European Bus Forum 2015
Re-regulation’s phoney war continues
Once again held in Manchester, though this time in the University of Manchester’s Renold Building, The European Bus Forum 2015 was organised by Russell Publishing’s Eurotransport publication and hosted by Transport for Greater Manchester. With a dinner held the previous evening, it was both a networking opportunity and a chance to hear generally well presented papers on a broad variety of relevant subjects.
Speakers included representatives from local authorities, operators, passenger groups, transport lobbyists, trade organisations, manufacturers and suppliers, among others and the chair for the main sessions was Linda McCord, Senior Passenger Manager of Passenger Focus.
The format was unusual in that the first and large sessions of the day involved all delegates but the main morning and afternoon sessions were organised as ‘breakout sessions’ with three completely separate programmes staged in different lecture theatres. In the morning the three themes were: Bus Rapid Transport Systems, Fuel for Thought and Smart Ticketing & Payments, while the afternoon brought: Making the Bus the Mode of Choice, RTPI and new technologies and Vehicle Specification and Accessibility. With excellent speakers lined up for each you had the feeling you were missing out whatever you opted for, even though it was possible to flit between lecture theatres. In the end I plumped for Fuel for Thought and Making the Bus the Mode of Choice. In the former I got the most out of Dickon Posnett, Development Director of Argent Energy’s presentation entitled, ‘Biodiesel – The good, the bad and the ugly’ and David Yorke, New Technology, Training and New Projects Manager at Tower Transit’s answer to the conundrum ‘Hydrogen Buses – are they really viable?’ In the latter, I particularly enjoyed the engrossing presentation given by Nick Phillips, Accessibility Leader, Borough of Poole, on ‘Securing Modal Shift and the Importance of Partnership Working’ which explained how bus ridership in his area has almost doubled in a decade.
Unfortunately, available space limits what can be said in this article to some of the main points made, in particular in the pro and anti regulation debate, but I made a number of contacts that will lead to future articles.
Dr Jon Lamonte, CEO TfGM
Dr Jon Lamonte, CEO of TfGM, delivered a welcome speech in which he said that Greater Manchester’s economic potential exceeded that of any city region outside London. Innovation was in Manchester’s genes and the city drew from all over the world to get its entrepreneurial culture. Underpinning everything was transport, in Manchester and everywhere else was transport. It always had been it always would be. In 1824 Manchester had had the first stage carriage bus service in Britain and was an early example of the city’s innovation in transport.
In Manchester there was ‘a fantastic example of how innovation in Government could work. It was an ongoing programme that delivered the stable predictable conditions in which businesses and commerce had confidence and could thrive and prosper, and the benefits of that growth be shared fairly. Since 2011 the region had had the UK’s first Combined Authority which allowed the ten authorities in Greater Manchester to work together much more effectively across all policy agendas, across the city region, and could make long term commitments covering, transport, the economy, the housing market and the social needs of residents. The planning system supported growth so that health service and social care could be properly integrated. He claimed that the Combined Authority had been really successful and copied elsewhere. In November 2014 a groundbreaking devolution deal had been made with the UK Government which reflected its confidence in Greater Manchester to deliver and shape its own destiny. It gave it control of the £6bn annual NHS budget and powers over employment, skills, business support, housing and, crucially, transport with the power to introduce bus franchising as well as control over local railway stations and oversight of the key route highways network. It gave Manchester the tools that the growing economy needed and the leaders of the combined authority were absolutely committed to.
Buses were vital to a sustainable economy, not just in Manchester but anywhere. Greater Manchester and its partners had achieved a lot in the last ten years, with one of the biggest bus priority networks outside London, but a lot more needed to be done. Bus patronage in London had increased by a third while staying pretty flat in Manchester and declining in other city regions. Too many people saw buses as inferior. The barriers needed to be taken away between one bus and the next and between buses and other modes of public transport. There were a big set of challenges but, ‘if we get it right the future for bus is extremely bright’, he said.
He thought that the bus industry needed to innovate. All the business sessions were about the bus being faster, more reliable, more comfortable, more convenient and a product that can be marketed to sometimes sceptical customers.
Jon Lamonte hoped it would attract a far wider group of passengers to do the job that bus services were uniquely able to do: affordable, attractive, congestion busting and cleaner transport, particularly in city regions where economic fortunes were so tied to having a transport system that works.
He concluded by thanking the bus and coach companies that had stepped in the previous night to fill the breach when there had been major problems with the rail network around Manchester.
Andrew Jones, Transport Minister
Present in the form of a video address, which ensures he is not exposed to any inconvenient feedback, Transport Minister responsible for buses, Andrew Jones, said that ‘the Government is committed to improving bus services even further, just as I know the industry is.’
He said that in challenging economic times there was, ‘a continuing need for Government, Industry and Local Authorities to deliver both great value and great services. One of the ways we’re doing that is building on measures announced under the coalition to devolve transport decision making to local areas.’ Talking of the deal giving Manchester powers to franchise bus services, he said, ‘now we’ll legislate to make this a reality. I would welcome any thoughts you have on this subject. I know these proposals are of concern to many in the bus industry and that’s precisely why I want to work closely with you as we develop our proposals. It’s vital to me that your views are heard and understood and appropriate steps are taken to deal with your concerns. I want your input to the process so I will encourage my officials to engage with you before the legislation is drafted.’
On Total Transport, he said it had; ‘the potential to greatly improve the efficiency and delivery of local transport services to local people. It involves integrating transport services currently commissioned by different central and local Government agencies and provided by different operators. On 14 January the DfT launched a £4m bidding fund for local authorities in England to pilot Total Transport solutions in their areas. The bidding closed on 11 February and we received 42 bids. Available funding was increased to £7.6m and 37 partnership schemes received funding.’
On smart ticketing he said that progress was being made after a slow start and 93% of all bus journeys outside London were being made on buses that could accept smart tickets.’
He wanted disabled people to have the same access to transport services and opportunities to travel as other members of society. He said that ‘84% of buses in England now meet the legal accessibility requirements (Ed. that’s untrue because all buses should meet the current requirements) but we will continue to monitor compliance. Though he would continue to encourage operators and local authorities to invest in audio visual announcement systems where possible, but had; ‘no plans to make these systems mandatory through legislation,’ concluding that he was ‘looking to the bus industry to provide leadership and secure even better services in the future.’
Umberto Guido, UITP
As European Projects Director for UITP, Umberto has already overseen one EBSF (European Bus Systems of the Future) project and after explaining some of its highlights said he is now on with round two. He hoped that through an energy strategy and attention to auxiliaries it would show a 10% reduction in energy use. On vehicle design, he thought this might produce a 15% saving through work on modularity and that work on vehicle design might also lead to increases in commercial speed of 8%. Intelligent garages and maintenance procedures aimed to save 10% on garage costs.
Claire Haigh OBE, CEO Greener Journeys
Dressed in her customary green to stress her message, Claire Haigh’s presentation was entitled ‘Why Buses Matter’. In it she recapped her well rehearsed arguments for the economic contribution of the bus. She noted that ‘behaviour change is going to have to be a part of the carbon reduction strategy,’ expressing concern that vital spending on bus infrastructure was going to suffer, and saying that the Treasury needed to understand just how important bus revenue support was and that bus passes had to be properly and securely funded. Giving a big plug to Catch the Bus Week, which would continue, she revealed that Greener Journeys’ next big report would be launched in September and would provide an evaluation of bus infrastructure based on work done by KPMG.
Robert Montgomery, MD Stagecoach UK Bus
Leaving the audience in no doubt where he stood, Bob Montgomery gave, ‘The case for Partnership Working in the UK’ and did it well. He said that the industry had been in the position where local authorities owned the buses, planned the networks, set the fares and carried the risk before and costs rose rapidly while patronage fell. He pointed out that from 1980 to 1985 under local authority control, bus patronage in Manchester fell 24%.
Since 1986, when the bus companies had been sold to the private sector, there had been massive investment in buses, people, training, marketing, brands, and smart ticketing. The result was the current position with very high levels of passenger satisfaction. For those who held up the London model, he pointed out that passenger satisfaction in London at 83% was at the lowest level of all UK cities. Growth in London was nothing to do with franchising, it was down to the level of funding. In Manchester in the last 14 years Manchester had grown patronage by 22% despite the massive expansion of Metrolink, and when you put use of the bus and tram together, because a lot of people had taken the opportunity to switch, there had been passenger transport usage growth in Manchester. There had been much less public sector investment and a lot more private sector investment and innovation.
For the future there were four options. The first was no change, the second was to buy back the bus business and franchise, thirdly the authorities could confiscate the operator’s businesses and not compensate; and fourthly, deep alliances could be developed between the public and private sectors that enabled both to play to their strengths.
Stagecoach did not see the status quo as an option because more could be done. It supported the devolution agenda and the creation of a Northern Powerhouse. On the second option, if the authorities were to buy back the businesses at the market value given the amount of investment that had gone in, bring them back into the private sector, as in London, introduce franchising then re-privatise the buses, it would it would result in a massive loss for the public sector and it wouldn’t address the issues. You would also lose a massive amount of expertise in product development, pricing, marketing and operating. Then there was solution three, which was cheaper but disproportionate and, Stagecoach believed, unethical. Again it didn’t address the issues and you’d lose the goodwill, trust and confidence of the private sector. How could you expect investors to invest again if their current investment had been confiscated?
Explaining why franchising did not address the issues, he said that growth in London was nothing to do with franchising, it was because of London’s unique economic conditions and the power of the London economy. The powers of TfL were different, but what really made the difference was the funding. Franchising was expensive. There was also the matter of courage, ‘we haven’t seen any suggestion of anything being done to improve the bus operating environment after buses are franchised, and unless you improve the environment, with congestion charging for example, you could not achieve the levels of bus use in London.’
His favoured solution was to establish deep partnerships between the public and private sectors. Both sectors recognised the need for change, the potential for growth and that they had things to bring to the party. If the opportunities and all the problems were shared and all the issues addressed in a deep and genuine partnership you could keep the best of the deregulated market and also deliver the social and environmental objectives of the local authority. Bob said that Stagecoach did not currently have deep proper partnerships working anywhere in the UK, though it was very close to it in two cities.
One criticism of the current scheme concerned smarter ticketing, but every Stagecoach bus was already equipped for it and every journey in England, and from next month Wales too, could be made by obtaining a card and never having to make a transaction again. This had been done through partnership without taking away the incentive to innovate and to deliver best prices to consumers. He argued that, ‘the worst thing we could do is to leave the setting of local bus fares as a monopoly to the local authority in a time of austerity. We know what happens then when public sector cash flow gets tight’. The best value to taxpayers was through partnership. Stagecoach was already moving on towards contactless technology.
Everyone in a partnership had to be very clear about what they wanted, concluding that, ‘Working together is far better.’
Following his presentation the chairman noted that passengers didn’t care who ran the buses, they just wanted a good service.
Stephen Joseph OBE, Campaign for Better Transport
The Campaign For Better Transport’s (CBT) Executive Director, spoke on Total Transport and the proposed Connectivity Fund,’ saying that the bus funding context was one of austerity. There was continuing pressure on unprotected departments like transport and local government with reductions in supported bus services and continuing pressure on other transport budgets including those for schools, colleges and hospitals. CBT had highlighted cuts in local bus services and together with pteg identified opportunities and benefits through pooling transport budgets. This had developed into the Total Transport concept for which there was considerable enthusiasm throughout government, resulting in the funding for pilot schemes that the Minister had earlier mentioned. It was about keeping people independent, access to jobs, access to health care and access to education and training.
He said that where there had been previous initiatives, especially rurally, too often it was pilot schemes that disappeared when the budgets ran out. Total Transport should, by building on people’s experience, be more sustainable than that.
He called for the creation of a Connectivity Fund, a ring fenced fund for local public transport drawn from across government because other Government departments would benefit most from having good public transport services. There was increased willingness from government to look at smarter spending.
He argued for a further Local Sustainable Transport Fund (LSTF) as previous ones had been successful and believed the case needed to be made for other forms of bus support. Targeted funding could make a huge difference in helping public transport, especially buses, help the economy.
He wanted to see the Buses Bill include more than franchising, suggesting competition clarifications, statutory assessment of need and a bus policy statement.
Summing up he concluded that buses were facing cuts in local and national funding, Total Transport was part of a wider cross-government interest in smarter spending (including cycling and health), that if Total Transport pilot schemes worked it could lead to more funding and cross government support (such as a Connectivity Fund and developer funding) but he warned that the outcome of the Buses Bill and spending review would be critical.
In a brief question session afterwards, it was suggested that if we could get children on the bus they would stay. Bob Montgomery responded that he didn’t think young people were an issue; it was more the 30-50 year old age group that were the issue.
The Regulation Debate – Moving forward
Winding up the afternoon, a panel of seven speakers chaired by Mark Watts, Director of Luther Pendragon Europe, discussed the regulation debate though with more pro regulation speakers than anti and much of the time taken up with statements of entrenched positions I didn’t feel it shed that much new light. I’ll conclude with a few paraphrased words from each of the panel.
Giles Fearnley, MD of FirstGroup UK Bus, pointed out that that prior to 1986 in most Metropolitan areas it was pretty much a franchised setup with operators paid to run networks. Services were dictated by the availability of public funds, not by the customer demand. Customer satisfaction was low and the cost inflation borne by the industry was two or three times that of the RPI at the time.
Robert Montgomery briefly reiterated his earlier points that franchising in major cities was totally disproportionate, it was a very expensive process, it did a huge amount of damage and it didn’t target the issue it was fixing. London wasn’t about delivery it was about funding and the political courage to introduce measures such as congestion charging.
Mark Yexley, Operations and Commercial Director for Arriva UK Bus, said that with control came responsibility and risks as well as potential controversy if the bus companies were confiscated. Weighed up against what could be brought to the party through partnership there was so much could be achieved by playing to the strengths of the different parties, that why would you want to go instead for something so much more risky, long winded and controversial.
Jonathan Bray, Director, pteg, said the good news was that both buses and city regions were being taken seriously by Government. Bus franchising was not weird, strange, risky or dangerous. 15% of buses outside London and 100% in London were already franchised. There were many operators not at the table who were enthusiastic about the opportunity franchising offers. Many big operators around the world had a track record of delivering high quality integrated public transport in partnership with the public sector. They were not speaking on the platform because they were not defending a poorly regulated, highly profitable monopoly, but they were waiting in the wings and very enthusiastic about delivering all these opportunities. Franchising was not going to happen everywhere but it was going to happen in some places and would build on what we already had. It wasn’t a future that could be shouted down or wished away. It went with the grain of where cities wanted to be and what passengers wanted. What was so awful about trialling, somewhere in the UK, a fully integrated public transport system? It was what people wanted, it worked elsewhere and it would be a success.
Martin Abrams of the Campaign for Better Transport, who ran a campaign called ‘Save Our Buses’ said the hardest part of his job was when he got a call from a bus user who had heard that his bus service was about to be cut. It was having a dramatic impact on people. To him, something was not right with buses and the bus market at the moment, CBT did not believe the status quo was acceptable and that was why it now supported the franchising of bus services because it believed it could bring benefits like simple unified fares structures, the ability to meet socially important aims like offering cheaper travel for younger people, cheaper tickets for those working part time or on zero hours contracts and efficient network planning.
Huw Lewis, Corporate Manager for Customer Services and Communications at Nexus, thought it was important to see the debate from the perspective of local communities and key economic drivers in those communities. The idea of franchising was not controversial in those communities or in Government. Local authorities wanted transport networks that delivered across the economy and recognised the bus as the biggest and most versatile of assets. As retail, amenities and employment became more centralised and distant, transport became all the more important. Using the example of education, the school leaving age rising to 18 had driven the growth of large colleges offering a far more diverse range of opportunities than the old sixth form, but nationally college principals highlighted the cost, complexity and availability of transport, which was a barrier to people. The next generation was too often having to make do with what it could afford rather than gaining the right skills for the future. The same was true in employment and may other areas. Once local and national government might have stepped in to bridge the gap but the public sector was already having to trim away at financial support that underpins the whole experience of choosing bus, and actually at passenger numbers, operator profit and the viability of services. This wasn’t a presumption in favour of franchising but Nexus had decided that it was the best route to delivering its wider aims.
Dr Jon Lamonte said that he could only speak for Greater Manchester, but from his perspective it wasn’t about what was the best way to run a bus network and it certainly wasn’t a critique of bus companies individually or collectively, it was a discussion about the best way to run the economy of Greater Manchester and to grow it. What they were looking for in the period to 2040 was what was the best way to run the economy, what was the transport contribution of the economy and how did it fit together and therefore it was looking for the best integrated transport network to make that happen. It included a joined up network across all modes, a clear stable network, and a clear brand. It was having a simple clear offer with fares that were set locally, a network set locally and he wanted to move progressively towards that.
He felt that competition legislation prevented bus companies doing some of the things they would want to do which was a reason why franchising presented a new opportunity and said that TfGM wanted to invest in bus priority schemes as well as improvements in bus infrastructure.
An enjoyable event, it was somewhat more UK-centric than the title suggested (though there were European case studies within the breakout sessions), anyone not interested in the peculiarly British regulation versus deregulation debate might well have found the content limited. It suffered a little in that it came after Professor David Begg’s Bus Summit earlier this year which perhaps tackled the re-regulation debate a little more robustly and inevitably involved many of the same key speakers saying much the same as they had then.