Lord Hendy of Richmond Hill

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That the Bill be now read a second time.

The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)

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My Lords, before I come to the Bill, I will pay my respects to Baroness Randerson. Since being appointed to your Lordships’ House, Baroness Randerson served as a Government Minister and spent almost 10 years as her party’s transport spokesperson. During this time, she showed a mastery of the transport brief, making important contributions to wide-ranging debates and holding successive Governments to account.

After becoming a Minister in July, I enjoyed exchanging views over the Dispatch Box and in private with Baroness Randerson. I was very grateful to work closely with her on the recent Passenger Railway Services (Public Ownership) Bill—now Act—the first Bill I have taken through as a Government Minister, and she showed her characteristic attention to detail, inquisitiveness and determination to ensure that the legislation left this House in the best shape possible. I know she was enthusiastic about the Bill in front of your Lordships’ House today and would have wanted again to make sure that it left this House in excellent shape. On that, I will do my best.

As your Lordships will be aware, Baroness Randerson had a distinguished career prior to her introduction to the Lords, serving in the Welsh Assembly, now the Senedd, as the Member for Cardiff Central for 12 years and holding a ministerial post in the Welsh Government. I am honoured to have had the opportunity to work with her, and I know that her commitment to public service will be long remembered. I send my condolences to her family, friends and colleagues in this House.

Moving to the Bill, I am pleased to present the Bus Services (No.2) Bill for Second Reading today. It is not to be confused with the Bus Services Bill, which was introduced as a Private Member’s Bill in the other place. I declare my interest as a licensed PCV driver and that the charity of which my wife and I are trustees holds a number of community bus service permits used for the Imberbus service, which raises money for charitable purposes.

Buses are the most popular mode of public transport and are essential for growth, jobs and housing. However, we have seen in England that passenger numbers and bus service levels have been in decline, with 1.8 billion fewer annual bus journeys outside London in 2023-24 compared with 1985-86. The Transport Act 1985 radically changed the bus industry by privatising the National Bus Company companies and deregulating services outside London, restricting the powers of local leaders to decide what is best for their local area. This Government intend to reverse this.

In London, passengers have long benefited from public control of the bus network, with lower fares and frequent and reliable services. The 1.8 billion passenger journeys made in London in the year ending March 2024 demonstrate how critical the network is to London. This figure accounts for over half of all bus journeys in England. Outside London, two of the existing local authority bus companies, in Nottingham and Reading, are ranked second and third for the highest number of bus journeys per head in England. The success of London, Nottingham and Reading is not a coincidence. Passengers will use good services. It is therefore only right that these options are available to all local transport authorities.

As a Government we are committed to delivering better buses. In the 2024 manifesto the Government set out a clear plan to improve bus networks. This Bill marks an important contribution to supporting the Government’s missions to kick-start economic growth and break down the barriers to opportunity. Changes that the Bill makes will enable safer, more reliable, inclusive and accessible networks that provide the connections that passengers need. This, as I said, is essential to accessing vital jobs, education and healthcare in cities, towns and rural areas across England.

The Bill is about providing local leaders the ability to choose the best way of running services in their area, a choice not currently available everywhere in England. Local authorities should be able to decide how best to run their services, choosing the right operating model that works for their communities. This will help improve bus services and grow usage, meaning that it will be passengers who benefit. The Bill is focused and narrow in scope. Its measures apply primarily to local bus services in England. School services are also in scope due to the single clause relating to enhanced criminal record checks for drivers of school services.

We have already taken a first step in reforming bus services. We brought forward the Franchising Schemes (Franchising Authorities) (England) Regulations 2024. These came into force on 18 December and enable all local transport authorities in England to franchise their bus services. These powers had previously been limited to mayoral combined authorities and mayoral county combined authorities. The Bill builds on these regulations and marks the next step in our ambitious plan towards a better bus network. The need for reform is clear—to reverse the decline in passenger numbers and services that have been depleted over many years, and particularly recently.

Transport for Greater Manchester’s journey to bus franchising has shown the potential benefits of greater public control. It is timely to be presenting the Bill during the week in which its journey has been completed. Manchester has already seen patronage increase by 5% since public control began to be rolled out in 2023. Elsewhere, local authority bus companies such as Nottingham City Transport have delivered award-winning services to passengers. There are also great examples of local transport authorities working in partnership with the private sector to deliver excellent services, such as in Brighton, Norfolk, Bournemouth and Poole, and Wiltshire. Sadly, there are also examples of towns and cities with little or no evening or Sunday services, and rural areas with no services at all. There will be no one-size-fits-all approach. Different cities, towns and rural areas have different needs. The Bill is about ensuring that local areas have all the tools they need to improve bus services for their communities.

Bus services are the lifeblood of communities. They carry people to hospital appointments, to school and to their jobs. This is especially true for women, those who are young, those on low incomes, ethnic minorities and the elderly, all of whom rely on buses more. Given the strong case for change, the principles behind the Bill should, I hope, receive cross-party support. The manifestos of all three main political parties acknowledged the importance of buses. There is also strong public support, so I sincerely hope that noble Lords on all sides of the House can get behind the Bill as a vital step towards fixing our fragmented and variable bus networks.

I know from speaking to many noble Lords that they believe in improving the bus network for the better, whether that is improving accessibility or rural services, or protecting routes. The Bill seeks to address all these issues and keep passengers at the core of its aims. It is a government priority. The ambition is clear, and it is hoped that the Bill will deliver greater consistency in bus services across the country. Its objectives include protecting passengers from anti-social behaviour and violence, reducing fare evasion and expanding powers to local authorities on bus funding.

I am sure that some noble Lords will question how the Bill moves forward from the last fundamental shift in bus legislation. It is true that the Bus Services Act 2017 gave new powers to local transport authorities to create enhanced partnerships and allowed mayoral combined and mayoral combined county authorities to pursue bus franchising, but these franchising powers did not extend more widely. New local authority-owned bus companies, formerly referred to as municipal companies, were also banned by that Act.

This Bill builds on the 2017 reforms, while also reversing the ban on local authority-owned bus companies. This will help deliver a wider set of options for local areas. Local transport authorities—LTAs—know the needs of their communities and they are best placed to decide what shape their bus services should take.

I will briefly enumerate what the Bill does. It is split into 11 areas. First, while the recent franchising regulations removed the limit on which local authorities could franchise, the clauses on franchising in the Bill will streamline the process, including by removing the Secretary of State consent requirement. The intention is to introduce flexibility and to reduce the amount of time it takes for LTAs to franchise their bus services if they choose to do so.

Secondly, a provision in the Bill will require LTAs to specify requirements which must be followed where bus operators under enhanced partnerships wish to vary or cancel a service that has been identified as a socially necessary local service.

Thirdly, for local areas where enhanced partnerships remain the best option for local services, the Bill will strengthen these partnerships, allowing for improved working between LTAs and bus operators.

Fourthly, the Bill will repeal the ban on establishing new local authority bus companies, giving local authorities the chance to use their local knowledge to run services in their area and opening up powers currently limited to the five legacy local authority bus companies.

Fifthly, LTAs will be given the power to design and make grants to operators of bus services in their areas. They will have greater freedoms to decide where that money is directed.

Sixthly, provisions on bus registration will improve the availability of information for passengers. This includes new statutory powers to require LTAs in franchised areas to provide information about local bus services with the aim of helping to improve reliability for passengers.

Seventhly, the Bill includes measures to improve safety on buses by giving powers for LTAs to bring forward by-laws to tackle anti-social behaviour and powers to enforce fare requirements.

Eighthly, it is important to increase the safety and accessibility of stopping places, so there is a measure giving the Secretary of State the ability to set out expectations for bus stops and bus stations in statutory guidance.

Ninthly, the Bill closes an existing loophole through the inclusion of a safeguard for school services. This requires the operator of a public service vehicle to check an enhanced criminal record certificate for drivers who carry out closed school transport services more than three times in any 30-day period.

Penultimately, there is a power in the Bill to mandate training of bus staff, including bus drivers, on tackling crime. This is intended to tackle incidences of violence against women and girls, as well as anti-social behaviour. There is also a measure for training on disability awareness and assistance.

Finally, to meet the commitment to move towards sustainable travel, there is a measure on zero-emission buses to accelerate their rollout by introducing a restriction on the use of new non-zero-emission buses on registered local bus services. But, in recognition that the industry will need time to adjust to this change, this will not come into force before 1 January 2030.

This is a comprehensive and focused Bill that reforms and develops critical aspects of bus services. Stakeholders, including the bus industry, have been engaged throughout policy development to ensure that the provisions are fit for purpose and address the key challenges that the industry faces.

The Bill’s application is largely to England only. This is the case for the critical measures relating to bus operating models, such as franchising. Certain clauses will also apply to Wales and/or Scotland where necessary, but the Bill as drafted will not require any legislative consent motions from the Welsh Senedd or Scottish Parliament.

Before I conclude my opening remarks, I reinforce that reform does not end with this Bill. This journey has many stops. Following Royal Assent there will be further regulations required, including on franchising, bus registration, fare evasion, staff training and zero-emission buses. These are needed so that that which the Bill has enabled can be set out clearly for industry stakeholders and local authorities to follow. My department will continue to engage with all parties.

I recognise that franchising is a choice, but that this route is not currently well trodden. My department is therefore developing guidance to increase capability and capacity in those authorities that are striving to franchise, and this guidance will follow the Bill.

While the Bill does not introduce new funding, I am sure that noble Lords will wish to debate funding through the parliamentary process. It would be remiss not to mention the Government’s Budget commitment to over £1 billion of funding for buses in 2025-26 to support and improve services and keep fares affordable.

To conclude, this Government will reform the bus network to deliver improved services for passengers across England. This supports our growth and opportunity missions, providing a clear strategic direction for buses and proper integration and co-ordination. The Bill presents an unprecedented opportunity, learning from the 2017 Act, to create a safer, more reliable and transparent bus network, with local leaders having more powers to decide what is best for the local area that they represent. This will be a step forward in reversing the decades of decline that have become synonymous with bus travel in this country. There is much to be done and this will not be an easy journey, but industry stakeholders and local authorities alike are invested in creating an improved bus network that users can be proud of. This Bill is a vital component in our plan to reform buses. I beg to move.

Lord Hendy of Richmond Hill (Lab)

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My Lords, I thank those who have engaged in today’s lively debate on the Bill. I have listened carefully and with much interest to the excellent points being raised across your Lordships’ House. I will attempt to respond to some but not half as many questions and concerns as I would like to because of the time. We also have Committee, in which we can explore many of these issues in greater detail. In the meantime, I will follow up where I can as soon as I can on some of the issues that I cannot mention now.

I thank the noble Earl, Lord Effingham, for his introduction, much of which was covered by what the noble Lord, Lord Moylan, has just said, but I will say one or two things to him in passing. First, on the notion that bus fares increased by 50% from £2 to £3, it is of course a calculation that bus fares of £2 increased to £3, but many passengers do not travel on individual tickets. Also, as the industry trade body said, for the 26% of passengers who travel on individual tickets many fares for shorter journeys remain below £3. The cost of franchising in Manchester is not £1 billion; it actually cost, on a one-off basis, £135 million, much of that paid for by Greater Manchester itself. One of the reasons why it cost so much money is because it took six years, as the process was so convoluted. A clear aim of this Bill is to make franchising easier.

Also, as a point of issue, it is not only electric buses that get recalled by manufacturers. As a bus operator, I can tell your Lordships of many circumstances in which buses have rightly been recalled for safety reasons. I think it is inevitable that zero-emission buses will take over in future, and the Bill seeks to ensure that the industry recognises that. However, he is right in referring to a one-team ethos; I am not entirely sure that that sentiment was reflected in what the noble Lord, Lord Moylan, just said, but we will do our best to get a good Bill out of this, I am sure, and I welcome that sentiment.

I thank the noble Baroness, Lady Pidgeon, for her really helpful remarks. The devolution of funding and the statutory guidance given by the Secretary of State, under new Section 154A, we will debate in Committee. It is not the intention to apparently devolve funding and then put on such rules that in fact it is not really devolved. The intention of the Bill is to allow a much greater level of freedom for local transport authorities than they have had. It is also the intention of the Government in due course to streamline the funding streams above that. I recognise that point completely. Frankly, I am as confused as some noble Lords about how many streams there are. The noble Baroness mentioned some of them, and that would be better, but actually the result of this Bill is that to make it much easier at the point at which the money is distributed, which must be the right thing.

I recognise the points about young people’s fares. There are already local transport authorities that give concessions to young people, and nothing in this Bill will prevent that. The wider point, which we will come to again and again with this Bill, is that this is designed to give local transport authorities more freedom. A number of noble Lords have referred to that this afternoon and this evening. It is the right thing to do because buses are a local service, not a national service. I will come back to the specific remarks of the noble Lord, Lord Moylan, at the end, but the clear intention of this Bill is to allow local transport authorities to decide what methodology of providing a service is best for them and then to do it.

I was much heartened by hearing that the noble Lord, Lord Burns, a former Permanent Secretary at the Treasury, welcomed multiyear funding. I will reflect with my colleagues in government on what his experience is of that. We have to wait for the Spring Statement to know what this Government are able to do in the straitened financial circumstances that they find themselves.

The noble Lord and other noble Lords have referred to open data, and I can certainly commit to the fact that open data is the intention of this Bill and of the Government. The intention of open data, reflecting the recent point by the noble Lord, Lord Moylan, is that it should be free. That is the right thing to do. If you want public transport usage to increase, the data should be available. I have a rather good story to tell the House about open data. At Transport for London, we searched for the person who developed the best open data app for the Underground. I said that I would like to see that person. It turned out that they worked for a bank in Melbourne, and it was not immediately possible for them to turn up in my office. However, it is a really important point.

The noble Lords, Lord Whitty and Lord Hampton, and others, referred to integrated ticketing. I will write to them about that. It is obviously the intention to have integrated ticketing. One of the attractions of franchising is that it enables that to happen. One of the weaknesses of commercial bus provision outside London is the degree to which individual operators would rather offer that technology but only on their own buses, whereas the public and passengers want it to be available on every bus. I know that my noble friend Lady Blake has some experience of that from Leeds and West Yorkshire. It is obviously desirable for passengers, particularly in urban areas, to be able to use any bus and for the ticketing system to be consistent.

A number of noble Lords referred to training. There is already mandatory training for bus drivers. The intention of this Bill is to specify further mandatory training but to deliver it within that regime, which I think is absolutely right. A number of noble Lords referred also to the roads on which buses operate. It is quite right that the reliability and indeed the economics of bus operation are vastly altered by the existence of congestion and the ability of buses to get through traffic, whether through bus lanes or other things. One of the most notable things about the Manchester franchising is that a consequence of putting some of the bus service into the control of the Mayor of Greater Manchester, then to be reflected in the local transport authority, was that a vastly increased focus was immediately available on, for example, getting rid of temporary traffic lights and straightening out traffic management. There have been references this afternoon and this evening to what help can be given to local transport authorities that wish to engage in franchising. The Bus Centre of Excellence has been mentioned. It does not need full-time employees but for advice to be available when needed. One of the features of that is to give advice on traffic management so that buses can take their appropriate place in transporting passengers in local areas.

It is always a delight to hear from the noble Lord, Lord McLoughlin. He has made some excellent decisions in his time, including appointing me as the chair of Network Rail, though my wife was not similarly impressed by that appointment. Many of the points that he raised are obviously germane, in particular on the very sharp decline in passenger numbers in the north of England. He said that one size does not fit all, and he is absolutely right—I think that is much more to his point. This Bill enables local transport authorities in cities, towns and rural areas to choose the best way of going forward. It is not necessarily franchising. Even if it is franchising, it is not necessarily on whole routes. Some of it is about franchising in particular areas where a franchise mechanism might produce better public services. The Government do not want to dictate whether you should have a franchise; they want local transport authorities to use the best mechanisms that they can.

It was a delight to hear from the noble Baroness, Lady Bennett, and even better to hear that the noble Baroness, Lady Jones, is recovering. I look forward to seeing her in her place. The noble Baroness, Lady Bennett, raised a number of questions that will have to be answered either in Committee or in correspondence. She referred particularly to recovering lost routes. One of the real sadnesses of the last several years is that some bus funding has been available to start new bus routes when the old ones ceased, because they were not able to be funded through that arrangement. But it is better if routes are not stopped and then started again because, in the course of that, you can lose a lot of patronage.

The noble Baroness mentioned South Yorkshire. I can tell her that the South Yorkshire Mayoral Combined Authority has completed a franchising assessment, and the consultation on its scheme closes on 15 January.

I listened very carefully to the noble Baroness, Lady Harris of Richmond. I had an exchange with her previously about the circumstances in North Yorkshire that she raised, and her concerns are known to the Government. I am also aware of a petition tabled to Parliament from a Member for the area in the other place, and my colleagues in the Department for Education will respond to that shortly. I note, out of interest, that North Yorkshire is a Conservative council.

The noble Lord, Lord Snape, referred to matters including the cost of zero-emission buses. One of the reasons for the Bill proposing both an effective ban on non-zero emission vehicles and the date of 2030 is that, as he knows as an experienced bus person, the cost of zero-emission and hybrid vehicles has gone down. The intention is to support sales, which this and the previous Government have strongly supported through funding to bring down the cost of those vehicles, such that they will be available and economical to run when that time comes.

A lot of points were raised by the noble Baroness, Lady Pinnock, about bus services, many of which were germane. I have no doubt that we will discuss them in Committee. She asked whether I agree that, as local transport authorities have or will get more responsibility, more councillors should be involved. I am not sure that it is my job to decide that but, as has been mentioned before, help might be needed with some of these arrangements. I know—actually, it is quite well known—that the quality of passenger transport in local transport authorities depends on their having expertise. On that matter, I agree with the noble Lord, Lord Moylan. One of the purposes of the Bill is to set out the choices, and the department is putting money and resource aside to help people make the right choices and institute them successfully.

The noble Lord, Lord Hampton, raised several issues about safety. I will consider the points that he and others have raised about whether safety data should be collected. I will certainly write to the noble Lord and I have no doubt that those matters will be raised in Committee.

I do not drive passenger service vehicles in service very often now, but my technique in keeping time was always secondary to road safety. My belief is that that is still widely true in the bus industry, if only because of financial reasons, because bus operators, and for that matter local transport authorities that choose to operate buses, will always be subject to the costs of insurance. We will have a further look at driver welfare and will no doubt discuss it. The noble Lord also raised data sharing, to which I have already referred.

It was extraordinarily kind of the noble Lord, Lord Holmes, to refer to London 2012, which now seems quite a long time ago.

Lord Hendy of Richmond Hill (Lab)

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It was a long time ago; the noble Lord, Lord Moylan, and I completely agree. I wanted only to say that I do not claim particular credit for it; if you lead a team, you should give credit to the team that you lead and not take it all yourself.

The noble Lord’s more important points were about inclusion and accessibility. I absolutely recognise the points he made about the accessibility of the bus service to people with disabilities. I note his contention that Clause 22 does not go far enough, but I promise—and I am sure we will discuss it in Committee—to look at the degree and extent to which this clause can answer his points. He must be able to see that the intention of Clause 22 is to improve bus stopping areas and for the Secretary of State to give some guidance, which ought to be mandatorily taken into regard by local transport and highway authorities.

The noble Lord, Lord Berkeley, raised points about community control and who is in control. As I said, the point of this is to return control to local transport authorities. He also raised a question, which he largely answered, about what happens if local transport authorities do not do their job. One would hope that the citizens of the local transport authority would vote them out for not doing their job. That is the remedy. I do not think that the Secretary of State coming down on local transport authorities like a ton of bricks is a satisfactory alternative; we want to return control to the people who should rightly have it.

Incidentally, there have been bus routes down the Embankment since the trains went. I used to travel on route 109, but it does not go there any more.

The noble Baroness, Lady Brinton, also raised some important points on the Bill. She raised Clause 9 on approved persons, which we will discuss in Committee. The intention is not to deregulate approved persons but to widen the range of them. I completely agree with her that they should have some qualifications. An unqualified person should not be able to make a judgment about whether a franchising scheme is right.

The noble Baroness asked whether Clause 11 complies with the procurement regulations. I am advised that I am able to tell her that it does.

The noble Baroness welcomed Clause 19 and referred to assistance data. I will take that away and see what can be done. Bringing data on bus service usage into the 21st century is quite important and I am sympathetic to the idea that, as long as it is not a burden to bus operators, or indeed local transport authorities, collecting data is the right thing to do, so that we know what is going on.

I note very clearly the noble Baroness’s comments on Clauses 24 and 25, that diversity training is not the same as the rights for disabled people, and on what we did, with her great assistance, in the Passenger Railway Services (Public Ownership) Bill, referring to the Equality Act. I will go away and reflect on that.

Lastly, I come to the noble Lord, Lord Moylan, who has some extraordinary views about socialist paradises and returning to the era of the Attlee Government. I find it particularly extraordinary because I know that the noble Lord has such a strong view about the autonomy of local authorities. The Bill intends to return bus services to the autonomy of local authorities and for the Secretary of State not to intervene so much in the provision of services.

I have to tell the noble Lord that there is currently a huge disparity in the provision of bus services across Britain. I was not only responsible for the bus service in London, as he knows, but, for a measurable length of time, I was responsible for the bus services in what was laughingly called south-east England but apparently included Norfolk, Northampton, Leicester and Southampton. Even within one bus group, 20 years ago, there was an extraordinary variation in the provision of services and the extent to which bus operators sought to maximise the network and the return on it, or cut off individual journeys, to the extent to which some towns and cities in Britain find themselves short of or even without bus services after 7 pm and on Sundays.

I think I know roughly how to run a bus network, and one of the things you should do, which is the feature of the best bus services run by the private companies outside London—I can mention some places, but I will not—is to seek to service the network and to take people to school, hospital, work, leisure and home. It is in those places where those services have drifted away that something else needs to be done.

That is also true of rural services. The noble Lord alleged, quite wrongly, that the Bill does not deal with demand-responsive transport. It very much does—that is one of the remedies open to local transport authorities, as it should be. It is not a particularly cheap methodology but it is there to be used and, in fact, there are some startlingly good examples of it. He refers to it as though it is an urban feature but his own Government instituted an experimental regime in Cornwall, which, as the noble Lord, Lord Berkeley, knows, has produced rather a good bus service in Cornwall by having features of Cornwall Council’s activities that amount to franchising in the same way that the Bill will allow to happen.

I have come to the end of my allotted time. There is a limit to what I can answer here. As I set out earlier, the Bill is primarily about empowering local leaders wherever they are. It is a privilege to bring this forward to your Lordships’ House for Second Reading. I thank all noble Lords who have participated in today’s debate. I welcome the support of those who have spoken in favour of the Bill’s measures and look forward to continuing the debate on the Bill in Grand Committee.

Lord Hendy of Richmond Hill

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That the bill be committed to a Grand Committee, and that it be an instruction to the Grand Committee that they consider the bill in the following order: Clauses 1 to 10, Schedule, Clauses 11 to 31, Title.

The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)

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My Lords, the first group of amendments relates to the Bill’s purpose. At Second Reading, I set out the need for this Bill and explained why the Government are taking action to transform bus services across England. The Bill provides new powers for local leaders, so that local communities in England have greater control over bus routes and schedules. I thank the noble Earl, Lord Effingham, and the noble Lord, Lord Moylan, for their amendment and the opportunity to revisit the Government’s objectives.

Amendment 1 would place a direct requirement on the Secretary of State to have regard to improving the performance and quality of bus passenger services in Great Britain—in fact, it would make this the statutory purpose of the Bill. I absolutely support the reasons why noble Lords have drafted this amendment: they, too, want to achieve a better bus network that is more reliable and performs well. That is a shared goal. The reason we are here debating this important legislation is to reform the industry.

I recognise the points made by the noble Earl, Lord Effingham, about the KPMG report, and by the noble Baroness, Lady Pidgeon, about the benefits of buses to individuals and communities, as well as the inadequacies of the current arrangements. However, I am bound to disagree with the assertion that there is no evidence for the Government’s approach. There is plenty of evidence, some of which we have already talked about, such as the improvements in Manchester and elsewhere, including Cornwall, which is not a large conurbation. I also disagree with the assertion that there is public good and private bad in here. This is a very large menu of choices for local transport authorities. It is certainly not one size fits all.

As the noble Baroness, Lady Pidgeon, observed, during the passage of the Passenger Railway Services (Public Ownership) Act 2024, the noble Lords, Lord Moylan and Lord Gascoigne, tabled a very similar amendment. It sought to insert a purpose clause setting out improvement of passenger railway services as the purpose of that Act. At the time, I explained that the Secretary of State’s and the Government’s wider plans and objectives for the rail network included improving performance but noted that this was not the sole purpose. I offer the Committee the same rationale for this Bill. The amendment to the public ownership Bill was not carried.

Of course the objectives of this Bill include improving reliability and performance. They are important aims, but the Bill seeks to do more. It seeks to improve safety and accessibility, to provide local leaders with the powers to make the right decisions for their local areas, to support reaching net zero and to put passengers at the heart of the Government’s reforms. The noble Lord, Lord Grayling, was kind enough to suggest that I would not let ideology triumph over the right solutions. In this case, the Government are not doing that, either.

The Bill contains a range of solutions for local bus issues, which allow local choices for the best solutions and would recognise, in appropriate cases, both the adequate provision of bus services by their existing means, with commercial operators, and the range of solutions, including both large and small operators. To single out one objective would undermine the message that the Government are trying to convey to local authorities, passengers, operators and the wider industry. Thus, I do not support the proposal.

Extending this requirement across Great Britain also presents significant difficulties. The Committee will have noted that most of this Bill extends to England and Wales but applies only in England, with a limited number of clauses that extend and apply to Wales and/or Scotland. In tabling Amendment 1, noble Lords appear to be seeking to apply all the Bill’s measures across the whole of Great Britain. That would raise the potential of cutting across the powers of the Scottish and Welsh Governments to decide how to run their own bus networks and what is best for their local communities. That would not be the right approach. It would mean the UK Government interfering in policy areas where the devolved Administrations categorically do not want that. It also potentially undermines their reform agendas; as some noble Lords will be aware, the Welsh Government are due to introduce their own Bill into the Senedd in the coming months, as they seek to introduce bus franchising.

This amendment would also have significant ramifications on time and resources. Local transport is devolved, so legislative consent Motions would be required. That would potentially slow down the passage of the Bill and the pace of the Government’s reforms, which would be a bad outcome for passengers, who desperately need better bus services now, for the reasons set out by the noble Earl and the noble Baroness earlier. I am sure that noble Lords opposite would not want this outcome and therefore hope that this amendment will be withdrawn.

Lord Hendy of Richmond Hill (Lab)

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My Lords, this next group of amendments, as we have heard, relates to bus franchising. I will first turn to Amendment 8 in my name. This amends paragraph 9(3)(a) of the Bill’s Schedule, which sets out the procedure for varying a franchising scheme. It is minor and technical in nature. The amendment inserts the words

“which have one or more stopping places”

into this paragraph. This is the form of wording used elsewhere in the legislation, including elsewhere in the Schedule, to ensure that cross-boundary services are captured. This wording ensures that if a franchising authority reduces its franchising scheme’s area, it must consult all those operating cross-boundary services, as well as those operating local services wholly inside the area. This is an entirely appropriate requirement if a franchising authority is seeking to reduce a franchising area, and it is important that the language is updated to reflect that and to ensure consistency across the Bill.

I am not sure which amendment it would refer to, but I thank my noble friend Lord Berkeley for his intervention about Cornwall. As a matter of fact, I was with the person he referred to, Nigel Blackler, the architect of the Cornwall bus scheme, this morning, and also Councillor Davis from Devon from the south-west. They are so keen on the Cornish experience that they are proposing, after the passage of this Bill, assuming it becomes law, to extend it to the whole of south-west England. This is a testimony to the broad level of support for these measures given, as no doubt noble Lords will know, the political composition of Devon County Council.

As to Mr Blackler’s experience, I think he has devised an extraordinarily good scheme for Cornwall, despite not having worked in either London or Manchester. The heart of that is the understanding of the local need for bus services, not necessarily the technical characteristics of a franchise. I commend him on the success of the scheme, as has been described by the noble Lord, Lord Berkeley.

Moving on to other amendments in this group, I thank the noble Lord, Lord Goddard, for Amendment 2, which seeks to amend Clause 4. I understand that its intent is to test whether the Bill’s removal of the requirement that the mobilisation period be less than six months removes the requirement to have a mobilisation period at all. The mobilisation period is, of course, the time that expires between a franchising authority letting a contract for franchised services and those services coming into effect on the ground.

We want to give franchising authorities the flexibility to set the mobilisation period that suits their needs, so they are better placed to make the right decision for their communities, but I want to clarify that the Bill does not remove the requirement that a franchising authority sets out a minimum mobilisation period. While a franchising authority could make this period as short as it chooses to because of the Bill—for example, a minimum of one day—this determination will be based on the practicalities applying to individual franchising authorities on the ground. It is therefore best left to those authorities’ devolved decision-making. There is also, incidentally, no removal of the requirement for a minimum mobilisation period in the transitional provision in this clause. I hope that this clarification satisfies the noble Lord and allows him to consider withdrawing his amendment.

The noble Lord, Lord Moylan, has tabled Amendment 3 on service permits. He readily admits that this amendment, if it were included in the Bill, would largely wreck the franchising model. Of course, I respect his knowledge of the history of road services licensing from the 1930s, as well as the long and distinguished history of London Transport and its successors. As he is aware, service permits provide franchising authorities with a mechanism to allow bus operators to provide commercial services within franchising scheme areas, including important cross-boundary services. The measures in the Bill add further tests that franchising authorities can use when determining whether to grant a service permit.

I reassure the noble Lord, Lord Moylan, that these new tests allow franchising authorities to consider a wide range of benefits that these commercial services could provide, therefore giving authorities more scope to grant service permits and harness the additionality that the market can provide. The amendment would remove not just the new tests proposed by the Bill but the existing test already in legislation. It would mean that franchising authorities would be required to grant all applications for service permits, including those which compete directly with franchised services, for example. Because this amendment would undermine franchising authorities’ ability to run coherent and affordable schemes, I ask the noble Lord to consider not pressing it, noting that it does allow, in appropriate cases, commercial services to be provided as a matter of additionality.

Amendment 5, also tabled by the noble Lord, Lord Moylan, seeks to include the data and criteria that can be used by an independent assessor when reviewing a franchising assessment. It must be for the local transport authority to decide which data it will use to carry out the franchising assessment and determine its affordability, not the independent assessor. The remit of the independent assessor is limited to ensuring a robust assessment of the information that the franchising authority has used. The local transport authority is best placed to understand the issues it faces, as it did in Cornwall, and how best to assess these from the available datasets. New datasets, fortunately, become available frequently as technology develops. This amendment is therefore unnecessary and I look to the noble Lord not to press it.

The noble Baroness, Lady Pidgeon, spoke to Amendment 6, brought forward by the noble Baroness, Lady Brinton. This proposes a change to Clause 9. As noble Lords know, as part of the Government’s commitment to improve bus services and hand more powers to local leaders, the Bill aims to accelerate and lower the cost of the franchising process. To that end, the Bill will remove the existing requirement that those conducting independent assurance of authorities’ assessments must be auditors. This requirement has significantly restricted the pool of people able to undertake these reports. Instead, qualifications and other experience enabling someone to undertake reports will be set out in secondary legislation.

The amendment seeks to

“inquire whether the Secretary of State intends to issue the criteria for the ‘approved persons’ role in the near future”.

Clause 9 will come into force by regulations at a time the department chooses. The intention is to bring it into force only when secondary legislation is ready. My officials are engaging with a range of stakeholders to identify appropriate qualifications and will work in a collaborative way to bring forward secondary legislation in due course.

The amendment in the name of the noble Baroness, Lady Brinton, also seeks to ensure that any secondary legislation is subject to the affirmative procedure. Because the qualifications that would enable a person to conduct assurance reports are likely to change over time, it is important that the secondary legislation remains agile and responsive to such change. These changes are technical in nature and therefore I do not believe that the affirmative procedure is proportionate.

I hope that reassures the noble Baronesses that the Government seek to work co-operatively with the House to ensure that appropriate secondary legislation is brought forward in a timely manner and that, therefore, the need for appropriate qualifications will be addressed. As a result, I hope they will feel able not to press their amendment.

Amendment 7, from my noble friend Lord Woodley, intends to remove the time limit of 112 days on the notice period for varying or cancelling the registration of an existing bus service in an area that is transitioning to franchising. The existing time limit is essential in ensuring that the franchising process moves forward within a reasonable and predictable timeframe. It serves to maintain momentum in the implementation of franchising schemes, which is essential for creating certainty in the market. The time limit also helps safeguard the interests of passengers by minimising disruption.

Without the time limit, there is a risk that the franchising implementation process could be drawn out unnecessarily, leading to prolonged uncertainty for both operators and passengers. Such delays could cause operational instability and undermine the benefits of a timely transition. I will, however, consider further the point raised by my noble friend Lord Woodley, about the early withdrawal of service. But for the moment, the amendment is unnecessary, so I ask my noble friend not to press it.

I thank the noble Lord, Lord Goddard of Stockport, for Amendment 12. I recognise the history of the determined effort of Manchester—including the efforts of the late, great Sir Howard Bernstein—to take control of its bus services. I am delighted not only with the success of what has been achieved but because a former colleague, Vernon Everitt, who has been mentioned and who is now the transport commissioner for Transport for Greater Manchester, has helped to deliver what is demonstrably a better bus service, with increasing passenger numbers, as the noble Lord observed.

Amendment 12 would require franchising authorities to publish an evaluation report no later than one year after franchised services are first delivered through a scheme and to set out the scheme’s costs and benefits. I point out to noble Lords that a key purpose of the Government’s franchising guidance is to provide authoritative best practice. For instance, the revision to the franchising guidance published in December 2024 includes new content based on feedback from Transport for Greater Manchester and other mayoral combined authorities seeking to adopt that approach. The department will continue to undertake this best practice-focused approach to developing further iterations of the guidance. I therefore hope the noble Lord will consider not moving his amendment and not placing an additional requirement on franchising authorities.

On Amendment 14 in the name of the noble Lord, Lord Moylan, I think this is the right place to directly challenge the noble Lord’s assertion that the permission of the Secretary of State should be needed for local transport authorities to go down this road. He is a distinguished local government politician, as the noble Baroness, Lady Pidgeon, observed, who fiercely—in my time at least—fought undue central influence. I am astonished to now discover that he advocates such interference, not even up to a point. Mind you, he might have been subsequently converted by being a very distinguished deputy chair of Transport for London.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Lord for his interjection. In his case, it is true, but there are other cases where the market has shown a considerable inability to respond across the country.

To conclude on Amendment 14, it is for the reasons I gave that I ask the noble Lord, Lord Moylan, not to press his amendment.

Amendment 15 in the name of the noble Lord, Lord Moylan, would require a local transport authority to carry out a preliminary assessment if it was considering franchising its bus services. Much of what the noble Lord has proposed to be included in the preliminary assessment is already included in the current legislation and must be included in the local transport authority’s franchising assessment. An assessment may or may not conclude that franchising is the best option. The assessment would then be published if an independent assessment had been carried out and the decision was that franchising was the best option. This amendment is therefore unnecessary, and I would welcome the noble Lord not pressing it.

Amendment 16 in the name of the noble Lord, Lord Moylan, seeks to impose a five-year moratorium on repeating franchising scheme assessments in the same area if the previous attempt was unsuccessful. The aim of the Bill is to simplify the process for authorities wishing to pursue franchising, ensuring that decisions are made at the appropriate level and in a timely manner. This amendment would introduce unnecessary constraints on local transport authorities by adopting an overly rigid approach. There are many factors that might lead an authority to decide against pursuing franchising initially, only to reconsider this later; indeed, the period of time suggested by the noble Lord would in some cases exceed the cycle of local authority elections, in which a different party that chooses to do something different might be elected. Imposing a blanket restriction limits authorities’ ability to respond flexibly to evolving conditions and opportunities. Assessments are costly and time-consuming so will not be undertaken lightly. This amendment is unnecessary; I hope that the noble Lord will not press it.

Lord Hendy of Richmond Hill (Lab)

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Of course I respect the noble Lord’s view, but the needs of local communities as expressed through local transport authorities are continuous and there are many examples across the country, unfortunately, of private sector operators choosing, for legitimate commercial reasons, to significantly vary the bus network in their area with the minimum statutory notice. They are quite adept at changing their business in accordance with market circumstances, whereas I think it is quite right to afford local communities the chance—through their elected local transport authorities—to choose to take a view about whether the bus service they are being offered is good enough to continue in its present model, or whether to choose to do something different. If there is a degree of jeopardy attached to this, that jeopardy can be expressed by the continuous need for commercial operators in those circumstances to continue serving the local area well. That would therefore make it unnecessary for the local transport authority to pursue franchising, when there are already remedies in the Bill and a mixture of measures offered to local areas to achieve their aims.

The next four amendments are from my noble friend Lord Woodley, and Amendment 17 is the first of these. He has been joined by the noble Lord, Lord Whitty, who also spoke about this. It seeks to place a requirement to establish a joint forum between the franchising authority, bus operators and trade union representatives. However, current legislation states that franchised services must be provided under a local service contract between the bus operator and the franchising authority. It is then for an individual bus operator, as an employer, to discuss and determine staffing and employment standards within the bus company, in consultation with staff and their trade union representatives. It is also for the franchising authority to decide what forums it wants to put in place to support the delivery of its bus services.

It should not be for the Government to dictate how a local transport authority should run its services. I know that noble Lords are concerned about driver welfare standards, and I am pleased to tell them that this issue is covered in the current franchising guidance. I will consider further what is said in the guidance about consultation with the workforce, and workforce planning, as a consequence of this discussion. For the moment, I do not believe that this amendment is necessary and I ask my noble friend not to press it.

Amendments 18, 19 and 20 were also tabled by my noble friend Lord Woodley. They raise the important issue of ensuring that employee rights are protected when a local authority bus company is established or during the transfer to franchising. This country already has robust legislation in place to safeguard employees. As noble Lords know, the transfer of undertakings regulations apply to employees of businesses in the United Kingdom. Should a local transport authority choose to establish a bus company, it would be necessary for it to consider the application of TUPE regulations, which are supported by additional guidance to help employers and employees understand their respective responsibilities.

Similar principles apply to franchising. Section 123X of the Transport Act 2000 already provides for the TUPE regulations to apply to staff transfers resulting from the introduction or transfer of a bus franchise, meaning that proposed Amendment 20 would add little or no value beyond what is already in place.

Furthermore, the franchising statutory guidance offers detailed advice on how to determine whether a member of staff is “principally connected” with a service. In line with existing regulations, this guidance advises franchising authorities to work collaboratively with local operators and employee representatives to agree on criteria for determining which staff are principally connected with affected services. For example, such criteria could include the amount of time that an employee spends working on franchised services or whether the employee is part of a specific group assigned to those services. TUPE would then apply to employees identified as being principally connected.

It is of course worth emphasising that, like some other public service employers, existing local authority bus companies often go beyond basic statutory requirements to support their employees. This is particularly true for individuals from protected groups, with many local authority bus companies offering attractive terms and conditions, such as higher rates of pay, flexible working arrangements, and generous holiday and maternity and paternity provisions. However, as I said in respect of the previous amendment, I will consider further what is said in guidance in this respect beyond what is already there. I therefore ask my noble friend not to press these amendments.

The final amendment in this group comes from the noble Lord, Lord Hampton, and I note and welcome his interest in safety on the bus network. He will be aware that some of the most important parts of the Bill for passengers are around disability and addressing crime and safety, which includes provisions on training for front-line and wider bus staff. However, this amendment specifically relates to training for officials from franchising authorities on IOSH, which is about providing managers with the tools to maintain a safe environment, and NEBOSH, which is a qualification in health, safety and environmental management— I refuse to say either of those as an acronym.

The effect of this amendment would be an increase in the cost and time it takes to franchise, if staff had to undertake this specific training before starting the franchising process. We all understand that safety is paramount for bus staff, passengers and the wider public but there are only a small proportion of franchising cases and those involved in franchising where having such qualifications would be relevant. It may also be that some of the training for holders of an operator’s licence, the Driver Certificate of Professional Competence, might be equally appropriate.

Part of the reform is to simplify and speed up franchising and drive down costs. This amendment would disproportionately impact authorities in considering franchising, including those in smaller towns and rural areas. This would disenfranchise local authorities, which goes against some of the core tenets of the Bill. Nevertheless, I will consider further what might be said in guidance about these important qualifications for those involved in this process who should hold them. As a result, I hope the noble Lord will feel able not to move this amendment.

Lord Hendy of Richmond Hill (Lab)

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I will now address the amendments relating to local authorities, specifically the Bill’s grant-making powers, functions and duties. Before I address the amendments tabled by your Lordships, I will talk to the government amendment in my name, Amendment 81. This makes a minor change to Clause 30, providing for the provisions under Clause 21, on local transport authority by-laws, to come into force by regulations. Clause 30 sets out the commencement details for each clause of the Bill. The majority of clauses will come into force on days appointed by the Secretary of State by regulations. The current exceptions are Clause 21, “Local transport authority byelaws”, which is due to come into force two months after Royal Assent, and Clause 23, “Safeguarding duty: drivers of school services”, which comes into force six months after Royal Assent.

Clause 21 empowers local transport authorities to make by-laws addressing anti-social behaviour on their bus networks. It also allows the Secretary of State to issue statutory guidance about the exercise of enforcement functions in relation to local authority by-laws. Bringing Clause 21 into force by regulations, rather than two months after Royal Assent, is imperative to ensure that officials in my department have time to develop meaningful guidance to aid local transport authorities and their officers in undertaking enforcement functions. If the change cannot be made, local transport authorities may make by-laws before the guidance can be issued, or there may be insufficient time to develop comprehensive guidance that will be of the most use to local transport authorities and their enforcement officers. It is therefore an important change to make.

I move next to Amendment 4, tabled by the noble Baroness, Lady Pinnock. I thank her for her recognition that the Government’s recent settlements for local transport authorities are comprehensive for the moment. Her amendment seeks to include further consideration of funding requirements in the scheme assessment that authorities must undertake when developing a franchising scheme. I reassure her that consideration of the affordability of proposed franchising schemes, and therefore funding, is already a central part of the assessment. The existing legislation states that the assessment must include consideration of whether the proposed scheme would be affordable to set up and operate. As for a requirement for a specific analysis of the funding required to maintain or improve services for all communities, I stress that the legislation already requires the proposed franchising scheme to be properly costed and compared to another course of action, such as an enhanced partnership.

Finally, I note that both the franchising assessment and the independent assurance report must be published alongside the consultation. This ensures transparency around the local transport authority’s decision.

The Government have set out their ambitions to consolidate and simplify bus funding streams and to provide the long-term certainty that local transport authorities and bus operators have been calling for. The forthcoming multi-year spending review provides a real opportunity for the department to assess the sector’s funding needs so that bus services are adequately funded to support economic growth and, in particular, to overcome the barriers to the Government’s missions. Of course, any future spending decisions must be subject to the outcome of the spending review process. For all those reasons, and with that statement, I hope that the noble Baroness will feel able to withdraw her amendment.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Lord for his intervention; my response to him will probably be very similar to what I said at the time. First, the allocation methodology was far more transparent than the previous Government’s allocation methodology: it allocated money to all local transport authorities in England for bus services when, previously, there had been occasions when money was competed for via a long and tedious process not necessarily winding up in success. I, too, am struggling to recall all three of the criteria, only because my mind is currently full of these amendments, but two of them were population and bus mileage, which are self-evidently the sorts of indexes that you would use for this process.

Lord Hendy of Richmond Hill (Lab)

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The noble Lord is absolutely right. I thank him for his further intervention; we got there between us, even though neither of us could remember to start with.

Those are pretty central ways of allocating that funding. I will not necessarily commit the department precisely to that methodology in future because, obviously, we have the right to consider the matter further. Equally, we would of course be open to any other proposed indices to consider against population, deprivation and place need, but, in my view, those seem to be pretty good ones; I cannot see that they are obviously wrong. In conclusion to this little excursion into this matter, it is certainly better than partial allocations and competing for money without local transport authorities being certain of success—I am certain of that.

It is important to note that much of the funding to local authorities and local transport authorities is consolidated. That funding is not hypothecated by central government, thus it is for the local transport authority to determine how to apportion its funding. For example, the Ministry of Housing, Communities and Local Government provides local authorities with funding through the local government funding settlement. Money from that can currently be used to support bus services, for example by tendering. In future, it is possible that a local transport authority could choose to put some of that funding towards a bus grant using the powers proposed by Clause 16. The same is true for funding provided through the Department for Transport’s bus service improvement plans. Local transport authorities can decide how to allocate that funding towards a variety of bus initiatives.

Local authorities also have access to other sources of funding, including council tax money and retained business rates. Some of this money could be used to establish a local bus grant without recourse to funding provided by central government. The Government do not wish to tie the hands of local transport authorities by specifying the total funding to be used to carry out the functions under this section. It is for them to work out how much they wish to spend on such grants from within their wider allocations.

The powers proposed under Clause 16 are optional and would be available to local transport authorities if they chose to use them. It is thus hard to see how the statutory guidance—which may be published but its publication is not mandatory—could contain the information that would be required by the noble Lord’s amendment.

Lastly, I fear that the amendment does not fully recognise that the statutory guidance provided for by Clause 16(6) is intended to set out factors that a local transport authority should consider when choosing to design and pay a grant to bus operators. The local transport authorities will be very aware of their financial situation when doing so. The amendment is therefore not needed and I ask the noble Lord not to press it.

Turning to Amendment 32, it is good to see that the noble Lord, Lord Moylan, recognises the important role that demand responsive transport can play in contributing to local public transport provision. The amendment takes a belt-and-braces approach—both proposed subsections would have the same effect by ultimately requiring local transport authorities to think about flexible bus services, a form of demand responsive transport, if they chose to use the powers that would be granted by Clause 16 to design and pay grants to bus operators. I contend that neither the belt nor the braces are needed. There is nothing in Clause 16 to prevent a local transport authority choosing to use the powers therein to have regard to, and to support flexible bus services, to the extent that they meet the definition of “service” in Clause 16(2). I am happy to have that on the record, as the noble Baroness, Lady Pidgeon, requested.

Other types of demand responsive transport—for instance, that provided using private hire vehicles—are not likely to fall within the definition of “service” in this measure. Indeed, in our drafting of Clause 16 we have deliberately made it possible for local transport authorities to support a wider range of bus service types than the Government can through the existing powers available to the Secretary of State under Section 154 of the Transport Act 2000. This is because we want local transport authorities, in line with the devolution agenda, to be able to design grants that best support the outcomes that they see as important. That is key to help ensure that local bus services are able to contribute to economic growth and to breaking down barriers to opportunity.

Noble Lords will also be aware that Clause 16(6) gives the Secretary of State the option to publish the statutory guidance. If we feel that the guidance is needed, we will publish it.

Local transport authorities will be best placed to determine whether demand responsive transport is a viable option for their areas. The Bill and other aspects of our devolution agenda—including building on the devolution deals introduced by the previous Government —are aimed at giving local authorities more freedom and flexibility. However, given that flexible bus services are a key part of the bus offering in some areas, and will continue to be an important option for local authorities when considering the appropriate mix of services, it would seem strange for the statutory guidance, if it were published, not to contain references to flexible bus services. I hope I have demonstrated that the amendment is not needed and I therefore request the noble Lord not to press it.

I thank the noble Baroness, Lady Pidgeon, for Amendment 33. I note with sadness that the late Lady Randerson is not here to be able to debate it herself. It is a terrible shame. As noble Lords will all be aware, economic growth is one of the core missions of this Government, and the amendment rightly highlights the important role small and medium-sized enterprises have to play in delivering growth. The Bill supports the economic growth mission by giving local transport authorities greater freedom in deciding how they support their local bus services to boost economic growth and remove barriers to opportunity.

The amendment is intended to ensure that local transport authorities that choose to use the new powers to design and pay grants to bus operators think about the needs of small bus operators when designing those grants. However, the amendment is not needed because under the grant-making powers given to them by the Bill, there is nothing preventing local transport authorities designing grants that prioritise and support smaller operators of bus services, subject to other competition and subsidy controls. Because most local transport authorities are in enhanced partnerships, they will be best placed to understand the needs of small operators. They will certainly know those in their areas and whether such grants would be appropriate.

As public authorities disbursing funding, local transport authorities will, however, need to ensure that any grants they design, using the powers that would be granted by the Bill, comply with relevant subsidy controls to ensure that they are not distorting their local market or the national market. I hope that assurance allows the noble Baroness, Lady Pidgeon, not to press her amendment.

Lord Hendy of Richmond Hill (Lab)

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I thank my noble friend for his intervention. The real security in this—at least for passengers, and indeed for local transport authorities—is actually with the traffic commissioners. We will no doubt come to this later on in another of the amendments from the noble Lord, Lord Moylan. In fact, the process that my noble friend referred to is an elegant example of where the activities of the Driver and Vehicle Standards Agency, if followed up with the traffic commissioners, place a burden on operators to behave properly—to treat their staff properly and offer an adequate and safe service to the public. That mechanism of inspection by the DVSA and subsequent action by the traffic commissioners, should it be necessary, is a very elegant method of regulation. It is, incidentally, also strongly supported by the industry at large.

Amendment 34, tabled by the noble Baroness, Lady Pinnock, would require local transport authorities to publish a review when proposing to create new by-laws under the provisions in Clause 21. The purpose of this clause is to address a current inconsistency that means only some authorities have powers to make bus by-laws. The requirement for a review before exercising these powers would place additional burdens on local transport authorities, increasing costs and slowing down the implementation of by-laws, and that is not desirable. The inclusion of this clause comes from the Government’s engagement with local authorities and an understanding of the tools that they need to best operate safe and inclusive bus networks for their local communities. It is also not necessary because similar powers to those proposed by the Bill are available to some local transport authorities and railway operators in operating their rail and light rail networks, so there is some experience of this.

I draw the noble Baroness’s attention to the engagement with local authorities and existing by-laws in answering her question about whether these by-laws would work. The procedure in Clause 21 draws on and is analogous to that found in existing legislation, including the Railways Act 2005 and the Local Government Act 1972. Neither Act imposes requirements on local transport authorities or operators to undertake a similar review. I undertake to go away and consider with colleagues whether there are, or should be, model by-laws available. I therefore ask the noble Baroness not to press Amendment 34.

On Amendment 50, it is a real pleasure to see the noble Lord, Lord Bradshaw, in his place this afternoon. I understand the point that he is making about his proposal to place a statutory duty on local highway authorities or other authorities to take, create, implement and report on a traffic reduction strategy with the aim of improving bus journey times—I should have said that he is supported by the noble Lord, Lord Goddard. Improving the reliability and frequency of local bus services is a key part of the Government’s plans for buses, and the Bill helps give local transport authorities the right tools and levers to do that.

However, I do not believe that this amendment is the right way to do that. For example, local transport authorities are already obliged under the network management duty, established by Section 16 of the Traffic Management Act 2004, to consider the reduction of congestion and improving traffic flow in how they manage their roads, so this new duty would in effect replicate that. It would also go against the principles of devolution—giving more freedom and fewer obligations —that we have committed to with the Bill. Local transport authorities are already able to effect positive changes in bus reliability through enhanced partnerships with operators of bus services in their areas.

The recent experience in Manchester of franchising has served to illustrate, at least to me, that the power of franchising has very quickly drawn to the attention of the authority—in that case, Transport for Greater Manchester—those elements of the management of the local road network that need to be improved in order to drive a safe and reliable service.

The noble Lord’s amendment links the production of this traffic reduction strategy to any financial support issued by the Government,

“for the provision of bus services”.

This brings a range of funding streams into scope beyond just grants that are intended either to support bus services themselves, such as the bus service operators grant, or to improve infrastructure, such as bus priority schemes that could improve bus journey times through the bus service improvement plans. Some government funding—for example, grants to make buses more accessible—may be caught under the broad wording of this new measure. There is, of course, no obvious link between this kind of grant and traffic reduction, and it would be inappropriate in such cases to produce a corresponding traffic reduction plan. However, I understand the noble Lord’s point, and I will consider further how and in what way we might address the very valuable point that he is making. On that basis, I ask him not to press his amendment.

The noble Baroness, Lady Pidgeon, has brought forward Amendment 52 to place a duty on authorities to promote bus services and publish regular reports detailing progress towards achieving that objective. I firmly believe that all authorities and operators are interested in promoting their bus services in their local areas and that it is not necessary to bring forward an amendment that places a direct requirement on authorities to do so and to report on how they have met their objectives.

The Transport Act 2000 already places a duty on the local transport authority to develop and implement policies which promote and encourage safe, integrated, efficient and economic transport in their area. Buses form part of that duty, and we know through bus service improvement plans that local transport authorities are already doing this. A local transport authority also needs to have wider monitoring and evaluation plans in place to assess the outcome of its policies. It also has to answer to its communities.

The Bill is all about providing choices to local transport authorities and ensuring that decisions are made at the right level ultimately to improve the bus network for their communities. It should therefore be for the local transport authority to decide how it will measure its successes. On that basis, I ask the noble Baroness not to press her amendment.

I turn lastly to Amendment 69, which I thank the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, for bringing forward. The amendment would require local authorities to promote the adoption of customer-facing technology. The Government remain committed to ensuring services are continuously improved for passengers. I agree with noble Lords that it is important that passengers experience good access to technology, such as free wi-fi and charging facilities. As noble Lords have noted, many operators already seize these opportunities. We would be keen to encourage further adoption, albeit that we can have little control, given that operators would need to assess its cost impacts.

From a passenger-information perspective, the Government are committed to delivering better bus services, and part of this work is working closely with bus operators and local transport authorities to improve the information available to passengers about their bus services. The Bus Open Data Service was launched in 2020 and requires all bus operators of local services in England to provide passengers with high-quality, accurate and up-to-date passenger information including timetables, fares, tickets and vehicle location information. As part of this work, the Government understand the importance of having real-time information widely accessible in a range of spaces that passengers use and are conscious of the need to continually consider new ways to improve access to real-time information, while staying in line with wider government digital and data strategies. I note what the noble Baroness, Lady Pidgeon, says about the continuing progress of technology and the difficulty of specifying now what it might deliver in the future.

I hope that the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, will understand that I do not wish to cut across the work which is currently underway. On that basis, I would ask them not to press Amendment 69.

Lord Hendy of Richmond Hill (Lab)

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I will first address Amendments 9 and 10 from my noble friend Lord Woodley. The option of a direct award is designed to support the transition to bus franchising, bringing forward some of the benefits of franchising while delivering service continuity to passengers. Expanding the scope of direct awards to include local authority bus companies under all circumstances would not meet these objectives, which are limited and designed to deliver continuity and would, in the case of his amendments, prevent fair competition with private operators. With respect to my noble friend, these amendments are unnecessary and I would ask him to withdraw Amendment 9 and not press Amendment 10.

I thank the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, for tabling Amendment 13. It is up to local leaders to determine how to run their bus services best and to assess the effectiveness of the delivery of their franchising contracts. Franchising authorities using direct awards are subject to comprehensive reporting requirements and the Bill does not change this. The additional requirement would create unnecessary additional burdens.

Noble Lords asked whether the clause complies with the Procurement Act 2023. As I said in my letter to all noble Lords, Clause 11 is limited to the direct award of net cost contracts, also called concession contracts, where the operator provides franchise services in return for the fare revenues. These contracts are exempt from the Procurement Act 2023—see paragraphs 21 and 37 of Schedule 2 to that legislation—and instead fall under the Public Service Obligations in Transport Regulations 2023, which the Bill is amending. Therefore, this clause does not impact on the Procurement Act 2023.

On the questions raised about there being more than one operator, this is a transition arrangement in order that the passengers involved, the customers of bus routes, and the operators get more certainty in the transition than might otherwise be the case. Clearly, the provision of direct award can be useful to authorities seeking to move to a franchising model both now and in the future. It also provides flexibility to stagger the full implementation of franchising, for example, tendering competitive franchise contracts at different times. It can be used only for the first franchise contract in an area to support the transition. Direct award contracts will have a maximum duration of five years, and in many cases a shorter duration will be appropriate. Long-term franchising contracts will be competitively tendered in the usual way. For clarity, in areas where there is more than one operator, only the incumbent operator can receive a direct award contract for the same or substantially similar services. It is uniquely placed to provide service continuity to passengers during this transition.

The amendment tabled by the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, would create unnecessary additional burdens on local and central government to complete the assessment. I therefore ask them not to press their amendment.

The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)

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My Lords, before I commence my response, I would like to update your Lordships on progress since day one of the Grand Committee. I have met with several noble Lords to discuss the Bill, including exploring matters that were the subject of amendments debated in your Lordships’ House. I am also considering the role of guidance, such as bus franchising guidance, in providing clarity on the department’s expectations. I thank noble Lords for offering their thoughts on these issues and look forward to continuing our discussion. As the noble Baroness, Lady Brinton, did, I welcome the presence of representatives of the National Federation of the Blind UK, to whom I spoke at the end of the last Committee meeting.

I begin by taking government Amendments 44 and 45 together. Amendment 44 makes a minor change to Clause 22 to clarify that where it refers to a public service vehicle, it means a public service vehicle as defined in the Public Passenger Vehicles Act 1981. In practical terms, this is the standard definition of a public service vehicle, referenced in the Transport Act 1985 and used in other legislation, whether relating to accessibility or otherwise. This amendment seeks to ensure consistency of understanding between this and other clauses and existing legislation. It does not change the intention or function of this measure.

Amendment 45 is intended to future-proof Clause 22 by anticipating the use of autonomous vehicles in local bus services. Clause 22 currently requires specified authorities to have regard to guidance on the safety and accessibility of stopping places. Facilities in this context include those that assist a driver of a public service vehicle to enable passengers to board or alight from the vehicle. The feature most commonly used to do this is the painted cage on the roadway, which keeps an area free of obstructions to enable the driver to position their vehicle flush with the kerb, but it is conceivable that, in future, there may be facilities that support the autonomous alignment of the vehicle without the involvement of a driver. As such, this amendment seeks to remove the reference to a driver in the relevant definition of facilities. It is clearly important that we make legislation for not just the services of today but those of tomorrow and, where possible, avoid the need for future amendments to primary legislation.

I thank the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, for Amendment 11. The intention behind the option directly to award contracts is to support the transition to a franchising model. As part of the direct-award contract, the franchising authority can stipulate the accessibility requirements that it expects the operator to deliver. There is existing guidance in place that supports this. This amendment would be likely to delay the transition to bus franchising and increase the burden and cost on the franchising authority, and for these reasons I believe that it is unnecessary.

I turn now to the amendments that the noble Lord, Lord Holmes of Richmond, has tabled to Clause 22. He is one of the many champions in this House for inclusivity and accessibility in transport, and, of course, I absolutely respect his views, as I do those of the noble Baronesses, Lady Brinton and Lady Grey-Thompson, given the experiences that they have talked about today and elsewhere, and those of the noble Lord, Lord Hampton. I will respond to each of the amendments tabled by the noble Lord, Lord Holmes, in turn.

Amendment 35 seeks to amend Clause 22 by including a power to make guidance to ensure that inclusive design principles are complied with in full. I know that the noble Lord supports the premise of this clause, including our intention to ensure that new and upgraded bus stations and stops are inclusive by design. I am concerned, however, that the amendment as drafted would place unnecessary constraints on how the guidance can be drafted and might make it more challenging for local authorities to implement it effectively. Instead of providing authorities with choice, the guidance would need to encourage the adoption of a single set of principles that might not be relevant in every circumstance. It would also constrain the collaborative development approach that we intend to take. I assure the noble Lord that we have included Clause 22 because we know that stopping-place infrastructure must be more inclusive. However, I am concerned that his amendment would frustrate our ability to achieve this rather than support it.

Amendment 36 seeks to emphasise the importance of independent travel for disabled people. Clause 22 currently allows the Secretary of State to provide guidance for the purpose of facilitating travel by persons with disabilities. This amendment would clarify that it is for the specific purpose of facilitating independent travel. As currently drafted, the clause allows the Secretary of State to provide guidance to facilitate travel by all disabled people, whether travelling independently or otherwise. The amendment could have the undesirable effect of requiring guidance to focus principally on those not travelling with companions. I am sure that the noble Lord would agree that bus stations and stops should be safe and accessible for everyone, and I believe that the current clause draft is more appropriate for achieving this.

Amendment 37 seeks to specify in greater detail what stopping-place features can be covered in statutory guidance. It does this by providing a list of specific stopping-place features that the noble Lord considers to be important to cover. However, Clause 22 already specifies that guidance can cover the location, design, construction and maintenance of stopping places and related facilities. That list is intended to be permissive and overarching. It is important for the decision on what facilities to cover and what advice to provide to be informed by specialist input and stakeholder engagement. We will work closely with the Disabled Persons Transport Advisory Committee, or DPTAC, as we develop the guidance. We will also engage with other organisations representing disabled people and others to ensure that the guidance covers the right subjects and can be effective in supporting provision of safe and accessible infrastructure. It seems likely that the features that the noble Lord identifies, as well as others he has not, would be highlighted to us as important for inclusion, regardless of whether his proposed amendment is accepted.

Lord Hendy of Richmond Hill (Lab)

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I am so sorry to both noble Baronesses. That is my error.

Amendment 42 in the names of the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, seeks to protect access to local transport services by requiring the statutory guidance to recommend the use of demand-responsive transport, or DRT, where other options are not viable. As I said on the previous day in Committee, DRT has the potential to improve the local transport offer. I agree with the noble Lord, Lord Grayling, that demand-responsive transport is not mutually exclusive from accessibility. Accessibility must be part of that offer, where it is part of the local transport offer. I agree that authorities should consider a range of transport options when reviewing the future of services, but I am not convinced that the stopping places statutory guidance is the right place for this recommendation.

Clause 22 is principally about ensuring that stopping places provide a safe and accessible environment. There may well be times when it is appropriate to consider the role of DRT when planning such work; however, it is more appropriate when considering service provision generally, which is beyond the scope of the statutory guidance about stopping places. I reassure noble Lords that the Government have a strong interest in DRT for areas without regular fixed-route connections, many of which—though not all—might be rural. The department is currently undertaking a monitoring and evaluation exercise on the DRT rural mobility fund pilots and will produce best practice guidance to support local transport authorities interested in setting up DRT services in their areas.

Amendment 56 seeks to require relevant authorities to publish a report on the accessibility standards of bus services within their boundaries, including an assessment of how satisfactory they consider them to be. I fully support the spirit of this amendment, which is designed to incentivise local authorities to take responsibility for driving up accessibility standards in their areas. It is precisely because of the need for greater focus and consistency in the provision of safe and accessible infrastructure that the Government are requiring authorities to have regard to the statutory guidance on safety and accessibility at stopping places.

However, throughout the process of developing Clause 22, the Government have been clear that the clause and subsequent guidance need to consider a variety of factors. That is why the requirement has been designed to be both proportionate and flexible. In contrast, this amendment as drafted would place an unreasonably high reporting burden on local authorities. It would also introduce significant duplication, with authorities with overlapping jurisdictions required to report on the same matters. For instance, both Eastbourne Borough Council and East Sussex County Council would be required to report independently on the accessibility of bus services in Eastbourne.

Achieving compliance could entail a lot of work with little benefit for authorities, which would be asked to report on services for which they are not responsible. For instance, a district council with no responsibility for bus services would still be required to report on the accessibility of services in its area. While I recognise the accountability and positive change that noble Lords seek to encourage, I am not convinced that this is a sufficiently proportionate way to achieve it. As I have indicated, I will think about it further and talk to noble Lords to identify how we can help authorities take decisions on local transport provision with a sufficient understanding of the impact of services on disabled people.

Amendment 57 seeks to bring bus operators explicitly within the remit of the public sector equality duty under the Equality Act 2010. The amendment proposes to achieve this by adding bus operators providing services to the list of public authorities in Schedule 19. Local transport authorities are already subject to the public sector equality duty as listed public authorities in Schedule 19, and this would include franchising authorities. The duty must also be met by an entity that exercises a public function, even if it is not explicitly listed in Schedule 19. This would include any bus company that exercises such functions, such as a local authority bus company.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Baroness for her intervention, and I will certainly write to her on that basis.

Lord Hendy of Richmond Hill (Lab)

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My Lords, I shall speak first to Amendments 26, 27 and 28, which have been tabled by the Government. A review of enhanced partnerships is under way and is due to conclude in the summer. The objective is to identify areas of improvement to deliver a better minimum standard of bus services across the country. Amendment 26 supports improvements to enhance partnerships designed to enable the enhanced partnership scheme to include a broader set of measures that are directed at improving services generally across the entire local area—for example, setting consistent reliability targets across the entire area rather than on specific routes.

Amendment 27 supports the improvement of enhanced partnerships and relates to situations where a local transport authority develops interventions, such as bus lanes and traffic light priority. Where these interventions result in direct and indirect savings to bus operators, it will now be possible for local transport authorities and operators to include measures in the enhanced partnership scheme requiring this additional revenue to be reinvested. This will support the delivery of the bus service improvement plan objectives and improvements for passengers and ensure that the reduction in operating costs is not entirely absorbed by bus operators as profit.

The Government’s final amendment in this group is Amendment 28. Most enhanced partnerships have developed a bespoke variation process through which they can make changes to the scheme rather than rely on the variation process in the Transport Act 2000. However, there may be circumstances where this bespoke mechanism is not working for everyone. This amendment therefore provides local transport authorities with very limited circumstances where they can utilise the statutory variation provisions instead of the bespoke variation mechanism in the EP scheme to make changes to their scheme.

The purpose of this amendment is to allow local transport authorities to make an application to the Secretary of State when an operator is acting unreasonably and has objected to a proposed variation that would be made under an existing bespoke variation mechanism in an EP scheme. If on application by the local transport authority the Secretary of State is satisfied that the variation cannot be made, due to unreasonable or obstructive behaviour by one or more operators, or that the variation would benefit the people using the local services, they can direct the parties to follow the statutory variation process instead. The measure is designed to provide some protection to local transport authorities to deal with deadlocks in partnership negotiations and to enable changes to local services that are in the best interests of the people who use them.

Amendment 21 would alter the definition of socially necessary local services in the Bill to explicitly include entities that have a healthcare or educational aspect. I reassure noble Lords that the definition of “socially necessary local services” includes areas outside large towns and cities and that it includes local services that enable passengers to access essential goods and services. As such, the definition already encapsulates access to healthcare and schools, but I shall look further at what the noble Baroness has said on this matter.

I thank the noble Baroness, Lady Jones, supported by the noble Lord, Lord Holmes, for her Amendment 22, which looks back at services cancelled in the last 15 years to look at socially necessary services in the present and future. I recognise that there have been services recently discontinued that may be considered by a local transport authority as addressing the needs of some of the communities they serve. I shall take that away and look further at what we do in this respect.

Amendment 22A, tabled by the noble Lord, Lord Moylan, seeks to ensure that when a local transport authority provides a tendered service, it receives the same level of protection as a commercial service. On the assumption that the reference to tendered services refers to services subsidised by the local transport authority, these already receive the same level of protection as other commercial services under this measure. Clause 12 does not differentiate between a tendered service and one provided on a commercial basis. If a local service is considered to be a socially necessary local service, Clause 12 requires the local transport authority to list it in their enhanced partnership plans, irrespective of whether it is tendered or purely commercial. On this basis, the amendment is unnecessary.

I thank the noble Baroness, Lady Pidgeon, for Amendment 23. This would have the effect that, where a socially necessary local service has been cancelled, the local authority will step in to provide a service when another bus operator cannot be found. It also sets out the implementation steps once the local authority establishes a replacement service. I reassure the noble Baroness that under Clause 12 when an operator wishes to cancel or amend a service, they will need to consider alternatives to mitigate any adverse effects of changes to such services.

I point out that local transport authorities are already under a duty to secure public passenger transport services that they consider appropriate to meet the requirements of the area and which would not otherwise be met. This is likely to include socially necessary local services. Clause 12 should result in additional transparency by identifying the socially necessary local services in enhanced partnership areas. This will provide the Government with additional information to inform decision-making around funding for local bus services. Local transport authorities have the best understanding of the needs of their local communities. Any additional obligations introduced through legislation would place an undue burden on local authorities and undermine their independence.

I turn to Amendments 24, 25 and 29 tabled by the noble Lord, Lord Moylan. Amendment 24 proposes that demand responsive bus services be specifically considered as a measure for mitigating the possible adverse effects caused by the cancellation of a socially necessary local service. I consider that such considerations should be left to the local transport authority. The Bill sets out that enhanced partnership schemes must include requirements that apply when a socially necessary local service is cancelled or materially altered. These must include consideration of alternative options to mitigate the effects of a cancellation. This will include how demand-responsive bus services could be deployed.

The purpose of Amendment 25 of the noble Lord, Lord Moylan, is to ensure that local transport authorities have regard to maintaining a competitive market. I believe this amendment to be unnecessary because there are existing legislative protections that will ensure that local transport authorities sufficiently consider the impact of their actions under this measure on the market. The decision about how to manage the local network rightly rests with the local transport authority. In making decisions around what measures to include in their enhanced partnership, local transport authorities will need to consider impacts on competition. Existing legislation also requires LTAs to consult with the Competition and Markets Authority when varying their enhanced partnership under the new clause. If the local transport authorities were to decide to set up a local authority-owned bus company or provide service subsidies to fill a service gap, there are wider legislative and regulatory frameworks that will apply and are sufficient.

Lord Hendy of Richmond Hill (Lab)

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My Lords, I will respond to the noble Lord, Lord Moylan, and the noble Baroness, Lady Pidgeon, on Clauses 18 and 19.

On Clause 18, there is currently no one single source of information for passengers about bus service registrations or similar information about services that operate outside traffic commissioner-administered areas. Information on local bus services is fragmented, and this clause seeks to improve this state of affairs. As such, it enables the Secretary of State to make regulations requiring franchising authorities to submit information about services operating in their areas. This information will be similar to that provided on the registration of a service with the traffic commissioner, and it will be provided to the Secretary of State.

Together with Clause 17, Clause 18 lays the groundwork for a new central database of registration information, bus open data and information about services operating outside traffic commissioner-administered areas. This will provide passengers with a single source of information about local services. It is important to clarify that this provision does not reinstate the requirement for franchised services to be registered with a traffic commissioner. Rather, it provides the power to require franchising authorities to provide information to the Secretary of State, thereby enabling its inclusion in the new central database.

In addition, Clause 18 broadens the categories of data that the Secretary of State may collect regarding local services and the vehicles used to operate them. This power extends to gathering information from franchising authorities concerning franchised services and allows the department to collect additional data aimed at improving transparency within the sector. It might be said that the clause would answer the earlier intervention from the noble Baroness, Lady Brinton, about whether all buses actually conform to the PSVAR regulations and, therefore, it would be useful in that respect, too.

Crucially, Clause 18 also empowers the Secretary of State to collect data that will support the monitoring of local service operator performance and assist in the effective exercise of ministerial functions. That might include, for example, information relating to the costs associated with operating a service and the number of staff involved in its operation. I hope that explanation is sufficient to allow the noble Lord, Lord Moylan, to withdraw his opposition to the inclusion of the clause.

On the noble Lord’s opposition to the inclusion of Clause 19, the clause works in tandem with Clause 18 to support greater public transparency, and thus accountability, over local bus services. While Clause 18, in part, provides for greater information collection going forward, Clause 19 ensures that equivalent historical information already held by the department can be published. The clause achieves this by amending the Statistics of Trade Act 1947 to insert two new sections to enable the publication of existing operator-level bus data. It also provides for the Secretary of State to give notice to industry prior to the publication of such data.

Section 9 of the Statistics of Trade Act requires the consent of individual undertakings before information identifying them can be published. The newly inserted Section 9B disapplies Section 9 of the 1947 Act in relation to information about relevant local services that has been collected under Section 1 of that Act from PSV operators’ licence holders, or their representatives. This disapplication applies during a qualifying period, beginning on 1 May 2015 and lasting until the day when this clause of the Bill comes into force. Disapplying the requirements in Section 9 will allow the department to publish operator-level information collected during the qualifying period, even in cases where consent cannot reasonably be obtained from the large number of individual operators concerned. That point is crucial. The requirement to obtain consent from each individual operator would result in inconsistent data provision. This, in turn, would mean some communities not having access to the same level of information about local bus services as others, or indeed equivalent information for all services within a single community.

The newly inserted Section 9C requires the Secretary of State to publish a notice specifying the information intended for publication at least 30 days in advance, and further details the locations where such notices must be published. These provisions will enable the timely and transparent publication of operator-level bus data, improving access to information while maintaining appropriate safeguards.

Although the noble Lord, Lord Moylan, is of course right that in a commercial undertaking, this information might be considered commercially confidential, it is also essential for the local transport authority representing the users of these services to be able to access such information in order correctly to plan bus services in their areas, for the benefit of all the people who live there. That is the justification for this clause, so I hope he will accept it and withdraw his opposition to it.

Lord Hendy of Richmond Hill (Lab)

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My Lords, I feel compelled to respond to the last point.

Lord Hendy of Richmond Hill (Lab)

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I will finish it by feeling compelled to respond to the last two interventions. The noble Lord, Lord Moylan, referred to his doubt that you could see the cost and revenue for each bus service in London; I beg to differ, because I was responsible for running the thing for 15 years. I absolutely assure him that we knew, to the nearest penny, the revenue and cost allocation for all the routes. That enabled us to provide a broadly acceptable service, in very different circumstances, over the considerably varied area of Greater London.

I also assure the noble Lord that that knowledge is collected by any responsible bus operator in the rest of Britain. The point is that it ought to be available to local transport authorities which are keen to offer comprehensive bus services in circumstances where a number of bus operators do so. Many of them are not competed against by others, because they cannot match their comprehensive standards. That means that the local transport authority does not have the information to understand what might be substituted in its place for communities that have a very poor service.

I defend both these clauses very strongly. I think good information about this is absolutely necessary. This is not about selling biscuits or buckets; it is about providing public services for people in this country who wish to go about their business and go to work, school, hospitals and other places.

Lord Hendy of Richmond Hill (Lab)

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I should say to the noble Lord, Lord Moylan, that I completely agree with his sentiment, but I think that he has misunderstood what this clause seeks to achieve. There is absolutely no intention whatever that, as a result of this clause, drivers or other staff should be asked to put themselves at risk.

Lord Hendy of Richmond Hill (Lab)

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My Lords, these amendments cover zero-emission buses, as the noble Lord, Lord Moylan, and the noble Baroness, Lady Pidgeon, have rightly said. The restriction on the use of new non-zero emission buses will not take effect any earlier than 1 January 2030, but the clause places a restriction on the use only of new buses. The noble Baroness is right to raise this issue; I myself have heard some misapprehension about what this actually means. It is about new vehicles, and the flexibility to determine when to replace diesel buses with new electric buses will remain, because if the date were to be 1 January 2030, all vehicles in service on 31 December 2029 would be able to carry on in service.

I will shorten the speech I have been given because it replicates some arguments about the use of electric vehicles, but it is common ground between all those who have spoken on this issue today that the operation of zero-emission buses is a really good thing. I do not think we need a complete assessment from local transport authorities. The important point that the noble Lord, Lord Moylan, made is that there are circumstances in which there can be some further exemptions. In fact, the Bill already provides for the Secretary of State exempting certain vehicle types or routes from the restriction. That is the proposed amendment to the Transport Act 2000, new Section 151A (3)(c), which states:

“The Secretary of State may by regulations … specify local services or descriptions of local service in relation to which subsection (1) does not apply”.


There is a considerable flexibility here, in particular the recognition that there may still be services where zero-emission buses at the date at which the Secretary of State sets may not for some reason be capable of operation. However, I hope the noble Lord recognises, as I think the noble Baroness, Lady Pidgeon, does, that this is generally seeking to do the right thing in respect of air quality and local bus services.

Amendment 48, tabled by the noble Baroness, Lady Pidgeon, probes the scope of Clause 27. I understand and am sympathetic to the concerns she raises. The clause will apply to mayoral combined authorities but as drafted, it will not apply to franchised bus services within such areas. I offer assurance that the Government are actively looking into potential options to address this. I hope to return on Report with an update and, were I to need to speak to the noble Baroness, I hope she would be happy if I did so.

The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)

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My Lords, Amendment 49 in the names of the noble Baronesses, Lady Pidgeon and Lady Grey-Thompson, and the noble Lord, Lord Hampton, and Amendment 78 tabled by the noble Baroness, Lady Jones, seek to place a statutory requirement on reviewing the Bill’s impact on rural areas and villages. I also heard clearly the point from the right reverend Prelate the Bishop of St Albans—and, incidentally, I agree with him about the need for cross-subsidy to help bus routes that are not in themselves profitable.

I note and understand the importance of serving villages and rural areas. Indeed, the Government intend the choices available to local transport authorities in the Bill to address just those points—including, for the avoidance of doubt, as we discussed this on a previous day, the appropriate use of demand-responsive transport.

The monitoring and evaluation of the Bill, which include the impact on rural services, will be completed as part of a wider evidence review of bus franchising. It will take several years—up to five years—for local authorities to transition to a franchised network or to form local authority bus companies, so any review prior to this would not be able to consider the full impact of any such transition. I listened very carefully to the noble Lord, Lord Burns, and I have very high regard for the work that he did in both south Wales and north Wales; he made elegantly that very point. In addition, the full impact of franchising is not expected to be seen until franchising schemes have been operating for some time. Therefore, the timing of a full assessment of impacts on local services needs to reflect that timeline.

I say to my noble friend Lord Snape that while a dose of realism is always a good thing in a discussion about the future, the evidence from the stages of franchising in Manchester is that a remarkable change in both the reliability of the bus service and the volumes of patronage and revenue has been seen as a consequence of the introduction of franchising in various phases.

Lord Hendy of Richmond Hill (Lab)

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Indeed. I am grateful to my noble friend for that observation. I should have also mentioned the situation in Cornwall, which is more or less franchising and in an area that can be called rural, where the consequence of a decent set of organised services in a rural area has been a considerable increase in patronage. My noble friend’s point about realism is right, and I think the real point of what he was saying is that these things take some time to mature and come into effect.

On rural areas, there is no doubt that considerable damage has been done to public transport by an approach necessitated by the previous Government’s funding mechanisms, which have reintroduced routes that were withdrawn, withdrawn again routes that were reintroduced and given a lack of continuity to services that need it in order for people to rely on them.

I thank the noble Baroness, Lady Pinnock, for bringing forward Amendment 53 about statutory changes to local council powers. The Government believe that such changes will be wholly beneficial to communities in the United Kingdom. There may be legislation in this Session that alters the powers of local councils to provide them further powers on transport. Given the proximity in timing of any such legislation to this Bill, it would not be appropriate to provide such a review, as the powers would not have had sufficient time to be in force.

I appreciate that this Bill and the English devolution Bill, as well as the forthcoming railway reform Bill, will or may have related provisions to enhance the role of local councils, and we will work closely across and between departments to ensure that they most effectively give local councils control over their own transport networks. In respect of buses, the extensive guidance already available on enhanced partnerships in franchising from government, and the Bus Centre of Excellence, which has been referred to previously, will be available.

Amendment 62 in the name of my noble friend Lord Berkeley would introduce a statutory requirement for the Secretary of State to review within six months the Bill’s impact on certain local transport services. I refer to the remarks I have already made about the length of time it would take to take a good view about changes. I know that my noble friend is a long-standing campaigner on ferry services and the important role they play in connecting communities. I also note his description of the ferry service to the Isles of Scilly as “bumpy”, which is undoubtedly true. I agree that these services provide a crucial lifeline for many communities and ensure that people can access essential services, as he says.

The noble Lord also asked at Second Reading about tram services. Again, they are an important part. However, the meaning of this Bill is clear: it is focused on the provision of local bus services and a tram is clearly not a bus—a ferry is even less so. On ferries, though, I understand that the Isles of Scilly Council has been in touch with the Ministry of Housing, Communities and Local Government regarding both this matter and broader support for the islands. I hope that the noble Lord will note that I have said that.

Turning to Amendment 73, I thank the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, for bringing it forward. The Committee will have heard the noble Lord’s remarks about the handling of passenger complaints. The Government remain committed to ensuring that services are continuously improved with passengers. This amendment is consistent with our approach to rail, for which guidance on how to resolve complaints already exists. I agree with the noble Lords that it is important to deal with complaints properly, but it is my view that, apart from the handling of the original complaint, the resolution role sits with passenger watchdogs. The department is in the process of undertaking work with existing passenger watchdogs—Transport Focus and London TravelWatch—and bus stakeholders to identify issues and make recommendations on embedding standardised complaint-handling processes, ensuring that passengers have clear escalation. I agree wholeheartedly with the noble Lord that the way to deal with complaints is not to file them in the waste-paper basket, but I do not wish to cut across the engagement that is currently under way.

I shall now address the points from the noble Lord, Lord Moylan, about help for local transport authorities in route planning and fare setting. Of course, he has missed the fact that virtually every local transport authority in Britain has existing experience in both since, for the past 40 years, they have had to tender services that have not been found by commercial bus services to be worth running. I cannot believe that there is a local transport authority in the country that does not have some experience of both route planning and fare setting.

Amendment 79B in the name of the noble Lord, Lord Moylan, seeks to impose new requirements on the provision of real-time passenger information. I absolutely agree with the noble Lord that ensuring that passengers can access high-quality, real-time information about their services is critical, but he will, I hope, be aware that there are existing obligations on bus operators. The Public Service Vehicles (Open Data) (England) Regulations 2020 provide the foundation for those obligations and, from these regulations, the Bus Open Data Service was launched in 2020 to facilitate the provision of high-quality, accurate and up-to-date passenger information across England, outside London. The Government will continue to work with local authorities and the sector to help drive improvements in real-time information.

I know that the noble Lord will have noted the part of our earlier discussion about the requirement in this Bill to ensure that real-time information is available on an accurate basis; the worst thing you can have is inaccurate real-time information. However, this Bill is also about empowering local areas. Part of that is trusting them to take decisions on what is best for the communities that they serve and working with them constructively, particularly in areas where there are existing regulations to ensure that services are improved. This is why I believe that the noble Lord’s Amendment 79B is not necessary.

Turning to Amendment 79D, again I thank the noble Lord, Lord Moylan, for bringing it forward. As he said, it is about working with local transport authorities and airport operators, but I do not believe that the amendment is necessary. My department is currently carrying out a call for ideas for the integrated national transport strategy, which will set out a single national vision. This will have people who use transport and their needs at its heart and will empower local leaders to develop integrated transport solutions. As part of the Bill, we want better links across modes—links that connect people and businesses and support the economy. We are working with operators, local authorities and passengers in that way to deliver more reliable public transport networks in general. The noble Lord will, I hope, understand that I do not wish to cut across the engagement on the integrated national transport strategy that is currently under way.

Lord Hendy of Richmond Hill (Lab)

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I thank my noble friend for his intervention. First, the ultra-light tram development in Coventry is still a tram—it has steel wheels on steel rails, so it is still a tram. Secondly, all those schemes, even ones that will, I hope, produce a relative reduction in capital cost, have to be considered through the Transport and Works Act orders and other mechanisms for building infrastructure. The consequence of that is that those schemes are generally under the control of public authorities and are almost always in urban areas. One of the consequences of the freedoms that this Bill will give to local transport authorities will be the introduction of franchising, binding together all the public transport services in those conurbations, including both timetables and fares, to give an integrated service to citizens who live in those towns and cities.

Lord Hendy of Richmond Hill (Lab)

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My Lords, Amendment 51 tabled by the noble Baroness, Lady Pidgeon, would require local transport authorities to review the impact of bus fares on patronage. Where a local transport authority has delivered fare interventions to encourage patronage, such as Cornwall’s bus fares pilot and the West Yorkshire Combined Authority Mayor’s fare intervention, they have already commissioned independent evaluation reports to measure their success. Bus service improvement plans already in place also include measures addressing bus fares to encourage greater use of buses. We must recognise that changes to fares are usually delivered at the same time as other transport interventions that support and improve bus services. It would therefore be challenging to attribute any change in patronage solely to a change in the fare charged to passengers.

Your Lordships will have noted that the Government are in the process of negotiating the outcomes for which local transport authorities will be held accountable in respect of buses, as part of their recent respective comprehensive funding settlements. In addition to outcome monitoring at a local level, we will continue to monitor fare impacts at a national level to inform future fare cap decisions.

In passing, I note the noble Baroness’s observations about whether Shropshire adopted the £2 fare cap. I am informed that all except six bus services in Shropshire were covered, although I would not say that the bus network in Shropshire was either adequate or satisfactory. One of the effects of the Bill, when it becomes an Act, will be to enable local transport authorities to do better by the various means embraced within it. I therefore submit that the amendment from the noble Baroness, Lady Pidgeon, is unnecessary because of the actions already taking place.

I thank the noble Lord, Lord Moylan, and the noble Earl, Lord Effingham, for Amendment 63, which seeks to examine the impact of ending the £2 national bus fare cap. The department has prepared a full monitoring and evaluation report of the £2 national bus fare cap, which has just been published. The report is available to read and I will make sure that noble Lords present have the link to it. It suggests that urban populations are more likely to have used the scheme, where of course journeys are shorter and fares are more likely to be £2 or less. In fact, the average fare payable on buses prior to the scheme’s introduction was between £2 and £3. The Government’s adoption of a £3 cap, and the added safeguard of increases above £2 being limited to the rate of inflation, do a great deal, at the cost of £150 million, to continue to ensure that millions can access better opportunities and get greater bus use.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Lord for that. I will certainly think about whether, and at what stage, the department would look at that further. I am certainly not going to commit to it today, because we are looking at wide-ranging legislation about bus services in general, but I wanted to inform the Committee that the work on the £2 bus fare cap is now published.

Amendments 74 and 80 from the noble Baroness, Lady Pidgeon, also concern the £2 bus fare cap, which I have just addressed. They are clearly intended to seek its reintroduction. Bearing in mind what the average bus fare is, that the Government are proposing to continue with a £3 cap and that fares between £2 and £3 will go up only by the rate of inflation, I hope she will agree that those amendments are unnecessary. However, the noble Baroness referred to the wider retailing of bus tickets, which is obviously a good idea; from time to time, I find myself agreeing with the noble Lord, Lord Moylan. Access to bus services should be widely available, and not understanding the fare structure or being able to buy a bus ticket are the worst reasons for not using the service.

In my view, and in the Government’s view, the provisions in this Bill that allow local transport authorities a choice of enhanced partnerships or franchising, or even their own bus companies, will enable local transport authorities to look at wider retailing. Of course, the ultimate aim is not to sell bus tickets at all but for people to use credit cards or bank cards directly as means of payment. We want the bus industry and bus services to move towards that, and I believe that this Bill will facilitate it.

Amendment 77 in the name of the noble Baroness, Lady Jones, looks for a review of the English national concessionary travel scheme. The Government want everybody who needs it to have access to public transport and are committed to improving the system. The English national concessionary travel scheme costs about £700 million annually, and any changes to the statutory obligations, such as the hours in which the pass can be used being extended, would need to be carefully considered. As I said to the noble Lord, Lord Moylan, on a previous occasion in the Chamber, the Government are not considering changes to the scheme at the moment.

However, local authorities in England already have the power to offer concessions in addition to their statutory obligations. We see this in London, where individuals aged 60 and over are eligible for the 60+ Oyster card, and similar schemes already exist in other parts of the country, where local authorities have chosen to provide specific support to their communities through offers that go beyond their statutory obligation. That ability for local transport authorities will continue, and no part of this Bill will restrict it. A review into the English national concessionary travel scheme concluded in 2024, and my department is currently considering the next steps.

Amendment 79 in the name of the noble Baroness, Lady Jones, would require the Secretary of State to review the impact of making buses free for children. The Government remain committed to exploring targeted solutions that deliver value for money to taxpayers while ensuring affordable bus travel for those who need it most, particularly young people. Bus operators can choose to offer concessions to children and young people. In fact, youth concessions are currently offered by at least one commercial bus operator in 73 out of the 85 local authority areas in England outside London. Local authorities also have powers to introduce concessions or discounts for young people. Since buses are local and the Government are committed to devolution, that is where we believe that such choices should be made in respect of free and reduced-rate travel for children.

Finally, I note the observations by the noble Lord, Lord Moylan, about demanding or wanting reports following my noble friend Lord Snape’s helpful intervention. This Bill has been carefully thought through. The first requirement when it becomes an Act of Parliament will be that it works for local authorities, communities and bus passengers. No doubt there will be reports in due course but, frankly, I am not looking for any of them to be carried out now or in the immediate future because, as my noble friend observed, our efforts ought to be concentrated on running the bus service better rather than writing reports about why it does not work.

Lord Hendy of Richmond Hill (Lab)

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My Lords, I will address Amendments 54 and 55 together. I listened carefully, as I hope that I always do, to the noble Baroness, Lady Grey-Thompson, who talked about her real experience of travelling by bus. Anything less than 100% accessibility is unacceptable, and I completely agree with her.

The Government are determined that power over local bus services is put back in the hands of local leaders across England. That is why the department recently allocated over £700 million of bus grant for local transport authorities in 2025-26 by formula. Funding for bus services is also provided through the local government finance settlement. In fact, specifically, the 2025-26 funding included money for additional officer capability, for either additional officers or help equivalent to additional officers, to help each local transport authority in the choices that this Bill will give them.

The Government have also established the Bus Centre of Excellence, which I am sure we will continue to return to. Work is also under way to provide even more active support to local transport authorities that wish to explore franchising. I take this opportunity to make noble Lords aware of the Government’s plans to pilot different franchising models particularly suited to more rural areas. This funding, along with potential local transport authority bus funding in future financial years, is available to support implementation of the Bill’s measures.

It is, of course, wholly reasonable to expect the people who deliver policies and support services that help disabled people to understand their legal rights, needs and expectations. This afternoon, we will come on to the primary training needs of bus drivers, who are the visible front line of the bus service. The Government are clearly committed to helping authorities deliver the service improvements that we all want to see, whether it is through tailored assistance, the additional funding to which I have referred or the Bus Centre of Excellence.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Lord, Lord Hampton, and the noble Baronesses, Lady Jones of Moulsecoomb and Lady Pidgeon, for Amendment 58. It seeks to require local authorities to ensure that bus operators provide their drivers with access to the Confidential Incident Reporting and Analysis System, which I will refer to as CIRAS.

The Government are always concerned, as they should be, about any safety incidents in the bus sector, or indeed any other public transport sector. That is why a number of official routes exist to allow anyone to provide confidential, anonymous reporting on safety and standards in the sector, backed up by enforcement. Anyone may anonymously report a lack of safety or conformation to standards in the bus sector to the DVSA intelligence unit, which may use this information to investigate the situation, including by working with other government departments and agencies, as well as police forces.

Comprehensive standards bridge all aspects of bus operation, across the roadworthiness of vehicles, operation of services and driver standards. As I said, they are enforced by a number of organisations, principally the DVSA. The operators of the vehicles are licensed by the traffic commissioners, who consider non-compliance issues seriously and ensure that operators are effectively regulated. The judicial process of the traffic commissioners can and does result in depriving people of operators’ licences and depriving managers of their certificate to run bus operations.

CIRAS provides another route for employees to report concerns. Both Transport for London and Transport for Greater Manchester are members of CIRAS. Being able to report such concerns in a confidential manner is clearly important, and I would encourage employees of member organisations to consider using this service where appropriate. But CIRAS is a third-party service, and it would not be appropriate to include it within the scope of the Bill.

However, I did a bit of personal research on this, and I will say that if we are asking people to report bus safety issues to the DVSA intelligence unit, it would make a lot of sense for access to it to be freely available. When I looked at it, it was quite difficult to find, which is really unhelpful, so I commit that we will see what needs to be done to make sure that the route to report directly to the government agency responsible for safety on buses is as efficient and easy as possible.

I thank the noble Lord, Lord Hampton, and the noble Baroness, Lady Jones of Moulsecoomb, for bringing forward Amendment 59. Road safety is a priority for the Government, of course, and we expect bus operators, as I hope I have just said, to adhere to the highest standards of safety. Buses are one of the safest modes of road transport in Great Britain, and my department remains committed to improving safety with appropriate vehicle construction standards and ensuring the safe operation of vehicles. As we have heard, franchising authorities report safety in detail, and I expect that a consequence of this Bill, as it enables other franchising authorities to be established, will be to enable them to report safety in a similar way to how London and Manchester already do. In effect, the franchising authority is taking responsibility for procuring and delivering a bus service.

In respect of operations that are not part of franchise bus services, we have heard this afternoon that this is carried out through the STATS19 framework, which relies on reports from the police. These reports are based on locations identified by geographical co-ordinates. This is a role that cannot be delegated to local transport authorities and ought to stay with the Driver & Vehicle Standards Agency because it relates to PSV operator licensing requirements. However, I note the remarks of the noble Lord, Lord Hampton, in respect of accidents away from public roads, which I will go away and have a close look at. I am not familiar with that nuance, but it is clearly important. Trying to divide any sorts of accidents into fault and no fault is fraught with difficulty. In fact, it must be subjective, and therefore I am not sure that we would want to go down that road. I understand his point about recording accidents on public service vehicles wherever they occur, and I will go away and see what can be done about that.

Amendment 60 from the noble Lord, Lord Hampton, seeks to change long-established rules about daily driving time on regular bus services. There are two sorts of driving time rules: one for services that do not go beyond 50 kilometres and one for services that do. These daily limits are well and long established, and I think the gist of my conversation with the noble Lord was that he was looking for an ability for people to report scheduling requirements on bus drivers that make drivers feel that they are not safe. That is a matter that could well be drawn to the attention of the DVSA because it goes to the heart of the repute of the operator. I understand that there may well be drivers who feel that what they are being asked to do is potentially or actually unsafe. That goes back to the process that I have referred to and the ability to report it to either CIRAS, if the people responsible for the operation are members of it, or the DVSA if they are not. I note what he said about this amendment seeking to draw to our attention this important matter.

The noble Lords, Lord Hampton and Lord Moylan, talked about the timetable. No bus timetable in Britain should have any requirement for people to drive unsafely or exceed the speed limit. As a seasoned operator with some background in this, I say to them that very often, certainly in urban areas, what you are in fact looking for is not the timetable to be operated but the reliability of the bus service to be as good as it can be. My experience is that drivers should not feel under pressure to return to the timetable. In many cases, any substantial delay makes that impossible. The training given to bus drivers is about driving safely, having absolute regard to the safety of passengers and, in practice, maintaining the regularity of the service rather than the timetable.

If there are cases where drivers feel that they are being asked to drive unsafely, either by schedule or in practice, it is the reporting mechanism that we need to address because there are people trained in this stuff who can address those issues.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Lord for his intervention. Before I got to the railway, I spent most of my adult life trying to encourage people who control bus services not to rely on the timetable but to adhere to a regular frequency. Of course, the truth is that in most urban areas, once you have lost time, the chances of ever regaining it are, frankly, pretty small, and they are even smaller with the increasing use of speed limits of 20 miles per hour. I take the noble Lord’s point but, in the end, this is about people either being required to drive unsafely or believing that they are required to do so. It is certainly possible, and I have seen it done to encourage people to attempt to make time up but, in my experience over the 50 years I have been driving buses—now and again, more recently—it is very difficult to do so.

Let us go back to the safety aspect of this. Where the noble Lord, Lord Hampton, is going rightly concerns finding a way for bus drivers to express that they are being either expected to drive unsafely or encouraged to do it. I take his point about that very clearly. As I said before, there are all these requirements on franchised authorities, which will report on safety because they are procuring the service. CIRAS is available, where people have chosen to join that third-party organisation, but, where they have not done so, it is about making the route to complaining clearer and more available. I very much hope that that answers the noble Lord’s points. I will leave it there.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Earl, Lord Effingham, and the noble Lord, Lord Moylan, for their amendments; I also thank the noble Lord, Lord Burns, for his remarks just now. The Government know how important affordable and reliable bus services are in enabling people to access education, work and vital services. We also know that buses are particularly important for people in the lowest-income households, who make nearly twice as many bus trips as the average, and for younger people, who are much more likely to use buses than other age groups.

The Government also understand the importance of making payment methods on buses accessible and available to all. This is why we have provided guidance to local transport authorities and bus operators on developing their bus service improvement plans, which encourages both parties to work in partnership on improving the provision of fares and ticketing to ensure that the needs of all local bus users are taken into account. To this end, local transport authorities are also encouraged to capture local information about cash usage and electronic payments to inform the development of their bus service improvement plans. The bus franchising powers in the Bill will also give local authorities greater control over fares and ticketing while, through their enhanced partnership arrangements, they can work closely with bus operators to ensure that fares and ticketing policies are inclusive for passengers.

I should just add that, from my own experience as the person who was at the time responsible for the removal of cash payments from buses in London, contrary to the belief of the then mayor that it was the poorest people in London who habitually paid cash, it was completely the reverse: the poorest people in London had already worked out the value of Oyster cards and of daily, weekly and monthly ticketing. In fact, it was the ABC1 males who insisted on trying to pay the enhanced cash fare. When we withdrew it, they immediately moved to Oyster cards themselves. We have already discussed better ticketing once this afternoon, of course.

Amendment 71 looks to have integrated ticketing across the bus network; I note that the noble Lord, Lord Moylan, largely took Amendments 71 and 72 together. His sentiments are right: it is good for passengers, as well as for the bus network, its operators and franchising authorities, to have the most modern methods of payment with the lowest possible transaction costs. I completely agree with him.

What we do not want is to try to force people to do things that they cannot currently do while the work in progress that the noble Earl described is going on, to make payment methods as easy as possible. He asked me for a timetable, which I am not sure I can give him, but the multiplicity of back offices across the bus and railway networks in Britain needs to be untangled, and substantial work is going on within the department to enable multimodal ticketing, particularly in Manchester and the West Midlands, outside London. The consequence of that will be—I hope in time, and as quickly as possible—to allow the back office, in the way that he wants and as the noble Lord, Lord Burns, described, to provide seamless ticketing across bus networks. That work continues, and will take some time. He is, of course, right that in London the volume of transactions was so great that the credit card companies were willing to come to the table very easily. Outside London, it is a bit different, but the department is working very hard to do it.

Since the noble Lord, Lord Moylan, rightly says that the Government are moving quite well in that direction—and he also observes, as I can confirm from observation just now, that the English national concessionary pass has the English rose on it, because mine has it on—I submit, on his own assurance that the Government are moving quite fast, that neither amendment is necessary.

Lord Hendy of Richmond Hill (Lab)

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Before I address the amendments in this group in turn, I wish to say that I am grateful to the noble Lord, Lord Moylan, the noble Earl, Lord Effingham, and the noble Baronesses, Lady Pidgeon and Lady Harris of Richmond—who raised her concerns at Second Reading—for raising the importance of home-to-school travel for children with special educational needs. Although this is not directly within my department, my officials continue to work with the Department for Education to understand the issues and how they are best addressed. No child should struggle to get to school because of a lack of suitable transport.

Your Lordships may already be aware that the Government are clear that the system for educating children with special educational needs and disability—SEND—requires reform. The Department for Education will work with families, schools, local authorities and other partners to deliver improvements so that children and young people can access the support that they deserve. It acknowledges that challenges in the SEND system extend to the arrangements for home-to-school travel and has committed to ensuring that more children can receive the support they need in a local mainstream school. This will mean fewer children needing to rely on long and complex journeys to access education.

Turning to Amendment 65, home-to-school transport is the responsibility of local authorities with education functions, not local transport authorities. For example, Transport for Greater Manchester is the local transport authority for the Greater Manchester region but responsibility for home-to-school travel rests with the 10 local councils within the region. The Education Act 1996 places a statutory duty on local authorities to arrange free home-to-school travel for eligible children. A child is eligible if they are of compulsory school age, attend their nearest suitable school and would not be able to walk there because of the distance, their special educational needs, a disability, a mobility problem, or because the route is not safe.

It is for local authorities to decide what travel arrangements they make for eligible children. For example, they might provide them with a pass for free travel on public transport or arrange a dedicated bus, minibus or taxi. However, to meet their duty, the travel that they arrange must be suitable for the needs of the child concerned. The Department for Education provides comprehensive statutory guidance to help local authorities meet this duty.

The Government already expect local transport authorities to take account of the needs of all people travelling, including children travelling to school. Effective collaboration between local transport authorities and local authorities delivering home-to-school transport may bring benefits, but it would not be appropriate to place a duty relating to home-to-school transport on local transport authorities when statutory responsibility for that service rests elsewhere. For these reasons, Amendment 65 is unnecessary.

Amendment 66 relates to children travelling outside their local authority boundary to access a suitable school place. The statutory duty that requires local authorities with education functions to arrange free travel for all eligible children applies regardless of whether a child’s school is outside the council’s boundary. Where a child with special educational needs has an education, health and care plan, the school named in that plan will almost always be considered to be their nearest suitable school for the purposes of assessing their eligibility for free travel. It is already commonplace for local authorities to arrange free travel. For this reason, this amendment is unnecessary.

Amendment 67 concerns the application of VAT to transport for pupils with special educational needs who attend private schools. These services may already be exempt from VAT; for example, passenger transport in a vehicle with 10 or more seats does not pay any VAT, and operating a vehicle that has been constructed or modified to cater for the special needs of people with disabilities may also not pay any VAT. The Government’s ambition is a state-funded school place for every child who wants one, whether they have special educational needs or not. The Department for Education’s reforms, which I have already mentioned, will deliver an inclusive mainstream system that meets the needs of as many children and young people as possible in their local community.

I also draw the noble Lord’s attention to the consultation on the national insurance contributions Bill, which says at paragraph 2.13:

“The policy intention is to only capture education services and vocational training supplied by a private school, or a ‘closely connected person’, and closely related boarding services. The government recognises that other goods and services ‘closely related’ to education, such as school meals, transport, and books and stationery, are integral to children accessing education. As a result, other ‘closely related’ goods and services other than boarding (i.e. goods and services that are provided by a private school for the direct use of their pupils and that are necessary for delivering the education to their pupils) will remain exempt from VAT”.


I therefore consider this amendment unnecessary.

Finally, Amendment 68 concerns the impact that the increase in employer national insurance contributions will have on bus services for children with special educational needs. The Government recognise that the increase to employer national insurance contribution will have a varying impact across sectors but had to make difficult decisions to help restore economic stability.

As I have remarked already, local authorities are responsible for arranging home-to-school travel and deliver this through a range of providers. Department for Education officials engage regularly with local authorities to understand the challenges that they face and will continue to monitor this situation. It is expected that private sector organisations that contract with local authorities will take the impact of national insurance changes into account, along with other changes to their cost base, in the usual way through contract negotiations.

My noble friend Lord Livermore, at Second Reading of the NIC Bill on 6 January, said in response to a question about NICs and special educational needs transport:

“The right reverend Prelate also asked about SEN transport. In the Budget, the Government announced £2 billion of new grant funding for local government in 2025-26. This includes £515 million to support councils with the increase in employer national insurance contributions, which covers special educational needs home-to-school transport schemes”.—[Official Report, 6/1/25; col. 601.]

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Lord for his intervention. I was referring to support to local authorities for home-to-school transport schemes. I will take that away and come back to him with the clarification that he seeks in this respect. I can say that the Government do not expect the changes to national insurance to have a significant impact on home-to-school travel for children with special educational needs, so it would not be proportionate to conduct the assessment as the amendment suggests. I do not think that it is required.

Lord Hendy of Richmond Hill (Lab)

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My Lords, the imminence of the recess suggests to me that I should not challenge the noble Lord, Lord Moylan, in his knowledge of the history of the traffic commissioners, but I will do that over a drink some time. I am less interested in the development of the Road Traffic Act 1930, or indeed the Transport Act 1985, than I am in the future of the bus service in the 2020s.

Traffic commissioners play an important and strategic role in the transport sector and, these days—principally but not wholly—in road use safety. I certainly refute completely any suggestion that there is an absence of enforcement; the Driver and Vehicle Standards Agency does that. Traffic commissioners are an admirably economic and cost-effective way of dispensing justice to bus operators and bus drivers—those who are licensed to provide these important and, indeed, safe services—in a way that is widely celebrated in the industry and regarded as far more effective than any other solution. Indeed, the independent review of the traffic commissioner function undertaken by the Ministry of Justice, published in May 2023, found that

“the Traffic Commissioner function generally operates effectively”

and noted a strong level of support from the industry for functions continuing to sit with the traffic commissioner. The truth is that for a regulatory arrangement to be so widely celebrated by the industry it regulates is something to be celebrated, rather than abolished.

Lord Hendy of Richmond Hill (Lab)

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One of the reasons why is because it is not in the industry’s interest to have poor-quality operations competing with it; that is true in respect of both the goods sector and the passenger transport sector. When the traffic commissioners take enforcement action, including depriving drivers or operators of their licences or curtailing them, it is widely celebrated by those operators who do take account of the law and operate safely. That is what is important.

On our earlier discussion about the safety of bus operations and bus drivers, finding a mechanism that is effective for disciplining those drivers and operators who transgress the law—sometimes with no intention of complying with it—is very effective. I encourage noble Lords to consider the alternative mechanism of taking taxi drivers in front of magistrates’ courts, which are often found by everybody looking at the actions of the magistrates to be excessively lenient and persuaded by drivers’ explanations of their behaviour that would never pass muster with the traffic commissioner. It is a very important judicial function, and the commissioners need to be supported.

Returning to the Bill, your Lordships will have noticed that some limited changes are proposed to the functions of the commissioners. These include changes to services operating under service permits with enfranchised areas and powers to act against bus operators who breach the mandatory training requirement. The Bill is about empowering local leaders to take decisions on how best to run bus services in their areas. The presence of traffic commissioners across the regions of England—and, for that matter, Scotland and Wales—is complementary to this Bill’s objectives. They are well placed to use local knowledge to take the decisions they do in the execution of their powers, and I certainly do not believe that the noble Lord has made any case for change in the way that this amendment suggests.

Lord Hendy of Richmond Hill (Lab)

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I thank the noble Earl, Lord Effingham, for his remarks on Amendment 82. I also thank him, the noble Lord, Lord Moylan, and all other noble Lords for the issues they have raised in Committee. I have found the exchanges useful in discussing the purpose of the Bill and considering issues raised across your Lordships’ Committee. The Bill reflects how important it is to improve local buses for passengers across the country, including those who are woefully underserved in rural areas. Throughout this process, the needs of people living and working in and visiting rural areas have been integral to policy development.

Government officials have worked hard to publish a thorough and comprehensive impact assessment that has been rated green by the independent Regulatory Policy Committee. The assessment covers every one of the Bill’s measures in detail, including in the context of rural areas, so I am afraid I would struggle to justify why a further duplicate assessment is required. Although the noble Earl says this is not about delay, the amendment would have the potential to delay progress on the Bill and therefore to delay its introduction in areas that need its provisions.

It is important to remember that the freedoms allowed by the Bill to franchise and set up a local authority bus company are entirely optional. These powers simply give local transport authorities more choices in how their bus networks are operated. If a rural authority decides to establish a local authority bus company, it will have the flexibility to scale the company to match the needs of its local passengers, its ambitions for the network and the available funding. Additionally, it is important to highlight that the Government have allocated funding to build LTA capacity and capability on buses, including, but not limited to, the Bus Centre of Excellence. They also plan to pilot different franchising models that may be particularly suited to rural areas.

I conclude my remarks there, and once again thank all noble Lords for the excellent debates across the days we have shared in Grand Committee. I look forward to further debate on Report.