There won’t be much money for buses in the years ahead, but the sector can live without it if the government is willing to be brave
Brave courageous urban traffic policies don’t cost anything but will deliver much cleaner, liveable cities and contribute to meeting climate change targets
BY Robert Montgomery
Ever since Boris Johnson announced Bus Back Better, England’s new National Bus Strategy, back in 2021 and boldly put £5bn on the table, those of us who have been in and around bus operation and government bus policy for the last 40 years held onto a certain scepticism and wondered if this money was real.
Our scepticism has not been dimmed by the constant redefinition of what that £5bn was actually for and even whether it was ever £5bn for buses at all. Now, it looks like our scepticism was justified.
With Boris gone and, following recent events, the dawning of Austerity 2.0, it is pretty clear that discretionary government spending will drop to virtually zero to allow for investment in the NHS, the Ministry of Defence and the statutory obligations of local authorities which will all take precedence over any future bus investment.
We have been here before in the 2010s when bus funding was slowly strangled and many local authorities shed their bus management resource
We have been here before in the 2010s when bus funding was slowly strangled and many local authorities shed their bus management resource whilst, in parallel, growing traffic congestion slowed bus speeds creating the double whammy of falling patronage and rising costs.
We all know the long-term prognosis for, particularly urban, bus operation in the UK is a sound one provided networks survive the short-term cash haemorrhages caused by Brexit and Covid.
As we speak networks are being culled, not just by commercial operators, but also by local authorities like Kent admitting that they can no longer afford to sustain many traditionally supported services.
The notion that transferring revenue risk to the public sector is a safe haven is well and truly blown when austerity strikes, hence my deep-seated scepticism about a franchised future in our big cities.
Do we really need more government money?
I have been asking myself whether, fundamentally, the industry really needs more government money and, now that it is vanishing before our very eyes, considering how we move forward without it.
In reality, should we truly be bothered by its loss, or is there a better way of developing the UK’s bus networks?
Austerity 2.0 is a reality and there are bigger fish for the government to fry than subsidising £2 fares on bus networks for three months. Aren’t short-term price promotions to stimulate demand following market shocks the responsibility of the private sector operators who will reap the benefit of any long-term growth in demand? If there isn’t any long term growth to achieve then it would be a complete waste of public money on a short-term giveaway!
Can the bus market be more commercially sustainable?
So, let’s be real, and accept that the bulk of urban bus operation in the UK is a commercial proposition delivered by private sector operators currently suffering from shocks to demand from Covid and its aftermath and serious operational issues arising from a nationwide driver shortage driven by Brexit.
Yes, with political courage!
The real bridge between the current market status and the long-term prognosis of organic growth as a result of a major modal shift to save the planet from climate change is not about money but about political courage.
Supporting the UK bus industry to fulfil its destiny as the beating heart of a more environmentally friendly urban mobility ecosystem is not dependent on government funding but is overwhelmingly dependent on government courage.
We need political courage not public money
We do not need more public money but we do need political courage!
Brave courageous urban traffic policies don’t cost anything but will deliver much cleaner, liveable cities and contribute to meeting climate change targets.
Those policies are unavoidable in the long run so taking the decisions now in the context of expenditure constraints makes a lot of sense. Failing to take them will see bus demand across the country continue to fall, services continue to be withdrawn, and strangled by traffic congestion and labour shortages when we all know the long term future in our cities will be based on mass transit and active travel, not private cars.
Clearly, the first two of the policy measures outlined above cannot happen overnight, but a clear early signal of a positive direction of travel on both would significantly boost confidence and investment in the future of the urban bus market, compensating for any disappointment in the absence of more material direct public financial support.
THREE KEY POLICY OBJECTIVES
The current government can achieve the win-win of saving funding on buses whilst boosting the future of the UK bus industry and the environment in the UK’s great cities through embracing three key policy initiatives right now:
Be brave on managing urban roads
The government must accept the inevitability of universal road pricing as the market for diesel and petrol evaporates and the income from fuel duty is lost.
Cover the revenue shortfall with a move to universal road pricing and give both Highways England and local authorities a statutory obligation to use road pricing to eliminate excess traffic and congestion, giving mass transit the ability to operate freely, faster and cheaper and deliver substantial modal shift and a significant uplift in revenue.
People question whether the commercial bus model is broken. It is not. It is simply crippled by traffic congestion which has had a far more detrimental and sustained effect on the bus industry than Covid.
Covid was just the straw that broke the camel’s back.
Let urban buses run freely, demand will rise, costs will fall and the commercial model will blossom.
This approach to actually managing the urban road environment should also be integrated with proper urban parking controls and pricing.
For that we need a brave and visionary secretary of state for transport.
Be brave on granting visas for foreign heavy vehicle drivers
The government must recognise the scale and nature of the deeply ingrained heavy vehicle driver shortage since both Brexit and Covid, and open up visas to foreign drivers. The current ongoing discussion on a trade agreement with India could sensibly contain visas for Indian truck and bus drivers to live and work in the UK, solving the debilitating driver shortage at a stroke whilst contributing to growth in the economy.
For over 12 months we have watched bus operators across the country living hand to mouth without enough drivers, and that problem will not be fixed without radical action. The last crisis of this sort in the late 2000’s was resolved by mass recruitment from Eastern Europe which reversed post Brexit.
Putting artificial barriers on driver recruitment, where drivers are the very lifeblood of the business, is simply suicidal.
We need to diversify the source of drivers both domestically and internationally to deliver the exceptionally high levels of reliability required to gain and sustain mass modal shift.
Hearing managers proudly saying they have reduced lost mileage to 3% is truly scary when it should be less than 0.5%.
For that we need a brave and visionary home secretary.
Be brave on confronting the true financial cost of franchising
The government must ensure that any proposals by mayoral combined authorities to franchise urban bus networks are thoroughly and properly assessed against the alternative of radical public/private sector partnerships. The statutory audit, required by the 2017 Bus Services Act, captures the full cost of any measures intended to be implemented after the transition to franchising.
Simply assessing the ‘business as usual’ status quo under franchising against the current model isn’t enough to ensure networks will be financially sustainable in the long run if the public are being promised cheaper fares and more services as a direct result of franchising.
The assessment should fully reflect the cost of moving away from commercially sustainable fares and service levels.
We should never forget that the Tyne and Wear Quality Contract proposal of 2013 was initially heralded as being cheaper than the status quo of commercial operation whilst providing lower fares and more services but, by 2015, it had wilted under proper scrutiny and assessment and was shown to be financially unsustainable.
The one certainty of a franchised network is a dramatic increase in cost as has been seen in London and is, therefore, incompatible with Austerity 2.0.
For that, we need a brave and visionary chancellor of the exchequer who will curb the financial folly of franchising.
ABOUT THE AUTHOR: Robert Montgomery has worked in the bus industry in the UK, Ireland and the Middle East for 52 years, including as managing director of Stagecoach Group’s UK Bus Division. He is now working with partners on developing public/private sector partnerships in urban areas, with digital technology suppliers and on business development projects in the Middle East.
This story appears inside the latest issue of Passenger Transport.
How can buses survive Austerity 2.0?
by Passenger Transport on Nov 4, 2022 • 2:19 pm No CommentsThere won’t be much money for buses in the years ahead, but the sector can live without it if the government is willing to be brave
BY Robert Montgomery
Ever since Boris Johnson announced Bus Back Better, England’s new National Bus Strategy, back in 2021 and boldly put £5bn on the table, those of us who have been in and around bus operation and government bus policy for the last 40 years held onto a certain scepticism and wondered if this money was real.
Our scepticism has not been dimmed by the constant redefinition of what that £5bn was actually for and even whether it was ever £5bn for buses at all. Now, it looks like our scepticism was justified.
With Boris gone and, following recent events, the dawning of Austerity 2.0, it is pretty clear that discretionary government spending will drop to virtually zero to allow for investment in the NHS, the Ministry of Defence and the statutory obligations of local authorities which will all take precedence over any future bus investment.
We have been here before in the 2010s when bus funding was slowly strangled and many local authorities shed their bus management resource whilst, in parallel, growing traffic congestion slowed bus speeds creating the double whammy of falling patronage and rising costs.
We all know the long-term prognosis for, particularly urban, bus operation in the UK is a sound one provided networks survive the short-term cash haemorrhages caused by Brexit and Covid.
As we speak networks are being culled, not just by commercial operators, but also by local authorities like Kent admitting that they can no longer afford to sustain many traditionally supported services.
The notion that transferring revenue risk to the public sector is a safe haven is well and truly blown when austerity strikes, hence my deep-seated scepticism about a franchised future in our big cities.
Do we really need more government money?
I have been asking myself whether, fundamentally, the industry really needs more government money and, now that it is vanishing before our very eyes, considering how we move forward without it.
In reality, should we truly be bothered by its loss, or is there a better way of developing the UK’s bus networks?
Austerity 2.0 is a reality and there are bigger fish for the government to fry than subsidising £2 fares on bus networks for three months. Aren’t short-term price promotions to stimulate demand following market shocks the responsibility of the private sector operators who will reap the benefit of any long-term growth in demand? If there isn’t any long term growth to achieve then it would be a complete waste of public money on a short-term giveaway!
Can the bus market be more commercially sustainable?
So, let’s be real, and accept that the bulk of urban bus operation in the UK is a commercial proposition delivered by private sector operators currently suffering from shocks to demand from Covid and its aftermath and serious operational issues arising from a nationwide driver shortage driven by Brexit.
Yes, with political courage!
The real bridge between the current market status and the long-term prognosis of organic growth as a result of a major modal shift to save the planet from climate change is not about money but about political courage.
Supporting the UK bus industry to fulfil its destiny as the beating heart of a more environmentally friendly urban mobility ecosystem is not dependent on government funding but is overwhelmingly dependent on government courage.
We need political courage not public money
We do not need more public money but we do need political courage!
Brave courageous urban traffic policies don’t cost anything but will deliver much cleaner, liveable cities and contribute to meeting climate change targets.
Those policies are unavoidable in the long run so taking the decisions now in the context of expenditure constraints makes a lot of sense. Failing to take them will see bus demand across the country continue to fall, services continue to be withdrawn, and strangled by traffic congestion and labour shortages when we all know the long term future in our cities will be based on mass transit and active travel, not private cars.
Clearly, the first two of the policy measures outlined above cannot happen overnight, but a clear early signal of a positive direction of travel on both would significantly boost confidence and investment in the future of the urban bus market, compensating for any disappointment in the absence of more material direct public financial support.
THREE KEY POLICY OBJECTIVES
The current government can achieve the win-win of saving funding on buses whilst boosting the future of the UK bus industry and the environment in the UK’s great cities through embracing three key policy initiatives right now:
Be brave on managing urban roads
The government must accept the inevitability of universal road pricing as the market for diesel and petrol evaporates and the income from fuel duty is lost.
Cover the revenue shortfall with a move to universal road pricing and give both Highways England and local authorities a statutory obligation to use road pricing to eliminate excess traffic and congestion, giving mass transit the ability to operate freely, faster and cheaper and deliver substantial modal shift and a significant uplift in revenue.
People question whether the commercial bus model is broken. It is not. It is simply crippled by traffic congestion which has had a far more detrimental and sustained effect on the bus industry than Covid.
Covid was just the straw that broke the camel’s back.
Let urban buses run freely, demand will rise, costs will fall and the commercial model will blossom.
This approach to actually managing the urban road environment should also be integrated with proper urban parking controls and pricing.
For that we need a brave and visionary secretary of state for transport.
Be brave on granting visas for foreign heavy vehicle drivers
The government must recognise the scale and nature of the deeply ingrained heavy vehicle driver shortage since both Brexit and Covid, and open up visas to foreign drivers. The current ongoing discussion on a trade agreement with India could sensibly contain visas for Indian truck and bus drivers to live and work in the UK, solving the debilitating driver shortage at a stroke whilst contributing to growth in the economy.
For over 12 months we have watched bus operators across the country living hand to mouth without enough drivers, and that problem will not be fixed without radical action. The last crisis of this sort in the late 2000’s was resolved by mass recruitment from Eastern Europe which reversed post Brexit.
Putting artificial barriers on driver recruitment, where drivers are the very lifeblood of the business, is simply suicidal.
We need to diversify the source of drivers both domestically and internationally to deliver the exceptionally high levels of reliability required to gain and sustain mass modal shift.
Hearing managers proudly saying they have reduced lost mileage to 3% is truly scary when it should be less than 0.5%.
For that we need a brave and visionary home secretary.
Be brave on confronting the true financial cost of franchising
The government must ensure that any proposals by mayoral combined authorities to franchise urban bus networks are thoroughly and properly assessed against the alternative of radical public/private sector partnerships. The statutory audit, required by the 2017 Bus Services Act, captures the full cost of any measures intended to be implemented after the transition to franchising.
Simply assessing the ‘business as usual’ status quo under franchising against the current model isn’t enough to ensure networks will be financially sustainable in the long run if the public are being promised cheaper fares and more services as a direct result of franchising.
The assessment should fully reflect the cost of moving away from commercially sustainable fares and service levels.
We should never forget that the Tyne and Wear Quality Contract proposal of 2013 was initially heralded as being cheaper than the status quo of commercial operation whilst providing lower fares and more services but, by 2015, it had wilted under proper scrutiny and assessment and was shown to be financially unsustainable.
The one certainty of a franchised network is a dramatic increase in cost as has been seen in London and is, therefore, incompatible with Austerity 2.0.
For that, we need a brave and visionary chancellor of the exchequer who will curb the financial folly of franchising.
ABOUT THE AUTHOR: Robert Montgomery has worked in the bus industry in the UK, Ireland and the Middle East for 52 years, including as managing director of Stagecoach Group’s UK Bus Division. He is now working with partners on developing public/private sector partnerships in urban areas, with digital technology suppliers and on business development projects in the Middle East.
This story appears inside the latest issue of Passenger Transport.
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