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5 May 2009 : Column 56WH—continued

Interestingly, she talks about the quality of service offered by the bus company:

So there is a saga of poor quality of service and unpredictability, and now the company is pulling the rug out from under people at the last minute.

5 May 2009 : Column 57WH

We launched a campaign to get South Gloucestershire council to subsidise the route. That has happened after our successful campaign. The council agreed to step in to provide money for a reduced service once an hour for six months, but, of course, in six months we shall have the whole thing again and people will not know where they stand or whether they can rely on the service beyond the six-month period. I welcome the fact that the council will promote the service, which First should have been doing anyway, because often people stand at a bus stop along that route and do not even find timetable information. For instance, when First announced that it was planning to scrap the service, or prevent it from using various stops, it did not even put information on the bus stops.

That shows the contempt with which First treats its passengers. It can do that because it is a monopoly. In theory, Steve Webb Buses could set up and run along the same route, but we all know that First will be the only one that does so. The irony is that First won the tender for the subsidised service, so it still ends up running it anyway, but is paid by the council to do it. I cannot help feeling that we have got to the worst of all worlds in respect of buses in the last 20 years, because in many places we do not have a public monopoly, which at least could be in the public interest, or vigorous private competition, which might be efficient, but we end up with a private monopoly, which is probably the worst of all worlds.

Stepping back from that local example, where we have a sticking-plaster solution and local council tax payers are now paying to keep the service going once an hour for the next six months, but no long-term solution, what is the long-term prospect for my constituents getting a decent bus service not just on this route, but across the area?

The context, with which the Minister will be familiar, is that more built-up areas, such as Bristol and the surrounds, have suffered big time since deregulation. With a 94 per cent. rise in the real value of fares and a 46 per cent. fall in patronage, there have been huge hikes in fares and a drop in bus usage in those built-up areas. That contrasts with London. The Minister will be familiar with this, but it is worth putting on the record that in London, where the local authority can essentially dictate and co-ordinate the services, fares and routes, bus usage is growing at its fastest rate since the mid-1940s; buses in London carry the highest number of passengers since 1968; and bus mileage in London is higher than at any time since 1957. I accept that London is different, but a lot of features of the London model could be applied.

What have the Government done? The Minister’s response might be that the Local Transport Act 2008 is the way forward. That Act allows more flexible voluntary deals between bus companies and councils, but, frankly, in our area First has got the councils over a barrel, because it is the only provider. I was rather alarmed to discover that, in the passenger transport executive areas, 90 per cent. of the services are run by the big five operators and, in general, they do not fight each other. It feels like a stitch-up.

First runs in Bristol. Do Arriva and all the others compete against First? Mysteriously, it does not seem to happen. The theory of competition is great, but the reality is that we all know that the vast bulk of the services will be run by First. Wessex Connect will pick
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up the odd one, as will South Gloucestershire Bus & Coach, but we all know that First will be in there as the main provider. We do not have realistic competition. If the bus companies have the councils over a barrel on voluntary partnerships, what about statutory partnerships? They are another option, although they are limited in scope. My preferred model is a franchise or quality contract. The 2008 Act provides for that, which is welcome, but although the Act was passed last year, the regulations and guidance are not yet in force. Will the Minister tell us when they will be?

In theory, it has been possible for some years for local authorities to franchise services throughout an area, but in reality no one has applied for or been granted permission to do so, because the legislative hurdle has been very high. The 2008 Act relaxes that, and I welcome that relaxation, but I am worried that even when its provisions are in place we may not see franchising and fierce competition between companies in the Greater Bristol area, because many tests will still have to be overcome. The decades of public transport failure in my area should be enough evidence that the alternatives have been tried vigorously. Yes, we will have quality corridors, or whatever the latest jargon is, and yes, there will be new bus lanes and better bus stops, but they will be on the major arterial routes in and out of the city, and people living in villages, young people, elderly people and those who want to travel off peak will receive limited benefit because they do not live where the major routes are.

I do not doubt that the Government want to do something about the problem, and I am sure that the 2008 Act was well intended, but when will we see a difference on the ground? I know that there is already co-operation with bus companies in Bristol and south Gloucestershire and that there will be new bus lanes, but that will not scratch the itch for my constituents who live in villages or areas that are not on major routes. We had a public meeting in Iron Acton, which would have been completely cut off by the changes. Elderly residents said that they would have to move out of the area because, for example, there is no GP in the village so they could not visit their doctor without ringing community transport. People who have appointments at the eye hospital early in the morning could not get there. Losing those services would have killed communities, and I see no evidence that anything other than a radical shake-up will address those concerns.

First is in the business for what it can get out of it, and we should stop pretending otherwise. It makes hefty profits and its bus services are profitable overall. It is not a charity, and we have given it the opportunity to prove that it has a public service ethos, but it has kicked us in the teeth. Let us not pretend that relying on the good will of First or anyone else will get us there. The answer in my area—it may be different in other areas—is for local authorities to work together and to franchise a comprehensive network of services that will be stable in the long term and not cut with eight weeks’ notice, that will link in with other public service infrastructure, such as main line and suburban railways, and that will provide off-peak and rural services. I know that such services cost money and that the pot is not unlimited, but if First and other companies had to bid for the complete network, they would have to make a choice. They would have to decide whether they were going to be in or out
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of Bristol. That would force the issue, because it is in their interests to stay in the area, and we could get an awful lot more from them than if we just relied on their good will, which is the model that we have relied on too much in the past.

I could read out dozens of comments from angry people who want to be bus users and do not want to use their cars. Many of them commented on the website that they are always being told to get out of the car, but bus services are being cut. They are profoundly frustrated, and I hope that the Minister will say that the Government’s changes will be implemented quickly and bring about a real change, not just in services, but in fares. I have surveyed young people who say that the cost of fares is their overwhelming problem. We have relied too much on bus companies’ good will, but they are not in the business of showing any, so we must be much tougher on behalf of bus users, and I hope that the Minister will assure us that the changes will make a difference on the ground. If not, further powers may be needed to make bus companies provide a public service, which is what should have been provided all along.

1.44 pm

The Parliamentary Under-Secretary of State for Transport (Paul Clark): I congratulate the hon. Member for Northavon (Steve Webb) on securing this debate. I know that the matter is close to his heart, and he referred to a similar debate 18 months ago when he concentrated on young people and their travel. My predecessor, my right hon. Friend the Member for Doncaster, Central (Ms Winterton), responded to that debate and stated clearly that the Government were working on improving the experience for present bus users and those to come. Our strategy is for a continual increase in bus patronage, and that has started. Bus services are the backbone of transport for the vast majority of people in this country. Some 5 billion journeys are made every year, and we want the number to increase with more quality bus services throughout the country in place of the existing patchwork of services.

My right hon. Friend talked about the work in developing the then Local Transport Bill, and recorded that the Government were putting some £2.5 billion into funding local bus services each and every year, including the £1 billion-odd for the concessionary scheme for some 11 million older and disabled people, which has come into being since that debate and provides opportunities for many people who might otherwise be isolated. However, I recognise that even with a gold-plated concessionary bus pass there will be issues if there are no buses. The hon. Gentleman said that nothing short of a radical shake-up is required in the bus industry, and the Local Transport Act 2008 provides the tools for that to happen, but leadership is needed at all levels to take forward what is right for a specific area. I shall return to that, and respond to some of the hon. Gentleman’s specific points.

As the hon. Gentleman said, most bus services outside London are provided by commercial operators in a deregulated market. Any operator is free to run local bus services, and Steve Webb Enterprises could apply, after gaining an operator’s licence and registering the routes and timetables with the local traffic commissioner.
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That is one right, but it is also within operators’ rights to withdraw bus services that are no longer commercially sensible, and operators are required to give 56 days’ notice to the traffic commissioner of any service cancellation.

Local authorities have the power to subsidise socially necessary services, as is happening with the X27 service to which the hon. Gentleman referred, that would not otherwise be provided by commercial operators, and about one fifth of bus services throughout the country are provided in that way. However, I readily accept that in the remaining four fifths of services—the vast majority—there has been little scope historically for local authorities to influence either the price or the standard of service offered. It has invariably been left to Adam Smith’s “invisible hand”—the working of competition in the free market—to drive down fares and force up quality. After more than two decades of deregulation, perhaps the fairest thing to say is that the results have been mixed.

As I have gone around the country, I have seen some good examples and spoken to people who use those services and not just to those who have briefed me. There are some good examples of partnerships that have worked and brought together both sides of the table. I say “both sides”, but when it is a genuine partnership that works, we do not end up with people being seen as on different sides of the table, because they are working hand in hand. I am talking about work by local bus service providers going hand in hand with supportive action by the local authority.

Places such as Telford, Brighton, York and Milton Keynes have had increases in patronage where there has been a genuine desire to go the extra mile, if I may use that term, to provide a service that is responsive and reflective. Those are increases in ridership over and above the extra ridership from the England-wide concessionary fares scheme; I want to make it clear that they are additional increases. However, as I have said, there is far too much of a patchwork of average provision and poor provision, rather than the good services that I could point to. That is what we need to deal with and the 2008 Act provides the ability to do that.

Before responding to an Adjournment debate, I always like to ensure that I know what everyone is talking about, and when I looked at the “Focus on Sodbury, Yate and Dodington” website, I saw that the hon. Gentleman believes that we have only “tweaked the rules” in the Local Transport Act. I hope to prove otherwise. Indeed, I know that he will be deliriously happy when I tell him about the greater powers that councils now have to determine what bus services operate in their area and to cap excessive fares. He is calling for that in this debate, and I am delighted to tell him that we are delivering it through the 2008 Act.

A principal aim of the Act is for local authorities to have a variety of options for exerting greater influence on the standard of bus services in the deregulated market. There is a strong emphasis in the Act on partnership working. Where there are good examples of a strong partnership, there has been the ability to deliver and provide the ingredients for success and an increase in patronage.

The hon. Gentleman referred to previous attempts to secure better bus services, the problems of companies seeming to be working hand in glove and competition
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not working. One problem with previous legislation was that competition law worked as an obstacle to sensible partnerships. We have been able to work with the Office of Fair Trading to ensure that, under the provisions in the new Act, there is not that obstacle and that we can have a far stronger bus service and provision and negotiation through local authorities and the bus operators to make it a success.

Steve Webb: As the Minister has mentioned competition law, will he address the question that I asked at the start? Is First Bus correct to say that it could not have subsidised the X27 from the profits on another route? Is it as simple as that?

Paul Clark: Let me answer that at this stage. As far as I am aware, it is not the case that companies cannot cross-subsidise between local routes. Let us think about a process of negotiations that might well happen. “Here is a package of routes that we want to be provided,” says the local transport authority to the bus company. It sets that out as a specification. Some of those routes would undoubtedly be more economically viable than others, so there would be a package and one would assume that any company bidding for that franchise—that operation—would take into account the costs involved and the income streams that there would be. Clearly, I was interested in the hon. Gentleman’s comments about what First had given as a reason for not being able to follow through on the X27, but my understanding is that there is no reason why it cannot cross-subsidise, unless of course that is an internal rule of its own.

With regard to the 2008 Act, there are quality partnership schemes, although the only successful one that really has flown was the one in north Sheffield. The concept was provided for under the Transport Act 2000. The provisions for quality partnership schemes have been strengthened under the 2008 Act. I am referring to the local transport authority having the strength to be able to negotiate in respect of frequencies, timings and maximum fares as part of that beefed-up role. That is important and helps to meet some of the hon. Gentleman’s concerns. He referred to fares rising astronomically, and one of the provisions of the new Act will cover that.

The hon. Gentleman said that his preference would be something along the lines of the quality contracts schemes—the London style of franchising. That may be a realistic option for given areas, but again it is for local authorities and local transport authorities to decide on what would meet their requirements. We have changed the rules. I think that the hon. Gentleman said that the
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hurdles that had to be got over were so high as to make that unrealistic. We took the opportunity to examine the provision in relation to the Local Transport Act. The requirement was that a quality contracts scheme must be the “only practicable way” of achieving the local authority’s objectives. We have now provided for a much more balanced set of “public interest criteria” that schemes would need to meet. That makes it far more realistic for people to be able to meet the requirements in relation to a quality contracts scheme.

With regard to the timetable for quality contracts schemes, one of the things that I said once we had got the Act through and on the statute book at the end of November last year was that we needed to get on with rolling out the provisions. As hon. Members know, we can pass legislation, but we also need to roll it out and get it going. That is what we have been doing in a range of areas and there is a lot of work to be done. That includes setting up Passenger Focus to have a strong voice now for the travelling public on the buses as well as the railways. That is another provision that came into being in April.

With regard to quality contracts, we will shortly be consulting on the requirement for secondary legislation. I hope to see the quality contracts provision up and running by the end of 2009. Like the hon. Gentleman, I want to see the Act a reality on the ground, making a difference for the people whom he represents here today and for the people whom hon. Members represent throughout the country. I hope that that will be a way forward.

I believe that the 2008 Act can provide the radical change required, but leadership is needed at local level, not only from elected leaders, which is fundamental, but from officials, those working in the industry and those in local bus companies. We all want one thing: more people on the buses and services being provided reliably, efficiently and effectively. I want to see that happen, but it takes two to tango. It certainly needs to happen in this case. When I was in Bristol recently, I met representatives of the West of England partnership. I hope that if one thing comes out of this, it is that the hon. Gentleman and colleagues alike will work with the leadership of the West of England partnership to see what can be taken forward from the 2008 Act to make a real difference for the travelling public, whether in south Gloucestershire, Bristol or the rest of the area.

Question put and agreed to.

1.59 pm

Sitting adjourned.

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