Bus Services (No. 2) Bill [Lords]

Victoria Collins Excerpts

2nd reading
Monday 2nd June 2025 Commons Chamber

[Gareth Bacon]

With respect to my right hon. Friend, I will not, because I am conscious that lots of Members want to speak.

Those safeguards are designed to ensure that franchising serves the passengers who rely on our bus services and the taxpayers who pay for them. The expertise required to design, manage and operate franchised networks is not readily available in most councils. That is why the Bus Services Act 2017 limited franchising powers to mayoral combined authorities, which are bodies with the scale, resources and democratic mandate to take on such responsibilities.

Crucially, the legislation we enacted to pave the way for mayoral combined authorities to issue franchising models also required those authorities to demonstrate that franchising would deliver genuine benefits for passengers. The removal of that requirement by this Bill is concerning, and it betrays the view held by those on the Government side of the House that the public sector is inherently infallible. Members will not be shocked that I do not share that view, but they do not need to take my word for it.

[Victoria Collins (Harpenden and Berkhamsted) (LD)]

Will the hon. Gentleman give way?

[Gareth Bacon]

I will make some progress and then give way.

Members should take the word of Centre for Cities, which has made it clear that expanding franchising could expose councils to serious financial risks, because after decades of deregulated services, many transport authorities simply lack the skills and capacity to manage a comprehensive bus network, yet would be financially responsible if an undertaking goes wrong.

These are not just hypothetical concerns. The experience in Greater Manchester illustrates just how easily costs can spiral, leaving the taxpayer out of pocket. The Secretary of State will no doubt be aware that initial projections published in Greater Manchester combined authority’s transport revenue budget put the cost of transitioning to a franchised system at £134.5 million for 2024-25. That figure has since ballooned, with ongoing operational costs now forecast to exceed £226 million per year by 2025-26, which is a 68% increase in one year. Over four years, the scheme could cost up to £1 billion—far, far more than anticipated. Moreover, the House will know that the annual level of bus subsidy in London last year amounted to £646 million. Greater London is the most heavily populated and most economically active area in the entire country. It also has the highest level of bus use. Yet even with all those advantages, it requires that level of annual subsidy just to keep the network running.

--- Later in debate ---

[Victoria Collins]

It is really important that we stop the vicious cycle. In my area of Harpenden and Berkhamsted, the X5 has been cancelled for commercial reasons. The bus company says it is no longer commercially viable, but that has left people who work in the local hospital saying, “I might have to move house or leave my job.” There are children who now have to wait at school or who cannot get back from school because the bus goes too late. We need to stop the vicious cycle and make sure the funding is there, and this is a good start to help bring buses back to the communities that need them.

[Gareth Bacon]

I refer the hon. Lady to the answer I gave to my hon. Friend the Member for Isle of Wight East (Joe Robertson), which is that without substantial extra levels of funding from the Government, that simply will not happen. Local authorities may have the powers to do it, but they simply will not have the ability.

The Government have talked about the amount of money they are putting into the Bill and the Secretary of State referred to it in her speech, but it is a mere £1 billion, of which £700 million has been earmarked for bus planning documents, not actual services. Less than 30% is being directed toward the delivery of bus services themselves, which will not touch the sides. Giving local authorities the legal power to do something without the money is mere window dressing. If these challenges can emerge in Greater Manchester and Greater London despite all their resources, planning and political leadership, what should we expect elsewhere? The truth is that we do not know, and that highlights the danger at the heart of the Bill.

On a connected vein, through franchising, we may end up extinguishing a number of highly successful private sector businesses, reducing them to operating for a fee and doing what the state instructs them to do in terms of routes, services and fares. Quite aside from losing the expertise that the private sector brings to the network, the Government risk removing any incentive for the private sector to invest in our bus networks, potentially leaving the taxpayer with ever greater burdens.

Despite my various concerns about this legislation, I would like to recognise that the Bill we see before us was greatly improved during its passage through the other place—improvements driven notably but not exclusively by Conservative peers. The purpose clause, which obligates the Secretary of State to consider service performance, quality and accessibility, was a much-needed addition, as was the amendment requiring an assessment of the impact of ending the £2 fare cap. Successful amendments requiring the Secretary of State to review bus services to villages in England, to develop a programme to eliminate serious injury during bus operations, and to require bus operators to record all data regarding assaults and violent behaviour, were all tabled by peers from other political parties to His Majesty’s Opposition and, collectively, they improve the Bill. The latter amendment was tabled by the noble Lord Woodley, a Labour peer and former joint general secretary of the Unite trade union. It was, bizarrely, opposed by Labour peers, but it succeeded with the support of Conservative peers and those of other parties.

A further successful Conservative amendment was passed, mandating a review of the national insurance burden on special educational needs transport, following the increases announced by the Chancellor of the Exchequer. I must say that it is deeply regrettable that Labour peers were whipped to vote against a measure designed solely to protect some of the most vulnerable in our society. In opposing the special educational needs transport amendment in the other place, the Government asserted:

“The Government do not expect the changes to national insurance to have a significant effect on home-to-school travel for children with special educational needs and disabilities, so it would not be proportionate to conduct the assessment that this amendment suggests.”—[Official Report, House of Lords, 26 March 2025; Vol. 844, c. 1756.]

Leaving aside the breathtaking arrogance of that statement, it is directly contradicted by the very providers tasked with delivering these vital services. The chairman of the 24x7 Group, one of the largest operators of SEND transport in the country, has warned that changes to national insurance contributions could significantly raise employment costs, making some contracts unviable. That has the potential to leave thousands of children without access to the transport they rely on to attend school. To oppose even a review of such consequences is not just shortsighted; it speaks to a worrying indifference about the impact of this legislation on vulnerable passengers.

The Opposition were also disappointed that Labour peers voted against introducing a safeguard against repeated franchising assessments for the same geographical area, which risks wasting public resources and creating instability for operators and passengers alike. Similarly, it was disappointing to see Labour peers not support plans to ensure that floating bus stops do not threaten the safety of those who are blind and partially sighted.

Likewise, if improving passenger services is at the heart of the Bill, I fail to understand why Labour peers were whipped to vote against the amendment that would give the Secretary of State the power to intervene when franchised services fail due to poor local management. Does the Secretary of State really believe that passengers should be left stranded simply because a local authority is unable to deliver? I do not believe that to be the case and I look forward to her amending the Bill as it proceeds through the House.

Why did Labour peers vote against those measures? Once again, it would appear that ideology took precedence over passengers. That is why we will push to reinstate these prudent amendments as the Bill proceeds through the House. The Liberal Democrats supported many of the measures in the other place and I sincerely hope they will do the same in this House, for the benefit of passengers.

In conclusion, franchising may well play an important role in improving the bus networks of the future, but the Bill alone will not get us there. That is because the Bill does not prioritise those who matter most: the people who rely on buses every single day to get to work, attend school, reach appointments and stay connected with their communities. While we welcome the positive changes made by peers in the other place and we will not divide the House on Second Reading, we cannot vote for a Bill that lacks basic safeguards, ignores the risks and prioritises ideology over impact. We will therefore seek to improve the Bill as it proceeds through the House. I urge the House to consider not just the political implications of this legislation, but its real-world consequences for the millions who depend on these services every day.