Dear Mr Gray Bus Regulation (Scotland) Bill | write in response to the above Members’ Bill which you have put out to public consultation. | respond as a private individual, who lives in your East Lothian Constituency. Prior, to offering some general comments, | will answer the specific questions you pose for consideration at the end of your consultation: 1. I do not support the general aim of the proposed Bill, The reasons for this | will explain in my general comments, but | am not convinced that re-regulating the Scottish bus industry, putting Control into the hands of local or national politicians, instead of in the hands of business experts, is a step in the right direction, 2. [am unable to see any practical advantages of the proposed legislation, whife the main disadvantages would be the significant cost increases to the public purse of implementing quality contracts or financially supporting poorly used setvices on higher frequencies than ate currently operated. ‘There is the real risk that this bill would lead to the politicising of the bus industry — taking It back to the dark ages of the 1970s and early 80s, where passengers were al the mercy of their local politicians, and the frequency operated on individual bus routes was dependent on ‘which Councillors or local MPs could shout the toudest on behalf of their constituents, rather than on the basis of genuine passenger demand, with the busiest routes having more buses serving them, 3. | cannot see that re-regulation would lead to significant improvements to bus services. | believe that market forces, as at present, are the best driver of improvements, whether that be through competition for passengers on similar routes between different operators, or where there is less. competition, because an Operator has to continually improve their product offering in order to attract new, and retain existing passengers in order to make a profit to remain in business. 4. [agree that in some very rural areas, where there is no prospect of being able to sustain 2 commercial bus service, community transport options should be considered to provide life-line public transport options for the small number of people who do not have access to other modes. of transport. This should be planned and managed at the local level though, not through national transport strategies that are too generic to be effective at the local level 5. I do not agree that the Traffic Commissioner should be given powers to impose greater financial penalties on operators who fail to meet the terms of franchises, as | fundamentally disagree with the need for franchises. | do however; support the principal of introducing Quality Partnerships between Operators and local authorities in order to improve bus services in a particular area or locale, As the experience of South Yorkshire (Sheffield) in the last year has demonstrated, significant improvements to bus frequencies, lower fares, and newer vehicles can be achieved at the fraction of the cast when compared to introducing Quality Contracts. 6, I would expect that if buses were to be re-regulated, with a far higher subsidy required to operate the bus network, then fares would need to increase to off-set this higher subsidy, have no specific comment on this question. Please see below. | begin these general comments by questioning the need for re-regulation as this Bill suggests. Much of this call for re-regulation is based on the events of 2012 when First Bus withdrew 2 number of services in East. and Midlothian. The consultation cites the withdrawal of 20 routes, the risk to 200 jobs, and jeopardising the livelihoods of those depending on the services to get to and from work. However, what the consultation fails to even mention is that virtually ALL the withdrawn routes were replaced by a service provided through an allemative operator. These alternative operators employed many of the First Bus drivers who were made redundant, so | do not support the assertion that there was a significant reduction in local employment. Lothian’ Buses in particular, replaced First's entire commercial network with altemative commercial services, at no cost to the local authority, and many of these replacement services were at higher frequencies than those operated by First. First also withdrew from a number of financially supported services, most of which were re-tendered and awarded to other operators meaning that there were very few residents of East or Midlothian left without a bus service — hardly supporting the theory that bus services were decimated. Taking the main bus service between Pencaitland/Ormiston and Edinburgh as an example, First withdrew their main commercial daytime service (448), and Lothian Buses responded by filing this gap in the market, establishing a new commercial route, operating under the East Lothian banner (113). During the period of time First Bus operated the service, they evening and Sunday service was financially supported by Eest Lothian Council and this arrangement still exists for Service 113 today. At the time of the 113s Introduction, Lothian Buses Introduced lower fares and a range of ticketing options which allowedpassengers from Pencaitiand and Ormiston to make use of the wider Lothian Buses network across the City and East / Midlothian. To illustrate this point, the single fare from Peneaitland to Edinburgh was reduced from £3.70 to just £2.50 — a reduction of over 30%. in the first year since the introduction of the 113, Lothian Buses have introduced 5 brand new single deck vehicles onto the route, and have made enhancements and improvements to the timetable 3 times ~ the latest improvements taking place from the 8” September 2013, The daytime frequency on Weekdays is now close to every 40-minutes, compared to the hourly frequency previously offered by First. | remember attending two separate public meetings — one in Pencaitland, and another in Haddington, during 2010 & 2014, where lain Gray attended to listen to the complaints of long-suffering First Bus passengers about the poor standards of service they were subjected to on a daily basis. Since the introduction of the 143 in June 2012, | think it would be difficult to find any real criticism of the bus service from the residents of Ormiston and Pencaitland, And all this was achieved in the deregulated market, without any political intervention, and by allowing market forces to work, the way they were designed to do. in light of the example | cite above, itis difficult to conclude that any ‘market failure’ emerged in 2012 in East or Midlothian that would require a re-regulation of bus services to put right. The exact same can be said of the recent withdrawals of bus ‘services in the Cumbemauld area, again by First Bus. Here, Stagecoach Glasgow introduced additional journeys on their own Glasgow to Cumbernauld services to ensure that there was sufficient capacity to meet passenger demand. Again, as per the East Lothian example, few bus passengers were significantly inconvenienced by First’s actions. In the case of the First Bus withdrawals across Scotland in 2012, the reason cited by First Bus was rising costs and diminishing subsidies. This raises an important question of funding which needs to be addressed by the Scottish National government, and should not be used as part of the reason to justly re-tegulation. | point in particular to the National Concession Scheme, which many commentators now believe is unsustainable in its current form. When the scheme was initially launched, bus operators were assured that they would be no better or no worse off for carrying concession holders. At that time the reimbursement rate was set at 73% of the adult single fare. By the start of the next financial year, this will have dropped to under 60%. On top of this, the amount of money Government makes available to the scheme is capped, and in most years to date, the cap has been breached resulting in operators not being paid the full amount to carry concession passengers. At the same time, with an ageing population, more ‘and more people are becoming eligible for the scheme, which again will put more pressure on the limited resources allocated to paying for it. | believe that it is essential that these issues are addressed, and while | appreciate that this may be difficult politically, someone is going to have to grasp the nettle here if the scheme Is going to be sustainable in the longer term. For example, with the national pension age gradually increasing to 67, and with people generally working longer now, Is it right that people are entitled to a free’ bus pass from age 607 Is it right that 60 year old lawyers, on considerably higher than average salaries, can travel to work for free on their local bus, even although they can more than afford to pay for their fare? Unless there is a long term strategy to address these issues, | would suggest that this poses a significant longer term risk to bus service viability | welcome the acknowedgement that the London’ system of contracting all bus services requires significantly higher levels of public subsidy. Were this Bil to be successful in Scotland, then the level of subsidy required to operate the kind of bus network envisaged would Increase significantly on current levels. Is this in the best interest of the general public? Given that passenger satisfaction rates for bus services across Scotland are already very high, | am unable to conclude that there are significant issues, other that pethaps a small number of localised issues which should be addressed at the local level, not by aa sea-change in national policies thal are going to be costly to introduce. The assertion contained within the consultation is that ail bus routes should become contracted, and that operators should tender for these contracts which would contain profitable and non-profitable routes. At the current time this is the route that the Tyne & Wear Integrated Transport Authority (ITA) are traveling down. They want to award Quality Contracts for the provision of bus services across the entire area they have Jurisdiction over. This, despite the fact that national bus satisfaction surveys, compiled independently, illustrate that salisfaction rates amongst bus passengers in the north-east are some of the highest in the UK at 87%. Furthermore, research has illustrated that fares in the region have either stayed the same or fallen in real terms in 4 out of the past 6 years. | fail to.see how this supports the theory that there has been any market failure at play? All three of the main bus operators in the region, ‘Stagecoach, Go-Ahead and Arriva have invested millons of pounds over the last 15-years in new buses for their fleets, as well as improving service frequencies across their operating areas, where there is the commercial justification for doing so ~ i.e. where passenger demand is high, and where there is the potential to increase this demand stil further. It is my own opinion that this is not so much about improving bus services, as more about trying to arrest the profits of the main bus companies by stealth in ‘order to fund the ailing Metro system which is losing significant arnounts of money per annum.If @ Quality Contract style system was to be adopted in the north-east, Stagecoach have publicly stated that this would amount to a theft of their commercial business which they would challenge in the court. Given the time, effort and financial capital that they have invested in their north-east business to bulld It up and make it profitable, is it right that a Government body can come along and effectively take control of their routes and timetables and at best dictate to them what routes and timetables they can operate, or at worst, take the routes from them and award them to an alternative operator? | would suggest that this is entirely unfair, and not in the best interests of the travelling public, yet this Is exactly the kind of scenario that this Bill could lead to In Scotland, As evidence to support this hypothesis, Stagecoach ‘commissioned an independent research to assess the impacts of the ITA proposals. This research concluded that around 50% of Stagecoach adult fate-paying, passengers in Sunderland and South Shields would pay more ~ with fares rises of up to 20%. Furthermore, the plans would discriminate in favour of Newcastle, at the expense of some of the poorest housing estates in Sunderland and South Shields. However, it was noted that bus fares in the ward of ITA Chairman, Clit David Woed, would not fisel As Stagecoach rightly point out, communities south of the Tyne would be asking why they had to pay more to hold down fares for electors in Councillor Wood's own back yard. This is the problem with politcising the bus industry ~ rather than market forces dictating routes, frequencies and fares; you have Councillors, MSPs and Local Authority Civil Servants dictating where and when buses will operate, and all these people have vested interests, which are often not in the interests of the populous at large, only a minority. Furthermore, with the greatest of respect, most of these ITA and local authority civil servants, and Councilors are not commercial Bus Network Designers — this is @ highly skilled and specialized profession. Without the involvement of these industry experts, free from any political shackles, to design the most cost-effective commercial bus network, that has the potential to generate significant passenger demand, then the bus networks which emerge are unlikely to be profitable and successful in the longer term. Instead, the market for bus travel would begin to decline, as it did through the 70s and 60s because state-controlled bus companies were not free to genuinely respond to changes in demand in the market for local bus travel. It is my opinion thet only by allowing genuine and free competition within the market for local buses, can foster innovation and drive up the quality of the service being provided. Where bus operators compete, it is in thelr best interests to provide a high quality service; otherwise they will struggle to win passengers. In areas where there Is little active competition between bus operators, the continued threat that competition may arise by a new entrant to the market place should be sufficient to drive up quality. It is also worth commenting that the main competitor to the local bus is the private car, thus even in areas that are served by one dominant bus operator, there is stil a massive incentive to drive up the quaity of the service in order to win new business or retain existing business. Bus operators appreciate that many people have an altemative to using the bus, so without retaining thelr custom, there is no long-term future for bus services. | cite the examples of the award-winning Stagecoach Express network in Fife, a8 a prime example of how a commercial bus company, working in the de-regulated environment can build-up a business and generale modal shifl from private car to bus. If you go back 25-years, there were 4 buses from Fife arriving in Edinburgh between 8am & 9am in the morning. Now, there are over 30-buses arriving In the same period — all of them busy with commuters who otherwise may have travelled by car, ‘adding to already bad congestion on the road network to the North of the City and around the Forth Road Bridge area. | doubt whether this success would have been achieved had the bus network stil been working in a regulated environment. I note with interest the statistic listed in the document which illustrates that during 2011/12 there were 542 us services registrations cancelled in Scotland with the Traffic Commissioner for Scotland. | have looked through the Notices and Proceedings issued by the Commissioner for the same time period Many of these cancellations were for services which were operated for the purposes of schools, or where subsidised services had been re-tendered, and another operator was taking over the route. This meant that while there were over 600 cancellations, there were also over 700 new local bus services registered in Scotiand over the same time period. In this instance, | think the statistic reported on was only half of the pleture, and | think it would have been useful to report on the number of new registrations in order to prevent any misunderstanding from the general public, who may pick-up the wrong end of the stick. It is my view that there is a general acknowledgement throughout Scotland, that Edinburgh and the Lothian’s has one of the best bus networks, and quality of services of anywhere in the United Kingdom. ‘Again, this has been achieved by Lothian Buses working within the deregulated market. The difference between Lothian Buses and other bus operators is that its stil in public ownership ~ being managed es a ‘commercial company at arm’s-ength by the City of Edinburgh Council. With this type of set-up, the business stil has to function as a commercial entity, but unlike the large PLCs, more of the profits can be e-lnvested In improving the bus network and keeping fares down, rather than going to private investors/shareholders, | would suggest that rather than re-tegulating the bus industry in Scottand, the focus should be on how this mode! of bus operation can be extended to other areas where localauthorities have identified that there are gaps in the market (where other commercial operators have exited the market), or where a local authority sees that the quality of services being provided by an operator are not up to the standards that they would like to see. In essence, if Glasgow City Council wishes to begin commercial bus operation, or buy an existing bus operator, in order to compete with First Glasgow, they should be allowed to do so, as long as the new entity operates within the legislation of the 41985 Transport Act which dictates the de-regulated market. IF there is no legislation currently in place to facilitate iocal authorities desire to commence or buy their own commercial bus operations, this is something that should be considered as a viable alternative to wholesale re-regulation, Furthermore, the Bill in its current form focuses on the ‘filings’ of bus operators. Itis, however, weak on the fallings of local suthorities, and the lack of resource they allocate to maintaining and improving bus riority measures and infrastructure. It is my view that in general there is insufficient funding allocated to improving access to buses at bus stops (raised kerbs for example to allow easy boarding by the elderly, infiim and disabled in wheelchairs), or for providing good quality ighting to improve safety or for providing ‘good quality information about bus services using the stop. In terms of the road network, more local authorities need to look at ways of making changes fo road layouts with additional bus lanes or junction priorities so that bus journey times are reduced, making the bus @ genuinely viable alternative to the car. ‘As an example here, Brighton & Hove Bus Company has worked in close partnership with the local ‘authority to improve bus priority which has resulted in sustained passenger growth over a number of years, IN contrast, the newly elected Mayor of Liverpoot is currently trialling the closure of dedicated bus lanes so that all general traffic can use them. This can only be a backward step, taking bus travel back into the bad old days - making it less attractive, and undoubtedly making the bus network less commercially viable in the longer term if passenger numbers decline as a result of the pro-car policies. It is intoresting to note that the Mayor is a Labour politician, yet is advocating anti-bus polices. In conclusion, | would cite the examples I have discussed throughout this paper to demonstrate that a re- regulation of the bus industry in Scotland can only have a detrimental effect on the level of service provided, and the cost of that service to consumers. | believe that | have demonstrated that the deregulated market does work, and that this should continue to be the main legislative framework which is used in Scotland going forward. Rather than consider expensive Quality Contracts, the focus should be on Quality Partnerships which are formed within the context of the deregulated market, and which | believe can deliver more benefits than a Quality Contract, but at a fraction of the cost. In particular, we must avoid the potticising of the Scottish bus industry if itis to thrive in the longer term. The onus should be on local authorities, as much as bus operators, to provide the conditions in which a commercial bus network can thrive with very litle external subsidy from the public purse. 1 also suggest that the current concessionary reimbursement scheme is fundamentally flawed and needs to be reassessed so that some of the funding being spent here can be re-channelled into altemative bus schemes which can drive- Up the quality of bus services in the longer term. | hope that the consultation being carried out on this Bill will be of use in helping to re-shape the final Bll which comes before the Scottish Parliament, and | trust that my comments will be taken on board and considered as part of this process. Yours Sincerely lan Bieniowski