Community Transport and the Department for Transport's proposed consultation Contents

Conclusions and recommendations

1.The pressure on community transport organisations to cross-subsidise core, socially valuable work from income earned from contracts such as home-to-school transport has to some extent, in some areas, been driven by a lack of available local authority grant funding in recent years. Further investigation of this may be useful, and we may choose to consider the adequacy of funding for socially valuable but commercially unviable community transport services, and the effects on local transport markets, particularly for home-to-school transport, later in this Parliament. (Paragraph 13)

2.The community transport sector has developed considerably since the Transport Act 1985 came into force. Broadly, community transport organisations have developed their operating models with the acquiescence or encouragement of local government and successive national governments. In particular, they have responded to calls for them to seek out new funding streams and become more business-like in approach. Some have achieved this very successfully at the same time as delivering considerable social benefits. Given that they have acted in good faith, and generally in line with the longstanding guidance, it would now be unjust if planned changes were to be their downfall. In these circumstances, it is incumbent on the Department to handle any necessary changes with particular care and sensitivity (Paragraph 21)

3.The Transport Act 1985 and associated guidance sets out a relatively light touch regulatory and licensing regime for the provision of community transport. For decades, the regime has provided an effective framework within which not-forprofit organisations can effectively plug gaps in commercial provision and provide community-based local transport services to people who would otherwise suffer isolation. Broadly, it still achieves this. (Paragraph 29)

4.Some commercial operators appear to have suffered substantial detrimental effects from potentially unfair competition from community transport organisations in contestable markets. There is, however, a notable lack of reliable evidence against which to assess whether the practices of community transport organisations create widespread unfairness or the geographical extent of the problem. Proposals to address instances of unfairness should be considered in the forthcoming consultation but, given the acknowledged wider social benefits of community transport, the Department should proceed with caution. It must not take a sledgehammer to crack a nut. (Paragraph 30)

5.We recommend the Department work with the relevant agencies with a view to taking proportionate measures to collect and publish data to enable comparison of the road safety records of different types of road passenger transport operators, including those operating under the section 19 and section 22 permit system.(Paragraph 34)

6.As acknowledged by the Department, UK legislation and guidance have not kept pace with developments in community transport practice and European Regulations, and, under intense legal pressure, some changes have now become necessary. The Department did not respond appropriately to address valid concerns over many years, and it acted too slowly. The Department must consider whether a satisfactory outcome may have been achieved earlier had it tackled relatively localised issues head on several years ago; while now a moot point in relation to the issues at hand, the Department must learn the lessons for its future regulation of policy areas which are its responsibility (Paragraph 42)

7.The Department’s letter of 31 July to all section 19 and 22 permit issuers was wellintentioned but, in the light of its new understanding of the potential effects, some of its content could be deemed ill-judged. In trying to clarify and calm the situation, it achieved the opposite, creating confusion and a level of panic in the community transport sector. The uncertainty led to some local authorities halting commissioning processes and, in some cases, unnecessarily beginning the process of withdrawing contracts from community transport organisations. (Paragraph 59)

8.The Department’s note to local authorities of 9 November is welcome but is itself evidence of the need for very substantial clarification of its letter to permit issuers of 31 July. That it took the Department more than three months to provide a potentially more workable definition of “non-commercial” in the context of community transport services demonstrates the Department’s lack of understanding of the sector and the potential effects of its initial proposals. There is still more work to do in fully understanding the implications. This is highly regrettable and must be addressed. The Department must enhance its expertise, understanding and oversight of community transport, and be able to demonstrate how it has done so. (Paragraph 71)

9.The implacable position of the Bus and Coach Association, driven by Mr Allen, appears to have resulted in the need for change, the Department for Transport’s proposed consultation and our inquiry. We recommend the Department seek to reopen constructive dialogue with Mr Allen. (Paragraph 72)

10.While the Department has been forced to act under the threat of imminent legal action, its consultation should avoid a narrow, legalistic focus on bringing UK guidance and legislation into line with relevant EU Regulations. The consultation must also be used as an opportunity to consider reforms designed not only to achieve compatibility, but also to maintain achievement of the key public policy objective—the provision of high quality, safe and secure community transport services for people who might otherwise be left isolated. Protection of these services, the huge majority of which are uncontested, and by definition cannot be provided by commercial operators, is imperative.(Paragraph 75)

11.We welcome the Minister’s commitment to maintain the community transport permit system, and the 9 November proposals to achieve this. Given the current level of paralysis in the community transport sector, we recommend the Department publish its consultation as soon as practicable, but it must include within its scope:

12.In the context of exiting the European Union, we recommend the Department for Transport, alongside its forthcoming consultation, begin to consider longer term legislative change to maintain and foster the UK’s unique approach to community transport.(Paragraph 77)

13 December 2017

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