport Executive. The railways and other businesses were now under the direct control of the Commission.

The fresh competition from road haulage and the financial burden of paying interest on British Transport Stock meant that the Commission started to incur deficits from 1956, and after that the losses increased year by year.




Modernisation



Both the Railway Executive and the Commission prepared modernisation plans, but the abolition of the Executive meant that it was the Commission’s version which was submitted to the Ministry of Transport in December 1954. The BTC was proposing an investment of £1.2 billion, which would pay for the replacement of steam engines with diesel locomotives and multiple units, as well as new large marshalling yards and the installation of modern signalling.


Reporting progress, 1962

The government agreed, but the investment did not improve the Commission’s financial position as had been hoped, partly because some of the elements in the plan, especially the marshalling yards, were out of date. Parts of the freight business, such as small consignments, were being increasingly lost to the roads, and vast yards to sort the wagons which would carry them were no longer needed. In addition, although new diesel multiple units were generally successful, the diesel locomotives had many problems.

By the end of the 1950s the Commission’s financial position was very poor, because its accumulated losses now amounted to hundreds of millions of pounds, in spite of the Modernisation Plan.

In response, the government decided to abolish the debt-laden Commission and replace it with several boards, including a British Railways Board. A new chairman was appointed in 1961 to lead the Commission during its last days, with the intention that he would take charge of the future BRB when necessary legislation had been passed. His name was Dr Richard Beeching.


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