New analysis by Chris Cheek’s Public Transport Monitor reveals extent of increased dependence of England’s bus industry on government money
Direct revenue support, via either the Department for Transport or local government, has doubled from 15% of total income in 2018/19 to 31.3% last year
Public spending on bus services and their passengers accounted for 49.8% of bus industry revenues in England outside London in 2023/24.
This figure comes from a new analysis by Passenger Transport Monitor of figures published by the Department for Transport and the Ministry of Housing, Communities and Local Government.
The analysis reveals how this figure has increased in recent years. Prior to the pandemic in (2018/19) public spending accounted for 37.8% of income.
In London, the proportion of revenue coming from public funds fell from 43.6% to 41.6%, but this remains above the 39.5% seen in 2018/19.
Chris Cheek, who led the analysis commented: “The shift in bus industry economics over the last five or six years has been swift and remarkable … Direct revenue support, via either the Department for Transport or local government, has doubled from 15% of total income in 2018/19 to 31.3% last year. Interestingly, that is a higher proportion than the 27% seen in the run-up to deregulation.”
Commenting on the analysis, Giles Fearnley, the former managing director of First Bus told Passenger Transport: “It is fantastic that since Covid, the government has recognised the real value of bus networks to local communities and economies through this money, but with this comes real risk that it won’t last. CPT is absolutely right to be lobbying hard for a long-term funding settlement in the forthcoming Spending Review.
The shift in bus industry economics over the last five or six years has been swift and remarkable
“The consequences of failure are all too obvious with the likely undoing of so much great work being delivered right now to underpin and develop services and networks, both through franchising and through ever stronger and effective partnerships that this additional funding has itself brought about.”
Bill Hiron of Eastern Transport Holdings called for urgent action to arrest the cycle of decline.
He told Passenger Transport: “We all know from virtually every piece of both research and best practice, that speeding up bus services and making private motoring less attractive (both financially and in terms of journey time) creates a virtuous circle. Bus usage will increase, services will improve, the level of subsidy required will fall, and repeat.
“But such a major policy change – which will be decried by opposition politicians and the press as ‘declaring war on the motorist’ is, of course, not a decision the bus industry or its leaders can make. That will take courageous politicians (and let’s not forget that such a policy would have huge spin-off benefits to public health, NHS spending, the urban environment and loads more). So why not start with the 5p a litre freeze in fuel duty? The Campaign for Better Transport says that ‘unfreezing’ fuel duty would save £2.6bn a year. That sum, cumulatively, would go a long way to commencing a revolution in bus priority in our town and city centres.”
“Fundamentally, the general ease with which private cars can access our towns and cities has to change. Grasping that nettle has the potential to truly transform the economics of bus service provision!”
This article appears in the latest issue of Passenger Transport.
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