rail subsidy
@hipennine
Ah, rail 'subsidy'. The air community comfort themselves with the thought that inter-city rail receives massive subsidies - all that needs to be done is to remove them!
The situation is, in fact, rather more complicated.
In the old days, the nationalised British Rail had an 'Inter City' sector that was defined as 'the bit of the railway that is not subsidised'. All very clear.
After privatisation, government financial support for railways increased many-fold. True, more people are travelling by rail but the system as a whole became more inefficient and costly. However, overall government support has been coming down for the last couple of years.
The calculation of total government support to railways is very complicated. If you want to know more, you should read Roger Ford's column in 'Modern Railways'. 'Uncle Roger' is, I believe, a proud holder of a ppl and quite possibly a ppruner, so he might want to correct my mistakes.
In general, there are two main parts of the subsidy: a direct grant to Notwork Rail and a subsidy to the operator (or a premium paid by the operator). So, an operator might pay a premium to the government but this is outweighed by the grant.
The subsidy / premium is contracted between the operator and the government, usually getting more positive (ie less subsidy /more premium) over the life of the contract period.
So when GNER and later National Express East Coast (think London-Edinburgh) both contracted for too big a premium, their payments just got bigger and bigger. The current (state owned) operator, East Coast, pays a much smaller premium. First Great Western (think London-Bristol/Exeter) pays a premium but gets money back(!) Virgin West Coast (think London-Manchester/Glasgow) plays by different rules (I think).
But all in all, there ain't no great subsidy pot for inter-city rail out there just waiting to be taken away to rescue the regional airline industry. Trains are getting faster and more frequent and the railways are getting better at informing the public. Oil prices keep on going up, tilting the market more and more in favour of the train.
You don't have to believe me but I wouldn't bet my career on the regional airline business being the same size as now 20 years hence.