Mar 26, 2020 | Comments

Politicians Might Get What They Want But No Longer Want it – The Future of the Bus Industry

Matthew Moll

 

No one can be certain what the outcome of the Coronavirus will be on British Society and the Global Economy. We don’t know yet when we will next be able to watch live sport, visit the cinema or go to the pub. It isn’t even clear when schools and universities will reopen. A large proportion of the population is now working from home and whilst some will be glad to go back to their office when it is all over, others may stay at home even if just for part of the week. Will people flock back to the high street, cinemas and nightlife or will this be the final nail in their coffins?

All this will have an effect on the future of the bus industry and will probably null and void the DfT’s National Bus Strategy. Franchised Train Operating Companies are now all operating on management contracts and if the DfT has any sense it will use this opportunity to implement the restructure of the rail industry. But will the same happen for the bus industry?

One scenario is that some near normality is restored and patronage bounces back. The likely impact will be the use of the money set aside by the DfT for Electric Bus Towns etc. to instead compensate bus operators for the loss in revenue. This will mean the structure of the bus industry stays the same but the money earmarked for boosting patronage will no longer be there. Local Authorities are likely to have little spare cash to spend on improving bus priority measures and infrastructure whilst operators might be less willing to invest in new vehicles given their financial position, indeed both First and Stagecoach have already said capital expenditure is likely to be the first casualty of the current crisis. This will mean the continued overall decline in long term bus patronage and, indeed, in the manufacturing sector.

We might hope for another ‘post-war’ boom with a surge in ridership as people are no longer constrained. At the other extreme we might have an industry on its knees with only a proportion of pre-crisis patronage returning. Even if 80% of the patronage returns it will have a massive impact on the future sustainability of the bus industry. This could result in the view of operators to franchising changing, the big groups might start to support the plans of the Metro Mayors and others to take over control of the network. It would mean that instead of fighting for survival as traffic generators fail to return, they could get a guaranteed profit margin and let the Combined Authorities worry about the lack of passengers and revenue. And for Andy Burnham and co. a success as they take back control of the bus industry without opposition, but would they still want it?

If the traffic generators for bus fail to fully return it is likely that this will be mirrored on the other forms of local transport. Would GMCA want to carry the burden of supporting the bus network whilst having to deal with a lack of passengers on Metrolink?

Beyond this there is talk of nationalising the bus industry if only temporarily. Running all services as contracts whereby the government pays for any operating loss makes sense whilst they are telling people to avoid public transport if possible. After all, the vast majority of operators don’t have deep enough pockets to keep funding running empty buses around all day. Without government support, if operators are forced to reduce services to skeletal levels then key workers will find other transport and never return. The problem is what happens at the other end. Will some areas need to stay like this longer than others? Will politicians attempt to get involved and argue that since the services are currently de facto franchised why don’t they stay that way?

So what should be happening now? Operators themselves will no doubt be too busy with day to day issues of providing a service to ask directly, however CPT, ALBUM and the higher echelons of the groups should start now by drawing up together a set of scenario outcomes and responses. The CPT has indeed already been making the right noises about the need for support from government. A proactive industry is more likely to survive this crisis in some shape or form than a reactive one.

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