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A better deal for buses

October 24, 2014

Here in the North East buses are the backbone of our public transport network – on average every person in the region makes around 77 bus journeys every year, much higher than in many other parts of the country.

But, passenger numbers are actually in long-term decline – down by 13% since 2001 according to the 2011 Census. At the same time road congestion is getting worse as more and more of us are forced to switch from the bus to our cars. Something has to change if this trend is to be reversed – beating the traffic jams and making our bus services sustainable for the future.

That is why the proposal put forward by the North East Combined Authority earlier this week to shake up the way bus services in the region operate is so important.

The move towards introducing a Quality Contract Scheme for bus services in the North East may sound like technical mumbo jumbo – but it will mean a fundamental change which could bring huge benefits for bus users and help us to create a coordinated bus network across the region – just like the way that Transport for London run the buses in the capital.

We are the first region in the country to go down this route, and others are watching us with interest. The new arrangements will take time to establish, and there are still some legal barriers to overcome. The proposal will now be considered by an independent Quality Contracts Board who will decide whether the proposals are in the public interest. The new arrangements could be in place by 2017.

Back in the 1980’s all bus services across the country, except London, were ‘deregulated’ allowing bus operators a free market to operate services which were commercially viable to them. Council’s then had to complete the network by funding those less profitable routes that the bus companies could not operate commercially.

Over time this led to a fragmentation of the bus network as different companies competed for the most valuable bus routes whilst councils’ picked up the bill for the rest. For the passenger – working out information about bus times, ticket prices and routes required them to negotiate a confusing array of different information.

And, as council budgets have come under pressure, so has our ability to subsidise less profitable bus routes – putting at risk vital services which may have few passengers but which provide an essential lifeline for otherwise isolated communities.

A relatively small number of bus companies now control the bus networks across the country. Many have generated enormous profits since deregulation – but plainly they have not been able to sustain a network which meets the needs of its customers. There can be very few business sectors where profits continue to rise whilst customer numbers fall away so significantly. Something isn’t working.

Perhaps it is not surprising that the only place that bus passenger numbers have increased in recent years is in London – which escaped deregulation with Transport for London continuing to commission and coordinate the network. If this system is good enough for London it should be good enough for the North East.

Under the Quality Contract Scheme it will be the North East Combined Authority which decides which bus routes companies will be asked to operate – not market forces. And rather than letting the market decide the price – operators would provide services on a range of routes to a contractually agreed price.

This would lead to a range of benefits for passengers.

Bus contracts would be for the whole service – not just the most profitable routes. This will put the responsibility for sustaining less profitable routes back to the bus companies within the agreed contract price. In effect, some of the profits from the more popular routes would be used to support the whole network – including school buses and services to more isolated communities.

The bus network would be better coordinated across the region – on the basis of what bus users need rather than competition for profit. This would help make it easier to produce clear simple information about the bus network and the timetable across the whole region – available from a single source making it much more straightforward to find the bus you want when you need it.

Our new approach would be clear about the quality of buses to be provided and service standards that passengers should expect. On average buses would be no more than seven year old and there would be a clear expectation that the bus fleet should be clean and green – helping to reduce carbon emissions.

We now have an opportunity to plan routes more strategically, working closely with businesses to identify their future needs – and identify how more people can get to work on the bus, without the need for more cars on the road.

Ticket prices, along with concessionary schemes for older and younger people, would be consistent across the whole bus network making it much easier to work out how much a journey will cost. Average price rises will be capped at the level of inflation – making bus fares more affordable – and more attractive when compared to using the car. Concessions will include a flat fare for 16-19 year olds – meaning that families will no longer have to make difficult decisions about where a child should work or study on the basis of how much it costs to get there.

Joining-up the system in this way will also make it much more straightforward to introduce smarter ticketing systems – like the oyster cards used in London. These would work across buses and on the Metro system.

It was interesting that bus passenger groups turned out in force for the Combined Authority meeting to voice their support for the Quality Contract Scheme. People who are passionate about their bus services understand that it provides the right way forward.

The bus companies will be disappointed. The Quality Contract Scheme will have an impact on their profits. We have given careful consideration to their alternative proposals, but felt that they could simply not deliver our ambitions for better bus services. We were also clear that, without action, bus use would continue to decline, and the pressures on public funding would simply become unsustainable.

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