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Nestrans response to the consultation on proposals for a Bus Regulation (Scotland)Bill by Iain Gray MSP - 28thAugust 2013

Nestrans welcomes the opportunity to provide comments on the proposal for a Bill to providetransport authorities with greater powers to set service levels for local bus services, includingpower to group profitable routes with non-profitable routes before they are put out to tenderwith operators.

Nestrans is the Regional Transport Partnership for the North East of Scotland and coversthe two local authority areas of Aberdeen City and Aberdeenshire. As such, the regioncovers a variety of areas from urban and suburban areas, towns, rural villages and moreremote rural areas. Nestrans does not operate any public transport services but works withthe two Councils and the two main bus operators in the region, First in Aberdeen andStagecoach Bluebird, through a voluntary Quality Partnership Agreement to improve busprovision across the region.

The North East Bus Quality Partnership was established in 1998 and re-freshed in 2010.The partners meet regularly and have delivered and are actively pursuing a number ofpartnership initiatives. Given the current success of this collaborative working Nestranscurrently has no plan to enter into either a statutory Quality Partnership or a Quality Contractat this time, although the former would be considered if the voluntary partnership was nolonger deemed to be effective and it was considered in the best interest of the partners andthe travelling public.

We have considered each of the questions posed in the consultation paper and ourresponse to each is detailed in the points below:

1 Do you support the general aim of the proposed Bill?

Yes. Nestrans recognises that the current arrangement fails to protect those that depend onlocal services. We recognise the significant social problems that can occur due to lack ofpublic transport provision and the isolation and lack of opportunity that can result, particularlyin rural areas but also in towns and urban areas, particularly in the evenings and atweekends.

Nestrans generally supports the principles and aims of the proposed Bill, to provide transportauthorities with the power to enter into franchising agreements with bus operators to deliverbus services, however we are unclear how the proposals would be implemented in practice,

what they would deliver beyond mechanisms currently available and the cost implications offranchising.

2 What would be the main practical advantages of the legislation proposed?

The main advantage of the proposals would potentially be a more stable bus network.Greater stability in the network would provide greater clarity to the travelling public as well asthe maintenance of bus links that may otherwise be lost. Greater integration of services andreducing the barriers to the introduction of multi-operator ticketing arrangements would alsohave significant benefits. Opportunities to specify other factors of the bus network such as

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fares and the quality of vehicles could also help to contribute to wider objectives, such asimproving air quality as well as potentially improving the perception of bus travel.

However, whilst these advantages could all be achieved, they could only be deliveredthrough potentially significant increases in public funding for bus services. The example of

London is given with the recognition that the system there is supported by a high level ofpublic subsidy.

Local authorities currently have powers through tendering procedures to take more control indetermining what services should be provided and specifying the routes, standard andquality of services and fares. Nestrans supports the aim to provide transport authorities withgreater powers to compel operators to provide a minimum level of service, however thispower is already available through provisions for statutory Quality Partnerships and QualityContracts and we are unclear how the proposals would add to or change these powers.

Nestrans agrees that greater clarity or a relaxation of the requirements around provingmarket failure would perhaps be helpful in terms of not waiting until the complete failure of a

service before efforts can be made at initiating improvements, however we dont believe thatthis is the only barrier to establishing Quality Contracts. The cost and risk to the localauthorities of taking on the delivery of local services in this manner is also a significantbarrier.

There is also a risk that private sector innovation, for example in the areas of marketing andpromotion, may be stifled unless franchise agreements can be set up to retain some degreeof operator flexibility and incentivisation.

3 In what ways do you envisage re-regulation being used to improve bus services?

Re-regulation could bring greater service integration and greater network stability as well as

improvements in vehicle quality and greater control over fares charged, all of which couldaddress wider objectives of the public sector such as improving air quality, reducing socialexclusion and encouraging mode shift. However, as stated above, such changes wouldcome at a potentially significant cost and risk to the franchising authority.

We support the aim to provide transport authorities with greater powers to compel operatorsto provide a minimum level of service, however powers to specify services and fill gaps inprovision are already available to local authorities through the tendering process.

4 How can community transport be better utilised to serve local communities andparticularly low passenger volume routes?

Community transport and demand responsive transport both have a key role to play in theoverall public transport network, particularly for people in rural areas and those who areunable to use other public transport services. A number of demand responsive andcommunity transport services operate in the north east, some of which are supported by thelocal authorities.

Although we support the statement that the importance of community transport and dial abus services must also be considered when thinking about how transport can operate moreeffectively for everyone it is difficult to envisage how discretionary powers to transportauthorities to enter into bus service franchise agreements would have any material effect oncommunity transport.

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5 Do you agree that the Traffic Commissioner should be able to impose greaterfinancial penalties on operators who a) fail to meet the terms of the franchise or b)walk away from the franchise altogether?

Any franchise agreement would require a contract between the franchising authority and the

operator with appropriate contractual elements to be included within it to account for suchsituations with appropriate penalties to ensure compliance. It may be appropriate for theTraffic Commissioner to have a role in the enforcement and arbitration, in the case ofdispute, of agreements although this should not be the only means of redress available tothe contracting authority who should be able to impose sanctions using the appropriateprovisions within the contract.

6.What is your assessment of the likely financial implications of the proposed bill toyou or your organisation? What other significant financial implications are likely toarise?

As Nestrans does not operate or tender any public transport services nor does it have

access to detailed financial / cost information on the commercial bus network we do not havea detailed insight into the likely financial implications of entering into franchise agreements.However, based on experience from elsewhere, significant additional cost would beanticipated and be dependent on the scale of the franchise, the level of service / qualityspecified, the infrastructure required and the level of interest shown by prospectiveoperators. Increased bus monitoring would also be required to ensure operators areadhering to the terms and conditions of the agreement and this would require additionalresource from the franchising authority.

Currently, the Councils have a duty, under sections 63 -64 of the Transport Act 1985, tosecure the provision of such passenger transport services as it considers appropriate tomeet any public transport requirements in its area which would not, in its view, be met apart

from action on its part. In many areas, including the north east, budget pressures mean thatthere has been a reducing budget available within local authorities to provide these services.

The comparison provided in the proposal of subsidy in the rail industry in comparison to busis a stark statistic and, along with the comparison with the London system, highlights a keyissue which is lack of funding both at a national and local level for provision of bus networks.

7. Is the proposed Bill likely to have any substantial positive or negative implicationsfor equality?

If the proposals were to result in more comprehensive bus networks, providing services toareas and parts of the community that do not currently have good access, enhances thequality of the fleet in terms of accessibility and addresses current local concerns regardingfares, then this would have significant positive benefits for equality of access.

8 Do you have any other comment or suggestion that is relevant to the need for ordetail of this Bill?

As outlined at the beginning of our response, a voluntary quality partnership is currentlyoperating successfully in the north east and current legislation already places a duty on localauthorities allowing them to address deficiencies in service provision through the tenderingprocess. Due to budget constraints however, local authorities across the country, includingthose in the north east, are less able to plug these gaps or enhance service provision.

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Although franchising would give more control over the network this wont be possible withoutsubstantial public subsidy. We also have a concern that the introduction of such powerscould lead to raised public expectations which, given current funding constraints, could notbe met.