Bus Services Bill Contents

Conclusions and recommendations

Partnerships, franchising and ownership

1.Advanced Quality Partnerships and Enhanced Partnership Schemes have the potential for delivering greater benefits by allowing local transport authorities and operators to work together more intensively. However, there is a risk that Enhanced Partnership Schemes could entrench the position of dominant operators. We welcome the Government’s commitment to take into account the specific aspects of the local bus market in developing the Enhanced Partnership Scheme voting mechanism. The Government should publish further detail regarding the voting mechanism as soon as possible to allow the House of Commons to scrutinise the possible impact of Enhanced Partnership Schemes on competition. (Paragraph 26)

2.Franchising has the potential to deliver benefits that cannot be achieved by partnerships. While there are some risks associated with franchising, these are mitigated by existing safeguards in the Bill. In our view, it is primarily for the local transport authority to decide whether or not franchising is appropriate for any particular area and we agree with the majority in the Lords that the process set out in the Bill as introduced is unnecessarily cumbersome. (Paragraph 40)

3.We accept that there may be a case in principle for reinstating the secondary requirement for the Secretary of State’s consent before any individual authority other than a mayoral combined authority can franchise. However, this has been difficult to assess, in part because the draft guidance was not available for our witnesses to consider when they gave evidence to us. If the Government wishes to reinstate the consent requirement, it must produce more detailed guidance on how the Secretary of State will exercise these powers. A key consideration for the Secretary of State would be the extent to which the proposals for franchising ensure small and medium sized operators are not prevented from entering the market. The detailed guidance must be produced in good time for the Commons Public Bill Committee stage. (Paragraph 41)

4.Franchising is at the heart of this Bill. The Committee is concerned that key elements relating to this provision are still not available for scrutiny while other parts are only available in draft. This is not the first time this has happened and it is unacceptable. The Government should commit to publishing all relevant draft secondary legislation and guidance when a Bill is introduced into Parliament. (Paragraph 42)

5.We accept that the question of whether incumbent operators would suffer a loss from franchising is a complex one. However, franchising does not mean operators already providing bus services in the market cannot compete; it simply means that they must compete for the market rather than for passengers as they do at present. There is no case for compensation for operators in areas where the local transport authority decides to introduce franchising. (Paragraph 45)

6.Franchising and partnership schemes have the potential, where successful, to partially address the funding pressures currently facing bus services by increasing full fare passenger numbers. We welcome the Government’s commitment to devolve BSOG where franchising is implemented. We recommend that the Government also commits to devolving BSOG to those authorities who implement an Enhanced Partnership Scheme or Advanced Quality Partnership. (Paragraph 49)

7.It is right that those affected by proposed changes to bus services have an opportunity to contribute to the decision making process. We welcome the Bill’s emphasis on consultation with bus users and employee representatives. We recommend that the Bill be strengthened by agreeing an amendment requiring LTAs proposing Enhanced Partnership Schemes to consult with the appropriate representatives of any affected employees. This would bring the provisions around employee representation for Enhanced Partnership Schemes in line with those for franchising and Advanced Quality Partnerships. We recommend that the Bill be strengthened by agreeing an amendment requiring LTAs proposing Enhanced Partnership Schemes to consult with the appropriate representatives of any affected employees. This would bring the provisions around employee representation for Enhanced Partnership Schemes in line with those for franchising and Advanced Quality Partnerships. We also support the proposal to allow communities to designate bus routes as community assets. (Paragraph 54)

8.As highlighted by our predecessor Committee, passenger transport services are essential to allow isolated communities to fully participate in society. In the context of continuing cuts to local authority budgets, the Bus Services Bill can only be part of the solution in protecting local transport services in isolated communities. The Government must explain how its devolution agenda will help to support local communities to maintain often critical bus services that nevertheless require ongoing financial support. (Paragraph 55)

9.There are some circumstances, for instance where no private operator is willing and able to operate socially necessary services, where it would be appropriate for a local authority or group of authorities to set up their own operator. We accept that there is the risk of a conflict of interest where the authority has decided to implement franchising and that such a conflict could seriously delay or perhaps even prevent a franchising scheme from coming to fruition. However, the current prohibition on all new municipal operators in the Bill is a disproportionate response. We encourage local transport authorities to assess the benefits of partnerships and franchising before they consider setting up a municipally owned operator. The Government should produce guidance setting out the measures it expects local authorities to put in place to ensure that an arm’s length relationship is maintained. (Paragraph 59)

Accessibility, open data and ticketing

10.Audio-visual equipment on buses as standard is now long overdue. We welcome the Government’s commitment to bring forward regulations under the Bill relating to audio-visual as a pragmatic response which balances the interests of bus users and operators. The Government should ensure that bus users and their representatives are involved not just in the development of the regulations but also in assessing their impact after they have been implemented. The Government should commit on the face of the Bill to implement this change by 1 January 2019. (Paragraph 67)

11.The London experience shows the potential of open data in empowering passengers and allowing local authorities and operators to better understand local needs and gaps in the service. However, the Government’s failure to prepare the draft open data regulations in time means that it has been impossible for this Committee or the House of Lords to assess the effect of these provisions on operators. The Government’s amendments in the Lords are to be welcomed but only go some way to mitigating the issue. The Government should publish an update on its previous open data policy including, ideally, draft regulations, to allow Parliament to better assess the impact that these provisions are likely to have on industry. (Paragraph 73)

12.We welcome the Advanced Ticketing Scheme provisions as a tool to encourage simpler and more integrated ticketing. However, more must be done to ensure that innovation in ticketing technologies is encouraged and not hampered. Within six months of Royal Assent, the Department should produce, in consultation with industry partners, guidance which supports local transport authorities in developing ticketing schemes that do not impede newer technologies, are not a disproportionate burden on operators, and which pay due regard to the accessibility needs of different groups. The Government should co-ordinate the development of back office ticketing functions to limit unnecessary complexity or duplication. (Paragraph 77)

Road conditions and congestion

13.Congestion is not the only issue facing the bus industry, but it is a real threat in some areas. LTAs and operators need to fully understand the effects of congestion and other factors on bus speeds and performance. Transport for London already performs admirably in this regard and other LTAs can learn from them. Where they think they would be useful LTAs and operators should be encouraged to build performance and reporting frameworks into their partnership and franchising arrangements. We therefore encourage the Department to produce guidance within six months of Royal Assent to assist authorities who wish to draw up performance and reporting frameworks. (Paragraph 84)

14.We are sympathetic to the aims of the House of Lords in passing the amendment to allow local transport authorities which are implementing Advanced Quality Partnerships to have greater enforcement powers over traffic offences. We also agree that the devolution of moving traffic offence powers requires further consideration. However, linking moving traffic offences to the bus regulatory structure is illogical and will add further unnecessary discrepancies between the powers held by different local authorities. We repeat our previous recommendation that the Government immediately bring into force the remaining provisions of Part 6 of the Traffic Management Act 2004 to allow all local authorities in England to enforce moving traffic offences should they so wish. (Paragraph 87)

22 November 2016