Bus Services Bill [Lords]

Debate between Bridget Phillipson and Theresa Villiers

2nd reading: House of Commons
Wednesday 1st March 2017 Commons Chamber

[Mrs Villiers]

No, I have already given way.

We need to bear it in mind that, in competing for bus contracts, local operators might be up against large transport groups owned by overseas Governments with deep pockets. I am particularly concerned that the amendment that was approved in the other place will mean that bus operators could even find themselves having to contest for contracts alongside a company owned by the franchising authority that is making the decision to award the contract, giving rise to an obvious and unacceptable conflict of interest. I fear that clause 4 would inevitably result in a number of bus companies going out of business, which would be bad for passengers. I am also concerned that local authorities that are keen to take over the provision of bus services will find that taking on revenue risk could be a very costly exercise that would deplete the funding available to support those crucial non-commercial routes that do not generate enough passengers to cover their costs.

No local authority has introduced a quality contract to re-regulate bus services, despite their having been on the statute book since the early years of this century. I acknowledge that there are different reasons for that, but one of them is that taking over bus operations is inevitably a very expensive project for local authorities. To those who think that passing greater financial responsibility for investing in the bus network from the private sector to local councils is a great idea, I would point out that it involves investment in buses and bus services having to compete with pressing priorities such as social care, libraries, waste collection and all the rest, and that that investment—and bus passengers—are likely to suffer as a result.

Ever since 1986, there has been a vigorous and lively debate about the effect of deregulating bus services outside London. It cannot be denied that many millions of pounds of investment have been made by private sector bus operators in the years since privatisation. That brings me to a key problem with the franchising proposals—namely, the uncertainty that they will cause. If bus operators are unsure about whether their businesses could end up being taken off the road, they will be reluctant to invest in new buses or to improve passenger facilities such as ticketing systems.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

I have listened with some frustration to what the right hon. Lady is saying. I fail to grasp why something that works in London and no doubt delivers very well for the people she represents cannot be done in other parts of the country. The insecurity that she talks about could have the reverse effect in large parts of the north-east, where the insecurity at the moment rests with the travelling public, who do not know whether there will be a bus to get them to hospital on a regular basis.

[Mrs Villiers]

There seems to be an assumption that if the London model of regulation were to be applied everywhere else, it would suddenly deliver London standards of bus services, but a causal link between the two has not been established. A whole range of factors in London contributes to the high levels of ridership and the success of the bus network. Simply reproducing that regulatory system elsewhere would not deliver the same end result, not least because Londoners pay several million pounds in congestion charges every year that are recycled into bus services. That larger level of subsidy makes a difference to the quality of the services.