Bus Services Bill [HL] — House of Lords, 2016-06-08
Topic: Transportation
George Young (Conservative, Centre-right): My Lords, I hope that when my noble friend replies to the debate, he will be able to respond to some of the powerful points we have just heard from the noble Baroness—points which I know will be made by other noble Lords who want to see the bus service made more user-friendly for travellers with a disability I focus my brief remarks on the more controversial clauses forming the franchising section of the Bill. As a former Secretary of State for Transport, I brought in franchising for the rail industry so I have a familiarity with that aspect. I was also a member of the Greater London Council in 1970, when the Government handed over responsibility for the bus service to a local authority, so I can see the issue from that perspective as well The Bill can help to unlock the full potential of the bus service as an even more important member of the public transport family. But, if I can make a controversial point, I believe that historically we may have overinvested in light rail in our cities and underinvested in the buses. In many cases, a properly protected, prioritised bus lane and bus service could have done what a light rail system does at a fraction of the capital and revenue cost and, of course, with the flexibility for vehicles that is denied to those on a fixed rail. I do not want to detract from the success of the Croydon Tramlink and Manchester Metrolink schemes, but they didn’t half make a hole in my departmental local capital budget for transport schemes. It may be that the measures in the Bill enable funds for public transport to go further by moving the dial a bit away from metropolitan light rail projects towards the bus In focusing on the franchising sections of the Bill, I am aware of the dangers of generalising from the experience of London, where the bus service is unique in being regulated, unlike the rest of mainland UK. This has enabled Transport for London to plan, procure and manage a network of services in a consistent and co-ordinated way. It has also been generously funded, which may not always be possible elsewhere. Through collaborative work with others, this has led to increased service levels, improved quality of services and significant increases in patronage—way above what has been seen outside the capital. During the first 15 years of this century, bus ridership in London has grown by 70% and buses in London now carry the highest number of passengers since 1979 Having been a Member of Parliament for two constituencies—one in London and one not in London, thanks to the Boundary Commission—I have no doubt in my own mind that the model of running buses in London is far better than that outside London, from a consumer’s point of view. There are particular problems with a deregulated system: it limits the degree to which bus services can be fully joined up and co-ordinated with each other and with other modes of public transport, and there can be confusing fares and uncoordinated routes and timetables, which can put many off using the bus services. So I see the strong case for making this model available outside London; it has been copied widely outside this country but not, so far, outside London. I recognise, however, that this has implications for the bus industry, which has operated outside London in an unregulated environment. Many companies have developed markets and customers and I understand their concern that, under franchising, they may not get the contract, thus risking their investment—I will say a word about that in a moment The literature on the case for extending bus franchising is extensive. We have the Transport Select Committee, the Public Accounts Committee, the Institute of Economic Affairs and quite a lot of White Papers. It is fair to say that there is no consensus, but I was struck by the conclusion of the Competition Commission, which reported in December 2011 against mandatory franchising but said that, "existing legislation enables LTAs to introduce franchising in England, Wales and Scotland and we would not wish to rule out its future application in particular local markets where the respective legislative requirements are met … we also note that LTAs have wider social and policy objectives that are not relevant to this investigation, but which may legitimately lead them to take a different view on the desirability of introducing franchising in relation to the local bus markets for which they are accountable" That is, basically, what the Bill does—no compulsion, but an option to extend franchising where it makes sense It strikes me that, unlike the current deregulated market, the franchising model offers newly elected mayors the opportunity to set new minimum standards for bus services across their areas. Such standards could include, as my noble friend said in introducing the Bill, consistent branding, real-time information for passengers, timetabling apps and other useful technologies. I know and the House will know that Manchester is keen to go ahead along these lines Turning to the industry’s concerns, the CPT press release says: "The CPT supports the Government’s proposals in the Bill for advanced quality partnership schemes and enhanced partnerships", but the next paragraph on franchising is more cautious: "But where local authorities consider introducing franchising CPT is pleased to see that those proposals will be subject to robust and fair public and financial tests, and that the Bill aims to allow SME operators to compete fairly" At the meeting with the CPT that my noble friend Lord Attlee kindly arranged, the industry was more critical about the franchising process and some of the comments were hostile My view, for what it is worth, is that if a company has invested in the local bus market, knows its customers, has the appropriate fleet of vehicles and drivers, has already engaged in a constructive partnership with an LTA, and is providing a good-quality service, it is well placed to win the franchise. Of course, once the franchise is won, it is then insulated from competition on those routes, which it is not at the moment in an open, unregulated market. I hope the industry’s concerns about franchising are allayed by the obligation placed on local authorities by the Bill to benchmark any proposed franchise scheme against what could be offered under an enhanced partnership scheme. Only if a franchise can achieve more than what could be achieved under an enhanced partnership will franchising go ahead. Further comfort is provided by the prohibition, which I know was criticised by the Opposition Front Bench, on local authorities operating their own buses. The industry will of course welcome that There is one issue on which the CPT might have a valid point. The Bill is silent on the subject of compensation for those companies that might lose their business if unsuccessful with the franchise. My experience is that you do not normally get compensated if you do not win a franchise. But the briefing I have seen says that foreign investors will be entitled to compensation under the terms of the TTIP agreement currently being negotiated at EU level, but not British investors. Is this apparently un-level playing field something my noble friend can comment on when he winds up the debate? In conclusion, the Bill delivers on our commitment on devolution, it offers an updated menu for transport authorities without being too dirigiste and it offers passengers the possibility of a better co-ordinated and balanced service. I hope the Bill can now move on and, in the immortal words of Flanders and Swann: "Hold very tight please! Ting-ting!".