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The Transport Act 1962 ( 10 & 11 Eliz. 2. c. 46) is an act of the
Parliament of the United Kingdom The Parliament of the United Kingdom of Great Britain and Northern Ireland is the supreme legislative body of the United Kingdom, and may also legislate for the Crown Dependencies and the British Overseas Territories. It meets at the Palace ...
. 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 Maurice Harold Macmillan, 1st Earl of Stockton (10 February 1894 – 29 December 1986), was a British statesman and Conservative Party (UK), Conservative politician who was Prime Minister of the United Kingdom from 1957 to 1963. Nickn ...
's
Conservative Conservatism is a cultural, social, and political philosophy and ideology that seeks to promote and preserve traditional institutions, customs, and values. The central tenets of conservatism may vary in relation to the culture and civiliza ...
government to dissolve the British Transport Commission (BTC), which had been established by
Clement Attlee Clement Richard Attlee, 1st Earl Attlee (3 January 18838 October 1967) was a British statesman who was Prime Minister of the United Kingdom from 1945 to 1951 and Leader of the Labour Party (UK), Leader of the Labour Party from 1935 to 1955. At ...
's Labour government in 1947 to oversee railways, canals and road freight transport. The act established the
British Railways Board The British Railways Board (BRB) was a State ownership, nationalised industry in the United Kingdom that operated from 1963 to 2001. Until 1997, it was responsible for most railway services in History of rail transport in Great Britain 1995 to d ...
, which took over the BTC's railway responsibilities from 1 January 1963 until the passing of the Railways Act 1993. The act put in place measures that enabled the closure of around a third of British railways the following year as a result of the Beeching report, as the act simplified the process of closing railways removing the need for pros and cons of each case to be heard in detail.


Historical context

By the end of 1960, British Railways had accumulated a deficit of some £500 million and the annual rate of increase of the deficit was estimated to be in the region of £100 million. The act sought primarily to remedy this situation by putting public transport operators on the same footing as private companies, reversing the policy that had been in place since the earliest days of transport law, namely that the carrier was a
monopolist A monopoly (from Greek and ) is a market in which one person or company is the only supplier of a particular good or service. A monopoly is characterized by a lack of economic competition to produce a particular thing, a lack of viable s ...
to be controlled and regulated by the State for the benefit of the public.


Commencement

Section 96 of the act provided that the act would come force on a day or days appointed by the secretary of state. The (SI 1962/1788) provided that the whole act except section 75 of the act would come into force on 1 September 1962. The (SI 1964/2025) provided that the section 75 of the act would come into force on 1 January 1965.


New financial management obligations

By virtue of sections 36 and 38 of the act, some of the debts of the BTC, including the funds invested in the failed 1955 Modernisation Plan, were written off or transferred to the
Treasury A treasury is either *A government department related to finance and taxation, a finance ministry; in a business context, corporate treasury. *A place or location where treasure, such as currency or precious items are kept. These can be ...
. The British Railways Board was directed, under Section 22, to run the railways so that its operating profits were "''not less than sufficient''" for meeting running costs. The obligation to be self-sufficient was a departure in UK railway legislation and marked an important turning point. Each railway service should pay for itself or at least have the prospect of doing so. The days of general subsidisation of the railways were now clearly over. The change of policy was brought about by the Select committee of the House of Commons on Nationalised Industries, which concluded that the BTC should make its decisions exclusively on considerations of "direct profitability". Where decisions based "''on grounds of the national economy or of social needs''" needed to be taken, the Minister of Transport would be responsible, having sought the approval of
Parliament In modern politics and history, a parliament is a legislative body of government. Generally, a modern parliament has three functions: Representation (politics), representing the Election#Suffrage, electorate, making laws, and overseeing ...
. The railways would now be operated on the principles applicable to a private entrepreneur in a competitive marketplace. In that respect, section 3(1) provides that it was the duty of the British Railways Board to provide railway services "in Great Britain" (not 'for') with regard to "''efficiency, economy and safety of operation''".


Break-up of the British Transport Commission

To facilitate the new policy, the BTC was replaced by five new public corporations: *the
British Railways Board The British Railways Board (BRB) was a State ownership, nationalised industry in the United Kingdom that operated from 1963 to 2001. Until 1997, it was responsible for most railway services in History of rail transport in Great Britain 1995 to d ...
*the London Transport Board *the British Transport Docks Board *the British Waterways Board *the Transport Holding Company (holding the shares of companies belonging to BTC, including Thomas Cook and Son Ltd and Thomas Tilling) The four boards inherited the property, liabilities and functions of the BTC, but their activities were to be co-ordinated by the Minister of Transport, rather than a body separate from the government. The boards needed the consent of the minister to borrow and for approval for projects involving large sums of money (sections 19 and 27).


New advisory bodies


Nationalised Transport Advisory Council

Section 55 of the act created the Nationalised Transport Advisory Council to "advise" the Minister of Transport on the activities of the five corporations, which would all be represented on the council.


Transport consultative committees

The Central Transport Consultative Committee took the place of a similar body that had been created under the Transport Act 1947 to represent users of the railway, and area transport users consultative committees covered individual areas of the country. The committees were to make recommendations relating to the services provided by the four boards, although their remit did not include the charges and fares. The Minister was not bound to follow any recommendations.


Procedure for closure of railway lines

A new procedure was set out for the closure of railway lines, Section 56(7) requiring that
British Railways British Railways (BR), which from 1965 traded as British Rail, was a state-owned company that operated most rail transport in Great Britain from 1948 to 1997. Originally a trading brand of the Railway Executive of the British Transport Commis ...
gave at least six weeks' notice of their intention to close a line and to publish this proposal in two successive weeks in two local newspapers in the area affected. The notice would give the proposed closure dates, details of alternative transport services (including services which BR was to lay on as a result of closure) and inviting objections to a specified address. A copy of the notice was to be sent to the relevant area committee. Rail users affected by a closure could also send their objections to the area committee (this was not required to be specified in the closure notice) who would then report to the Minister of Transport. The area committee would consider the "hardship" which it considered would be caused as a result of the closure, and recommend measures to ease that hardship. The closure would not then be proceeded with until the committee had reported to the minister and he had given his consent to the closure. Based on the report, the minister could subject his consent to closure to certain conditions, such as the provision of alternative transport services.


Reform of the law of transport

The four boards were placed in the position of private companies in respect of their commercial activities. They no longer had the status of
common carrier A common carrier in common law countries (corresponding to a public carrier in some civil law (legal system), civil law systems,Encyclopædia Britannica CD 2000 "Civil-law public carrier" from "carriage of goods" usually called simply a ''carrier ...
transporting persons and goods for the public benefit, but were now bailees transporting goods and people like a private operator. The main effect of this change was that the boards were no longer "absolutely liable" for their operations, i.e. bearing responsibility for loss even in the absence of negligence or fault on their part. Now they could restrict their liabilities in a similar fashion to private operators. A consequence was that they could reject passenger and goods consignments and limit the exposure of their liability, and were free to "''demand, take and recover such charges for their services and facilities, and to make the use of those services and facilities subject to such terms and conditions as they think fit''" (Section 43), i.e. have total freedom of contract to sell their services, rather than operate via the medium of a statutory process. An exception was made for the London Passenger Transport Area where fares were still fixed by the Transport Tribunal. As one commentator noted, "''the Act goes much further in giving effect to
laissez-faire ''Laissez-faire'' ( , from , ) is a type of economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies or regulations). As a system of thought, ''laissez-faire'' ...
in the law of transport than English law has ever done at any time since the seventeenth century''".


Railway byelaws

Section 67 of the act enables byelaws regulating the use of the railways to be issued. This provision featured in '' Boddington v British Transport Police'' (1998) where the
House of Lords The House of Lords is the upper house of the Parliament of the United Kingdom. Like the lower house, the House of Commons of the United Kingdom, House of Commons, it meets in the Palace of Westminster in London, England. One of the oldest ext ...
recognised the principle that a defendant in criminal proceedings, in this case fined £10 for smoking on a train in violation of a railway byelaw, could challenge the validity of the rule before a court, save where Parliament has indicated that such a challenge is not possible.


Current status

Much of the act has been repealed and updated: further information can be found by searching for the act in the
UK Statute Law Database legislation.gov.uk, formerly known as the UK Statute Law Database, is the official Web-accessible database of the statute law of the United Kingdom, hosted by The National Archives. Established in the early 2000s, it contains all primary le ...
.


See also

* Beeching Axe * Canals of the United Kingdom * History of the British canal system


Notes


References


External Links

* {{Authority control Railway Acts Former nationalised industries of the United Kingdom United Kingdom Acts of Parliament 1962 1962 in transport Transport policy in the United Kingdom History of British Rail British Transport Commission History of transport in the United Kingdom