Select Committee on Transport, Local Government and the Regions Appendices to the Minutes of Evidence

Memorandum by the Go-Ahead Group plc (Bus 19)


  1.  The Go-Ahead Group is one of the leading providers of passenger transport services in the UK, covering bus, rail and aviation ground handling services. We operate a range of bus services throughout the country including the North East (Go North East), Oxford (the Oxford Bus Company), Brighton & Hove, as well as central London and south London (London Central and London General) and Surrey, in and around Crawley and Gatwick (Metrobus).

  2.  We have been operating some of these bus services as Go-Ahead for almost fifteen years, and in the main from the early 1990s. We are committed to providing a first-class, affordable and comprehensive service to all our passengers. Many of our managers have wide experience not just in Go-Ahead, but in the precursor public sector operations.

  3.  We are the only bus company to produce an annual environmental report detailing our commitment to the environment. We regularly renew and up-date our fleet with the most environmentally-friendly and accessible buses. All our buses run on ultra low sulphur diesel fuel, 45 per cent are fitted with regenerative traps and 55 per cent have a Euro II engine. In the last year alone (2000-01) we spent £37 million on 390 new buses, and our average fleet age (excluding Routemasters in London) is 5.83 years, well below the Industry-Government target.

  4.  Go-Ahead also works closely with its employees. In Oxford we have set up a pioneering stakeholder board to increase employee, trade union, passengers and local business involvement in all aspects of the business.


  5.  There is an on-going debate about the effectiveness of the partial fuel duty rebate received by bus companies and its possible replacement, perhaps by a subsidy per person carried. The fact remains that bus services, of all transport systems, benefit least from fuel duty rebates or exemptions. Both aviation and rail services benefit to a far greater extent. We see no reason in principle why bus services should not benefit from a full rebate, which is the only general subsidy to bus operators.

  6.  To introduce a subsidy per passenger carried would be counter to the Government's overall policy objectives. By definition, bus companies that continue to operate rural and low density bus routes would lose out, placing a greater burden on local authorities. In addition, companies that are introducing low-floor buses and buses with air conditioning, which use more fuel, would also suffer. The fuel duty rebate remains the best way to ensure that companies can continue to maintain routes that serve outlying communities or those at times of lower demand. This is not an argument put simply to favour Go-Ahead's commercial interests. Indeed, as a Group, a move to passenger subsidy would be broadly favourable, with at least two of our subsidiaries benefiting substantially, although our ability to maintain certain rural routes would be compromised.

  7.  Concessionary fares, particularly for old age pensioners, should not be regarded as a subsidy for the industry. They are a subsidy to the passenger. The scheme is designed to ensure that operators are no better or worse off as a result of participating in such a programme. Go-Ahead recognises the importance of, and supports, such schemes as they are very effective in combating social exclusion.

  8.  Other payments to operators, for local authority secured services or education transport, should not be regarded as subsidy. They are more properly described as contractual payment for specific performance of local authority defined services.

  9.  Some subsidies are, in our view, mis-directed. For example, the rural bus grant was only available for new bus services when the emphasis should have been on maintaining and improving existing quality bus routes.


  10.  In our experience, Quality Partnerships where we operate our bus services have been a great success. They are far less prescriptive and much more flexible than a Quality Contract as envisaged would be. Quality Partnerships in our view encourage much greater co-operation between local authorities and bus companies.

  11.  We have seen their success in terms of the number of passengers carried. In Oxford the partnership has resulted in a 55 per cent passenger increase since 1991. In Brighton & Hove we are currently seeing an 8 per cent year-on-year increase building on a record of continual growth since 1994. Overall, Quality Partnerships have seen passenger growth in the region of 3-6 per cent throughout England.

  12.  Examples where co-operation is working include:

    —  Brighton & Hove City Council/West Sussex County Council investment in bus priority and real time information is accompanied by Go-Ahead investment in new vehicles, on-bus real time information equipment and improved frequencies.

    —  The Oxford Transport Strategy is supported by Go-Ahead with significant fleet renewal and improved frequencies.

    —  Continued fleet investment to increase the proportion of low-floor vehicles, improve frequencies, reduce average fleet age and improve security (CCTV etc).

    —  Investment (in partnership with local councils/authorities) in "real time information" and "automatic vehicle location" technologies.

    —  Innovative ticketing schemes—"flat fare" (Brighton), "Smartcard" (Oxford), "integrated ticketing" (Go North East).

    —  Innovative/largely unique consultation process in the North East for service changes.

    —  Expansion of Park & Ride facilities/services in Oxford.

    —  The introduction of low floor buses was an example of early partnership. Go North East was the first company to introduce them outside London in partnership with North Tyneside Council in 1994.

  13.  The nearest equivalent to a Quality Contract is the system operating in London, with detailed obligations on reliability and mileage. London, however, is a unique case. There is severe road congestion, wide-spread commuting and near saturation on the Tube and the Heavy Rail networks. The combination of these elements—where the transport system is well-defined and there is little room for flexibility and innovation—is not present in any other UK city. Elsewhere, it is vital that councils and bus companies can have the flexibility to meet rapidly changing needs.


  14.  All customer research leads to the conclusion that service reliability is paramount. Dedicated—and enforced—bus lanes, priority junction control and parking restrictions are essential to provide an efficient bus service for passengers. These measures demand the commitment of local authorities to ensure that we can play our part. In Brighton & Hove for example, the council has invested over £6.5 million in priority measures, alongside the £15 million we have invested in our fleet, and has taken over parking enforcement and recruited additional wardens. Brighton & Hove bus company has helped to highlight the need for stricter enforcement by mounting a public campaign including a successful petition which attracted 2000 signatures and enabled the company to raise the matter as a priority with the Police.

  15.  Bus priority measures help to ease traffic congestion, help us to provide better and more reliable bus services for our passengers and make better use of travelling time for our vehicles. Without a doubt, bus priority measures are essential to ensure a smooth running bus service for the travelling public.

  16.  In addition, if bus services are to get anywhere near the reliability figures imposed by Traffic Commissioners then much greater enforcement measures need to be undertaken. This would include the enforcement and increase of parking restrictions and more monitoring and enforcement of bus lanes. Perhaps the Commissioners should also monitor police and local authority activities in these areas.


  17.  In our view, the bus industry is already adequately regulated. At present, we are allowed to set fares, routes and timetables, in accord with passenger demand, wherever we are able to do so commercially. Any increase in regulation would have a harmful effect on the quantity and quality of the bus services we operate.

  18.  Although we are free to set our own timetables, the majority of our services are still influenced by the local authority, for example to coincide with school timetables, as well as by the demands of our passengers.

  19.  Extensive and increased regulation would, we believe, impact significantly on the service we could offer our passengers. It would increase bureaucracy and costs. It would reduce flexibility making it more difficult to respond to passenger needs and would break the link between the market and the network planner. It should not be forgotten that the Transport Act 1985, which defined the current form of regulation, was a direct response to the excessive cost incurred in a number of authorities, particularly in Metropolitan areas where direct control of bus services was exercised.

  20.  One aspect of regulation that is no longer working is that of Traffic Commissioners. They now seek to impose far more unrealistic targets than are imposed elsewhere in the transport industry. The ability of a bus to keep to a timetable is far more outside of our control than in any other comparable industry. Delays are caused by events such as accidents or illegal parking, which we can neither predict nor remedy.


  21.  We are able to offer routes across a wide range of areas. Because of our network approach, we are able to maintain less profitable routes by subsidising them internally. Service reductions are ultimately as a result of Councils facing cash crisis on revenue expenditure for supported services, NOT due to Go-Ahead companies cutting back or increasing profit levels demanded.

    —  In Crawley Metrobus stepped-in to maintain the commercial bus network abandoned by a previous operator.

    —  Go-Ahead companies invest enhancing the frequency of commercial networks.

    —  All subsidiaries operate a "social network". In other words, they cross subsidise to maintain a mix of profitable/not so profitable/not independently profitable services.

  22.  There is no clear evidence of mass deregistrations taking place. The recently published ATCO report is based purely on local authority opinion of new registrations/cancellations, not on actual figures. It should also be remembered that many registration changes are limited to one or two journeys, or are made to meet a specific local authority requirement.

  23.  Go-Ahead is mindful of the need to reduce social exclusion. We fully support concessionary fare schemes, and we have a commitment to introduce fully accessible low floor vehicles throughout our operations.

Chris Moyes

Deputy Chief Executive

April 2002

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2002
Prepared 12 September 2002