Local Bus Market

Debate between Norman Baker and Julie Hilling

Thursday 10th January 2013 Westminster Hall

[Norman Baker]

The Bus for Jobs initiative is being assessed by the bus companies, and I spoke about it to a leading member of the bus industry yesterday. I will be keeping in touch with the industry, to see what the initial response is and whether there is a case for extending the initiative. That would be a matter for the bus companies, but we want to see the response first—us from the Government point of view and them from a commercial point of view. If the initiative is successful in persuading people who have not considered the bus before to take the bus and then to stay with the bus, it might be a sensible commercial proposition for the bus companies.

However, I have made no secret of my belief that the bus companies need to do more to help young people, and that has formed a key part of my speech on major set-piece occasions when I have addressed the bus industry. The industry has responded sensibly and well to that challenge, and the companies know that I will continue to engage with them formally and informally. The subject is always on the agenda of the Bus Partnership Forum, which I hold with the industry six-monthly and in which young people also participate.

Overall, commercial services, which represent about 80% of bus mileage, are holding up quite well, which is good news that we should all welcome. I understand the challenges of being in opposition, but I encourage Opposition Members not to talk down the bus industry, which is easy to do—I have been in opposition myself. They should recognise what is going well, as well as not so well. Commercial services are holding up, and we should take some comfort from that.

Although there is good news on that front, I recognise—I am the first to do so—that in some areas of the country the garden is not quite so rosy. Recent statistics show that the supported service network—only 20% of overall bus mileage, but important for many people—is not as healthy as the commercial sector. The picture is not uniform, as it inevitably will not be in an era of localism, such as the one we are moving into, because the decisions are made locally by elected councillors. Some councils, such as East Riding, have prioritised bus services in setting their budgets, while others, such as Surrey, have reduced their spending but have done so creatively and carefully so as not to translate cuts into significant service reductions.

Other councils, I am sorry to say, have made what appear to be arbitrary and swingeing cuts that fail to consider properly the needs of their local residents—I refer to North Yorkshire and Cambridgeshire—which can lead to people in isolated communities, particularly in rural locations, having restricted access to education, training, work, health care and other important services. We have heard about how those who use the bus tend to be at either end of the age spectrum, so young people and elderly people are especially affected if such cuts are made, because they rely more on public transport to get around.

[Julie Hilling]

While the Minister is talking about local authorities continuing to support bus services, has he investigated whether those that do not have suffered more extreme cuts from the coalition Government than others? A lot of Labour authorities, for instance, have had much higher cuts to their spending than Tory councils. I recognise that that might not be the case in the two examples he gave, but I was wondering what the correlation is with local authorities that can no longer support such services.

[Norman Baker]

The allocation of money to local councils and their predominant concerns are matters not for the Department for Transport, but for the Department for Communities and Local Government, which sets the allocation for local council funds. We do not control that, but allocate our own funds, which we are increasing through the green bus fund and the better bus areas and community transport. That is what our Department has been doing, but I am unable to answer the hon. Lady directly, because that is not my Department’s responsibility. I do not believe, however, that there is a direct correlation between the reductions in local funding from the DCLG and the cuts in bus funding.

Indeed, what is reflected—quite properly—is the exercise of local discretion. Some councils have decided to protect bus services and to make them a high priority, while others have not sought to do so, which is entirely up to them, because they consist of elected local people. I certainly encourage individual constituents in those areas where bus cuts have been significant to ask their local councils and councillors why they have decided to prioritise bus cuts, as opposed to anything else, while perhaps the councils next door have not done so. To be fair, I referred to non-Labour councils, North Yorkshire and Cambridgeshire, but I can also pick out Darlington, Stoke and such councils, which have reduced their budgets. Things are mixed throughout the country.

Overall, however, bus mileage remains broadly flat, with commercial services in many cases picking up the slack as bus companies continue to look for opportunities to grow their local markets.

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[Norman Baker]

The hon. Lady is tempting me to respond to the consultation exercise, which I will do with clarity in due course. A point about quality contracts that I made to the Select Committee in response to the hon. Member for Blackley and Broughton (Graham Stringer) was that they are there in law:

“They are there as part of the Local Transport Act 2008”—

I was a member of the Committee—

“They remain on the statute book.”

There is no intention of removing them from the statute book and I expect the law to be respected by all parties. I would take a dim view of any bus company or anyone else who sought to undermine the law of the land as it is on the statute book.

On resources for traffic commissioners, to which the Committee referred, the coalition Government has already given a commitment to review their role in the next financial year as part of a wider review of non-departmental public bodies. It is sensible to include a look at their public service vehicle work as part of that review.

I shall pick up individual points that hon. Members have raised this afternoon. The Chair of the Transport Committee referred to multi-operator ticketing and whether it would require new legislation. We have made it clear that we strongly support multi-operator ticketing. We believe it is important to deliver the sorts of outcomes that passengers want, and to avoid the situation to which the hon. Member for Bolton West (Julie Hilling) referred of passengers buying a ticket and then having to buy a further ticket to get home. That cannot be a sensible outcome for passengers, and cannot help public transport generally. We do not want that.

[Mr Peter Bone in the Chair]

We have made it clear to bus companies that we want multi-operator ticketing. We have also made it clear that we reserve the right to introduce legislation if that does not occur. We hope that it will occur—there is some evidence of that—not least because in Oxford where it is occurring, the bus companies have discovered that it is in their financial interest. I am confident that the bus industry has bought the idea of multi-operator ticketing, and that it will become increasingly common throughout the country. However, we reserve the right to take that forward in legislation if necessary.

We also believe that transparency is important. I welcome any figures that can be produced to help passengers and to give a wider perspective of how the industry is performing, and indeed how the Government is performing. Anyone who knows about my role in Parliament will know that I have been hugely committed to transparency in all sorts of areas throughout my time here. We must avoid placing huge extra burdens on industry for not much return, so we cannot require endless figures to be produced if they are of little value, but in principle we are certainly open to any suggestions for extra information that is genuinely valuable. If the Committee has particular issues in mind, I will be happy to consider them.

My hon. Friend the Member for Milton Keynes South (Iain Stewart) referred to door-to-door journeys. He called them end-to-end journeys. I have discussed with the rail and bus industry how to describe them, but I will not bore him with the nuances of that conversation. Suffice it to say that the general view was that we should call them door-to-door journeys, and that is what the Department is doing. It will shortly produce information on such journeys to aid the process. It will cover the bus and rail industries, and ensure that different modes of transport are joined up. In best practice they are, but sometimes they are not.

My hon. Friend was right to refer to the role of smart ticketing, which is key to delivering door-to-door journeys properly. He said that it is necessary for people to be confident that they will get the cheapest fare when they use a new ticket-purchasing method for their journey. I absolutely share that view. For the railways it is a key objective of the fare and ticketing review that people buy the ticket that is appropriate for their journey, and do not pay over the odds unnecessarily. Obtaining the best possible deal for rail and bus passengers, which also involves transparency, is to the fore of the Government’s thinking.

I always listen with interest to the hon. Member for Blackley and Broughton when he talks about transport, because for many years he has demonstrated a genuine commitment and great knowledge. He referred to London’s upside, but he will recognise that it also has its downside. There are pros and cons with the London arrangement, and I am familiar with both. In any assessment of what is best for one area it would be wise to consider the upside and downside in London when considering arrangements for buses.

The hon. Gentleman referred to concessionary fares. There will be no change in the arrangements during this Parliament. That is what the coalition Government has said, but what individual parties do in their manifestos will be a matter for them as we approach the next general election.

The hon. Member for Bolton West raised the interesting matter of—I suppose, though she did not frame it in this way—the purpose of bus travel. What is the objective that we, or local councils, are seeking to deliver and what are bus operators delivering by running buses? There are different reasons, it seems to me, why buses are run. One is to provide a regular means of transport at a high frequency along corridors such as Oxford road, which is effective, or can be effective, in securing modal shift from the motor car, and thereby, in theory, easing congestion, reducing carbon emissions, and providing a viable public transport alternative. As we have seen in London and elsewhere, there is no question but that when we have frequent services and people turn up without having to think about the timetable, it drives passenger numbers up, creating a virtuous circle where buses become more attractive and more buses can be run. We have that in many parts of our country—not all, but in many parts—including much of London. However, it could be argued—this is one of the downsides of London, I might say—that sometimes, and it is my view, there is an over-provision of buses, which run significantly empty on occasions, back to back all the way along the road. That is a particular problem on Oxford street, as opposed to Oxford road.

It seems to me that the second purpose of a bus is to provide a social function and a necessary connection between those who are without private transport but need a bus to get to a school, a hospital, or whatever it happens to be. The hon. Member for Bolton West suggested that the answer was route-bundling, which is a perfectly legitimate philosophical view. However, I would say that route-bundling may satisfy her need for buses that go round the houses, but what is the consequence for Oxford road, or buses along high-frequency corridors? I am not sure that we can have both—perhaps we can. If we reduce high-frequency corridors to provide buses round the houses, that may meet more social needs, but it may secure less modal shift from road. I raise that philosophically to point out that such things are not perhaps as straightforward as they are sometimes presented.

[Julie Hilling]

I certainly had not taken my thoughts to the level of “Well, if you are going to provide a service here, you are taking a service off somewhere else.” For me, it is more about running the Oxford road service with that frequency, and alongside that, having another area of routes. Some will be highly lucrative and others less so. It is less about the distribution of resources, and more about saying, “Yes, we need to provide this service and those services.” It is not about taking resources away to provide them.

[Norman Baker]

Many of us, including me, would like to have our cake and eat it, would we not? “Eat our cake and have it” was, I think, the original English phrase, which makes more sense. If we can do that, fantastic, but I draw attention to the conundrum about the supply of buses and what is done with them.

The hon. Lady and the hon. Member for Blackley and Broughton referred to the costs of bus services in Manchester, and the hon. Gentleman made what might be termed “uncomplimentary comments” about FirstGroup. To be fair, I understand that FirstGroup recently reduced its weekly tickets to £13 from £18 in Manchester. FirstGroup tells me that initial signs are positive, with passenger growth levels ahead of 5% in just eight weeks, meaning that, so far, more than 300,000 bus journeys have been made on the reduced fares. It tells me that that is part of a long-term plan to rebase bus passenger levels in Manchester.

Assuming all that is correct, and there is no reason to think that it is not, it is a welcome development. I have often tried to persuade public transport operators that cutting fares can be useful in driving up business, and if that is what is being demonstrated by FirstGroup in Manchester, as it appears to be, it is a welcome development. I hope everybody would agree that it could potentially lead to more buses, cheaper fares and the creation of the virtuous circle that I referred to.

[Julie Hilling]

The Minister is being extremely generous in giving way. My understanding is that that experiment is in one part of the conurbation, and it certainly does not include services to Bolton and other parts. Hopefully, if that experiment is working for FirstGroup, it might consider bringing costs down across the conurbation.

[Norman Baker]

Precisely. If it is working, and it appears to be, it would be wise commercially to see where else it might apply. Doubtless, the people at FirstGroup are listening to this debate very carefully, and they will have heard the hon. Lady’s pitch for a similar scheme for Bolton West and elsewhere, no doubt, in the conurbation.

The hon. Lady asked what we would do to roll out something like Oyster. I can assure her that we are doing a great deal of work on smart cards, or smart ticketing—it is becoming difficult to get the right form, because we talk about mobile phones and everything else, and there is no simple phrase these days to describe all that. As a Government, one of the first things that we did was give a big sum of money to the various passenger transport executives to help develop smart ticketing in their areas, and we are giving other help as well. That money is forthcoming for rail and bus.

The hon. Lady asked what we would do to help Greater Manchester. I hope that we will do a great deal. We continue to work productively with the integrated transport authority up there. I am always very happy to meet its representatives and hear any concerns that they have. We have, in fact, given a great deal of money to Manchester for transport in the past two and a half years, including the beginning of the delivery of the entire northern hub, so I hope that we are doing a good deal to help transport in that area.

I was asked about data on bus spend. I am advised that DCLG collects some of those data and they are published as part of its annual statistics—not just on supported services, but more generally. On best practice, I think it is something that has value, but it is predominantly for the local government family in this new era of localism to identify that themselves. Of course, we are interested in it, and talk regularly to our local government colleagues and to the Association of Transport Coordinating Officers, for example. However, it is broadly my view that the Local Government Association needs to do rather more to step up to the plate and identify best practice, rather than simply seeing itself as a body that lobbies Government for something. In the new era of localism, it has a different role to play, which I hope it will develop rather more than it has done. We are helping local government in many ways, including through providing guidance for local authorities on tendering.

Bus Services

Debate between Norman Baker and Julie Hilling

Thursday 1st December 2011 Westminster Hall

[Norman Baker]

It is important to note that. That is a very relevant point and it leads me on, perhaps, to the points made by the hon. Member for Hartlepool (Mr Wright). I am sorry that, unlike the Chairman of the Committee, who presented matters fairly and equitably, albeit in a challenging way, he sought to present matters as something of a party political rant. He was keen to say that this was the Government’s fault, but the Government have not cut bus services in Hartlepool—his local council has. Councils up and down the country have not been cutting bus services, and if all the services in Hartlepool have disappeared he needs to take the matter up with his local operator and council.

The picture varies enormously across the country. I am not pretending that it is easy for local councils; it is perfectly true that there are challenges as a consequence of the local government settlement. Cuts have been made across the country in local bus services, particularly in supported ones. The Opposition spokesman, the hon. Member for Barrow and Furness (John Woodcock) said, I think, that the Campaign for Better Transport had found that three quarters of local authorities were cutting back on buses. That is unwelcome, but the fact remains that a quarter are not cutting back at all. Perhaps we should look at them for lessons on how they have managed to maintain their bus services rather than cutting everything in sight, which appears to have happened in Hartlepool.

[Julie Hilling]

Perhaps one of the things that should be considered is the level of cuts made to those local authorities. We know that the same cuts have not been made everywhere, and that some local authorities, particularly those in the north-west, north-east and other areas, have had far greater cuts than some authorities in the south, which have had much less stringent budgetary cuts.

[Norman Baker]

The hon. Lady will appreciate that I am not responsible for how the Department for Communities and Local Government has distributed its money, and I cannot comment on that in detail. What I would say, having looked at bus patterns across the country, is that it is not the case that southern counties have maintained their bus services while northern ones have not. The picture is much more mixed. The east riding of Yorkshire, for example, has done well on maintaining bus services. A north-south split is not reflected in the way she suggests.

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[Norman Baker]

I will not give way again, as I am trying to answer the hon. Gentleman’s points, and he is anticipating me all the time. The fact is that we now have a regulatory framework that his Government put in place in the Local Transport Act, and the record will show that it would have gone more in the direction that the hon. Member for Barrow and Furness wanted if his Government had accepted the amendments that I tabled at the time.

Our position has been set out clearly. The Government await the results of the Competition Commission’s inquiry. It would be premature to make judgments about the landscape of the bus market until it has reported. We will read the Competition Commission report carefully, consider the arrangements for the bus service operators grant at the same time and in parallel and make it clear where we are going as soon as we have had a chance to digest the final report. That is the responsible course of action, given where the Competition Commission is at present.

[Julie Hilling]

Will the Minister give way?

[Norman Baker]

Yes, but for the last time, as I need to make some progress.

--- Later in debate ---

[Julie Hilling]

I thank the Minister for giving way; he is being generous with his time. My question is simple: have we any idea when the commission is likely to report?

[Norman Baker]

Yes. We will have clarity from the commission, and clarity from the Government on BSOG, in the early part of next year. We will then be able to answer questions in more detail based on what the commission has said.

I think that it is unfair to paint the autumn statement in the negative way the hon. Member for Hartlepool did. He said that things would get worse. I do not want to have a debate about the finances, as this is not the place to do it, but I will give one statistic. The day after the general election, our interest rates were higher than Italy’s. They are now lower than Germany’s, which suggests that the Government are handling the economic position rather better than he gives us credit for.

In addition to the money for green buses announced this week and for retrofitting existing buses, the Chancellor gave transport authorities another £50 million this week in his statement. I hardly think that this has been a bad week for transport, or for local authorities as far as transport is concerned. It seems to be a good week in terms of what has been handed out.

I mentioned that the Competition Commission’s report would be published shortly. The Department has submitted its formal written response to the provisional remedies, which is available to view on the Competition Commission’s website. In the response, I broadly welcomed the provisional remedies. I believe that they have potential to improve multi-operator bus ticketing in particular, and I welcome the commission’s focus on that issue in its recent inquiry into the bus market. There is no question but that better integrated ticketing can help by enabling passengers to make more seamless journeys. Smart ticketing can also play an important role. That is why I have committed to delivering, with operators and public sector bodies, the infrastructure to enable most public transport journeys to be undertaken using smart ticketing by December 2014, to answer the point raised by my hon. Friend the Member for Blackpool North and Cleveleys.

I mentioned the Local Transport Act 2008. There has been some concern that the provisional remedies have been ambiguous in terms of the tools in the Act that can enable authorities to increase the quality of services, so let me be clear. Statutory quality partnership schemes, quality contract schemes and voluntary and qualifying agreements remain useful tools for local transport authorities to deliver their public transport policies. That is the present position. The Government have taken no action to undermine quality partnerships or quality contracts. We will consider where we are after the Competition Commission has reported. In the meantime, it is perfectly open to local authorities to use the terms of the 2008 Act. It is available on the statute book for them to use if they decide that that is what they want to do.

The hon. Member for Bolton West (Julie Hilling) discussed the general price of bus fares. She is absolutely right to express concerns about that. Over the past 30 years, the trend has been that the average cost of travelling by bus has increased more than the average cost of travelling by train or car. We recognise that buses are used disproportionately by poorer people. I want to ensure that we consider that issue in our response to the Competition Commission’s inquiry into the bus market. It is not for us in Government to start telling people how much they should charge for buses in Kettering or anywhere else, but we must ensure that the system and the market work properly, which is what we are trying to achieve as part of our consideration of the Competition Commission responses.

I was interested in the point made by my hon. Friend the Member for Milton Keynes South about the deal reached between the council and Arriva to provide a 50p rate before 9.30. It is an exceedingly interesting idea that a bus company and a council can come together to create a new, innovative arrangement that meets the needs of local people and, presumably, the bus company as well. We need more arrangements such as that, and I hope that we will see what we can do to encourage such innovation across the country.

Oral Answers to Questions

Debate between Norman Baker and Julie Hilling

Thursday 5th May 2011 Commons Chamber

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

I am pleased with the number of bids we have received so far for the first tranche of the local sustainable transport fund. A number of imaginative bids have come in. There is a further bidding round, however, and I would welcome any suggestions that could improve the co-ordination of transport across modes.

[Julie Hilling (Bolton West) (Lab)]

Does the Minister agree that referral fees and the whole claims management industry drive up the cost of motor insurance? Will the Government be doing anything to regulate this industry?

Sustainable Transport

Debate between Norman Baker and Julie Hilling

Wednesday 19th January 2011 Commons Chamber

[Norman Baker]

It certainly can encourage such projects. As I said in my previous answer, it is up to the local council to come up with a scheme that meets those objectives. I very much hope that my hon. Friend will pursue those objectives, which seem quite sensible, with the local council, and suggest that it submits a bid.

[Julie Hilling (Bolton West) (Lab)]

As the Minister will know, three times as much money is spent on public transport in the south as in the north. Will this programme do anything to redress that balance?

[Norman Baker]

Obviously, the population of the south is different from that in the north, which is one factor in question. We are keen to ensure that we achieve the two targets of creating growth and cutting carbon, and we also recognise that there are particular areas where unemployment is a problem, which we are keen to help as far as possible, so we will bear those factors in mind when bids come in. We certainly want to see a reasonable balance to the money that is distributed.