Local Bus Services

Andrew Gwynne Excerpts

Wednesday 5th November 2014 Commons Chamber

[Mary Creagh]

My hon. Friend makes a good point, and only this morning I met Councillor John McNicholas from Coventry to discuss some of the issues with Centro and the west midlands.

I want to talk about three big issues. The first is why buses are so important to our economy, and the second is what has happened to buses under this Government. Finally, I will set out how a Labour Government will empower local authorities to take control of local transport.

Let me begin with why buses are important. Buses give people the freedom to work, learn, explore new places and connect with new people. Nearly 5 billion bus trips are made in Britain each year, and three times more trips are made by bus than by train. Buses take the unemployed to job interviews and to work, and they take young people to their exams, colleges and into their futures.

I congratulate Councillor Liam Robinson, chair of Merseytravel, who spotted that young people from larger families were not turning up to school on Thursdays and Fridays. Why? Their families had run out of money for bus fares. He negotiated a young person’s ticket where the fare is capped at £2 a day instead of £1.30 a journey. The number of bus users has grown as a result, and young people in Liverpool and Merseyside no longer miss out on their education.

[Andrew Gwynne (Denton and Reddish) (Lab)]

My hon. Friend is right to mention the affordability of bus services. Is she aware that in Manchester, for example, to travel six miles on buses costs more than £3, yet here in London that same six-mile journey using an Oyster card would cost just £1.45? Do we not need affordable public transport too?

[Mary Creagh]

I could not agree more with my hon. Friend, and I was talking to Councillor Andrew Fender only this morning about some of the difficulties faced in the Greater Manchester area. If someone travels over a whole day in London within certain zones their bus fare will be capped at £4.40, but if they live anywhere outside London their fare is not capped and they pay far more.

Buses take people to the GP and to hospital appointments. When I visited Plymouth in July, Labour council leader Tudor Evans, my hon. Friend the Member for Plymouth, Moor View (Alison Seabeck) and Labour candidate Luke Pollard told me how a previous short-sighted Tory city council had sold off the city’s municipal bus company. [Interruption.] We heard the word “excellent” from the hon. Member for Thurrock (Jackie Doyle-Price). I am sure her constituents would be pleased to hear that.

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[Mary Creagh]

I aspire to a country in which even the Duchess of Westminster travels on the Clapham omnibus—or even the Westminster omnibus.

We know that the rise in bus fares has disproportionately affected the frail and the vulnerable, as well as young jobseekers and those on low incomes without access to a car. We know, too, that in some rural areas, bus services have all but disappeared—the result of this Government’s deep cuts to supported services, which my hon. Friend the Member for Coventry South (Mr Cunningham) mentioned. Freedom of information requests by my right hon. Friend the Member for Leeds Central (Hilary Benn) uncovered the fact that local authority bus subsidies across shire counties were cut by 23% in real terms between 2010 and 2014. Conservative Northamptonshire county council cut its subsidy by 55%, and Conservative-run Suffolk by 50%.

In cities outside London, there is a chaotic mix of local control over trams and metros, private provision of buses and nationally operated rail franchises—no integrated ticketing, no real-time information and no fares information at the bus stop. The bus companies say, “Ask the driver”, but can we imagine going to Tesco for a loaf of bread and being told that we have to take it to the checkout to find out the price? There is often no usable map of the bus networks and their connections. Instead, different bus companies compete for fares.

[Andrew Gwynne]

Is not the issue here that Transport for London set the frequency and set the standards and bus companies bid to be part of the network, whereas Transport for Greater Manchester does not currently have those powers so that private bus companies set the network and TFGM has to infill with minuscule resources that it does not have?

[Mary Creagh]

That is indeed an important point. The competition in London happens at the point of contracting the routes, whereas in Manchester the theoretical competition happens on the road. I was on a bus in Manchester last Friday, so I know my hon. Friend makes an important point about the sort of private provision and the sort of competition that benefit not just people, but our economy, jobs and growth. If we do not have transport mobility, we will not have social mobility because people will not be able to move out of their areas to look for work, further their education and better themselves.

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[Mary Creagh]

Thank you, Madam Deputy Speaker. Perhaps we should have a bell that Members can ring.

I am not sure that I should say who attended the summit. Officers from Devon county council attended, as did one Conservative leader, but I am not sure that he would be pleased with me if I named him. [Hon. Members: “Name him!”] No, I will not. It is for me to know and for other Members to find out. [Interruption.] It was not a secret summit. All 105 city and county leaders were invited.

At the summit, we discussed how London-style powers could bring more small and medium-sized bus companies into a market in which five big companies take 70% of the business. We noted that those five operators all complain about a regulated market outside London, but are happy to operate in a regulated London bus market. We discussed how the voice of the passenger left waiting at a bus stop could be heard, how we could overcome the barriers to open data about buses, how ticketing could be linked with trams and trains, and how interchanges could be made easier. We also discussed the fact that communities can be isolated just a mile from a city centre if there is no bus, which is what happens on the Peacock estate in Wakefield.

On Monday, Stagecoach claimed that it could deliver multi-operator Oyster-style ticketing across the country by 2015, which came as a surprise to many Members. We know that unless the law is changed, it will not be able to deliver multi-operator tickets with a daily price cap. Stagecoach has also claimed that politicians are

“peddling the myth that London is best”

for buses. This morning, however, one councillor referred to London as the “magic kingdom” of buses. London has 7 million regular Oyster card users. In contrast, the Secretary of State this morning heaped praise on Centro in the west midlands for having just 3,000 smart card users.

I want to seize this opportunity to fix the broken bus market. The current problems stem from an over-centralised state, and the Government have done nothing to change that. All local authorities face different transport challenges. Only when public transport, cycling and walking become attractive options will they grow and improve.

I do not think it is fair that only London provides passengers with one ticket for every form of public transport, always guaranteeing the lowest fare and capping daily bus usage at £4.40.

[Andrew Gwynne]

My hon. Friend is right to mention the multi-modal travel that is made possible by the Oyster card. If someone began a journey in Manchester on the train, transferred to Metrolink and then transferred to a bus, people would think that they were absolutely bonkers. Not only do those three travel modes not join up, but it is not possible to obtain a single ticket that can be used on all of them.

[Mary Creagh]

My hon. Friend has made another excellent point. I have experienced that myself. When I caught a tram from the station, a return journey cost £1.50, and I then had to take a bus to the venue, which cost £1.40.

I do not think it is fair that only London provides audio-visual announcements on all buses for the benefit of deaf, blind and partially sighted people. I do not think it is fair that only London provides seamless interchanges with real-time information that makes door-to-door journeys easy. When I was visiting—I think—Milton Keynes, a lady said to me “We call them ghost buses. You stand at the bus stop and you see from the countdown that buses are coming, but when they are due, they just do not turn up. Why are there these ghost buses in the system?” We know that there are problems with technology and other equipment, but why are the problems ironed out in some cities and not in others? Labour will ensure that cities are given the powers they need to take control of their transport system, no longer playing second fiddle to the capital. Bus provision where cities let the routes will unlock efficiencies to cut fares, run more buses and invest in growing the network. Bus provision must become quicker and easier to achieve. We want a bus market that is growing, not dying by a thousand cuts.

Transport plays a vital role in driving economic growth. Devolution is important and control over transport is important, but transport is much more than that. It has profound effects on us as people and on the places where we live. It affects our health, our environment and our quality of life. Buses are the lifelines of our cities, towns and villages. Buses enable people to get to work, bring jobs and growth to our high streets, reduce isolation and ensure mobility for those unable to drive.

Labour is the party of the bus user. In government over 13 years we increased funding for buses from £774 million in 1997 to £2.3 billion in 2010.

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[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

rose—

[Andrew Gwynne]

rose—

[Mr McLoughlin]

I have three choices. I will go to Chesterfield first.

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[Mr McLoughlin]

I entirely agree with my hon. Friend. I have no doubt that that route is going to be restored as a result of the bus company taking notice of the campaign that he led. I would recommend such action to all Members of Parliament. Perhaps I can also set the record straight in relation to Milton Keynes. The scheme to which the hon. Member for Wakefield referred was in fact started by Milton Keynes council when it was Conservative controlled. The pressure for it came from my Parliamentary Private Secretary, my hon. Friend the Member for Milton Keynes South (Iain Stewart), who has a long-standing interest in transport, having also served on the Transport Select Committee. He, too, knows a bit about campaigning for good services for local constituents.

[Andrew Gwynne]

It is all fine and well for private bus companies to have smart card technology on their buses, but does not the Secretary of State understand that what we want is proper integration between the various modes of public transport? We want a single pricing structure across all those modes so that my constituents in Greater Manchester—and others outside Manchester and London—can move from train to tram to bus easily.

[Mr McLoughlin]

I do not disagree with the hon. Gentleman on the desirability of easier access to the various modes of public transport, whether in relation to the trams and buses in his own area or to other forms of inter-modal change. He is absolutely right. When people turn up in a city that they are new to, they need to be able to get a better understanding of the public transport there, rather than having to find their way through a maze of information. I hope that recent advances in technology—they were not there five years ago so I cannot blame the last Government for not implementing them—will mean that bus and tram operators can all provide the much better service that passengers want for the longer term.

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[Andrew Gwynne]

I commend the work of my hon. Friend’s Committee in highlighting many of these issues. In my constituency, a deregulated transport system means that Audenshaw now has a really good bus service provided by Stagecoach trying to compete with a really good tram service provided by Transport for Greater Manchester, providing good alternative public transport, but along the A57 corridor, through Denton, where there is no alternative tram or train provision, we have a skeleton bus service. We have the worst of both worlds. We are paying more and getting less.

[Mrs Ellman]

My hon. Friend makes a good point. At the moment, the system does not allow proper integration to meet the transport needs of people across an area. We must always remember that deregulation was never introduced for the whole of the country. London was always left out, and that is why the London system has thrived while we have experienced all the problems elsewhere. It is certainly true that there are many local areas where the local authorities have innovated and used some of the provisions of the Transport Act 1985 to develop partnerships that could be successful—when the Transport Committee looked at what was happening in Oxford, we were impressed by what we saw, and individual Members will all have their own experiences—but they are examples and not the system that affects the majority of people.

Community transport, which was mentioned by the Secretary of State, is also important. When we did our work, looking at what is happening in isolated communities where services are being withdrawn, we found some good examples of community transport. However, community transport, which is run mainly by volunteers, cannot fill the gap that is created when local bus services are withdrawn. It simply cannot do that.

On the last information we had, about 47% of local authorities were being forced to reduce their subsidies to local bus services because of cuts in their expenditure. It looks as if the withdrawal of local services will be a growing problem: commercial services simply withdraw when they are not making a profit, and local authorities are under increasing financial pressure. Unless something different happens, there will be a reduction in services in areas where this affects vulnerable people.

Services on busy transport routes, which are profitable and used by significant numbers of people, will not be withdrawn because private operators will continue to operate them. There are many other areas, however, where bus services are a lifeline for people—I am talking about people who need buses to get to work or to try to get a job—but are being withdrawn. In the evening, people want to go out, but there may not be sufficient numbers to create a profitable service, so such services are being withdrawn. The difficulty is not on busy routes where there are large numbers of people and where there might be some competition—although we have a virtual monopoly situation—but in all the other areas, affecting millions of people.

I think it has been recognised that something needs to be done. In the last Parliament, the Local Transport Act 2008 introduced quality contracts, which was seen as a way of trying to address the problem. Many Members felt that it did not go far enough, but it was progress on the system that had been inherited. It was a matter of regret that the then Opposition opposed that Act. I was surprised by that and found it difficult to understand. There were also those who felt that the Act should have gone further.

Quality contracts have not solved the problem. The North East combined authority comprises the only group of transport authorities that got close to securing a quality contract. It is now consulting on some admirable proposals, but it has taken a long time to get there. The whole process has been protracted and difficult, as the authority had not only to negotiate with a number of people but to face opposition from some of the transport operators. I hope it is successful, as it is making great efforts. The proposals it has put together offer a great deal of promise to the people in their areas.

The Government must recognise that more needs to be done. The current devolution proposals that have been put forward include the plan for the Greater Manchester combined authority to be given transport powers, very much along the lines of the powers that already exist in London. I welcome that move, but if those powers are going to be good enough for the combined authority in Manchester, why can they not be made available for other transport authorities as well?

It is a matter not of imposing a system everywhere, but of permitting local authorities and transport authorities to acquire those powers if they want to do so. At the moment, that cannot be done, but I wish the combined authority proposal great success in Manchester, and I hope that it can be proffered in other areas as well.

Buses matter for millions of people across the country. It is high time that they were part of a national debate. I hope that as a result of today’s debate, and all the other discussions and investigations of bus services, buses get a much higher profile and secure more national recognition and more Government support. Yes, we should encourage variety and innovation, but we should recognise that the deregulation of buses has not, of itself, brought about massive competition to the benefit of passengers. Outside London, it has led to a reduction in bus usage, and we must reverse that everywhere.

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[Andrew Gwynne]

My hon. Friend will know that Greater Manchester Buses was split into two companies, one in the north and the other in the south of the conurbation. In his constituency, the buyer was First Bus and in my part of the conurbation it was Stagecoach. We now have, in effect, two private monopolies.

[Graham Stringer]

We do indeed, and I will deal with why the deregulated system does not work. Partly it is because on-road competition cannot work, as there simply is not enough space for the buses. When competition has been tried, it has led to massive congestion.

Let us look in detail at what has happened in the major metropolitan areas. The bus companies have gamed the system. They have not responded as one would expect in a competitive private sector area, by responding to what the customer wants; they have responded to where the subsidy is. So networks have contracted, as the companies could make a bigger profit on the major routes; and services have been withdrawn, so that the companies could get direct subsidy in franchised systems and larger amounts of money. It is a fact that every bus that goes out of a depot has a 50% subsidy attached to it, one way or another. This is not a private competitive market responding to customers; it is a private market responding to a subsidy regime.

So I am not surprised when Martin Griffiths, the Stagecoach chief executive, says something like the following, although his nose must have grown a great deal when he did so:

“The truth is that England’s city regions have significantly lower fares and higher customer satisfaction than London, as well as having access to frequent, integrated bus services and smart ticketing.”

I do not know what he was on when he said that; the bus fares are higher, and they have regularly increased by more than inflation and by more than increases in London. We know why Stagecoach is happy: it has been extraordinarily successful at gaining the subsidies.

I have no objection to business people making a profit for providing goods and services, and doing it well. The fact is that Brian Souter and his sister have made £1 billion. Does anybody think that has come from providing a better service and improving our bus services in the major metropolitan areas of this country? Of course it has not. It has come from knowing how to get to the subsidy and how to move the bus services in order to get there. That partly shows the answer to the point raised by the hon. Member for Lancaster and Fleetwood (Eric Ollerenshaw) about where the money will come from. The capital return on investment in buses in the English regions is twice what it is in London. Why should the people I represent in north Manchester be giving Stagecoach and First Group twice the profit because they are operating in a deregulated system? If we put this out to proper competition in a franchised system that was open and fair, so that the more competitive bus company won, those profit levels would go down to a level similar to that in London, and with some of that money we would be able to improve the service. The only evidence we have of a franchise system within England, Wales and Scotland is the one in London, and it managed for the first 13 or 14 years after deregulation, when the companies were regulated, to run services with very low fare increases and maintain the number of passengers, whereas in the rest of England the numbers decreased by 50%. Those companies managed that without subsidy, so I think that in the metropolitan areas we, too, would have a better service and we would not be going to the Exchequer for more money.

I will finish with a plea. I was delighted with the Chancellor of the Exchequer’s announcement about Greater Manchester and what he was saying about re-regulating the buses. This is not an ideological battle and nor should it be one. The fact is there is a simple way of improving services in the major metropolitan areas, which is by making it easier to have a London-style system and allow franchises. That would help everybody.