ScotRail Nationalised | Economics Case Study for 2025 Exams

Why was ScotRail nationalised in 2022—and has it delivered on its promises? In this video, we dive into one of the most topical case studies for Economics students and teachers alike: the nationalisation of ScotRail. Taken into public ownership by the Scottish Government in April 2022, ScotRail has since faced both remarkable passenger growth and serious operational challenges. We’ll break down the economic arguments for and against state ownership, the impact on ticket prices, consumer surplus, government subsidies, and more.

📚 Keynote Summary of Main Points:

ScotRail was nationalised in April 2022 after the Abellio franchise ended.

Passenger numbers increased by 75% post-pandemic—from 47m to 82m.

Yet, nearly 27,500 train cancellations occurred due to driver shortages and strikes.

The Scottish Government introduced fare reforms, including:

An 8.7% fare rise in 2024.

A pilot scheme removing peak fares (briefly lowering fares like Glasgow-Edinburgh from £31.40 to £16.20).

Only a 6.8% increase in usage led to peak fares being reinstated in Sept 2024.

To soften the blow, 20% discounts on season tickets and an expanded Flexipass scheme were introduced.

State ownership aims to prioritise social needs over profits—with lower fares potentially increasing consumer surplus.

However, state-run systems face criticisms such as X-inefficiency, high subsidies (£691m/year), and political short-termism.

Overall judgement: state ownership can work, if investment is sustainable and well-managed.