The Transport Committee published its Ninth Report of Session 2017–19, , as HC 1425, on 22 May 2019. The Government response was received on 11 October 2019. The Committee’s recommendations are in bold text, followed by the response from the Government.
The Government would like to thank the Transport Select Committee for its Inquiry into bus services in England outside London. It appreciates the broad base of evidence collected and the consideration provided by respondents and witnesses alike. We agree that travel by bus is essential for many people’s quality of life and remain committed to supporting the sector, so that people can choose the mode of travel that works for them. We welcome the Committee’s Report and provide below our responses to its recommendations.
We recommend that the full suite of operating models, including franchising, should be available to all local authorities, without the extra condition of going through the Secretary of State. In addition, all local authorities should have the option of creating a municipal bus company. The Department for Transport should not be the gatekeeper for which operating models local authorities decide are most appropriate for providing bus services in their areas. This should be left to local authorities to decide for themselves.
The Government partly agrees with this recommendation. It recognises that different local authorities may wish to use different operating models, including franchising, to manage their bus network. However, it also believes that it is important the commercial operators have certainty as to their future business model so that they can invest to benefit passengers.
To access the franchising model introduced through the Bus Services Act, approval from the Secretary of State is required to ensure, amongst other factors, that appropriate governance structures are in place—which Mayoral Combined Authorities have already proven in their establishment.
To date, no local authorities have formally approached the Government seeking powers to franchise bus services. This suggests that at present there is no strong appetite for these powers from local authorities and that granting them to all local authorities at this stage would result in a worsening of services as operators stopped investing due to the uncertainty caused. At a point when a number of local authorities request and assume the new powers it may be appropriate to review how the Department exercises its responsibilities, but now is not the time.
Neither have any local authorities yet developed an Enhanced Partnership. These partnerships can require significant input from an authority, both in developing detailed proposals with operators, as well as funding ‘their end of the bargain’—such as introducing bus priority measures and improving waiting facilities.
It is difficult to understand why the Secretary of State has not brought forward the necessary orders to enable franchising to proceed. We recommend that the Government do so immediately.
The Government agrees with this recommendation. All the legislation needed to enable franchising to proceed has been in place since 2018. The Government has now laid the statutory instrument that deals with appeals against a decision by a franchising authority not to grant a service permit; a service permit allows an operator to run a bus service in a franchised area that is not part of the franchised network. This is the final piece of legislation needed to fully operate franchising.
We recommend that the Government bring forward a more stable multi-year funding model for local transport, including bus services, by the summer of 2020.
The Government agrees with this recommendation. It has discussed local transport funding with local areas and understands their concerns regarding the complexity of multiple budgets and a lack of long-term funding certainty. The Government will consider potential reforms to local transport funding at the next Spending Review, expected in the summer of 2020. Through this process, we will explore options for simplifying the local transport funding landscape and streamlining how central government engages local areas in this area. The Government is now committed to a long-term funding settlement for buses, as announced in A Better Deal for Bus Users.
At present, the Transforming Cities Fund provides multi-year funding for local transport and is aimed at transforming intra-city connectivity and driving productivity in some of the largest city-regions across England. Around £1.1bn has been devolved to six mayoral combined authorities to spend according to their priorities; as well as £1.2bn to be split between twelve shortlisted city-regions to co-develop innovative public and sustainable transport packages based on local priorities. The Government expects that where smaller/rural towns form part of these city regions, they will also benefit from the improved connections between urban centres and their commuter areas.
The Local Growth Fund provides funding across England to Local Enterprise Partnerships to spend on local priorities, with a large element funding transport projects. Between 2015/16 to 2020/21 the Department for Transport is contributing over £1 billion per year to the fund. Most of the budget is managed by MHCLG but DfT retains responsibility for a total of £1.2bn for transport schemes that cost above £20m.
We recommend that, before the start of the Spending Review later this year, the Government set out a plan for how BSOG will operate, what it is intended to achieve and how it will be reformed to achieve these aims.
The Government agrees with this recommendation. The recently announced 2019 Spending Round provided a welcome addition of £220m of new funding for buses with initial details of our plans in A Better Deal for Bus Users including a commitment to review Bus Service Operators Grant to ensure that investment is focused on meeting the needs of passengers. The Spending Review is now expected in summer 2020 and the Government will set out its plans for BSOG at that time, including its aims, operation and reform. As set out in the Government’s oral evidence to the Committee, we would expect any reform to include consideration of how the funding could help to promote the uptake of zero and low emission buses, and provide support to marginal rural bus services.
We recommend that the Government review how it finances concessionary bus passes, and the guidance to local authorities on reimbursement of bus operators, with a view to meeting the principle of both local authorities and bus operators being “no better and no worse off”. As a priority, the Government should re-baseline the reimbursement rates on ticket prices for 2017/18 prices; and should continue to re-baseline fares every four years so that the principle of “no better and no worse off” is maintained and the reimbursement rate remains broadly in line with current fares.
The Government disagrees with this recommendation. Local authorities use funding provided by the Ministry for Housing, Communities and Local Government (MHCLG) to meet the costs of the statutory English National Concessionary Travel Scheme (ENCTS). This funding is not ringfenced towards any one use and gives local authorities freedom and flexibility to decide how to best use their funding to provide local services.
MHCLG is currently working on a Review of the Relative Needs and Resources for local government. This Review is being developed in close collaboration with local government representatives and others. It will consider the drivers of local authorities’ costs, the resources available locally to fund services, and how to account for these in a way that draws a more transparent and understandable link between local circumstances and resource allocations. The Government’s current aim is to implement the outcome of this review as part of the 2021–22 local government finance settlement, alongside increased business rates retention. The Government believes this provides the best opportunity to deliver sustainable, coherent reforms to the local government finance system.
The Department for Transport publishes reimbursement guidance to assist local authorities to achieve more accurate and efficient reimbursement arrangements in order to meet the principle of bus operators being “no better off and no worse off”. Reimbursement arrangements are a matter for negotiation each year between local authorities and bus operators. The Reimbursement Calculator allows users to input local values instead of using the default historic values, where available. For instance, users are able to input current bus fares which are then used to calculate the Average Fare Foregone as a result of the ENCTS, which in turn feeds into the reimbursement calculations. This, amongst other measures, allows the calculator to help mitigate any discrepancies that may arise from the usage of the DfT’s default values, where they are not best suited to local conditions.
Where operators dispute the reimbursement offered by local authorities, operators may appeal to the Secretary of State for a redetermination of the reimbursement rate. Over time the number of appeals upheld has decreased, so that in the most recent year reported—2017/18—there were none at all. We think the system has sufficient flexibility and its re-determination is not a priority at present. We do, however, recognise that the Committee intends to re-visit concessionary travel and its application across different modes of transport, and look forward to working with it later in this Parliament.
We recommend the Government publishes its evaluation of the Total Transport pilots by the end of the summer 2019. If the results of the pilots are successful, the Government should continue to fund and roll out this approach.
The Government agrees with this recommendation. It published its policy paper, Total transport feasibility report and pilot review, in July 2019. This reports that in certain circumstances services can be improved, and that it may also be possible to generate savings by adopting ‘total transport’ principles. In this context, there is nothing to stop local authorities from adopting this approach without further national intervention, as many of the barriers relate to engagement between organisations. The Government will also provide further funding, with its announcement in A Better Deal for Bus Users of £20m to support demand responsive services; we will shortly seek expressions of interest for this new fund.
In the short term, the Government should directly inform all local authorities of the bid-for funding available. In the longer term, we recommend that there should be a review across all bid-for funding for buses from the Department for Transport. By the end of 2019 the Department should, in concert with the Local Government Association, assess and publish details of how much it costs local authorities to bid for this funding, whether they receive the funding or not.
We recommend that the Government review, as a matter of urgency, the financial ability of local authorities to fund socially necessary services and report on this by the end of 2019.
The Government partly agrees with these recommendations. The Government will consider potential reforms to local transport funding at the next Spending Review, expected in summer 2020. Through this process, we will explore options for simplifying the local transport funding landscape and streamlining how central government engages local partners in this area. The Department already publishes details of any bid-for funding competitions, and contacts local authorities, their representative groups and other relevant stakeholders on the launch of bid-for competitive funding. This approach gives local authorities the maximum amount of time to consider bidding for a fund.
Most funding for bus is not bid-for. Local government spends over £1 billion on concessionary fares every year. Each local authority is responsible for setting a local budget that includes spend on concessionary fares, and is also responsible for funding concessionary travel costs through a mixture of un-ringfenced grants such as Revenue Support Grant from MHCLG, or from locally raised income such as council tax. The Department for Transport’s Bus Service Operators Grant provides most of the remaining funding for bus with £200m claimed by bus operators and a further £43m distributed by formula directly to local authorities each year.
This leaves only a small proportion of Government funding focussed on buses to be distributed by competition. The Government has used competitive funding to encourage the uptake of greener buses; this is to ensure that funding is awarded fairly given it involves support for private sector bus operators with potential state aid implications. In planning our communications of the scheme we involved the Local Government Association so they could inform their membership.
We will shortly be seeking expressions of interest in two new programmes, as announced in A better deal for bus users. These programmes will see trials of on demand services in rural and urban areas; and all electric bus towns. As part of these schemes’ development, the Government is exploring the extent to which a light-touch or co-development approach is appropriate.
The same announcement also included an uplift of £30m in Government funding for socially necessary services. In parallel, MHCLG is working on a more transparent and understandable link between local circumstances and resource allocations and is discussing support for tendered bus services with the Department.
The Government should define socially necessary services by the end of 2019, and provide guidance on the services it expects local authorities to prioritise when tendering for socially necessary services.
The Government disagrees with this recommendation. Under the Transport Act 1985 it is for individual local authorities to determine what local bus services that are not provided on a commercial basis are deemed ‘socially necessary’ and should be funded by the local authority—they can, for example, provide whole routes, or services at particular times, e.g. evenings and weekends.
Individual local authorities must balance the need to provide individual services that are ‘socially necessary’ against their other funding priorities and the Government believes it is right that local authorities should have the freedom to determine what are ‘socially necessary’ services in their areas.
The Government does, however, recognise the importance of these services to bus users and is providing an additional £30m for socially necessary services as part of the £220m announced at the 2019 Spending Round.
We recommend that the Government sets targets for modal shift to meet the policy outcomes of cleaner air for towns and cities and bring forward specific actions for how modal shift will be achieved, including by encouraging people to switch from private car use to travel by bus or other forms of public transport.
The Government partly agrees with this recommendation. The Government agrees that it is important to increase the share of journeys by bus. There is already compelling evidence on the benefits of this investment, as the Committee’s report shows.
However, it is for local authorities to determine what the right balance between bus and other modes of transport. Government’s role is to give local authorities the tools to drive further modal shift if that is what they would like. The Bus Services Act gives local authorities a range of tools to implement measures across their areas which can help improve passenger information, for example ticketing schemes. Officials at the Department for Transport have met with over 30 local authorities to explain how they can best use the powers in the Act to grow patronage. Bus operators are already incentivised to grow patronage as this will also improve their revenues.
There are still actions which Government can take at national level to increase bus modal share. The Government is now committed to a national bus strategy, and needs to consider the case for various interventions, including targets, that will enable it to take forward this agenda. Bus operators often cite congestion as the main reason for declining bus patronage and the Government has responded by introducing the £2.5 billion Transforming Cities Fund, which will improve transport connections making it easier, quicker and safer for people to travel and get to work, with a significant proportion of the proposals being developed focussed on travel by bus.
The Government should review the evidence for the effectiveness of bus priority measures across England, with a view to demonstrating the value of these measures in reducing congestion and increasing bus speeds. Local authorities must have the evidence base they need to give bus priority measures proper consideration.
We recommend that by October 2019 the Government reviews, and updates as necessary, all guidance relating to bus priority measures. We also recommend that the Government creates a buses guidance portal on the GOV.UK website where all the guidance on bus priority measures and good practice can be easily accessed by local authorities. This can then be linked to by those providing additional information and examples of good practice, such as Greener Journeys.
The Government partly agrees with these two recommendations. Whilst the assessment of the effectiveness of local bus priority measures is best done by local authorities and operators working together, the Government is taking action to ensure that local authorities understand the importance Government places on bus priority measures. To facilitate partnership working the Bus Services Act 2017 includes new powers to enable dialogue between bus operators and local authorities about, among other things, evidence based bus priority measures to ensure that the measures introduced effectively address the problems ‘on the ground’.
There are still further actions Government can take, and as part of the preparatory work for its new national bus strategy, we will explore with the Confederation of Passenger Transport, the Local Government Association and the Association of Directors of Environment, Planning and Transport whether there is scope for joint working in this area to further promote the value of bus priority measures. We will hold a workshop by spring 2020—as part of the preparatory work to support the new national bus strategy—to test the gaps in current advice. The Government will then refresh the Department’s guidance documents to provide up to date and relevant advice on prioritising those vehicles which can carry the most people. This will ensure local authorities have the information they need to improve the speed of bus journeys and further support the case for bus priority measures.
The Committee may also wish to note a further new position on bus priority with all new road investments in England that receive central UK government funding required to either support bus priority measures or explain why doing so would not be appropriate.
We recommend that Part 6 of the Traffic Management Act 2004 be commenced as soon as possible, as our predecessors have recommended twice before.
The Government disagrees with this recommendation. In its Report of 2013 into local authority parking enforcement, the Committee expressed concern about the way local authorities used CCTV for parking enforcement. There were concerns around revenue raising, penalty levels and the number of penalty charge notices (PCNs) issued. In response to this, Government enacted new legislation to restrict the use of CCTV for parking enforcement. The Government has similar concerns in respect of moving traffic offences and remains to be convinced about the case for giving all local authorities these enforcement powers.
We recommend that the Government set out when the Real Time Information platform it is funding will go live. We expect to be updated if they will not meet their deadline.
The Government agrees with this recommendation. The platform will go live from January 2020; operators will initially be required to provide routes and timetable data. From January 2021, operators will be required to provide basic fares and tickets data (covering the most common fare and ticket types) and location information. Operators will be required to provide information on complex fares from January 2023.
We will require all information to be published through links to operators’ datasets provided on the Bus Open Data Digital Service so that application developers can access the data either through downloads or Application Programming Interfaces (APIs). The service is currently in the Beta phase of development and will be accessible to operators ahead of the launch next year.
We recommend that the Government publishes its response to the accessible information consultation as soon as possible, and brings forward guidance and good practice around the provision of information by the end of 2019. Guidance should raise awareness of the common barriers to bus use and show bus operators and local authorities what they can do to reduce them.
The Government partly agrees with this recommendation. We will respond formally to the consultation on Accessible Information Regulations later this year, setting out our plans for making the regulations and the publication of supporting guidance.
The Government understands the important role played by accessible information in enabling a range of passengers, including those who are disabled, to travel by bus with confidence. We remain committed to using powers in the Bus Services Act to require the provision of audible and visible announcements onboard local services in Great Britain.
In 2018 the Government consulted on detailed policy proposals for introducing Accessible Information Regulations. The responses received provided a range of perspectives on the efficacy of the preferred approach, and we continue to liaise with the bus industry and other stakeholders in considering how best to balance the priorities of bus companies and their passengers in the eventual requirements.
The Government is also committed to publishing guidance that supports bus companies to comply with the new Regulations in a manner which meets their business needs, and which makes a meaningful difference for passengers. Whilst the Government agrees that it should help operators to identify and overcome broader information barriers frustrating access to bus services for disabled people, we remain of the view that such guidance must be developed and published to a timetable consistent with the making of Regulations. We will respond formally to the consultation later in the year, setting out our plans for the making of Regulations and the publication of supporting guidance.
We recommend that, by the end of the year, a specific customer service training module is added to the Certificate of Professional Competence syllabus for Public Service Vehicle drivers of local bus services within the UK. This will ensure that over a five-year period all drivers are trained in their customer service role. The roll out of this training should be undertaken following an impact assessment and consultation with all bus operators, big and small, and the devolved administrations in Scotland, Wales and Northern Ireland.
The Government partly agrees with this recommendation. The DVSA have made stakeholders aware of the Select Committee’s interest in this area and asked their views on the current approach of not mandating specific courses as part of periodic training this summer. We anticipate a consultation on the rules of the Certificate of Professional Competence (CPC) next year, and the responses received this summer will help us decide whether the principle of flexibility for drivers to choose their own training modules should be considered as part of this. However, bus passengers at present report very high levels of satisfaction with their journeys. The Government therefore believes the bus industry is well placed to assess the level of customer service training it gives its drivers, reflecting their understanding of the needs of their customers. If there is demand, training modules can be made available as part of CPC periodic training. This underpins the government position that there is no immediate need to introduce a mandatory specific customer service training module in the Certificate of Professional Competence (CPC) syllabus.
We urge the Government to explore how recruitment and retention in the bus industry can be improved and recommend that it consult on whether legislation governing bus drivers’ hours in Great Britain is still fit for purpose, or whether it should be amended, for example as is proposed by the Bus Drivers (Working Hours on Local Routes) Bill 2017–19.
The Government partly agrees with this recommendation. To explore how recruitment and retention in the bus industry can be improved the Government proposes to convene a roundtable with the bus industry (including bus operators, trade associations and trade unions), before summer 2020 to discuss this issue; including drivers’ working hours and the duty on operators to manage the risks of fatigue under health and safety legislation.
The Department for Transport did conduct an extensive review of the effectiveness of the GB domestic drivers’ hours rules in 2009/10. This included looking at whether these vehicles should fall under any of the provisions in the EU drivers’ hours rules, such as introducing the same maximum driving time and break requirements.
Following this review, the Government decided not to make any changes, concluding that the existing rules are both important and appropriate in ensuring the safety of drivers and others on the road, but that any further restrictions would risk imposing unreasonable burdens on industry. The Government has no current plans to make changes to the GB domestic drivers’ hours legislation.
We recommend that the Government update us on the success of these schemes once they are implemented.
The Government agrees to this recommendation. Easy to understand ticketing structures that are straightforward to access are necessary to encourage more people to use bus services. The Bus Services Act 2017 introduced a range of tools to make using the bus easier—including measures to make it easy to understand bus fares and improve ways to pay for them.
For example, the partnership elements of the 2017 Act contain specific powers to allow requirements on ticketing structures, payment options, the provision of ticketing information and associated marketing, and a multi-operator or multi-modal ticketing offer to be applied to all local bus services within the geographical area defined by the partnership scheme. All this can of course also be delivered under a franchising scheme using separate powers in the Act.
The open data provisions will also require all local bus operators to publish information on basic bus fares from January 2021 and complex bus fares from January 2023. Basic fares include the most common ticket types such as single, return and daily fares. The information published can be integrated into apps and other data portals aimed at bus users.
The Government will work with the responsible authorities to provide regular updates to the Committee on the successes of implemented schemes going forward.
We conclude that since young people are required to be in education or training until they are 18 they should benefit from a concessionary fares scheme. Young people are also key to securing the future of bus use. Inconsistency in how young people are treated when using buses is a barrier to travel. This needs to be examined in more detail and we intend to come back to this in our future inquiry about concessionary fares later in this Parliament.
The Government partly agrees with this recommendation. The Government recognises that the cost of travel can be an issue for some young people, which is why the Government is working on supporting discounted bus and train travel for young apprentices.
We welcome the launch of the Confederation for Passenger Transport’s (CPT) “Moving Forward Together” strategy in September and look forward to working with the CPT and its members on the proposals in the strategy. The bus industry will work with local authorities to deliver this offer.
We are pleased to see that this includes expanding discounted bus ticketing to apprentices and job seekers across the country by 2021. This offer is a testament to the strong partnership between the Government and the bus industry, and the importance both place on supporting apprentices.
Concessionary travel legislation also gives local authorities the flexibility to offer local travel concessions such as free or discounted travel to young people, if they choose to do so, and bus operators can also offer discounted travel for young people. In 2018/19, this resulted in 18 of the 89 Travel Concession Authorities (TCAs—predominantly local authorities) in England outside of London offering some form of concession to young people, and bus operators in 71 of the 89 TCA areas in England outside of London offering some form of discounted travel for young people.
We are also pleased to see local authorities introducing new schemes to help reduce travel costs for young people. For example, in September the Mayor of Greater Manchester launched a two year trial of “Our Pass” in Greater Manchester, which offers free bus travel to 16–18 year olds. The Government is monitoring these developments.
In addition, the Department for Education consulted earlier this year on the 16 to 19 Discretionary Bursary Fund. This consultation sought views on whether the methodology should incorporate a travel element, and if so, whether distance to travel and rurality should be included. The 16 to 19 Bursary Fund is allocated to schools, colleges and other education and training providers to support young people who are disadvantaged with the costs associated with attending education or training.
We recommend that the Government review the guidance for planning teams and those commissioning changes that affect service provision to ensure that public transport is being appropriately considered when planning permission is granted for new developments. We expect the Government to set out in their response to this Report the steps they are taking, and will take in future, to ensure local government at all levels is making good use of available guidance. We also recommend that Government thinks carefully about how to maintain transport links with vital services.
The Government agrees with this recommendation. It is working proactively to review and update guidance for planning teams to ensure that public transport is being appropriately considered at the earliest stage when planning permission is granted for new developments. For example, it is reviewing the design guidance ‘Manual for Streets 2’ with a view to updating it. Chapter 3 of the current document contains guidance on the design process for streets under a local authority’s care and Chapter 6 further expands on this to include how to design for public transport. Manual for Streets 2 expands on the original Manual for Streets to cover busier, urban areas, with information on how to design for bus priority in these areas. As well as updating the reference materials in the guidance, the Government is considering how best to embed good practice and share information about the new Manual for Streets.
The cross-Whitehall Housing and Transport programme is also driving forward integration of transport and planning of new developments. Current approaches include exploring the development of an analytical toolkit to help local authorities assess the transport elements of new development and also a consideration of the best ways to support local authorities to effectively plan transport infrastructure.
The revised National Planning Policy Framework (NPPF), published in July 2018 sets out that transport issues should be considered from the earliest stages of plan-making and development proposals so that potential impacts of development on transport networks are addressed, and to realise opportunities (for example in terms of the scale, location or density of development) that arise from existing or potential transport infrastructure. We will be publishing updated planning practice guidance on Sustainable Transport and Accessibility, which will cover how public transport should be considered as part of the plan making and decision making process.
The NPPF also makes clear that authorities should set policy requirements for infrastructure through plans, based on appropriate and proportionate evidence of infrastructure needs and costs. Authorities can use Community Infrastructure Levy (CIL) and section 106 planning obligations to deliver infrastructure, including that needed to support bus routes and services, to ensure development is sustainable. Changes to the CIL regulations, laid in Parliament on 4 June 2019 will speed up the process for authorities to adopt CIL; make it easier to fund and deliver the infrastructure their areas need, by removing pooling restrictions, and increase transparency for communities by requiring all local authorities to publish an Infrastructure Funding Statement, reporting on what they have received and spent through developer contributions.
Chapter 12 of the revised NPPF, states that planning policies and decisions should ensure that developments support transport networks. To support the NPPF, Government is producing (in consultation with DfT and other government departments) an illustrated Design Manual, which will include guidance on how places can better be connected through the use of public transport. The Design Manual will be a material consideration as part of the planning process.
We recommend that the Government develop and adopt a bus strategy by the end of 2020. This should include:
In its response to this Report the Government should lay out a clear timescale for the development of this strategy, including the impact assessments and consultations which will accompany the development of such a strategy. We believe there is merit in such a national strategy being underpinned by a national forum involving representatives from bus operators, trade unions and other stakeholders to examine and share information on issues such as improving services, recruitment and retention, skills, apprenticeship and bus safety.
The Government partly agrees with this recommendation. The commitment to produce a National Bus Strategy, as recently announced and set out in A Better Deal for Bus Users, will enable Government to set out its vision for bus and the way in which that will be achieved. Whilst local authorities have many of the powers to address bus services on the ground, the Government recognises that a national strategy offers a useful opportunity to set out clearly the roles and responsibilities of central Government, local authorities and bus operators. The strategy will also need to fit with the Government’s broader agenda for transport, including the Future of Mobility—Urban Strategy, the forthcoming Future of Mobility—Rural Strategy and the outcomes of the Spending Review. This is a very recently adopted position and we are not currently able to lay out a timetable for the Committee, but will commit to developing and adopting a strategy underpinned by a long-term funding settlement.
Published: 18 October 2019