Select Committee on Transport Eleventh Report


2  The current situation

6. The Transport Act 2000 requires a local transport authority to develop as part of its Local Transport Plan (LTP) and after consultation, a bus strategy that will secure the provision of appropriate bus services in their area. In formulating those policies they must have regard in particular to the needs of the elderly and people with mobility problems. Local authorities, through their LTPs, have the opportunity to take a more strategic view of public transport provision in their area and related expenditure. These cover both capital and revenue funding for five-year periods. Local authorities are encouraged to set objectives and targets for such factors as tackling congestion, delivering accessibility, safer roads and improving air quality. There is also a requirement to secure value for money in providing bus services and to ensure a smooth integration between bus strategies and LTPs.

Regulatory structure

7. The bus industry outside London was deregulated by the Transport Act 1985. Road service licensing was abolished from October 1986.[4] Any operator holding an operator's licence was free to operate services where and when they wished provided that the Traffic Commissioners were assured that the route was suitable for use by buses. As a consequence of the 1985 Act, local authorities are no longer permitted to provide blanket support for bus services in their areas. They are, however, allowed to subsidise services required to meet social needs that would not otherwise be met. Most bus services are now operated commercially, but some 16 per cent are subsidised.

8. In London the London Regional Transport Act 1984 transferred responsibility for the bus network from the Greater London Council (GLC) to London Regional Transport (LRT). The 1984 Act placed on LRT a duty to tender activities and operation where it thought appropriate. This resulted in progressive competitive tendering of bus operations in London over the period since 1985. In London therefore there has been regulated competition - competition for the market rather than the 'on the road' competition of deregulation. The Greater London Authority Act 1999 transferred responsibility for London's bus services from LRT to Transport for London (TfL), its successor body.

Declining passenger numbers

9. Bus deregulation has been with us for a little over twenty years. It has failed to arrest the decline in bus passenger numbers since 1950 but neither has it accelerated it. Statistics show that since 1985 journeys outside London have fallen whilst journeys in the capital have increased significantly, exceeding the 1985-86 figures. Journeys in the rest of the country have declined,[5] as the tables below demonstrate:
Table 1: Bus passenger journeys, 1980-2005


Source: DfT statistics
Table 2: Passenger use of buses and light rail, 1995-96 to 2003-04


Source: National Audit Office analysis of Department for Transport statistics
Table 3: Reported use of buses and light rail, nationally and by region, 2000-01 to 2004-05


In the five years to 2004-05, bus and light rail use has increased by nearly eight per cent in England and has fallen in all regions outside London



Source: Department for Transport

10. The Department for Transport estimates that passenger numbers will increase by five per cent in Passenger Transport Authority (PTA) areas and by 14 per cent in other areas as a result of the concessionary fares extension that came into force on 1 April 2006. Local authorities' draft LTPs forecast average growth in bus use of eight per cent between 2006 and 2011. Expected growth is shown in the table below:Table 4: The Department's projections of passenger growth on buses and light rail



Source: Department for Transport

11. The picture of decline is more complex than it would appear at first glance. Although there is an overall downward trend outside London, there are areas of the country where decline has been tackled and reversed. When asked for their views on the general trend, witnesses offered different reasons for the decline in ridership; they told us that it is likely that some decline in bus use was inevitable given structural changes in the economy, rising prosperity and increased car ownership. As Mr Stephen Joseph of Transport 2000 said: "I think fundamentally … in a situation where the real costs of motoring have been falling and bus fares have been increasing above the rate of inflation, it is very difficult in any context … to make bus patronage add up".[6] As did the Minister, Gillian Merron MP:

    Bus use has been declining steadily since the 1950s and the last few years have been no exception. We know that the background to all of this is sustained economic growth, with an increase in personal wealth and an understandable desire to own and use cars, which contributes, of course, to a corresponding decline in bus use.[7]

12. Other reasons given were population changes and poor planning. [8] For example, Arriva told us:

    There have been significant population changes in major urban areas over the last 10 years; all the metropolitan conurbations outside London saw reductions in population in the 10 years up to the 2001 census, some by up to nine per cent (Manchester). Each metropolitan area now has a large regional shopping centres situated away from traditional shopping areas; there are similar trends in leisure and employment.[9]

13. Decline is not universal, however. There are places where ridership has increased. These include examples in a regulated[10] and deregulated[11] environment, but tend to be in small historic towns or in areas with municipal bus companies. While some have required a big increase in subsidy, others have been achieved without significant public money. Witnesses from these successful areas, such as Brighton and Hove, cited partnership as the key to success,[12] as did the Association of Transport Co-ordinating Officers (ATCO).[13]

14. This, it is argued, demonstrates that it is not really the regulatory regime that is the problem, what is needed to reverse passenger decline is more research into what potential users want; improved services; better promotion; and a pro-active attitude by local government towards traffic constraint. Mr John Waugh, Uni-Link, told us that it was as simple as 'giving the people what they want':

    Can I quote from a report from the British Psychological Society, quoted in Local Transport Today? They said, "Our participants [in the survey] did not feel 'valued' or listened to by transport operators and so felt unable to bring about improvements in services". That lay behind all our efforts at the university to introduce a service over which we had better control and which we felt would offer much better service to our people. Having done so, we have achieved amazing results.[14]

15. Those successful local authorities who gave evidence to the Committee were asked whether they believed that their achievements could be replicated in the metropolitan Passenger Transport Authority (PTA) areas. Mr Paul Crowther, Brighton and Hove, told us: "…where you have a dense urban network of population, these models have got the potential for working very, very well".[15] Mr Bill Woolley, York City Council, agreed that successful models could be transplanted into PTA areas, but there had to be a willingness to make it work:

    …when I looked at some comparative figures between ourselves and two big urban conurbations, where the bus operator in question was claiming that they had put in exactly the same approach in all three and had a graph which showed our growth was certainly well ahead of the other two, their view was that it was the local authority's willingness to be partners in a way that gave them what they were book looking for, recognising that any partnership to be successful both parties have got to get something out of it.[16]

16. Nonetheless PTA areas appear united in the belief that they cannot achieve their objectives and turn around decline within the present framework.

17. Bus patronage figures have been in decline since the 1950s. Nationally, that decline has not been reversed since the introduction of deregulation in 1985, although journeys in London have increased. We welcome the Government's commitment to look at this problem from first principles and to put into place any new arrangements that may be required. Modal shift from car to bus is vital if the United Kingdom is to properly tackle congestion and reduce carbon emissions.


4   While the 1985 Act privatised the English bus companies, a similar duty was not placed on the Scottish companies until the Transport (Scotland) Act 1989 came into force. Back

5   DfT, Public Transport Statistics Bulletin 2005 Back

6   Q406; Stagecoach made a similar assessment, see Q202 Back

7   Q427; Our predecessor Committee made the same point four years ago in its report into the bus industry (HC 828) Back

8   Q427 Back

9   Ev 93. The ONS mid-year population estimates for 1990-91 and 2000-01 state that there was decline in every metropolitan area outside London with the exception of West Yorkshire. Back

10   e.g. Belfast, London Back

11   e.g. Oxford, Cambridge, York, Brighton and Hove Back

12   Qq 2-3 Back

13  Q5 Back

14  Q195 Back

15  Q45 Back

16  Q45; there were indications that PTAs and operators want to work together, for example Mr Huntley of the Go Ahead Group told us that "if over a period of time I cannot reverse the decline in patronage on our buses in Tyne and Wear I will apologise to the people of Tyne and Wear and I will resign". (Q215) Back


 
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