Bus Services Bill [HL]

Written evidence submitted by the Chartered Institute of Logistics and Transport (BSB 11)

1. The Chartered Institute of Logistics and Transport  is a professional institution embracing all transport modes whose members are engaged in the provision of transport services for both passengers and freight, the management of logistics and the supply chain, transport planning, government and administration. Our principal concern is that transport policies and procedures should be effective and efficient, based on objective analysis of the issues and practical experience, and that good practice should be widely disseminated and adopted.

2. CILT welcomes the opportunity to submit observations to the Public Bill Committee on the Bus Services Bill. As CILT is a professional institute, not a pressure group or lobbying organisation, our comments are generally addressed to whether the Bill when enacted can succeed in improving the performance and governance of the bus industry in England and, insofar as it applies, elsewhere in Great Britain outside London. Although we comment on certain amendments, it is for the Government and others to propose detailed modifications to the Bill.

3. Can this Bill achieve its aims? Although extensive consultation has taken place with stakeholders and the Bill has excellent intentions in respect of improving local bus services for passengers and for the wider community through economic growth and improving the environment as set out in the Department for Transport (DfT) initial overview [1] , CILT has concerns that:

· The Bill does not provide a clear path to achieve growing passenger numbers. Effective partnership working (which, whether formally or informally, happens in all the areas in which patronage trends are positive) depends on coherent local authority policies linking efficient, viable bus services with traffic and parking management. In too many cases, Councils are failing to make full use of the powers given to them by the Traffic Management Act 2004 to manage their road networks to minimise congestion, the most pressing problem facing the bus industry in surveys of operators [2] and passengers [3] alike.

· It isn't clear how the Bill’s new features add to existing powers to tackle air quality which is also related to congestion. In the future tackling pollution is likely to affect bus operations in towns and cities, for example through Clean Air Zones which will in many areas require significant investment in upgrading existing vehicle fleets.

· Links to economic growth will only come from effective spatial planning policies developed by Local Authorities, LEPs and other development agencies taking full account of transport needs. In many cases the mechanisms for co-ordinated development and transport policies are currently not strong enough.

· Contrary to the Bill’s intentions, commercial initiative may well be restricted by some of the new partnership provisions because the clarity of the current registration process is clouded by allowing local authorities to intervene and, in some cases, assume responsibility.

· The legislation governing bus services is becoming increasingly convoluted and correct interpretation correspondingly difficult. This Bill essentially adds to, repeals or amends previous legislation, dating back as far as the Transport Act 1968 and possibly beyond.

· A 21st Century bus industry dependent on local authority highways networks surely deserves easily understood legislation setting out clearly what is required of the principal players. An example of this is the further embroidery around the concept of Quality Partnerships, first set out by the CILT’s predecessor, the Chartered Institute of Transport, in 1993 [4] . The Bill is leading to a spectrum of interpretations of what may be included with several different (and potentially arcane) classifications of Partnership. Subject to necessary approvals, one or more authorities and one or more operators should be able to form Partnerships to deliver improved bus services provided that this does not affect the freedom of operators to act commercially. Approving bodies could include, inter alia, the Department for Transport or its Executive Agencies, the Traffic Commissioners and the Competition and Markets Authority.

· The devolution of powers over local bus services where suitable local governance arrangements are in place has been welcomed by many, but could lead to the so called "franchising" instrument being divisive and destructive if insensitively used.

· "Franchising" as envisaged in the Bill is NOT commercial franchising as usually understood.
Familiar high street names operate franchised businesses as diverse as hotels, fast food outlets, convenience stores, private tuition services, car hire, motor tyres and servicing or commercial cleaning. In this model local entrepreneurs buy into a brand and its values and build their own businesses delivering the products or services to the specification of the franchisors (brand owners). Franchisees may have commercial freedom to enhance the range of products or services provided that they do not do anything to detract from the brand or its values.

· "Franchising" in the Bill’s terms is a form of contracting in which most commercial freedoms are restricted.The "franchisee" is managing a service or group of services on behalf of the Mayor and/or local transport authority. It is open to well-intentioned but misguided Mayors to waste resource in pursuit of ideals that may be politically expedient but not always the best value for public money, ignoring the advice not only of those with significant commercial and bus operating experience but also possibly that of other transport authorities in the area. (Some consider this already to have happened in several cases including Mayoral aversion to bus lanes and other strong traffic management in unitary authorities such as Doncaster and to articulated buses in London).

· Open data is the most innovative section of the Bus Services Bill and provides a platform for positive development but this must be done with strict adherence to properly maintained technical standards to ensure interoperability and consistency.

· The Bill’s aims for information and ticketing are laudable.

§ It is the case that currently less than 25% of bus services are registered electronically but effective processing of operational data to produce customer information requires that electronic registration should be the norm not the exception and regulation is required to ensure this is the case.

§ Although 90% of buses may have smart ticket readers and the ITSO UK standards for smart ticketing have been available since the early 2000s in many parts of the country a high proportion of fares are still paid on board in cash contributing to long journey times and possibly causing congestion. Operators generally have been slow to engage in multi-operator smart ticketing schemes.

· Strong regulations are required to ensure that operators and, where appropriate, transport authorities use technology to improve the experience for bus passengers:

§ when using apps or on-line tools to plan their journeys

§ at bus stops, in the vehicles and through mobile apps to provide real time passenger information including next stop information on bus

§ by offering alternative route and service suggestions when disruption occurs.

4. Starting from a position in the context of the Bill as brought from the House of Lords we observe that:

· Except in London [5] bus services in Great Britain are provided by commercial operators (a few of which are "arm’s length companies": former municipal undertakings where the local authority retains a shareholding but which operate independently of the authority).

· Local Transport Authorities remain empowered to enter into contracts for services deemed necessary to meet local needs not provided for by commercial services but have increasingly limited resources with which to do so.

In the following sections we consider the Bill’s proposals and amendments tabled prior to 10th March 2017. Paragraphs in bold type may be considered as recommendations or proposals as to where the Bill might be amended.

5. Franchising powers

· For pragmatic reasons it is sensible not to allow extensive use of "franchising" powers until there is certainty of the capacity of both authorities and the bus industry to cope with the disruption that a change to contracting all of the services in an area or substantial parts of it has been tested.

· Although in due course there may be cases for extension of the powers to other classes of authority, we agree with the Government that the powers should be restricted to mayoral combined authorities.

6. Municipal Companies

· We note that some of the most successful bus companies in the UK in terms of passenger satisfaction and patronage growth have a municipal owner or principal stakeholder (for example: Blackpool, Lothian, Nottingham, Reading). Additionally there is evidence that community based companies (for example: the HCT Group established by Hackney Community Transport [6] or the Dales & Bowland Community Interest Company [7] procuring services in the Yorkshire Dales) can make a useful contribution, particularly where local Councils can assist with pump-priming finance or support in kind.

· We believe that the Government should not prohibit Councils from forming, or taking a stake in, new community based bus companies. In each such case a suitable business case should be made to the satisfaction of the Secretary of State.

7. Community Value and Bus Services

· An amendment has been tabled (30, Clause 14) [8] that refers to the concept of "Community bus routes" which would be designated by the Traffic Commissioners in response to nominations from approved groups representing their communities. These Community bus routes would be regarded as assets of community value in terms of the Localism Act 2011 and their operators would be required to continue them for six months to allow alternatives to be sought. This approach has apparent merit in preserving the status quo where communities are in danger of losing socially valuable services but requires further thought in terms of how the continuation of services is to be funded when presumably neither the operator nor the local transport authority believe they have the resources to do so. These are precisely the situations in which community based approaches such as those of HCT and the Dales & Bowland CIC referred to above could succeed in situations in which neither commercial operation nor long-term Council subsidy are feasible.

· We hope that the Government will consider sympathetically how to develop further this useful proposal based on designating bus routes as community assets.

8. Bus Services and Highways Management

· Operators delivering bus services have no control over most of the infrastructure that their services use – the highways and stopping places. These are controlled by local authorities. There is significant competition for both road and kerb space in many places manifested as congestion. This occurs not only in the obvious conurbation centres but increasingly in suburban centres and rural "hot-spots". It is welcome that the Bill provides for traffic management as a legitimate instrument of partnership. It might go further.

· A simple amendment could require local highway authorities to ensure that they exercise the network management duty and their powers under the Traffic Management Act 2004 to facilitate the operation of reliable bus services by taking measures to reduce delays due to congestion.

· A helpful approach would be for authorities to minimise the delays to people and goods (as opposed to vehicles) which can be achieved in many ways including junction design, traffic light controls and other technological measures as well as priority lanes.

· In parallel with reminding local highway authorities of their responsibilities, bus operators should also be expected to ensure that the time spent stationary at bus stops potentially delaying other traffic is minimised through the adoption of efficient boarding and alighting procedures including attention to vehicle layouts, fares and ticketing policies.

9. Fares and Ticketing

· There is currently a stark difference in the rest of the UK from the ticketing regime in London, where a single competent authority controlled the development first of Oyster and then contactless bank card ticketing by virtue of a common fares regime and equipment specifications. In contrast the continuing toils of ITSO elsewhere in mainland Britain are bedevilled by differing equipment standards, the multiplicity of fares scales but, most crucially, by the lack of agreed business models.

· Targets should be set for the introduction of inter-available and interoperable smart ticketing by bus, rail and other public transport modes throughout the UK as soon as possible. We note the stated intentions of several transport groups to do this but smaller players also need to commit to this.

10. Public Information

· In London real time information is universal for those with smart devices and widely available for those without. In some other parts of the country local authorities that were once leaders in real time passenger information schemes have switched off roadside displays because of spending cuts to achieve spending targets. Although open data enables app developers to fill the gap for those with mobile devices, this does not help the significant numbers of bus users without internet access who had come to rely on information displays at bus stops.

· Next stop information by visual and audible announcements is particularly helpful to the majority of bus users, not only strangers to an area, and operators should be encouraged to make this universally available.

11. Socially necessary Bus Services and Total Transport

· Significant numbers of people within society have no alternative to using public transport or choose to do so rather than use private means. Local Transport Authorities procure some local bus services under contract, although in significantly reducing numbers given the scale of reduction in local authority resources.

· Often the costs saved by a local authority withdrawing support for local bus services are exceeded by the consequential costs to that authority, the NHS and businesses in providing alternative services for those now unable to use buses but still needing to travel. The Department for Transport is examining the concepts of cross-sector costs and benefits in its work on Total Transport.

· Funding support should be provided for local authorities to ensure that Total Transport costs can be minimised across all agencies and businesses.

12. Concessionary Travel

· Local councils in England are the instrument of Central Government for reimbursing operators participating in the English National (free on bus) Concessionary Travel Scheme although its terms are largely controlled by the Department for Transport.

· There must be an economic case for the Department for Transport to administer the ENCTS as a truly national scheme.

· This would also have the benefit of removing inconsistencies in reimbursement levels between areas which have caused financial problems for operators, in one case being blamed for the cessation of trading by an operator that received substantially lower reimbursement rates in its home area than in neighbouring areas into which services ran.

13. Home to School Transport

· Local authorities also remain responsible for free home to school transport, albeit for less than 10% of all pupils, and we note that the complexity (and probably the cost) of this requirement will be further increased as a result of measures announced by the Chancellor in his Spring Budget [9] .

· Additional costs for journeys to and from school will be incurred where conventional bus services are no longer available and additional transport has to be procured. Adoption of the Total Transport approach will help to ensure that innovative options are explored to maximise travel opportunities at minimum resource cost.

14. Services in rural and other isolated areas

· The Bill is silent on the continuing problem of declining availability of services in rural and other isolated areas that lie off the main inter-urban corridors although devolution of powers to Cornwall (which has declined to consider "franchising") is an example of providing for solutions to be locally determined far closer to the, in this case, often social market.

· Bus services are labour intensive and should be customer focussed. To specify and deliver good local bus services a spectrum of local community and business interests and stakeholders should be involved in addition to bus operators and local authorities.

15. Stakeholder Involvement

· CILT believes consultation must include both passenger and staff representatives as intended by amendments made in the House of Lords.

16. Passengers in Wheelchairs

· It would be helpful if an amendment could be made by the Government to enshrine in statute priority for wheelchair users to occupy the space or spaces provided by operators to accommodate a wheelchair or wheelchairs.

· Although out of the Bill’s current scope this is very much in accordance with the objective of improving matters for bus passengers. Following the ruling in the Supreme Court in Paulley vs First Group [10] , the driver has the onus of trying to enforce this without statutory backing. A constable called to the scene might have to resort to public order legislation to resolve it. If the driver could point to a sign quoting the relevant section of the Bus Services Act 2017 after the Bill is enacted this would help considerably.

· It is not only the driver and disputants that are inconvenienced, it is other passengers on the bus who are delayed, it is potentially other bus users delayed in boarding following buses because the stop is blocked in consequence of the dispute and it is other road users if congestion is caused by the delayed bus. A simple clause to enshrine in statute priority for wheelchair users appears to be all that is necessary.

17. Other Matters

· The Bill is substantially enabling (indeed Henry VIIIth might be amazed at the extent of powers presented to the Secretary of State!). A labyrinthine structure is being created largely by amending the Transport Act 2000, itself modified by the Local Transport Act 2008, and further involving consequential change to transport legislation extending back at least as far as 1968 and possibly beyond. When the Bill is enacted this will create a framework that is complicated to work within and might well create anomalies of the type said to have thwarted full deregulation of bus services in London.

· However, we are pleased that Department for Transport has already discussed secondary legislation with several stakeholder groups and is continuing to do so.

· The Bill largely applies to England only - surely the UK government should look at ways in which the different administrations can cross-fertilise good practice?

· Open data requires common standards for customer information, ticketing technology and fares schemes and should also be adopted by the devolved administrations.

18. Local Governance

· CILT welcomes the continued emphasis on partnership as, we believe, the preferred way forward for local buses. The report "Bus Routes to Success" issued in 1993 by our predecessor the Chartered Institute of Transport was marked not only by the widespread adoption by both local government and bus operators of the principles of "Quality Partnership" recommended therein but also by the Government instituting what were then known as Ministerial Bus Working Groups. These consultative mechanisms have been carried through in various formats by successive Ministerial teams at the Department for Transport.

· It is noteworthy that the examples of towns and cities with bus services that are commercially and socially successful as quoted by many commentators and pressure groups are all in areas where there is strong partnership and local input. Why can't this happen elsewhere?

· It takes time, skills and resources to establish trust and the conditions for success and unfortunately the availability of skills and resources (political leadership as well as management and technical capability in both local authorities and bus companies) is very variable across England. Indeed CILT’s professional view is that, even within the metropolitan Combined Authorities that have subsumed the roles of Integrated Transport Authorities and their Passenger Transport Executives, many no longer have the skills, staffing levels or financial resources to plan satisfactorily and execute "franchising" schemes or some new partnership powers. This might be rectified if they could harness through partnership the skills of bus operators and other stakeholders such as LEPs and business groups within their areas.

· Local Authorities have been hard hit by cuts both in funds and in numbers of employees so giving them a stronger role has high risk. London has been fortunate in the willingness of its Mayors to empower good professionals (initially the London Regional Transport Commissioner and the Traffic Director - now both within TfL) to implement their policies and the Mayor’s ability to secure resources both for capital schemes and policies such as travel concessions for younger people. However, buses in London face a more difficult future as a result of congestion – already contributing to an accelerating loss of passengers – and cessation of Government revenue grants.

· An often overlooked aspect of partnerships is that they are most successful where there is strong leadership, both political and professional, and a commitment by all concerned to achieve shared goals setting aside organisational differences. In both public and private sectors we perceive needs for better training and succession planning in order to ensure that the necessary skills are available and continue as personnel inevitably change.

· One good approach to partnership would be to form local transport boards of stakeholders (Local Authorities, bus operators, LEPs, business, NHS for example). Places such as Reading and Cambridge have done this successfully to some extent albeit motivated by particular local issues: Brighton has a less formal but similar arrangement.

· CILT believes a positive approach is needed to what looks like poor legislation. We can do this by identifying what is already well delivered and can be built on. Where there is high risk that must be understood. For "franchising" the Greater Manchester Combined Authority and Transport for Greater Manchester (TfGM) have good relations with Government and will probably elect a strong Mayor so could well make the system work: particularly as they are talking of evolution not revolution. By contrast under earlier legislation some other authorities have experienced dilettante elected mayors and with their weaker resource bases "franchising" may not succeed.

· Inclusion of traffic management and parking as partnership commitments is potentially good but what accountability do Local Authorities have? All the sanctions in the Bill appear to be against operators.

· Objective assessment and approvals of partnerships should be required, a potential role for the Traffic Commissioners. There must be clear channels of consultation and appeal and clear responsibilities for the different regulators, especially clarifying where it is intended that Transport or Bus Services Act provisions should take precedence over Competition law.

19. The way ahead

· It would have been preferable for this Bill to have been new legislation designed for 21st Century communities and their Local Bus Industry by replacement of current legislation, not risking instability and lost focus by tinkering amendments to it. However, the tests must be:
Will the legislation that emerges:

§ Provide the bus services the public needs?

§ Contribute to economic growth and improved local environments?

§ Harness appropriate skills and resources from both the private (operating) and the public (infrastructure and social) sectors?

§ Enable easily understood and non-conflicting local governance arrangements?

· CILT will continue in the context of its ongoing Vision 2035 [11] work programme to consider the needs for passenger transport across the UK and the framework in which the bus industry and other service providers can effectively and efficiently meet these.

March 2017

[1] Department for Transport, "The Bus Services Bill: An Overview", May 2016

[2] Chartered Institute of Logistics and Transport, "Bus reform: survey of senior directors of local bus service operators: summary of findings", June 2016

[3] e.g. Transport Focus, Bus Passenger Surveys, annual series

[4] Chartered Institute of Transport, "Bus Routes to Success", 1993

[5] Transport for London procures bus services to its specification from contractors through a sophisticated system of performance related contracts. This is loosely termed "franchising".

[6] e.g. http://www.hctgroup.org/about_us or House of Commons Transport Committee evidence BSB0021

[7] e.g, https://www.dalesbus.org/dalesandbowland/ or House of Commons Transport Committee evidence BSB0008

[8] House of Commons, Public Bill Committee, Bus Services Bill [Lords],Notices of Amendments as at 8 March 2017

[9] "..we will extend free school transport to include all children on free school meals who attend a selective school." Chancellor’s Budget Statement, House of Commons, 8th March 2017.

[10] See https://www.supremecourt.uk/cases/uksc-2015-0025.html, select "judgement".

[11] http://www.ciltuk.org.uk/PublicPolicy/Vision2035.aspx, CILT Vision 2035, Transport, Logistics and the Economy


Prepared 15th March 2017