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Debate over bus reforms moves up a gear

Local bus services are back in the spotlight this week – the long awaited second reading of the Bus Services Bill takes place in the Commons on March 1.

The Government has some work to do to ensure that these important reforms are kept within parameters originally set as long ago as 2014.

The Bill has been through the House of Lords. It was debated by Peers ready to challenge key aspects of the Bill including:

  • Why make franchising more difficult to implement where there is no mayoral authority but all authorities involved in the proposed scheme  agree?
  • What is the justification for not permitting local authorities to operate their own bus company?
  • The Bill needed to do more  to enable local authorities to halt the continuing decline in rural services.

Amendments were made to key aspects of the Bill, in particular broadening  the power to franchise services and to allow local authorities to operate services. The Government can be expected to look to the Commons to reverse these amendments.

What’s happened since then?

There has been a pause in the process – time to debate Bills in the Commons has been at a premium for the last few weeks. The Bill now has its place for second reading.

In preparation for this, the Commons Transport Committee gave its view on the major elements of the Bill – it was not impressed with the limited detail provided by DfT around implementation and how partnerships and franchising are expected to deliver positive outcomes.

At the same time, the Committee was rather keen on franchising and perhaps even where there is no Elected Mayor with executive oversight of transport.

It also wants to see the financial  support provided by Treasury for local bus services (known as  BSOG) devolved by DfT to all authorities that are managing not just franchised networks but also where there are partnerships – allowing the authority to target use of the funding to its priorities.

Schemes taken forward under the legislation will require formal consultations before any measures are taken. The Competition and Markets Authority have now secured their place at the consultation table for franchising and the Transport Committee want to see employee representatives there also.

The Committee also considered the needs of rural areas – an increasing number of rural communities have lost their bus services through the inability of local authorities to sustain their support through subsidised contracts. This is not good news  – with communities losing lifelines to health, education, and social activities.

In the view of the Committee, the Government needs to encourage fresh thinking around this and look to see innovative solutions.  The Committee is concerned that industry innovation (bus operators have a good track record in promoting and delivering) could be lost.

The Committee supported the ticketing ambitions of DfT and wants to see innovation encouraged – systems to manage ticketing must be agile, keeping up with technological developments.

Finally, the Committee was also clear on the need to tackle road congestion in many parts of the country – credibility around bus arrival times at intermediate stops and assurance around arrival time are real worries for potential bus users.

What does this mean for the sector?

Whether authorities look towards using the franchising model or develop more effective partnerships with operators, these will take time to put in place.

In the meantime, private operators will continue their efforts to make services as user friendly as possible. This is particularly the case in relation to information systems and ticketing.  Everyone agrees that more and better quality information will contribute to increasing use of public transport. Technology is already playing a significant role in making ticket purchasing easier.

There will need to be clear working between authorities and operators in the area of information systems – for fear that specifications are required of operators under franchising or partnerships that lead to the need to start again with investment willingly made by operators ending up on the scrap heap.

What happens next?

Consultation began in early February over key areas of the draft legislation that DfT regards as most critical to moving forward. It still remains difficult to build up a full picture of how close we are to there being an effective toolkit to address the challenges of our public transport system.

Few authorities are demonstrating any real interest in tackling the issues with franchising as a solution. They will be concerned at the implications in terms of financial investment and also risk to the authority from taking such a significant step.

Operators of bus services welcome partnering opportunities – there is already considerable momentum behind improving the quality of services provided.

There is strong commitment to fleet investment that will contribute significantly to improved air quality, faster bus boarding through the adoption of contactless and smartphone app ticketing systems.

Operators have a good track record of collaborating in relation to ticketing – hesitation in this area is more to do with the competition law concerns that impact on the industry.

How can Ward Hadaway help?

We are holding an event on Friday 10 March in Leeds at which our local transport team will put the spotlight on some of the key issues now being addressed by DfT through draft guidance and regulations.

To book your place at the event, please click here.

If you are unable to attend but would like further information, please do not hesitate to get in touch.

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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