Enhanced Partnership Plans and Schemes (Objections) Regulations 2018 — House of Lords, 2018-03-06
Topic: Transportation
Elizabeth Sugg (Conservative, Centre-right): My Lords, the Bus Services Act 2017 contains a range of options to improve local bus services in England. In addition to franchising, there are new and improved options to allow local transport authorities to enter into partnership with their local bus operators to improve services for passengers One of these, the enhanced partnership regime, allows local authorities to define a geographical area in which they provide new facilities such as bus priority measures or take other measures that would make buses more attractive, such as reducing car-parking provision or increasing its cost. In return, local bus operators are required to meet service standards that are specified as part of the scheme. This can include a multi-operator smart-ticketing scheme or a requirement to operate cleaner vehicles or provide comprehensive timetable and fares information. The partnership can also limit the number of vehicles that operate along specific corridors to reduce congestion or improve air quality, or require the buses to co-ordinate their timetables with other modes, such as rail services The draft regulations, which were laid before the House on 17 January, set out the mechanism by which bus operators can formally object to the package of proposals during the development of an enhanced partnership scheme. A key element of enhanced partnerships is that only the majority of bus operators need to agree to the proposals for them to go ahead. This means that improvements to bus services that are supported by the local authority and the majority of bus operators cannot be prevented from being introduced by a "blocking minority" of operators which, for whatever reason, do not wish the partnership to be introduced The 2017 Act provides a mechanism allowing individual operators the opportunity to object to the proposals to make an enhanced partnership plan or scheme at two key stages. The first opportunity to object arises when the proposal for an enhanced partnership is subjected to a formal public consultation, and the second arises if the plan or scheme is modified following the consultation The regulations set out the process for determining if the number of operators objecting to the enhanced partnership plan or scheme, as proposed or modified, is sufficient to stop it proceeding any further. If this happens, the partnership would need to renegotiate the package until the objections fell below the statutory thresholds The regulations provide two criteria that need to be satisfied to determine whether there are a sufficient number of objecting operators to stop the partnership proposals. Both criteria need to be considered and either one, if met, would be enough on its own to stop further progress. The first criterion is that, for objections to be sufficient, the objecting operators together must represent 25% of operated bus mileage in the partnership area and at least three bus operators must be objecting. If there are fewer than three operators running bus services in the area, the regulations require them to object for this criterion to be satisfied. This ensures that objections are raised by operators with a significant stake in the local bus market while preventing a single operator, or pair of dominant operators, from exercising an effective veto The second criterion is that objections are received from 50% of local bus operators that, together, operate at least 4% of operated mileage in the partnership area. This prevents a large number of operators that together have only a relatively small stake in the bus market from objecting to a partnership that is supported by the local authority and the operators with the largest stake in that bus market I will now explain how those thresholds were arrived at. The bus market in England has been deregulated since 1986 and the number and size of bus operators in individual areas varies greatly. The objection thresholds in the draft instrument cater for this and were arrived at following detailed analysis of real-world bus markets by officials in the Department for Transport, and discussions with key stakeholders such as bus operators and local authority stakeholder groups. This objection mechanism was then subject to a full public consultation between 8 February and 21 March last year. While some respondents suggested alternative figures for the thresholds, there was no consensus on what they should be and it did not convince us to alter our proposed figures Following our detailed analysis and the results of the consultation, we believe these figures are the right ones to use for the objection mechanism. However, the mix of bus operators varies hugely up and down the country, as I said, and it would not be possible for any statutory criteria adequately to cater for all the ones where enhanced partnerships may develop. That is why the 2017 Act also allows for further flexibility. The statutory objection thresholds in this instrument are required to apply only when a plan or scheme is introduced. An enhanced partnership can also include a bespoke objection mechanism for use when an existing scheme is varied or discontinued. This allows individual partnerships to adopt an objection mechanism that better suits their needs The draft instrument also sets out those services that are not eligible to take part in the objection mechanism. The first is community bus services which, under the 2017 Act, are not required to meet the requirements of an enhanced partnership scheme. It also includes tour buses, services that operate less than 10% of their mileage in the partnership area and services paid for under subsidy by the local transport authority Since the Bus Services Act came into force in June last year, nearly 30 local authorities up and down the country have either expressed an interest in, or are actively pursuing, an enhanced partnership with their local bus operators. However, there will inevitably be some operators that seek to block progress, perhaps because the improvements proposed are not in their commercial interest or because they prefer the freedom to operate in a fully deregulated market. These regulations seek to strike a balance between ensuring that the partnership has broad support from local operators and not allowing a minority to block vital improvements that will make local bus services better for passengers. I ask the House to approve the regulations and I beg to move.