Bus Services (Yorkshire and Humber)

Fabian Hamilton Excerpts

Wednesday 17th April 2013 Westminster Hall

[Fabian Hamilton (Leeds North East) (Lab)]

It is, as always, a pleasure to serve under your chairmanship, Mr Howarth. Before I start the debate, I should apologise for being unable to stay for the entire afternoon. The debate was originally scheduled for 9.30 this morning, but owing to the funeral of Baroness Thatcher, the business of the House begins at 2.30 this afternoon, as hon. Members are aware. However, because I have had a meeting, in Parliament, with two constituents arranged since January and because those constituents had purchased their rail tickets in advance, I could not put them off, so I hope that you, Mr Howarth, the Minister, the shadow Minister, my hon. Friend the Member for Makerfield (Yvonne Fovargue), and all other colleagues present will forgive me for leaving early in what I hope they agree are exceptional circumstances.

It is a pleasure to open this debate on a subject that at first glance might seem rather complex and perhaps a little esoteric, but what we are about to debate is very far from that. In fact, it is fundamental to the future of so many people, especially young people, who are desperate for work, education or training—not just in Yorkshire and the Humber, but throughout the country. I am absolutely certain of that. Why did I choose such a seemingly long title for the debate, as on the Order Paper? I am grateful to my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith), who has been extremely active, both in her constituency and throughout the region, in drawing attention to a matter that, unless it is resolved soon, could well make the difference between renewed economic growth and further decline. It really is that important. Like me, she felt that it was not possible to reduce the title of the debate any further, because it was essential to include all the issues that needed to be discussed.

It might be helpful to hon. Members if I first remind them of the background to bus services in England outside London. In October 1986, the late Baroness Thatcher’s Conservative Government first deregulated bus services, allowing private contractors to run registered routes commercially and in competition with one another, and to tender for registered routes that were deemed to be unprofitable and were therefore subsidised by local ratepayers, later to become council tax payers of course. Local authorities were no longer allowed to run their own not-for-profit bus services, so the famous Sheffield buses, which in the mid-’80s cost as little as 2p per journey across the city, were doomed.

Contrary to popular belief at the time, I understand that many business rate payers in the centre of Sheffield were angry, because although their rates were relatively high, the cheapness of bus fares from the outlying villages and suburbs of the great city of Sheffield meant that city centre shops were always busy and profitable for their owners. Once the subsidies stopped and the routes became commercialised, the fares went up sharply, often putting them beyond the reach of many in the city and its outlying areas. A measure that was intended to lower bus fares through competition increased them massively in some cases.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

Does my hon. Friend agree that the other impact of deregulation in cities such as Sheffield was proportionately to increase the number of cars on the road and to decrease the number of people using local public transport?

[Fabian Hamilton]

I thank my hon. Friend for that important intervention. I remember clearly that in October 1986 the route that I used to travel from my then home in Armley, Leeds, to the city centre was via the Armley gyratory—a massive roundabout and huge junction on the western side of Leeds. Up to that point in October 1986, the traffic queue was not that great at 8.30 in the morning, but I remember that, immediately following deregulation, the queues trebled. Everyone had got on the buses, but they suddenly became much more expensive. That had been predicted by the Labour Opposition and by the local authority, of which I was about to become a member.

In my city of Leeds, the former City and the former West Yorkshire bus services became a commercial company—some may recall that it was called Yorkshire Rider—and it made a small number of former public servants very wealthy as they became managers of a cash-rich commercial service mandatorily divorced from the public service that they once received a salary to operate. Other commercial operators entered the field, but were soon swallowed up by Yorkshire Rider, which did not like the competition. Eventually, of course, Yorkshire Rider itself was swallowed up by an even larger concern, so that today there is a virtual monopoly in Leeds, with First Bus operating almost all commercial bus services not just in Leeds, but in Bradford, Wakefield and the surrounding districts of West Yorkshire. What was once a public service had become a cash generator, and the travelling public, so dependent on buses, were left to pay the cost of ever-increasing fares, caused by the need to make a profit and the sharply rising fuel prices that added to the misery.

I shall spare my colleagues the history of the fiasco of the Leeds Supertram during the past 10 years. Suffice it to say that the lack of any alternative public transport to the bus network in Leeds has made buses even more critical for non-car owners. The Labour Government, however, tried to do something for bus passengers—I will refrain from calling them customers—with the concept of quality bus contracts. In government, Labour legislated to enable local authorities to reverse bus deregulation in their area by introducing a quality contract—in effect, a move to tendered bus services.

Under a quality contract, the accountable transport authority sets the fares and plans the network, while private operators bid to run the services. That model exists in London, where deregulation of the bus network never took place. A number of Labour-run integrated transport authorities are consulting on introducing quality contracts for their local bus services. This Government claim that they will not block transport authorities from pursuing quality contracts, yet they are reforming bus funding in a way that creates a financial disincentive for councils to go down that route.

Department for Transport guidelines for local transport authorities applying for funding from the new better bus area fund state that only voluntary partnerships with bus operators, not quality contracts, will be eligible for funding:

“Bus services can thrive in areas where local authorities and bus operators work together to identify and solve problems, so proposals will only be considered if supported by key bus operator(s).”

The source for that quote is the Department for Transport’s “Better Bus Area Fund: Guidance for Bidders”, published in December 2011.

Labour published a paper containing a number of proposals to reform local transport, as part of the policy review entitled “Empowering communities to improve transport”. The proposals would enable transport authorities to improve local bus services through greater regulatory powers over fares and routes, and a new statutory power for the Secretary of State for Transport to designate bus deregulation exemption zones.

My hon. Friend the Member for Garston and Halewood (Maria Eagle), the shadow Secretary of State for Transport, said in her speech to the 2011 Labour party conference:

“Devolving funding and decision making over transport is making a real difference in our cities. But in government we didn’t go far enough. That’s why our policy review has been looking at how we can devolve more transport responsibilities.”

She referred, among other things, to local and regional rail services.

How, then, does all that relate to the support necessary for young people in our region and throughout the country to be able to access jobs, training or education? Perhaps the Yorkshire Post put it best, when on 28 February this year it said:

“SPENDING on buses could give Ministers a quicker and cheaper way to help the economy than investing in ‘big ticket’ transport infrastructure, according to a new report.

The research found bus services in England’s major urban areas outside London are responsible for economic benefits worth around £2.5bn.

The report from pteg”—

the Passenger Transport Executive Group—

“which represents passenger transport executives such as Metro and SYPTE”—

the South Yorkshire passenger transport executive—

“in Yorkshire, suggests grants to bus operators generate £2.80 for every £1 spent while every £1 used to support concessionary fares generates £1.50.

It also found that the majority of the bus industry’s £5bn turnover every year is ploughed back into the areas where operators work through their supply chains and because their staff live in the area.

Pteg chairman David Brown said: ‘This report suggests that whilst there is a great deal of focus on big transport infrastructure schemes as a way of generating growth, the urban bus also deserves more attention from policy makers.

Investing more in the bus could be one of the biggest bargains there is for government in supporting big city economies, in getting the jobless back to work and in addressing some deep rooted, and ultimately costly, social challenges.’

The report was published yesterday as councillors in Barnsley raised concerns over the impact of poor transport links on the town’s economy. Councillors on the authority’s economy and skills scrutiny commission warned transport issues were harming efforts to help the long term unemployed back into work. Young people, particularly in the west of the district, were finding it ‘almost impossible’ to access apprenticeships because of poorly served bus routes, the commission found.

Commission chairman coun Dick Wraith said: ‘The council and its partners are doing everything they can to bring new jobs to Barnsley, and that hard work needs to continue.

However, we need to make sure that local people can get to the jobs that are out there, especially young people, who can lose out to older competitors who have their own transport and don’t need to rely on bus services to get them to work.’”

I thank the Yorkshire Post for that article.

Chris Waterman, of the Rural Access to Learning Group, contacted me to tell me what his group, which is concentrating on the connection between transport in rural areas and access to learning, especially for young people, is considering. He said that it is trying to promote a wide-ranging discussion at national and local level on the future development and funding of student transport in rural areas. Although many parts of our region of Yorkshire and the Humber are highly urbanised, it also has huge rural areas dotted with many villages where huge numbers of residents, especially young people, find themselves completely stranded without decent and affordable bus services.

Chris told me about a female student who started an evening course that finishes at 9 pm. She lives on a bus route, 3 miles from the college, but the service has recently been reduced and the last bus now passes her home at 8.15 pm. During the winter months, the student was understandably nervous about having to walk home in the dark and, having no access to a car, decided that she could not stay the course. I am glad to say that Chris told me that the college made an exception and funded taxi services for that student for that course at that time. Not all students are that lucky. Many will have to ditch their courses because they simply cannot get to and from college in time. RALG will produce a report on the issue, which will significantly contribute to the debate and, I hope, offer helpful solutions. I am grateful to Chris Waterman for his assistance and look forward to reading the proposals that RALG makes.

I hope that many hon. Members will contribute to the debate, so I will not take up too much more time, but important points need to be made and, to conclude, I would like to mention a few of them. First, Ministers promised that funding cuts would not lead to the loss of local bus services, yet many communities have seen significant reductions in vital services and fares have risen, on average, by double the rate of inflation. Secondly, the most vulnerable are the most affected by the loss of local bus services, with 35% of the 5.2 billion bus journeys each year in Britain made by those eligible for concessionary travel.

Thirdly, transport authorities that seek to use the legislation passed by the Labour Government to re-regulate bus services, giving them control over fares and routes, have found themselves frustrated by the bus companies and, I am afraid, a lack of support from the Government.

Fourthly, according to the Department for Transport’s own figures—the annual bus user statistics—bus fares increased by 6.5% in England from June 2011 to June 2012. That is 5.4% in London, 6.8% in metropolitan areas and 7.6% in non-metropolitan areas, in just one year. That means that bus fares have gone up, on average, by twice the rate of inflation, which is 3.2%, using the retail prices index rate. The Department’s figures suggest that fares have gone up by a third in five years.

Finally, the largest five bus operating companies in the UK, which jointly control more than 71% of the bus market, made combined operating profits in 2011-12 of more than half a billion pounds.

I hope that the debate highlights some of the key issues frustrating so many of our young people in their attempts to get work, training or education, whether they live in cities, towns or rural areas, whether in the Yorkshire and the Humber region or anywhere else in England.