The national bus strategy

The national bus strategy

  1. If deregulation is dead then what is this that is replacing it?

For years we have been arguing that passengers in our areas don’t want on-street competition and private companies determining the key public service that they rely on. Instead they want single, integrated bus networks as part of wider single, integrated public transport networks. The national bus strategy shows that argument has now been won. It’s striking too how few friends bus deregulation has now that nobody seems to have turned up at its funeral yesterday to mourn its passing and to defend Nicholas Ridley’s original vision of a free and competitive market for bus services. But if deregulation as we knew it is dead then what is this that is replacing it?

The National Bus Strategy goes into a remarkable level of detail of what bus networks should look like in the future – from how buses routes should be numbered to how the fares should be structured and charged. In essence it wants the kind of bus network you would get through specification via a franchise or through municipal provision. But though franchising (and perhaps municipal operation in the future) are seen as legitimate ways of achieving these goals by the strategy, in effect bus services in England are being herded to the top of an Enhanced Partnership ski slope and given a hefty push. No Enhanced Partnership by April next year – no money. And whereas the few Enhanced Partnerships that exist have taken years to put in place, the Government wants the whole of England to be papered over with EP agreements (other than those who are on the franchise route) in a years’ time.

In some ways, it makes sense to seek to reduce the wriggle room that could translate into years of endless negotiations between local authorities and bus operators only to arrive at a watered down compromise and yet another bus strategy. But at the same time there has to be a danger that, on these timescales and with local government spending cuts having decimated transport planning capacity in the shires in particular, weak and baggy Enhanced Partnerships will emerge in order to access the cash – whilst the details that matter to passengers are spun out into the future. And Enhanced Partnerships are still a product of negotiation – rather than dictation by local authorities on behalf of national government in pursuit of a precise outcome. They also still operate within a deregulated market which is overseen by the competition authorities. So just how far can we expect the Enhanced Partnership tool to deliver the kind of  fully integrated single network with highly specified outcomes that the Government wants all across the country?

More widely, are we now entering – in theory at least – a strange hybrid model for bus provision where those operating bus services (when the music stopped before the pandemic) get to carry on but under a kind of quasi licence from local government which itself is under a kind of quasi licence from national government? And all within what is still nominally a free market where new entrants could burst upon the scene at any moment. Meanwhile, the bus strategy is in danger of bias against the route one option that could deliver the outcomes it wants – which is to write down precisely what you want and ask companies to bid to provide it. Because if you start an Enhanced Partnership to get the funding how easy, legally and otherwise, would it be to later ride two horses by starting the franchising process? How do you work closely with incumbent operators on an EP and at the same time run a free and fair franchising process where non-incumbents are on level terms? It’s strange too that though the document is keenly aware of the problems with timelines on franchising – and sets an ambitious timeline for Enhanced Partnerships – there is no mention of any reforms of the 2017 legislation which could learn the lessons from the slow take up and implementation of the powers it contains.

2. How much?

The National Bus Strategy is not short on ambition. It wants more services serving more places. It wants cheaper and simpler fares. It wants high spec green buses. It wants extensive bus priority everywhere. All of this will not come cheap when the pre-pandemic base case was that subsidy was well below what was needed to stem decline. Keeping bus services running during the pandemic is also burning through cash at a prodigious rate – and no one knows for sure how long social distancing will remain – or whether a post-summer third wave could mean restrictions are reintroduced. We know we have COVID-19 Bus Services Support Grant for now and we know we have the PM’s £3 billion. But beyond that we don’t know too much. Including what the quantum of overall funding will be available for bus, how it will be distributed or what the total price tag would be for all the goodies the Government wants. This doesn’t make it easy for anyone to plan ahead to deliver on both the ambitions and timescales that Government has set. On the plus side, with the PM right behind a policy which has pledged to transform bus services, however much HMT sucks its teeth about the price tag it will be difficult for them now to undermine the PM by cutting the bus industry off at the knees.

3. Beyond the headlines

There are some pretty hefty aspirations loitering in the odd paragraph here and there (all with their own price tags). Check these out for starters…

  • Five Glider schemes. I’m a big fan of Glider (and also good to see Northern Ireland get some attention for the good stuff it does on bus) but Glider works because it was very well thought through for the specific corridors it operates on and because the money was spent to ensure its quality from start to finish. Gliders in England will need to do the same if they are to work anywhere near as well.
  • A review of the eligibility for free bus travel for disabled people with a view to improving equality of opportunity.
  • Through fares for any journey involving bus, rail and light rail.

4. The dog that didn’t bark

The lack of any reference to addressing the antediluvian oversight and regulation of bus safety outside London is a big hole in the bus strategy. How can it be right that for rail and for buses in London, the analysis and data is there on safety risks and accidents (and is being systematically addressed) but nothing close to this exists for buses outside London? There is a glimmer of hope though in the review of the public service registration standards – which could be used to require reporting and data on accidents and risk.

So to borrow some lines from the late great Eric Morecambe. The national bus strategy has all the right notes, but not necessarily in the right order. But with some positive thinking…

Jonathan Bray is Director at Urban Transport Group

A longer version of this blog appeared in Passenger Transport magazine

Budget 2021: Five key takeaways for urban transport

1. The one year 2020 Spending Review, and the multi-year 2021 Spending Review, are more significant for urban transport than the Budget was likely to be – and indeed, proved to be. Also, between now and the 2021 Spending Review, we will have the bus strategy, and, if the road map to COVID-19 recovery works out, the Government will need to take some decisions on how it will fill the patronage/funding gap that COVID-19 will still leave behind. So plenty still to play for.

However, although public spending wasn’t the main focus of the Budget, it did put more flesh on the bones of the new funding streams that were announced in the 2020 Spending Review – perhaps most notably on the Levelling Up Fund. It also showed that the political dimension to funding choices, that are always implicit, are becoming more explicit through more ranking of areas to be prioritised and the greater involvement of local MPs.

2. Glass half empty? The Resolution Foundation analysis is that the Budget has further sharpened the axe which hangs over non-protected Government departments. They say: ‘Further planned cuts to public services spending will see budgets for unprotected departments (such as transport and local government) fall by £2.6bn next year (2022-23). And that by 2024-25, day to day public service spending per capita in unprotected departments will still be almost one-quarter lower than in 2009-10, with less than a fifth of the reduction in spending between 2009-10 and 2018-19 having been unwound. These spending cuts assume no further spending pressures elsewhere, which is highly unlikely given what’s in store for the NHS, schools and social care over the coming years.’

This is a particular concern in relation to the revenue support that public transport needs to recover, never mind, build its often low share of the trips that people make. It also has implications for the already denuded capacity of local transport authorities to retain and develop the skills and capacity they need to deliver capital investment and meet the increasingly complex environmental and social challenges that cities face.

3. Glass half full? Most of the extra £5bn promised for bus and active travel that the Prime Minister pledged in February 2020, is still to come. If you add in the existing Transforming Cities Fund and the new funds on their way, then potentially there could be significant capital funding on its way to spend on the right things on urban transport (public transport and active travel). Plus, few could argue that post industrial towns are not overdue an investment boost.

4. Meanwhile there’s a danger of a swing back to greater centralisation of decision-making with the risk that the Intra-city Transport Fund in particular becomes a tool by which HMT can manage the priorities of city regions which should be left to determine their own futures. More widely, the Budget reinforced the trend of recent years away from block funding towards places having to please and convince terribly clever people in London about the merits of their bids into multiple competitive funding pots.

5. One day a Chancellor is going to have to grasp the nettle of significant road vehicle taxation reform – not least because of the rise of electric vehicles. But yesterday wasn’t that day. The fuel duty escalator remains frozen. This further undermines both public transport’s competitive position and the slow progress being made to reduce transport’s drag on wider Government carbon reduction targets. But it could be that as the pandemic recedes, that 2021 is the year when more kites are flown around how a new and more progressive fiscal and charging regime for road vehicles could also fill the revenue gap that the electrification of vehicle fleets will cause in the current system.

Jonathan Bray is Director at Urban Transport Group

Why we need a new deal on urban transport – both during the pandemic and beyond

The roadmap of the release from COVID-19 restrictions was as cautious as was predicted for the early stages but perhaps more ambitious than was expected on the end game – with June 21st potentially seeing the end of all restrictions on journey purpose and on social distancing. It’s good to now have the playbook for the nation’s recovery from COVID-19 as a whole. But the uncertainty over what the future holds for public transport, and for urban transport more widely, continues.

Key uncertainties include that we don’t know what the new base level of public transport use will be once the restrictions on travel and on social distancing associated with the pandemic have been permanently removed and transport patronage has settled down to ‘new normal’. Our best current assessment is that without significant policy intervention, the base level of patronage will be well below what it was before the pandemic due to the changes in journey patterns that will have taken place – for example in regular commuting.

We also can’t be sure of when the ‘new normal’ will arrive. June 21st is the earliest possible date and it could be that even if that is achieved, that restrictions may temporarily return, either locally or nationally, at a later date.

What we do know is that the pandemic has underlined what was always true – which is that public transport gets essential workers who don’t have access to a car where they need to be. And without public transport, cities can’t function. It’s also clear that a just and green recovery from the pandemic isn’t possible without public transport. Transport’s poor performance is currently a drag on the UK achieving its carbon reduction targets and shifting more journeys to public transport and active travel will play a key role in correcting that. The pandemic has also hit hardest those people and communities with the least – who are also those who are least likely to be able to work from home. Better access to opportunity through affordable and better public transport is therefore key.

Government has rightly provided welcome emergency COVID-19 funding support during the pandemic so far – which has enabled the wheels of public transport to keep turning. Indeed, in some ways this is a unique situation in that unlike prior to the pandemic (when bus services were vanishing, leaving ‘public transport deserts’ in rural areas), during the pandemic the Government is guaranteeing a level of provision. But though it is doing this, it’s only doing it in a provisional and fragmented way – with different funding arrangements for each mode of public transport – and through a series of relatively short term funding mechanisms. Initially this funding has was predicated on the tacit assumption that the ‘new normal’ will arrive at a fixed point (which will be as soon as possible) when social distancing is removed and previous funding arrangements can be restored. More recently there has been a recognition of the need for ‘recovery funding’ which could bridge the gap between the end of the emergency period of the pandemic and the subsequent transition to when patronage has settled down to whatever the ‘new normal’ might be. At which point the Government can step back.

But there is a bigger challenge with the mindset behind the idea of ‘getting back to normal’, ‘recovery funding’ and so on… which is that the normal we had before the pandemic falls well short of the aspirations we had then, and have now, at both local and national level, for greater use of public transport. For example, the totality of funding prior to the pandemic was insufficient to stem decline in bus use. The way that funding was provided (and indeed continued to be provided throughout the pandemic) was through multiple, poorly coordinated funding streams involving different Government departments and was not linked to delivering a coherent set of wider policy objectives for bus.

With at least four more months of pandemic restrictions ahead of us which will hold down public transport patronage, and with a mountain to climb after that to get public transport use back to where it was prior to the pandemic, it’s time for a new deal on urban transport.

This new deal for public transport should:

  • simplify, devolve and guarantee the revenue funding and powers that urban transport authorities need to enable us to plan and provide single integrated public transport networks in the most cost effective way. Both during the remainder of the pandemic and beyond.
  • include a long term capital funding deal for investment in urban transport (similar to the one that national rail and roads already have) so that we have the certainty we need to invest in the decarbonised urban transport networks that can serve all our communities and underpin a green and just recovery.

Find out more on our website here.

Jonathan Bray is Director of the Urban Transport Group