Bus Franchising

Lord Moylan Excerpts

Thursday 12th September 2024 Lords Chamber

[Lord Moylan (Con)]

My Lords, I thank the Minister for the Statement. The Official Opposition share the Government’s desire for high-quality public transport and we will hold the Government to account on this.

In government, the Conservatives prioritised buses, protecting our network during the pandemic and introducing the “Get Around for £2” scheme, saving millions of people money on their commute and, most importantly, incentivising them to travel by bus again quickly after the impact that the pandemic had on travel. We know that our public transport sector desperately needs increasing passenger numbers to make routes viable and this is an especially acute problem in rural areas. The previous Government’s policy, driven by the “Get Around for £2” scheme, was successful in driving up the number of passenger journeys in the year to March 2023 by almost 20%. While this is not yet at pre-pandemic levels, our scheme is supporting the return of passengers and boosting the bus sector. So, before addressing the specific issue of bus franchising, can the Minister say what the Government’s intention is for the “Get Around for £2” scheme and whether it is also at risk of means testing? Will the Minister rule that out?

I turn now to the subject of the Statement: the statutory instrument. It seeks to give to all local authorities the powers on bus franchising that are currently exercised in major conurbations such as London and Manchester. Broadly and generally, the Official Opposition welcome the granting and devolution of more powers to local authorities, but this statutory instrument, like a number of announcements from the Government to date, is fundamentally bogus, for two reasons. First, it is often argued that cities and towns outside London should have the sorts of public transport services that London has and the sort of system that provides those transport services. As noble Lords will no doubt be aware, the bus service in London is provided by private companies that operate under concessions that have been granted to them, competitively, by Transport for London in a way that ensures a degree of coherence and system in the operation of the bus service across the conurbation.

The fares risk, which is the crucial question in all this, is borne by Transport for London. The bus companies themselves simply supply the service for a fee. The truth is that this is not something that just happened overnight. TfL did not suddenly find a way to do something that nobody else had ever done. Transport for London, in various guises, has been operating transport services in London for over 150 years, and bus services going back at least to the foundation of the General Omnibus Company—a French company, actually—in the 1850s in London. It is the historical core of what we now call London Buses. The capacity of most local authorities to deliver these services is extremely limited. They do not have those roots or those abilities. Where, out of nowhere, are they to conjure the ability to set up a bus concession management system?

The second reason that this is a fundamentally bogus statutory instrument is the cost of doing it. Running bus services, on the sort of basis that local authorities wish to provide them, is very expensive and requires large subsidies. My figures might be slightly out of date, but when the last Mayor of London, Boris Johnson, left office, the subsidy to London Buses was of the order of £450 million a year. The last I heard, and it may not be totally up to date, was that under his successor the cost of London Buses is of the order of £700 million a year. That is in a very large city, of course, but £700 million a year is a huge amount to have to find to subsidise bus services.

Throughout the country, local authorities will have to subsidise buses if they are to provide the sorts of services that this statutory instrument and this Government are holding out as being possible. Where is the money going to come from? Without massive investment in capacity and the subsidisation of operations, this statutory instrument is fundamentally meaningless.

So do the Government intend to publish a full assessment of the expected impact of this policy on the quality, frequency and accessibility of bus services? Will the Minister commit to assessing the relative impact of this policy on rural communities in particular, as opposed to urban communities?

Finally, the Official Opposition, as I say, support the desire for improved public transport and we generally support the increase of powers to local authorities. But this policy appears to put showmanship ahead of practical improvements. The Government have yet again got their priorities wrong, focusing on who runs local bus services rather than on delivering the people’s priorities, which are the quality, frequency and reliability of our public transport network.

[Baroness Randerson (LD)]

My Lords, the Liberal Democrats welcome this Statement. As it has emphasised, it is clear that buses are crucial to our economy and society. They provide services for many of the poorest groups—the young, the old, more women than men—and are crucial for access to education, jobs, health services and other aspects.

We welcome rapid action to deal with our rapidly declining bus network outside London and we are fundamentally in favour of devolution, believing that decisions made locally are generally more effective and efficient. If the Minister looks back to Hansard in 2017, he will see that I put down during debates on the Bus Services Bill amendments that did roughly what the Government’s proposed measures will do—allow all local authorities to franchise and set up their own bus services. The response from the then Minister was that it was all about issues of capacity. To be fair, that is still an issue. On its own, this will not be enough, so what are the Government going to do? Will they provide additional funding and funding changes in the Budget in order to ensure that franchising is enabled in those local authorities that are not generally as big as, for example, Manchester.

As with the rail Bill, our concern is that the key issues are not necessarily included in the Government’s proposals in order to be broad enough to solve the problems. I have a couple of associated questions. Reference has been made to government subsidies to support the £2 fare cap. That will run out in December, and another funding stream that is designed to support improved services will run out in April. Can the Minister give us a commitment that we will see the end of temporary funding and that it will be replaced with a multiyear, more encompassing set of funding that is less divided up? There are four sets of funding that go to local authorities. They need, as the bus industry needs, certainty and a long-term approach, so I hope the Government will do that.

Finally, can we have an assurance that the Government will look at badly needed incentives and assistance to encourage young people on to our buses? For years and years, we have had free fares for elderly people. Young people need a nationwide scheme of at least reduced fares in order to get them on the buses and encourage them to become the bus users of the future. Many rural areas in particular need additional bus services, and young people using the buses would be a great incentive to the establishment of new bus services in those areas.