Passenger services have rarely, if ever, made a profit as such.
Back in the days when railways were commercial entities and Britain had this outdated thing called 'industry', the richest companies were those with substantial goods and mineral traffic. Coal traffic was incredibly important and valuable. Passenger services were, at best, the icing on the cake and were often - get this! - run as a social obligation rather than a pure business.
To give an example, the Cambrian Railways, serving mid and north Wales, a very rural area with little industry, never made a bean, even in the days when railways had a virtual monopoly of both passenger and goods traffic. The Directors ran it on the basis that it served the community (in which they had substantial interests as landowners and quarry owners, etc.) Their objective was to keep it out of receivership as much as anything.
Such a paradigm of capitalism is inconceivable these days. It. Just. Would. Not. Happen.
The railway now operates almost wholly for social reasons. Take away the obsessions of petty accountancy and you can see that it gives wide social benefits - not least of which is keeping road traffic to tolerable levels. It is questionable whether London could function without the railways as the roads would be seized solid for 50 miles around.
To expect 'profit' on top of these social benefits is to really push the model. I believe it is totally unrealistic. It follows, therefore, that is appropriate to run the railways as a social enterprise for the general good, rather than as a business to make money. The only argument for private sector involvement is if you believe it is inherently more 'efficient'. It isn't, and many of the 'efficiencies', like exporting train construction to foreign countries, are undesirable.
