Londoners don't want to drive buses

[notadriver]

Seems less than I was lead to believe. Search for "buschauffeur vacature" or "chauffeur openbaar vervoer vacature".



https://www.randstad.nl/vacatures/1643197/buschauffeur-lijndienst-stadsdienst



shows a rate of 12.50 euros per hour, which is just over £9 at current exchange rates, although of course the pound is quite strong against the euro at the moment. Interestingly though the advert is for 21-27 year olds and is for just 32 hours a week. Maybe experienced drivers get more.



http://financieel.infonu.nl/geld/29017-wat-verdient-een.html compares wages for different jobs and it says an bus driver gets an average €2,748 and a maximum of €3,295.



http://www.watverdient.com/wat-verdient-een-buschauffeur/ says a beginner gets €1,800 a month and with experience €2,500.

Thanks for those. Very interesting. Of course it doesn't show the hours worked but still ...

£10.50 an hour assuming 40 hours over 4 weeks gives £1680 or €2300. Senior bus drivers on about £15 an hour works out to £2400 or €3200 and if we pay less tax that means that London bus drivers are better than their Dutch counterparts.

The cost of living is a factor in London but getting free tube and bus travel must surely make things easier ?

 

[Robertj21a]

Shareholders providing capital investment simply doesn't happen any more.

Please explain.

 

[TheGrandWazoo]

What Ridley truly believed we'll never know, but his public pronouncements were that "market forces" would create smaller and smaller companies all fighting each other and driving standards up and prices down.

Of course what actually happened here in Newcastle is that the PTE bus company got flogged to its managers (using leverage) who then made a killing when Brian Souter came calling And Stagecoach's version of "responding to local needs" in Newcastle is to demand Nexus make the daytime 32/32A route (as well as some early and late runs on routes like the 22 and 38) tendered as it was "unprofitable", only to register it commercially (meaning the tender costs went down the swannee) when another company won the tender.

And that's before we even start to think about the anti-competitive practices of Go Ahead (ooh, them again) in Ashington in an attempt to force Arriva out of Hexham.



I think the savings were dubious, and quality improvements very much depend on the local setting. I generally think bus operations are improving where there is some level of competition, either from other bus companies (e.g. Carlisle) or the private car (e.g. Northumberland-Newcastle services) or, as in Tyne and Wear, the companies finally pulling their finger out due to the threat of a Quality Contract.

But in other areas- Hemel Hempstead being a great example- the monopoly of one operator is leaving the network as a shambles that's dying on its feet.



Shareholders providing capital investment simply doesn't happen any more.

Oh dear David..... you've got your facts all wrong again. I already knew the answer but to help you, here's a quick photo for you...please feel free to read the strapline under the Busways fleetname

https://www.flickr.com/photos/jp471...uci-5xoaMp-sjsmVb-azGTos-ppiFpA-iPzziH-eYNb1F

However, if you're struggling to spot it, I can clarify. It says "An Employee Owned Company". Busways was sold to a management and employee buyout. The split was 51/49. So when they did sell out to Stagecoach, the drivers who had invested made a pretty penny as well.

Just to give you some more info, from someone who lived in the North East AT THE TIME, the reason they sold out was that they were acutely aware of being relatively small as consolidation in the market was gathering pace and hence were vulnerable. They could either expand but would need additional share capital to fund that expansion or sell out to a larger group. Stagecoach inherited a fleet that had a reasonable but increasing age profile and was increasingly under resourced (a lack of capital??) despite having invested in c. 25 DDs, 70 or so Darts, about 20 Lynxes and 40 Scanias L113s in the previous 5 years. It also had a high cost base in terms of staff costs. So they did two things. One was to immediately invest in the fleet with about 80-100 new vehicles. Second was to address the staff costs. Not through imposition or some back door method - they basically bought them out so the drivers got a large cheque (the second one in as many years for the ones who'd had shares). How did Stagecoach pay for all of that? Because they'd floated on the stock exchange in 1993 - yep, share capital again. Of course, once you float, you can just sit on the business and hope to make the dividends but what if you need to get more finance to expand further? A rights issue may well be the case though usually it is for expansion rather than repairing the damage of an idiot like Moir Blockhead! So that's why dividends and hitting returns are important!

As for the 32/32A, yes Nexus have incurred tender costs but how much have they saved overall? In case you don't know, many a procurement exercise is not about making a change but about scaring your provider into dropping their rates. Tender costs are actually just regarded as an investment - a sprat to catch a mackerel. Nexus were probably ecstatic. Those services you quote probably aren't viable. However, Stagecoach (like many a firm) took the view that they'd run at a slight loss in order to protect market share - happens in all industries (damn those capitalist pig dogs, eh?).

As for the question of quality and savings being “dubious”? Certainly, I don’t argue about the erosion of quality in the post de-reg period – I travelled on many a shabby National at that time. However, the aim in reducing public subsidy was very much met. In the 6 former English PTE areas, subsidy fell between 1984/5 to 1987/8 by over half. Of course, some of that is done “on the backs of the proletariat” – the drivers’ terms and conditions aren’t what they were. That is true but in those days, drivers would only actually work about 70% of their working day. There were so many bits of slack, it was unreal.

However, the idea of quality and customer service was not exactly a by-word in pre-dereg days either. What represents “quality” is very much subjective. Someone like Radamfi will always quote features like bonded glazing or aircon rather than things like wi-fi, charging points or eLeather seating. Nonetheless, the sheer fact that the bus industry is pursuing such concepts is actually a leap forward. In 1986, if I caught an evening bus at that time from the nearest large town, chances are it would be operated by a Bristol LH with tan vinyl seating. That same route would now have an Arriva Max single deck (probably a Pulsar).

Stagecoach always “got it”, First have now twigged (and I’m still not convinced about Arriva) – you need to grow organically and to do that, you have to innovate. The private car is always a/the competitor - the industry has only really got to grips with this in the last few years - deregulation, privatisation, consolidation etc meant that the focus was more on survival and growth (to survive) than actually growing the market. In this, I exempt First - the old strategy of managing decline was patently ludicrous as I've said ad infinitum

Also, you’ve mentioned Hexham etc before. Whilst the CC findings were pretty damaging, in some ways, it probably did Arriva a favour in diverting attention - a bit like having a nosebleed that distracts from the fact than you've p***ed yourself! The facts are that Peter Huntley was very clever. He identified that Arriva NE (under Steve Noble who probably had one eye on retirement) had become very complacent. Noble probably thought that the cosy arrangement that had lasted for years would probably continue and hadn’t bargained on the status quo being broken. In short, Huntley outmanoeuvred Noble/May – the emails that the CC found were probably less embarrassing than the truth!!

 

[Robertj21a]

.
Excellent summary, thanks for that.

 

[Teflon Lettuce]

£18 would've been £8.79 in 1986. I assure you that my late father wasn't on that as an hourly rate as an NBC driver (on a conventional rota and with 20+ years service as well). Nowhere near.

I base my figures on the fact that in 1986 the local NBC subsidiary to me was paying £6.05 per hour... as compound inflation equates to approxiamately 300-400% over the last 30 years then if the drivers had had a with inflation increase each year the rate would be between £18-25 per hour now. What is telling is that the first action of management on privatisation was to impose a 10% pay CUT on their drivers! says it all about shareholders methinks.

Also, with the "radical idea", profits for London companies are comparable with what firms make around the world. I mentioned ComfortDelGro and RATP as examples. Are you expecting them to work for nothing?

--- old post above --- --- new post below ---

How would you get shareholders to take lower profits ? - if they can get a better return on their investment they simply go elsewhere and the company collapses. If you had put your own savings in an account and they then said they would halve the return to you, wouldn't you look elsewhere ?

I have some shares in a multinational company which is listed in the FTSE 100 My dividend each year is approxiamately 2-3% each year... so if bus companies are making profits of 9 or 10% (or in arriva's case trying to reach 15% then surely shareholders are being greedy in expecting such returns on their investment?

 

[radamfi]

I have some shares in a multinational company which is listed in the FTSE 100 My dividend each year is approxiamately 2-3% each year... so if bus companies are making profits of 9 or 10% (or in arriva's case trying to reach 15% then surely shareholders are being greedy in expecting such returns on their investment?

Are you quoting the dividend yield when you are talking about 2-3%, which is dividend divided by the share price? That's different to the percentage profit.

 

[TheGrandWazoo]

I base my figures on the fact that in 1986 the local NBC subsidiary to me was paying £6.05 per hour... as compound inflation equates to approxiamately 300-400% over the last 30 years then if the drivers had had a with inflation increase each year the rate would be between £18-25 per hour now. What is telling is that the first action of management on privatisation was to impose a 10% pay CUT on their drivers! says it all about shareholders methinks.


--- old post above --- --- new post below ---

I have some shares in a multinational company which is listed in the FTSE 100 My dividend each year is approxiamately 2-3% each year... so if bus companies are making profits of 9 or 10% (or in arriva's case trying to reach 15% then surely shareholders are being greedy in expecting such returns on their investment?

Teflon - have a look at this

http://www.thisismoney.co.uk/money/...tion-calculator-value-money-changed-1900.html

If you put in £6.05, then it comes to £16.39. Where you get £25.00 from, I can't say.

Whilst I can't recall the exact rates at dereg, my recollection is that conventional drivers were on c.£3.40 an hour with minibus drivers on about £2.75. £6.00 an hour in the North East - not a hope

My father and his colleagues didn't get a cut when privatised but some of the archaic terms and conditions were removed. Such as a minimum shift length of 7.5 hours which included 25 mins (start) and 20 mins (end) for office duties, or that overtime was minimum of 3 hours. For instance

• You could have a shift that started at 06:15 (so 15 mins admin, 5 mins to drive the 1 min to the stand, and then 5 mins to handle the 0 passengers for the 06:40 departure and then work til 0850, then probably start again at 0920
• You could be finished for 12.20 after some languid driving and then be on standby until 13:25
• Of course, there was the break which took you to 12:50 so you'd have this dead time until 13:25 before the admin period took you to shift end at 13:45
• But what if there could be then a run to cover at 13:00 til 14:35 and so they would be asked to cover it.
• However, the driver would get paid til 16:45 as the min 3 hours kicked in

10.5 hours pay for not even 7 hours driving. I think my dad and many of his colleagues knew that it couldn't last.

Also, I think you're missing the point on dividends. What is acceptable as a dividend is that return vs. what you could get from investing it elsewhere (and the level of risk vs. reward). So what is important is what you're comparing it to?

If you're a pension fund manager, what you probably want are some fairly reasonable, regular returns that will help fund schemes especially those on final salary terms. Other institutional investors will also seek to have a balanced portfolio with some dependables and some riskier (but more lucrative) options.

As for Arriva getting 15%..... hmmm!

 

[Robertj21a]

--- old post above --- --- new post below ---

I have some shares in a multinational company which is listed in the FTSE 100 My dividend each year is approxiamately 2-3% each year... so if bus companies are making profits of 9 or 10% (or in arriva's case trying to reach 15% then surely shareholders are being greedy in expecting such returns on their investment?

Now I'm totally confused by your figures ! Aren't you confusing dividends with profits ?

 

[Teflon Lettuce]

Now I'm totally confused by your figures ! Aren't you confusing dividends with profits ?

perhaps someone with shares in a listed bus company would like to enlighten everyone as to what their dividend yield was last year? as I said the company I have shares in is a hugely successful multi national conglomerate and that only yields 2-3% per year... somehow I suspect that dividends and profits are linked....

what can NOT be argued is that bus companies CAN afford to pay a much higher rate than they do... they just CHOOSE not to in order to line their own pockets and those of their shareholders. Fuel prices have plummetted over the last 18 months or so... who is reaping the rewards of the savings? NOT the drivers! as an example Cardiff Bus are suffering a series of strikes at the moment because they are offering a paltry 3% rise after 2 years of pay freeze... why can't they pay a higher increase offset by savings on fuel costs?

 

[radamfi]

somehow I suspect that dividends and profits are linked....

Some companies with big profits choose not to pay dividends. Google, for example, is a huge profitable company but prefers to reinvest the profits in the business. Alternatively, a loss-making company may nevertheless maintain a dividend payment to avoid upsetting investors.

The dividend yield will go up if the share price goes down and the company maintains or improves the dividend. The share price reduction may simply be as a result of poor sentiment and nothing to do with the running or profitability of the company. A high yield does not necessarily imply good profitability and a very high yield is often a sign that the dividend will be cut in the near future.

 

[Robertj21a]

perhaps someone with shares in a listed bus company would like to enlighten everyone as to what their dividend yield was last year? as I said the company I have shares in is a hugely successful multi national conglomerate and that only yields 2-3% per year... somehow I suspect that dividends and profits are linked....

what can NOT be argued is that bus companies CAN afford to pay a much higher rate than they do... they just CHOOSE not to in order to line their own pockets and those of their shareholders. Fuel prices have plummetted over the last 18 months or so... who is reaping the rewards of the savings? NOT the drivers! as an example Cardiff Bus are suffering a series of strikes at the moment because they are offering a paltry 3% rise after 2 years of pay freeze... why can't they pay a higher increase offset by savings on fuel costs?

I'm sorry to say that I really don't have the time at present to explain just how wrong most of your comments and assumptions are. You seem to be totally confusing a whole host of issues.

 

[the101]

£6.05 an hour for driving a bus in 1986?

 

[wellwhatitis]

The shareholding- and who holds it- is relevant when others are stating that the taxpayer should fund wage rises because Go Ahead (or whoever) "can't afford it" as they "have to make money". The main person who's making money out of Go Ahead is the widow of the bloke who got a state asset on the cheap; what "investment" she brings is not clear. And it's the same with Stagecoach and with First; the people who bought cheap assets off the state are making a killing, but there's "no money" for anyone else.

The obvious solution- reversing the disastrous fire sale of state bus companies- would be a start; tube drivers and staff, despite the recent industrial bother, are looked after because they're not beholden to the profit motive of the kleptocrats.

Of course, if someone wants to explain why someone should get £2m a year dividends because of a quirk of history, and why that money shouldn't go to the people doing the grafting, I'm all ears.

Not sure what Corbyn has to do with owt?

You will find that most folk who don't like opinions such as yours when it comes to extortionate individual profit from privatisation and the inevitable resulting decline in employment standards will always politicise their argument in order to paint you as a loony lefty. It's the only justification they know.

They never understand or care that some people don't care about the politics, just the subject matter.

 

[TheGrandWazoo]

You will find that most folk who don't like opinions such as yours when it comes to extortionate individual profit from privatisation and the inevitable resulting decline in employment standards will always politicise their argument in order to paint you as a loony lefty. It's the only justification they know.

They never understand or care that some people don't care about the politics, just the subject matter.

I think you'll find that it was David who started the "fat cat" politicisation.

FWIW, I've said that I support drivers being paid more but the idea that there are some sort of ridiculous margins being made in London is patently not true. Therefore, the idea that company margins can be reduced to fund this is fundamentally unworkable. If they were excessive, then maybe but when you compare with similar margins elsewhere globally on a similar like for like basis, they are comparable.

It's one thing to have those views. However, then trying to support that with statements that are wrong and demonstrably incorrect? Well, sorry, but that is worthy of exposure to the harsh light of truth.

Hold views, no problem. Argue them, fine. However, it's not the first time that stuff that is not factually accurate (like the Busways privatisation rubbish) to support an argument has been said or allowed personal views to taint any objective analysis.

Oh, and likewise, just because I don't agree with such views doesn't mean that I'm some rabid free marketeer or closet UKIPer. I'm with Voltaire on that one.

 

[6Gman]

perhaps someone with shares in a listed bus company would like to enlighten everyone as to what their dividend yield was last year? as I said the company I have shares in is a hugely successful multi national conglomerate and that only yields 2-3% per year... somehow I suspect that dividends and profits are linked....

Recent figures:

First Group - zero (dividend suspended currently?)
National Express - 3.5%
Stagecoach - 2.5%
Go Ahead - 3.3%

 

[Tetchytyke]

I think you'll find that it was David who started the "fat cat" politicisation.

FWIW, I've said that I support drivers being paid more but the idea that there are some sort of ridiculous margins being made in London is patently not true.

I guess it boils down to opinion about what is an excessive margin and what isn't.

Given that TfL tell bus companies what to run, where to run it and how much to charge, I cannot see what value the private companies bring to the table. 10-12% margin seems an awful lot of money for doing very little. They don't even invest in the buses, TfL have been left footing the bill for the Borisbus.

As for politicisation, I see no issue with labelling the widow of the bloke who used the bank's money to buy Northern General a "fat cat". I cannot see what she brings to the table that means she deserves to be paid the thick end of £2m a year in dividends.

Hold views, no problem. Argue them, fine. However, it's not the first time that stuff that is not factually accurate (like the Busways privatisation rubbish) to support an argument has been said or allowed personal views to taint any objective analysis.

I'm not sure what "factually inaccurate" comments I've made? Busways' management had a 51% stake in the company; given their controlling stake in the company, it is fair to call it a management buyout. What Busways chose to advertise themselves is pretty much irrelevant; they were a management controlled company as the employee trust (whose trustees were heavily influenced by management in any case) had a minority stake in the company.

The fact the staff made some money when Brian came calling doesn't change the fact that it was the management who made the real dough. I'd agree that management sold out to Souter because they were spooked by the flotations of Northern General and Cowie, but I don't see how that's relevant to the point I made.

I'm not naive enough to think that everything would be magical and happy if the buses were operated as non-profit companies, but I genuinely do not see what the private companies bring to the table that justifies the margins they make. Stagecoach make 20%+ in Newcastle, yet the newest buses are five years old that haven't been touched since they rolled out of Falkirk. Arriva are probably the best bus company in the north east at the moment, with their investment in Sapphire and Max and their bus-tracker app, which says a lot.

 

[the101]

Given that TfL tell bus companies what to run, where to run it and how much to charge, I cannot see what value the private companies bring to the table. 10-12% margin seems an awful lot of money for doing very little. They don't even invest in the buses, TfL have been left footing the bill for the Borisbus.

Ignoring the rest of your post, the paragraph above would suggest that you know very little about bus operation, and certainly a lot less that you think you do.

10-12% is not an outlandish margin in any way, shape or form, and to suggest that operators in London 'do very little' to earn their money is absurd in the extreme. TfL contracted work is tricky and not for the faint of heart, as the likes of Harris Bus and similar proved. There are pitfalls aplenty for those who don't deliver exactly what TfL wants, expects and pays for, and TfL auditors regularly turn up unnanounced at depots to check systems are in order. Woe betide the operator should it be discovered that they are not.

The point about companies not investing in buses in London is also ridiculous. There are about 8,000 buses in London - perhaps you could advise us exactly what percentage of them are 'Borisbuses'?
--- old post above --- --- new post below ---

Stagecoach make 20%+ in Newcastle...

Proof please.

 

[TheGrandWazoo]

I guess it boils down to opinion about what is an excessive margin and what isn't.

Given that TfL tell bus companies what to run, where to run it and how much to charge, I cannot see what value the private companies bring to the table. 10-12% margin seems an awful lot of money for doing very little. They don't even invest in the buses, TfL have been left footing the bill for the Borisbus.

As for politicisation, I see no issue with labelling the widow of the bloke who used the bank's money to buy Northern General a "fat cat". I cannot see what she brings to the table that means she deserves to be paid the thick end of £2m a year in dividends.



I'm not sure what "factually inaccurate" comments I've made? Busways' management had a 51% stake in the company; given their controlling stake in the company, it is fair to call it a management buyout. What Busways chose to advertise themselves is pretty much irrelevant; they were a management controlled company as the employee trust (whose trustees were heavily influenced by management in any case) had a minority stake in the company.

The fact the staff made some money when Brian came calling doesn't change the fact that it was the management who made the real dough. I'd agree that management sold out to Souter because they were spooked by the flotations of Northern General and Cowie, but I don't see how that's relevant to the point I made.

I'm not naive enough to think that everything would be magical and happy if the buses were operated as non-profit companies, but I genuinely do not see what the private companies bring to the table that justifies the margins they make. Stagecoach make 20%+ in Newcastle, yet the newest buses are five years old that haven't been touched since they rolled out of Falkirk. Arriva are probably the best bus company in the north east at the moment, with their investment in Sapphire and Max and their bus-tracker app, which says a lot.

I'm sorry David. It's pretty disingenuous to say "what actually happened here in Newcastle is that the PTE bus company got flogged to its managers (using leverage) who then made a killing when Brian Souter came calling" and yet fail to mention that half of the business was owned by the workers who also made a killing. That is what is factually inaccurate - leaving out information is just as factually inaccurate as stating stuff that is factually and demonstrably untrue.

Did that fact that the drivers also made a killing slip your mind? Or did you deliberately leave that out? Was it something that didn't quite fit your narrative?

Many of the NBC sell offs that were MBO's were actually done on a similar basis. Take M&D who when privatised had 20% of the business was owned by which drivers and staff wanted to participate and ALL staff were then given a further £200 worth of shares. They made a fair sum when British Bus came along and bought them up. Similarly, Midland Red West who were bought on a 51/49 split. Some drivers did spectacularly well except those in Worcester who were advised by their union rep not to get involved in such capitalist sorcery. A few years down the line and their colleagues were getting huge cheques - that Union Rep was not a popular person.

Martin Ballinger and Chris Moyes did make money out of Go Ahead and they did take risks. You just don't know that. And yes, their widows get the money from the shares - just in the same way that my mother does from my father's shares that he was given when he was a driver. She also gets his BEST money - I assume you know what that is too?

As for selling out when "spooked", it is patently relevant and I'm happy to explain why. You talk about share capital and how once a business is bought, then it becomes irrelevant. Sorry but in this case, it was crucial. Busways was undercapitalised and increasingly so. It was struggling with fleet replacement and couldn't expand geographically so to make it less vulnerable. That's why share capital is important!

And, of course, you're being rather selective with your facts. You've talked about Busways but now mention that the newest vehicles in NEWCASTLE are five years old. Firstly, they're from 2011 but as I'm sure you are aware, Newcastle got the lion's share of investment between 2007 and 2011. In the most recent years, it has been the other parts of Busways (via Shields and Sunderland) that have received substantial investment. Or was there a reason that you failed to mention this?

As for London, companies do still invest in new buses. All other new buses are sourced by the operators not TfL - again, a slight omission from you? Also, 10-12% margin....

• Stagecoach is 9.5%
• CDG is 8%
• Go Ahead about 10%

There was a nice graph done a couple of years that TfL did and GAG were the highest. Can't find it now but again, I think you're out.

As for The Borismaster and your assertion that "TfL have been left footing the bill for the Borisbus" that's their look out! It is a stupid concept that defies financial logic, is on TfL's books only because no-one would sign up to it (and when you look at the sums, only a idiot would - cue BoJo).

 

[Tetchytyke]

10-12% is not an outlandish margin in any way, shape or form

As I said, it's a matter of opinion whether 10% is "outlandish" or not. Obviously the bus companies don't think it is.

As for proof of Busways' operating margin, here you are: http://www.nexus.org.uk/sites/default/files/30079 TEC Operating Cost Analysis 2012.pdf

I undersold them; their pre-tax profit margin is actually 24%.

ETA: I agree that the Borismaster is a spectacular waste of money, but that wasn't my point either. If the bus companies are justifying their profits because of risk, yet TfL have had to take the risk of having a fleet of pointless white elephant buses, then what is the point of paying for the bus company profits?

It seems very much a case of having one's cake and eating it to me.

Beyond that, it's all a matter of opinion and how one chooses to interpret the facts. You interpret profit margins one way, I the other.

 

[TheGrandWazoo]

As I said, it's a matter of opinion whether 10% is "outlandish" or not. Obviously the bus companies don't think it is.

As for proof of Busways' operating margin, here you are: http://www.nexus.org.uk/sites/default/files/30079 TEC Operating Cost Analysis 2012.pdf

I undersold them; their pre-tax profit margin is actually 24%.

ETA: I agree that the Borismaster is a spectacular waste of money, but that wasn't my point either. If the bus companies are justifying their profits because of risk, yet TfL have had to take the risk of having a fleet of pointless white elephant buses, then what is the point of paying for the bus company profits?

It seems very much a case of having one's cake and eating it to me.

Beyond that, it's all a matter of opinion and how one chooses to interpret the facts. You interpret profit margins one way, I the other.

Jesus wept - I'll get you a bigger shovel. You've moved from Go Ahead to Stagecoach....Let's get back to Go Ahead as that's where we started as you said that they should pay drivers more from the huge, capitalist riches harvested off the misery of the proletariat. Here's the 2015 annual report from Go Ahead.

OVERALL BUS PERFORMANCE REVIEW
Total bus revenue increased by 2.2%, or £17.3m, to £817.8m (2014: £800.5m).

The bus division delivered operating profit of £89.0m (2014: £83.5m),
increasing by £5.5m, or 6.6%, in the year, resulting in a rise in operating
profit margin of 0.5ppts to 10.9%. This performance was slightly behind the Board’s expectations for the year.

Operating profit in the London bus division was £42.3m (2014: £41.6m), up
£0.7m, or 1.7%. Operating margins remained broadly similar at 9.2% (2014:
9.3%), down 0.1ppts on prior year margins

So London, as that's where we began this discussion, is less than 10%. What are you expecting - 6% like Transdev? Mind you, that is the group figure and outside the UK, they don't fund much and just operate it so if they had to do that, I wonder what the margin might be....

Borismasters will make up (assuming the full 600 arrive) less than 7% of the entire London fleet of 9000 vehicles. Who buys the other 8300......Any ideas? Er...that'll be the bus operators!!

You're not very good with facts and figures - more cake dear?

 

[Teflon Lettuce]

I'm sorry to say that I really don't have the time at present to explain just how wrong most of your comments and assumptions are. You seem to be totally confusing a whole host of issues.

how am I confusing a "whole host of issues" the issues are

1. Bus companies in general make good regular profits and have good regular cash flow

2. Shareholders get a good dividend for their investment

3. Owners (such as the Souters) earn millions from their businesses

4. Fuel prices have plummetted over the last 18 months

5 drivers (who lets be honest are the ones that mean that the profits can keep rolling in) are STILL being paid poverty wages for a highly responsible job... as I have said in other forums before drivers are constantly told they are professionals ... try getting a lawyer or doctor (or architect for that matter) to work for £10/hr or less!

now for those that doubt that a bus driver could get £6.05/hr in 1986 I will tell you that was the going rate at Luton depot of Luton & District at deregulation for a guarunteed 42 hr week working out at £254.10 per week before tax. I currently work for £9.50/hr making £399 per week

That makes a percentage increase over 29years of less than 100% whilst inflation over the same period has increased by well over that figure... therefore drivers are now paid relatively less for the job than they were in 1986 whilst the top bosses are earning many times more than they were in 1986 in real terms...

I don't care for the arguments that if you don't pay a dividend you don't get the investment... if you ain't got the drivers to do the donkey work then no amount of investment will help you make a profit. I'm not a commie or even particularly left wing but I do believe in a fair days pay for a fair days work

UNTIL BUS COMPANIES ARE WILLING TO PAY A WAGE REFLECTING THE RESPONSIBLE NATURE OF THE JOB THEY WILL NEVER GET THE CALIBRE OF STAFF THAT THEY WANT.... as I said before... pay peanuts get monkeys.

it's about time bus companies started investing where it matters... in the drivers... not in lining the pockets of rich men!

 

[fowler9]

At the end of the day if you want staff who speak perfect English then they will have to be paid a wage that will enable them to live in this country and not just send money home while they exist here. Look no further than the employers and yourselves as it is all down to how much people are willing to pay, and us and the employers have more control over that than the workers.

 

[Tetchytyke]

Operating profit in the London bus division was £42.3m (2014: £41.6m), up
£0.7m, or 1.7%. Operating margins remained broadly similar at 9.2% (2014:
9.3%), down 0.1ppts on prior year margins[/I]

So London, as that's where we began this discussion, is less than 10%.

Which is precisely the first point I made when we started, that there are big profits in London and bus companies can afford to pay more, they just choose not to.

Using your figures, each £1000 pay rise in London will cost Go-Ahead £7m. Therefore Go-Ahead could afford to pay all their staff in London another £6000 a year before they begin to lose money in London. So much for "the taxpayer" having to fund additional wage costs because "bus companies can't afford it" as they "have to make money".

Given that the cost of new buses, through depreciation or leasing costs, is deducted before profit (or it should if they're accounting properly)- assuming the bus company actually pay for it (see the Borisbus for more details) the talk of capital investment is just wibble.

A 10% margin in most industries is seen as very tasty indeed- supermarkets consider 4% to be a strong performance- yet in buses it's hardly worth worrying about? Haway.

Outside of London, where the ex-PTE operators are making margins of 24%, the situation is even more clear cut. But I forget; the Bus Barons are "innovators" bravely taking risks that publicly-owned operators like Lothian Buses don't, so they deserve all the cream. And anyone who disagrees is some sort of commie :roll:

ETA Think it's time to agree to disagree

 

[Antman]

I'm sorry David. It's pretty disingenuous to say "what actually happened here in Newcastle is that the PTE bus company got flogged to its managers (using leverage) who then made a killing when Brian Souter came calling" and yet fail to mention that half of the business was owned by the workers who also made a killing. That is what is factually inaccurate - leaving out information is just as factually inaccurate as stating stuff that is factually and demonstrably untrue.

Did that fact that the drivers also made a killing slip your mind? Or did you deliberately leave that out? Was it something that didn't quite fit your narrative?

Many of the NBC sell offs that were MBO's were actually done on a similar basis. Take M&D who when privatised had 20% of the business was owned by which drivers and staff wanted to participate and ALL staff were then given a further £200 worth of shares. They made a fair sum when British Bus came along and bought them up. Similarly, Midland Red West who were bought on a 51/49 split. Some drivers did spectacularly well except those in Worcester who were advised by their union rep not to get involved in such capitalist sorcery. A few years down the line and their colleagues were getting huge cheques - that Union Rep was not a popular person.

Martin Ballinger and Chris Moyes did make money out of Go Ahead and they did take risks. You just don't know that. And yes, their widows get the money from the shares - just in the same way that my mother does from my father's shares that he was given when he was a driver. She also gets his BEST money - I assume you know what that is too?

As for selling out when "spooked", it is patently relevant and I'm happy to explain why. You talk about share capital and how once a business is bought, then it becomes irrelevant. Sorry but in this case, it was crucial. Busways was undercapitalised and increasingly so. It was struggling with fleet replacement and couldn't expand geographically so to make it less vulnerable. That's why share capital is important!

And, of course, you're being rather selective with your facts. You've talked about Busways but now mention that the newest vehicles in NEWCASTLE are five years old. Firstly, they're from 2011 but as I'm sure you are aware, Newcastle got the lion's share of investment between 2007 and 2011. In the most recent years, it has been the other parts of Busways (via Shields and Sunderland) that have received substantial investment. Or was there a reason that you failed to mention this?

As for London, companies do still invest in new buses. All other new buses are sourced by the operators not TfL - again, a slight omission from you? Also, 10-12% margin....

• Stagecoach is 9.5%
• CDG is 8%
• Go Ahead about 10%

There was a nice graph done a couple of years that TfL did and GAG were the highest. Can't find it now but again, I think you're out.

As for The Borismaster and your assertion that "TfL have been left footing the bill for the Borisbus" that's their look out! It is a stupid concept that defies financial logic, is on TfL's books only because no-one would sign up to it (and when you look at the sums, only a idiot would - cue BoJo).

It would have been illogical for any operator to buy a bus that is specifically designed for London because if they lose the route on retender what do they do with the buses? It therefore makes more sense for TfL to own the buses.

Whether the buses themselves are good bad or whatever is a matter of opinion but drivers love them.

Just putting things into perspective!

 

[notadriver]

how am I confusing a "whole host of issues" the issues are



1. Bus companies in general make good regular profits and have good regular cash flow



2. Shareholders get a good dividend for their investment



3. Owners (such as the Souters) earn millions from their businesses



4. Fuel prices have plummetted over the last 18 months



5 drivers (who lets be honest are the ones that mean that the profits can keep rolling in) are STILL being paid poverty wages for a highly responsible job... as I have said in other forums before drivers are constantly told they are professionals ... try getting a lawyer or doctor (or architect for that matter) to work for £10/hr or less!



now for those that doubt that a bus driver could get £6.05/hr in 1986 I will tell you that was the going rate at Luton depot of Luton & District at deregulation for a guarunteed 42 hr week working out at £254.10 per week before tax. I currently work for £9.50/hr making £399 per week



That makes a percentage increase over 29years of less than 100% whilst inflation over the same period has increased by well over that figure... therefore drivers are now paid relatively less for the job than they were in 1986 whilst the top bosses are earning many times more than they were in 1986 in real terms...



I don't care for the arguments that if you don't pay a dividend you don't get the investment... if you ain't got the drivers to do the donkey work then no amount of investment will help you make a profit. I'm not a commie or even particularly left wing but I do believe in a fair days pay for a fair days work



UNTIL BUS COMPANIES ARE WILLING TO PAY A WAGE REFLECTING THE RESPONSIBLE NATURE OF THE JOB THEY WILL NEVER GET THE CALIBRE OF STAFF THAT THEY WANT.... as I said before... pay peanuts get monkeys.



it's about time bus companies started investing where it matters... in the drivers... not in lining the pockets of rich men!

Would anyone here be prepared to justify the poor wages and conditions suffered by bus drivers ?

 

[TheGrandWazoo]

Which is precisely the first point I made when we started, that there are big profits in London and bus companies can afford to pay more, they just choose not to.

Using your figures, each £1000 pay rise in London will cost Go-Ahead £7m. Therefore Go-Ahead could afford to pay all their staff in London another £6000 a year before they begin to lose money in London. So much for "the taxpayer" having to fund additional wage costs because "bus companies can't afford it" as they "have to make money".

Given that the cost of new buses, through depreciation or leasing costs, is deducted before profit (or it should if they're accounting properly)- assuming the bus company actually pay for it (see the Borisbus for more details) the talk of capital investment is just wibble.

A 10% margin in most industries is seen as very tasty indeed- supermarkets consider 4% to be a strong performance- yet in buses it's hardly worth worrying about? Haway.

Outside of London, where the ex-PTE operators are making margins of 24%, the situation is even more clear cut. But I forget; the Bus Barons are "innovators" bravely taking risks that publicly-owned operators like Lothian Buses don't, so they deserve all the cream. And anyone who disagrees is some sort of commie :roll:

ETA Think it's time to agree to disagree

A 10% is very tasty margin - depends what market you're talking about? Bring in supermarkets at 4-5%. Then bring in someone like an FMCG manufacturer like Reckitt Benckiser - they're at 21% What I did was to compare with other regulated bus operations - which is logical comparisons. RATP is about 8% and even the might of First Transit make 7.1% and they're a) rubbish and b) have a load of operations where they don't even have any assets to fund!!

This whole conversation started about London bus driver wages. I don't argue that they should be paid more. However, the idea that it kind be blithely paid for out of the pockets of "bus barons" - talk like that and you wonder why people think you sound ever so slightly left wing - is ridiculous.

If you were to cut Go Ahead London's margin to the level that David thinks is "fair" (i.e. 4.5%) then you'd be able to fund an £12.00 an hour pay rate. Get it to where Teflon Lettuce thinks is correct (a minimum £18 per hour) and, well, you can do the maths. I think you need the practice.
--- old post above --- --- new post below ---

how am I confusing a "whole host of issues" the issues are

1. Bus companies in general make good regular profits and have good regular cash flow

2. Shareholders get a good dividend for their investment

3. Owners (such as the Souters) earn millions from their businesses

4. Fuel prices have plummetted over the last 18 months

5 drivers (who lets be honest are the ones that mean that the profits can keep rolling in) are STILL being paid poverty wages for a highly responsible job... as I have said in other forums before drivers are constantly told they are professionals ... try getting a lawyer or doctor (or architect for that matter) to work for £10/hr or less!

now for those that doubt that a bus driver could get £6.05/hr in 1986 I will tell you that was the going rate at Luton depot of Luton & District at deregulation for a guarunteed 42 hr week working out at £254.10 per week before tax. I currently work for £9.50/hr making £399 per week

That makes a percentage increase over 29years of less than 100% whilst inflation over the same period has increased by well over that figure... therefore drivers are now paid relatively less for the job than they were in 1986 whilst the top bosses are earning many times more than they were in 1986 in real terms...

I don't care for the arguments that if you don't pay a dividend you don't get the investment... if you ain't got the drivers to do the donkey work then no amount of investment will help you make a profit. I'm not a commie or even particularly left wing but I do believe in a fair days pay for a fair days work

UNTIL BUS COMPANIES ARE WILLING TO PAY A WAGE REFLECTING THE RESPONSIBLE NATURE OF THE JOB THEY WILL NEVER GET THE CALIBRE OF STAFF THAT THEY WANT.... as I said before... pay peanuts get monkeys.

it's about time bus companies started investing where it matters... in the drivers... not in lining the pockets of rich men!

Teflon - I don't doubt the earnestness of what you say. My figures from 1986 relate to United Automobile Services' Darlington depot at deregulation.

Using the figure of £6.05 that you give and running it through the inflation calculator I gave provides £16.39 - still some distance short of £18 let alone £25.

As for points 1 -5, I won't disagree with 1 to 3. I just don't know what it actually means. Unless you're advocating that NO business should make more than 5%, for instance.

As for point 4, fuel prices on the world market have come down by 50% but only by 20-25% to operators as much is fixed because of duty. You can do the maths and see how much of a bus operators costs are fuel and how much are staff costs. Doesn't take much in terms of increasing staff costs to wipe out any fuel benefits and that's without other costs increasing like business rates, insurances, etc

The other issue is that pass remuneration is now much lower so revenue is being depressed. Also, tendered services are cut and that was usually a way of spreading overhead much more over more routes/journeys. Yes, you save the running costs but the overhead usually remains much the same.

 

[CatfordCat]

I think there are two angles about bus operators not investing in Borismasters.

Probably the main reason is what happened with the bendy buses.

London operators tend to buy or lease buses for TfL contracts on the basis that those contracts will last 5-7 years, and when that's up, those buses can be given a refurb and used on the same or another contract for another 5-7 years.

And that it may then be possible to get a few years' more life out of those buses at one of their subsidiaries outside London, or that they will have some resale value.

Boris blew a hole in that by demanding early withdrawal of the bendybuses - and there was no way of guaranteeing that the next mayor might not make a similar decision about the borismasters - which would probably also have a limited second hand market.

Also, as has already been said, bus operator ownership of the buses could have given an unfair advantage to incumbent operators come the re-tender of routes. Tendering authorities owning buses isn't new outside London.

Nor inside London - TfL owned the batch of RMs bought back from various sources in the early 2000's and owns those used on the heritage 15 route.

 

[Antman]

I think there are two angles about bus operators not investing in Borismasters.

Probably the main reason is what happened with the bendy buses.

London operators tend to buy or lease buses for TfL contracts on the basis that those contracts will last 5-7 years, and when that's up, those buses can be given a refurb and used on the same or another contract for another 5-7 years.

And that it may then be possible to get a few years' more life out of those buses at one of their subsidiaries outside London, or that they will have some resale value.

Boris blew a hole in that by demanding early withdrawal of the bendybuses - and there was no way of guaranteeing that the next mayor might not make a similar decision about the borismasters - which would probably also have a limited second hand market.

Also, as has already been said, bus operator ownership of the buses could have given an unfair advantage to incumbent operators come the re-tender of routes. Tendering authorities owning buses isn't new outside London.

Nor inside London - TfL owned the batch of RMs bought back from various sources in the early 2000's and owns those used on the heritage 15 route.

The 137 route is currently up for retender, if Arriva lose it what would they do with the LT's if they owned them?

 

[BestWestern]

Of course, poor driving ability has nothing to do with ethnicity, does it? I've been on plenty of buses driven by Eastern European drivers who have driven competently. I've also been on buses driven by Scottish drivers where I've been much more concerned - indeed, on one occasion, I left the bus early over fears for my own safety.

There is a slight link, if you happen to feel that the operator importing the foreign labour is failing to provide adequate training in the rules of the UK roads and the basic standards expected of a PCV driver using them. When accidents occur involving imported drivers barrelling down the wrong side of the road, concerns are understandable. One such incident, in East Sussex I believe, involved a head on smash wirh a fire engine answering an emergency call.

I worked from a depot which gained a Polish contingent some years ago, when the big groups had only just begun importing cheap labour. One or two were very decent chaps, polite and conscientious. Others were rude, lazy and drove like nutcases. All, however, had very poor langauge skills, and neither customers nor colleagues found it acceptable. Sadly, the industry is in terminal decline and the 'race to the bottom' has been going on for decades. It's particularly galling when you see the salaries (as opposed to wages) being paid out by very same companies to their railway staff - and I say that as somebody who is now among those railway staff myself.

 

[wellwhatitis]

There is a slight link, if you happen to feel that the operator importing the foreign labour is failing to provide adequate training in the rules of the UK roads and the basic standards expected of a PCV driver using them. When accidents occur involving imported drivers barrelling down the wrong side of the road, concerns are understandable. One such incident, in East Sussex I believe, involved a head on smash wirh a fire engine answering an emergency call.

I worked from a depot which gained a Polish contingent some years ago, when the big groups had only just begun importing cheap labour. One or two were very decent chaps, polite and conscientious. Others were rude, lazy and drove like nutcases. All, however, had very poor langauge skills, and neither customers nor colleagues found it acceptable. Sadly, the industry is in terminal decline and the 'race to the bottom' has been going on for decades. It's particularly galling when you see the salaries (as opposed to wages) being paid out by very same companies to their railway staff - and I say that as somebody who is now among those railway staff myself.

I could have written this post myself. I too have moved into rail from bus and find the whole scenario extremely upsetting. Basically rail staff simply have all the pay and t's and c's that bus drivers used to have and the unions sold away in the blink of an eye. And for what is in many cases a far more skilled and responsible position.

I miss the bus industry terribly but I simply can't afford to work in it anymore.