Stagecoach calls for stimulus package

Stagecoach has called on the UK Government to use the forthcoming Spending Review to put in place a stimulus package to incentivise a return to more bus use.

The operator has submitted a six-point plan with a raft of policy proposals in advance of the Spending Review on 27 October. The proposals include tax incentives, discounted fares and a national bus marketing campaign to match the recently launched advertising push to attract consumers back to trains. The company has also called for reform of motoring tax and a clear government roadmap for investment to support decarbonisation of bus sector and deliver 4,000 new promised electric buses in England.

Stagecoach cites the latest DfT data, which shows that while car use has surged to as high as 111% of pre-pandemic levels, bus use in both London and regions across the country has lagged behind.

Bus journeys have plateaued at around 70% of pre-pandemic levels, according to Stagecoach, despite current government support packages and services operating at least 90% of pre-pandemic networks. Pre-Covid, bus passengers were responsible for around 30% of spending in towns and city centres. Journeys by concessionary passengers, including senior citizens, have lagged further behind says Stagecoach, which it believes raises concerns over social isolation among vulnerable groups.

Martin Griffiths, Stagecoach Chief Executive, said: “Bus networks are the arteries behind the social and economic heartbeat of Britain’s towns and cities. They are also central to delivering on the country’s net zero ambitions and creating healthier, more connected communities.

“Government messaging during 18-months of the pandemic has negatively impacted public perceptions of public transport and is holding back Britain’s buses. We need urgent government action and innovative policies to support the efforts of operators to re-boot bus use and unlock their power to kick-start the country’s recovery from the pandemic.”

Stagecoach’s plan includes:

  • ‘Back to Bus’ marketing campaign: a joint bus sector and government campaign to reaffirm the safety of the country’s bus network and counteract the negative impact of health messaging during the pandemic. This would be fronted by senior government ministers and also leverage the significant communications resources in mayoral and other local authorities.
  • Tax credits for public transport season tickets: an initiative to incentivise the purchase of monthly and annual travel cards through a salary sacrifice scheme administered by employers. Similar to the TaxSaver scheme in Ireland, it would support particularly those in lower-paid employment with the costs of travel for work whilst reducing single occupancy car journeys.
  • A national jobseeker or Universal Credit bus travel discount scheme: Stagecoach funds the UK’s only national discounted bus travel scheme for jobseekers, offering a 50% discount to help individuals find work. Trips under the scheme, the only one to date in the country, have increased by 115% since May. This approach could be extended on a national basis, with appropriate support, including potentially to all Universal Credit claimants.
  • Fast-track funding for fares scheme pilots: the National Bus Strategy is targeting lower bus fares, but current funding for these will not be available until April 2022. Fast-track funding for local authorities to support pilot projects from January 2022 would help deliver an earlier boost to bus use and identify the most efficient approach to delivering better value fares. It would also build on Stagecoach initiatives, including a pilot of flexible season tickets and simpler fares.
  • Festive fares initiative to support high street recovery: a government-backed time-limited bus fare reduction scheme in December over the festive period would help rebuild bus use and support local high streets in the critical Christmas retail period.
  • Mobility credits schemes as part of air quality/fleet renewal programmes: providing financial incentives to motorists to scrap older diesel cars in return for credits to spend on sustainable transport options, including buses. The initiative has been championed by Stagecoach and its partners at the Urban Mobility Partnership and a pilot scheme approved for Coventry. Further schemes should be introduced to support modal shift, rather than just replacing diesel vehicles with electric cars. This would also complement the £9 million air quality grants announced for English local authorities for 2021-22.

The Stagecoach submission urges the Government to consider wider reform of motoring taxation to encourage a shift to more sustainable bus travel, with the decarbonisation of road transport expected to have a significant impact on future tax receipts from fuel duty.

Moving to a pay-per-mile form of taxation for private cars, with appropriate mitigations, would increase awareness of the true cost of motoring and support a shift to available public transport or active travel alternatives, according to Stagecoach.

Mr Griffiths added: “Governments of all colours have for too long shied away from tackling the critical issue of growing and unsustainable car use. Current taxation policy is out of step with the strategy to deliver Net Zero. It has effectively made motoring cheaper, while the road congestion it causes has increased air pollution, accelerated the climate emergency and damaged public transport networks by making services more costly and less reliable.

“With the shift to electric vehicles, the country is also facing a significant black hole in public finances from declining fuel tax revenues. A new pay-per-mile regime for private cars, with measures to protect less well-connected rural areas and combined with other incentives, would help drive a return to public transport and more sustainable communities.”

Stagecoach is also backing a joint appeal by bus operators, manufacturers, transport authorities and trade unions for the government to use the Spending Review to set out a clear timeline for the planning and introduction of 4,000 zero-emission buses by the end of the current Parliament.

A letter to Transport Secretary Grant Shapps earlier this month called for an accelerated timeline and more efficient funding mechanisms to maximise government investment, allow the sector to plan the resources and skills required for the transition, and deliver new jobs and a world-class sector.

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