30th birthday Bus Privatisation in England

[plcd1]

First of all, I don't think you can say it is a complete failure even against those stated desires (though confused by your savant reference)

Of course, it's almost impossible to predict what can happen especially with external factors etc. Had you predicted what would happen in 1956, what would you have expected to happen? That bus journeys would decline from 15.5m to 5.6m over that time? That there would be factors such as massive complacency in bus operators, fare increases outstripping inflation for reasons attributable and independent of the operators, and then social factors (e.g. TV to a mass market destroying evening leisure trips to cinemas) etc

BSOG does indeed still exist but the overall level of subsidy is much reduced. However, and I do get bored of saying it, ENCTS remuneration is NOT a subsidy. It's payment for services provided.

Vehicle design has indeed changed and, to be honest, such a thing tends to be cyclical. In the 1960s, it was standee single decks (because of union rules etc regarding what was called OMO). By the late 70's, deckers were coming back into vogue heavily as staff shortages meant headways were widened or to improve efficiencies. Then we had minibuses, then into the super mini as the Dart appeared, and now back to deckers. However, when you look outside London (and perhaps a few other locations), the number of deckers is still much less than it used to be. And yes, you're right to cite the issue of low floor design as pushing the designs to be larger to accommodate the same number of passengers.

Cross subsidy in it's broadest sense has gone and that is actually no bad thing in some respects. The idea that a good route should be milked and adversely affected to prop up some dead duck has been demonstrated to be counter productive. Arguably, it is better to be upfront and levy tax and then subsidise which is what was happening until this austerity agenda, a hollowing out of state support for ideological reasons under the camouflage of some necessity.

The consolidation of operators was ALWAYS going to happen. As in any market, the law of duopoly kicks in unless the authorities act at a certain point! Therefore, we have some large players and that was always going to happen unless they legislated (which they didn't). Same as the ENCTS debacle was an example of ignoring price elasticity on demand. Why politicians think economic theory suddenly won't apply....well, perhaps it's just a bit expedient, eh?

That said, there are many more operators than there were even with these obvious statements. My home county of North Yorkshire was home to three main NBC operators viz United, West Yorkshire and West Riding predominantly with only a very few independents (e.g. Handleys of Middleham, Burrells of Newsham, John Smith in Dalton).

Now we have Arriva NE and EYMS (in place of United), Arriva (in place of West Riding) and Transdev and First (in place of West Yorkshire) in the main commercial areas. Moreover, large tracts notably the Vale of York and into the Dales have been vacated by the large groups even before the NYCC subsidy cuts. Instead, we have a raft of lower cost independents instead.

I know what was said prior to deregulation but any prediction of 30 years hence is based only what we know now being extrapolated. The only certainty is that it will be wrong - an affirmation of the wider "Half life of facts".

BTW, whilst I may not agree with all you've said Paul, I can't deny that you have a lot of very valid points!

The "savant" reference was used by Nerd to refer to the ideologues who supported Ridley's policy. They *did* make predictions. For everyone who's sat there correcting me I am only comparing the points Nerd made with where we are NOW. I should have made that clear. Yes loads of history with Transits, Sherpas and all the rest has happened but they're not there now.

No one is arguing about whether you can predict accurately. The problem here is that some clever ideologically obsessed people DID do that. There is nothing wrong with looking at what they said and passing a judgement. They're hardly going to be reading this now are they? And even if they did I don't imagine for one second they'd care. They'll be promoting some other policy that will not end up as predicted 30 years down the road (and that applies regardless of political stance). The real world and real people always get in the way of fine theories.

To be fair I said concessionary revenue and BSOG were "earners" not necessarily subsidy. If you were to remove concessionary revenue tomorrow from bus operators vast swathes of the national bus network would vanish - rightly or wrongly.

If consolidation was *always* going to happen how did Mr Ridley and his cohorts get that so wrong? You seem to be saying that it's a certainty when it can't be. It may be likely or even highly likely but clearly the DoT didn't believe it back in the early to mid 80s.

I suspect that if you asked passengers today if they preferred today's networks against those with cross subsidy they'd probably prefer the latter if they had to rely on the bus across the day and every day of the week. If it was demonstrably clear that fares on profitable routes were much lower than on socially necessary / marginal ones then I might agree with your comment but they aren't are they? The only cases where you get fare variation within a network is if there is any meaningful competition on a particular corridor. You may get short term fare cuts until such time as the competition is removed but then fares go back up don't they? None of this is really about the passenger, it is about market share / power and a fight for survival. The economists can dress it up however they like but that is the reality of what has gone on for the last 30 years. In rare cases it has, of course, been about destruction of an incumbent through deadly tactics (e.g. Darlington).

I hope you are not seriously arguing that there is also more service volume in somewhere like the North East and Yorkshire. The number of operators doesn't hugely matter to the passenger. The issue is "can they travel?". For an increasing number, and especially in rural areas, the answer is "not any more". Yes some City networks aren't too bad if you live on or near a remunerative core corridor but heaven help you if want to go on an orbital route or cross country. Worse if you have to use more than operator. No one is denying that there haven't been improvements in some areas but it is an extremely mixed picture and there has been a great deal of rationalisation and cuts.

I have lost count of the number of day trips I have had to abort at the planning stage because it is simply impossible to reach places or attractions on public transport - especially a bus after a rail journey. I don't drive and I won't pay taxi fares so I, along with many others, am being deprived of the ability to see and experience a wide range of things in this country because we can't be bothered to organise and fund our public transport when many other countries manage it perfectly well.

 

[Deerfold]

Watford junction to heathrow is the majority of the route of the 724.

Not sure how you're working that out. Watford Junction to Heathrow is about an hour on a route that takes over three hours between Harlow and Heathrow.

 

[Robertj21a]

The "savant" reference was used by Nerd to refer to the ideologues who supported Ridley's policy. They *did* make predictions. For everyone who's sat there correcting me I am only comparing the points Nerd made with where we are NOW. I should have made that clear. Yes loads of history with Transits, Sherpas and all the rest has happened but they're not there now.

No one is arguing about whether you can predict accurately. The problem here is that some clever ideologically obsessed people DID do that. There is nothing wrong with looking at what they said and passing a judgement. They're hardly going to be reading this now are they? And even if they did I don't imagine for one second they'd care. They'll be promoting some other policy that will not end up as predicted 30 years down the road (and that applies regardless of political stance). The real world and real people always get in the way of fine theories.

To be fair I said concessionary revenue and BSOG were "earners" not necessarily subsidy. If you were to remove concessionary revenue tomorrow from bus operators vast swathes of the national bus network would vanish - rightly or wrongly.

If consolidation was *always* going to happen how did Mr Ridley and his cohorts get that so wrong? You seem to be saying that it's a certainty when it can't be. It may be likely or even highly likely but clearly the DoT didn't believe it back in the early to mid 80s.

I suspect that if you asked passengers today if they preferred today's networks against those with cross subsidy they'd probably prefer the latter if they had to rely on the bus across the day and every day of the week. If it was demonstrably clear that fares on profitable routes were much lower than on socially necessary / marginal ones then I might agree with your comment but they aren't are they? The only cases where you get fare variation within a network is if there is any meaningful competition on a particular corridor. You may get short term fare cuts until such time as the competition is removed but then fares go back up don't they? None of this is really about the passenger, it is about market share / power and a fight for survival. The economists can dress it up however they like but that is the reality of what has gone on for the last 30 years. In rare cases it has, of course, been about destruction of an incumbent through deadly tactics (e.g. Darlington).

I hope you are not seriously arguing that there is also more service volume in somewhere like the North East and Yorkshire. The number of operators doesn't hugely matter to the passenger. The issue is "can they travel?". For an increasing number, and especially in rural areas, the answer is "not any more". Yes some City networks aren't too bad if you live on or near a remunerative core corridor but heaven help you if want to go on an orbital route or cross country. Worse if you have to use more than operator. No one is denying that there haven't been improvements in some areas but it is an extremely mixed picture and there has been a great deal of rationalisation and cuts.

I have lost count of the number of day trips I have had to abort at the planning stage because it is simply impossible to reach places or attractions on public transport - especially a bus after a rail journey. I don't drive and I won't pay taxi fares so I, along with many others, am being deprived of the ability to see and experience a wide range of things in this country because we can't be bothered to organise and fund our public transport when many other countries manage it perfectly well.

Very good comments from both of you, nice to have something well thought through and communicated clearly.

As a country, we have the majority of our bus services in the hands of organisations that are required to generate a profit for their investors. This in itself must 'sharpen' up' the respective management teams - the best of them will appreciate that achieving profit margin can be made a little easier if you also look at the wider passenger experience.

 

[radamfi]

To be fair I said concessionary revenue and BSOG were "earners" not necessarily subsidy. If you were to remove concessionary revenue tomorrow from bus operators vast swathes of the national bus network would vanish - rightly or wrongly.

Some old people would travel regardless because they have no choice and have to access shops, hospitals etc. But I would guess as car ownership grows among the elderly this captive market will eventually become small. Traditionally, bus operators were supposed to be no better or no worse off due to free passes but if there is a lot of generated traffic as a result of them then that might not be the case any more. Operators of course complain that the reimbursement is not enough, but of course they would.

The validity of BSOG is highly debatable. It is certainly a very blunt instrument. Theoretically, you could set BSOG so high so that it would be worth running a bus empty. Alternatively you could have negative BSOG so that bus operators would have to pay a charge for the privilege of running a bus service. How do you calibrate an optimal level of BSOG that results in the best service for passengers yet gives good value for the taxpayer? A high level of BSOG that results in a lot of extra buses may not actually be the best result if those buses merely duplicate what is already running and could be counter-productive if they are low quality operations.

I have lost count of the number of day trips I have had to abort at the planning stage because it is simply impossible to reach places or attractions on public transport - especially a bus after a rail journey. I don't drive and I won't pay taxi fares so I, along with many others, am being deprived of the ability to see and experience a wide range of things in this country because we can't be bothered to organise and fund our public transport when many other countries manage it perfectly well.

Personally, I think Britain is a write-off, especially regarding local buses, and that was reinforced by the Brexit vote result. Luckily we live in an age of cheap air travel and cheap international coach services so I now largely restrict myself to trips on the continent.

 

[nerd]

First of all, I don't think you can say it is a complete failure even against those stated desires (though confused by your savant reference)

Of course, it's almost impossible to predict what can happen especially with external factors etc. Had you predicted what would happen in 1956, what would you have expected to happen? That bus journeys would decline from 15.5m to 5.6m over that time? That there would be factors such as massive complacency in bus operators, fare increases outstripping inflation for reasons attributable and independent of the operators, and then social factors (e.g. TV to a mass market destroying evening leisure trips to cinemas) etc

BSOG does indeed still exist but the overall level of subsidy is much reduced. However, and I do get bored of saying it, ENCTS remuneration is NOT a subsidy. It's payment for services provided.

Vehicle design has indeed changed and, to be honest, such a thing tends to be cyclical. In the 1960s, it was standee single decks (because of union rules etc regarding what was called OMO). By the late 70's, deckers were coming back into vogue heavily as staff shortages meant headways were widened or to improve efficiencies. Then we had minibuses, then into the super mini as the Dart appeared, and now back to deckers. However, when you look outside London (and perhaps a few other locations), the number of deckers is still much less than it used to be. And yes, you're right to cite the issue of low floor design as pushing the designs to be larger to accommodate the same number of passengers.

Cross subsidy in it's broadest sense has gone and that is actually no bad thing in some respects. The idea that a good route should be milked and adversely affected to prop up some dead duck has been demonstrated to be counter productive. Arguably, it is better to be upfront and levy tax and then subsidise which is what was happening until this austerity agenda, a hollowing out of state support for ideological reasons under the camouflage of some necessity.

The consolidation of operators was ALWAYS going to happen. As in any market, the law of duopoly kicks in unless the authorities act at a certain point! Therefore, we have some large players and that was always going to happen unless they legislated (which they didn't). Same as the ENCTS debacle was an example of ignoring price elasticity on demand. Why politicians think economic theory suddenly won't apply....well, perhaps it's just a bit expedient, eh?

That said, there are many more operators than there were even with these obvious statements. My home county of North Yorkshire was home to three main NBC operators viz United, West Yorkshire and West Riding predominantly with only a very few independents (e.g. Handleys of Middleham, Burrells of Newsham, John Smith in Dalton).

Now we have Arriva NE and EYMS (in place of United), Arriva (in place of West Riding) and Transdev and First (in place of West Yorkshire) in the main commercial areas. Moreover, large tracts notably the Vale of York and into the Dales have been vacated by the large groups even before the NYCC subsidy cuts. Instead, we have a raft of lower cost independents instead.

I know what was said prior to deregulation but any prediction of 30 years hence is based only what we know now being extrapolated. The only certainty is that it will be wrong - an affirmation of the wider "Half life of facts".

BTW, whilst I may not agree with all you've said Paul, I can't deny that you have a lot of very valid points!

The savants I had particularly in mind were Stephen Glaister and John Hibbs.

Glaister was particularly concerned with the need to limit public exposure to, as he saw it, unlimited subsidy propping up an unsustainable model of bus provision. He is especially associated with the drive towards reducing bus size; he undertook studies that proposed that in a deregulated market, buses greater than 45 passengers would not be be economically viable.

Hibbs was more concerned with ending cross-subsidy within bus operations; and the way in which such subsidy - combined with barriers to market entry associated with spurious 'service quality' standards - acted to featherbed monopolistic and uncompetitive producer interests.

Both these principles (and associated predictions of a deregulated future) were highly influential in the form that the legislation took.

Both authors tended latterly to say that the policy had been partially successful in delivering what they predicted; and any shortfall against their predictions was largely due to its not having been pursued rigorously enough. If only public subsidy (especially in rural areas) had been removed entirely; or if only quality standards had been applied only to factors that risked passenger safety, then the fully glory of a free market would be operating in the transport indusrty in the UK; as they saw it operating in some other parts of the world. Hibbs was especially disappointed that his principle 'the route not the network' was not applied in rail privatisation in the 1990s; he had proposed that each railway line should be a separate commercial entity (competing with other railway lines); with full vertical integration of track and services along it.

In my view their analysis failed in two key respects:

- firstly, they failed to investigate fully the dynamics of demand for bus services. Both essentially saw the decline in bus use as arising from increased car ownership, exacerbated by the ostrich attitude of public authorities in continuing to prop-up services long after they had ceased to be viable. So they thought that removal of regulation (and the break-up of all the municipal and nationalised operations into entrepeneur enterprises), would attract custom back to the buses from their core public market - cheap and local travel. Which did happen, but only in London where deregulation had not been done (and where public subsidy continued at high levels).

- secondly, they entirely failed to understand the importance of trip length and service speed in bus demand. As they saw it, the future of buses would be in services that ran more frequently, stopped more often (if possible, on demand), and ran more of their routes away from main roads and through residential areas. Services that followed this prescription did indeed maintain patronage within inner urban areas; but lost it massively from potential patrons living further out, as overall trips became drastically slower. Hibbs and Glaister's response was that longer distance travellers would always prefer a car anyway; so there could be no sustainable market for limited stop buses running only along main arterial roads.

But the net effect of this was that the deregulated operators were always operating in a context of continually reducing demand; so commercial logic resulted in their primary investment being in maintaining market share - seeking to drive rival operators off their preferred routes, or take them over - rather than in co-operation across operators in expanding the local market for bus services generally through attracting custom from reluctant car users.

 

[TheGrandWazoo]

Hi Paul and others

Thanks for the comprehensive response. The "savant" reference got me as I was thinking more on the lines of the (perhaps) more contemporary use as someone who is a Raymond Babbage type individual, rather than as an academic, rather than who had actually said it.

Again, some reasonably argued points of which some I agree with.

In terms of ENCTS being a revenue stream etc, as has been said, the objective was that operators be "no better, no worse" in terms of the financial impact. However, that was not the case initially and has clearly been exacerbated subsequently. In some instances, we have had massive uplift in pensioner pleasure trips; fine if it's filling excess capacity but more of a challenge if you require additional resource. In some tourist spots, you have that issue. Meanwhile, in the old bread and butter local services, the likelihood of additional journeys is less pronounced. However, we have now seen the remuneration in some areas being at less than 40% and that is pushing services into being loss making. Some firms did make a bit of hay in the early days but that has long since ceased to be the case and 2/3 years of good times cannot outweigh the protracted issues of remuneration erosion over the subsequent 10 and certainly not the past 5 years. So "Operators of course complain that the reimbursement is not enough, but of course they would." - yes they would because it's true!

I am not making the point that service provision is more comprehensive as it isn't but that wasn't what you said viz "Operators much smaller. Hardly. A few survive in odd places like Harlow and in some rural corners but big groups predominate." Sorry, but that was about the fact that we DO have many more operators.

I don't shy away from the fact (and I think I stated it) that Ridley's idea that consolidation wouldn't happen was bunkum. It goes against history and economic theory. Same as Gordon Brown not thinking that if something is suddenly "free" then demand isn't going to increase in the way that it did. Why were Ridley et al wrong? I can only suppose it was dogma in place of experience! FFS, it's year 1 business studies

Being honest, there have been obvious winners and losers since 1986, good operators with a long term vision and some scurrilous ones. However, the fact is (and here I agree with you) that a public transport system needs to be adequately funded. In fact, we had a situation where ridership decline had halted nationally as a consequence of various bits of RBC funding. The fact is (and I predicted on this board about 3 years ago when Radamfi was going on that we would see more services being tendered as an extrapolation of what had happened in Surrey) that the government were going to massively cut central grants. As public transport is not a statutory obligation, it was an easy cut and so it proved to be. However, what have we seen? A coalition government being replaced by the Tory architects of that austerity policy so clearly the country didn't feel so strongly as to return a government that wouldn't follow that policy.

So why not cross subsidise? Because it doesn't work. The idea that one service can be handicapped to support another didn't work. All it does is to divert money from investment into supporting a load of dead ducks. We had a regulated environment where we had that PLUS exchequer aid, new bus grant (50% of the cost of a new bus), funding from rates (mainly in PTE areas), FDR and local government funding plus debt write offs etc. Yet still bus companies lost money hand over fist. The NBC lost £12m in 1974 and £19m in 1975 - that's over £300m in today's money. Lest we forget that this had already been identified prior to the Thatcher government coming in - the Viable Network Project had already begun in 1976 with Midland Red. This at a time when passenger figures were thudding through the floor as well despite oil shocks and people not being able to fill their cars! Also, note that outside London, 1970 - 1980 ridership declined faster than 1980 to 1990 despite the upheaval of privatisation!!

So are we going to vote in 2020 for an administration that will financially support our public transport network? No, and you can hold me to that! After all, as we've seen in the last day or so, much more important to insulate car manufacturers from the self inflicted trade wound of Brexit.

 

[carlberry]

But the net effect of this was that the deregulated operators were always operating in a context of continually reducing demand; so commercial logic resulted in their primary investment being in maintaining market share - seeking to drive rival operators off their preferred routes, or take them over - rather than in co-operation across operators in expanding the local market for bus services generally through attracting custom from reluctant car users.

The better operators (Trent Barton and Brighton for example plus more recent attempts by Stagecoach and Arriva) have attempted to expand market share. Cooperation falls fowl of the competition laws which are needed in a 'free' market as, otherwise, it quickly produces cartels. It’s only recently that local councils have been allowed to promote cooperation/coordination and it’s used as much to reduce the number of buses (Oxford for example) as it is to expand the market.

 

[radamfi]

So why not cross subsidise? Because it doesn't work. The idea that one service can be handicapped to support another didn't work. All it does is to divert money from investment into supporting a load of dead ducks.

We had cross-subsidy because some routes were profitable and some were loss-making. But we only have this argument because there were (and are) routes that are profitable. There is profit on those routes because the income is higher than the costs. Costs have been driven lower by greater efficiency which in some respects is desirable but other respects directly adversely affect the passenger experience.

But probably the main issue is the income. British bus operators are "lucky" that they is a sufficiently large underclass of people who cannot afford cars and will pay whatever fares are demanded. Those fares are unacceptable to me and many other people, but other people are forced to pay them.

So what would happen if fares were set at more acceptable levels? There would be few, if any, profitable routes. Similarly if costs increased so fast that fares could not be increased to compensate. The issue of cross-subsidy would then become irrelevant.

If you look at the places with world class transport, probably all routes would be considered to be "unprofitable" because the quality is too high and fares would be too low.

We still have cross-subsidy in this country - on the railways. There are routes which are classed as profitable and others not.

 

[Tetchytyke]

But the net effect of this was that the deregulated operators were always operating in a context of continually reducing demand; so commercial logic resulted in their primary investment being in maintaining market share - seeking to drive rival operators off their preferred routes, or take them over - rather than in co-operation across operators in expanding the local market for bus services generally through attracting custom from reluctant car users.

As you say, a big part of the problem was the route-based theory, that people only ever care about routes in isolation and don't have an interest in the wider network. The theory was that people would buy single tickets everywhere and so the idea of having a coherent network was not necessary.

Because the market was constructed with this in mind, co-operation was specifically prevented as being "anti-competitive", regardless of motive. It took several changes in the law before even the Oxford solution was permissible.

Of course, in reality, commuters will be using the bus most days, and so operators who offered daily or weekly tickets were able to offer discounts to these passengers, at the expense of people who only bought singles. Even that would be OK if operators shared corridors, you could choose your preferred operator for the week, but the operators' desire to maintain market share led to them all retreating into their own patch. The net effect was that if you had to use more than one operator for your journey you were paying through the nose for the privilege.

Stagecoach's bus wars, both the Darlington/Preston version and the Magic Bus race-to-the-bottom version, and the Go/Arriva carve-up, were just depressingly inevitable.

As was UK North, the poster boy for race-to-the-bottom competing on price regardless of consequences, for that matter.

 

[plcd1]

The savants I had particularly in mind were Stephen Glaister and John Hibbs.

Glaister was particularly concerned with the need to limit public exposure to, as he saw it, unlimited subsidy propping up an unsustainable model of bus provision. He is especially associated with the drive towards reducing bus size; he undertook studies that proposed that in a deregulated market, buses greater than 45 passengers would not be be economically viable.

Hibbs was more concerned with ending cross-subsidy within bus operations; and the way in which such subsidy - combined with barriers to market entry associated with spurious 'service quality' standards - acted to featherbed monopolistic and uncompetitive producer interests.

Both these principles (and associated predictions of a deregulated future) were highly influential in the form that the legislation took.

Both authors tended latterly to say that the policy had been partially successful in delivering what they predicted; and any shortfall against their predictions was largely due to its not having been pursued rigorously enough. If only public subsidy (especially in rural areas) had been removed entirely; or if only quality standards had been applied only to factors that risked passenger safety, then the fully glory of a free market would be operating in the transport indusrty in the UK; as they saw it operating in some other parts of the world. Hibbs was especially disappointed that his principle 'the route not the network' was not applied in rail privatisation in the 1990s; he had proposed that each railway line should be a separate commercial entity (competing with other railway lines); with full vertical integration of track and services along it.

In my view their analysis failed in two key respects:

- firstly, they failed to investigate fully the dynamics of demand for bus services. Both essentially saw the decline in bus use as arising from increased car ownership, exacerbated by the ostrich attitude of public authorities in continuing to prop-up services long after they had ceased to be viable. So they thought that removal of regulation (and the break-up of all the municipal and nationalised operations into entrepeneur enterprises), would attract custom back to the buses from their core public market - cheap and local travel. Which did happen, but only in London where deregulation had not been done (and where public subsidy continued at high levels).

- secondly, they entirely failed to understand the importance of trip length and service speed in bus demand. As they saw it, the future of buses would be in services that ran more frequently, stopped more often (if possible, on demand), and ran more of their routes away from main roads and through residential areas. Services that followed this prescription did indeed maintain patronage within inner urban areas; but lost it massively from potential patrons living further out, as overall trips became drastically slower. Hibbs and Glaister's response was that longer distance travellers would always prefer a car anyway; so there could be no sustainable market for limited stop buses running only along main arterial roads.

But the net effect of this was that the deregulated operators were always operating in a context of continually reducing demand; so commercial logic resulted in their primary investment being in maintaining market share - seeking to drive rival operators off their preferred routes, or take them over - rather than in co-operation across operators in expanding the local market for bus services generally through attracting custom from reluctant car users.

I had the misfortune to have Hibbs as an external examiner for the transport part of my Business Studies degree. I'm well aware of his rather extreme views about how public transport should be organised. However I've clearly not been paying enough attention to Glaister. I thought he was a tad more rational but clearly not from your remarks above.

I note, with my usual sigh of resignation, that the old classic of "you weren't pure enough in implementing our ideas" was trotted out as to why their predictions didn't materialise. That's usually a good sign of some level of lunacy on the part of the proponents. Thank goodness politicians did interfere with their ideas or else we'd be in even more of a mess than we already are. Can you imagine how they'd be feeling about the never ending pressure to re-regulate?

No quibble with your thoughts as to why their predictions failed. Of course we now have in London a collision between your two points. Although London has been successful in regrowing the patronage base the fact that buses are getting slower and slower, for a whole pile of reasons, has put patronage back on a declining trend. That's a mess that seems beyond TfL's ability to rectify. If nothing else it sort of proves the point that time is precious to passengers and they don't like being delayed by long journey times.

 

[nerd]

I had the misfortune to have Hibbs as an external examiner for the transport part of my Business Studies degree. I'm well aware of his rather extreme views about how public transport should be organised. However I've clearly not been paying enough attention to Glaister. I thought he was a tad more rational but clearly not from your remarks above.

I note, with my usual sigh of resignation, that the old classic of "you weren't pure enough in implementing our ideas" was trotted out as to why their predictions didn't materialise. That's usually a good sign of some level of lunacy on the part of the proponents. Thank goodness politicians did interfere with their ideas or else we'd be in even more of a mess than we already are. Can you imagine how they'd be feeling about the never ending pressure to re-regulate?

No quibble with your thoughts as to why their predictions failed. Of course we now have in London a collision between your two points. Although London has been successful in regrowing the patronage base the fact that buses are getting slower and slower, for a whole pile of reasons, has put patronage back on a declining trend. That's a mess that seems beyond TfL's ability to rectify. If nothing else it sort of proves the point that time is precious to passengers and they don't like being delayed by long journey times.

Thanks for those observations plcd; most interesting.

I don't think that Glaister is as extreme in his neo-liberalism as Hibbs was; his point was chiefly that the previous subsidy regime amounted to propping-up failure, while effectively blocking alternative models from being developed.

I think he agrees with your observation.

If you were to remove concessionary revenue tomorrow from bus operators vast swathes of the national bus network would vanish - rightly or wrongly.

His point is that this would be a good thing; as the vanishing of the old is a precondition for the emerging of the new. Hence he shared Hibbs frustration that Tory partisan lobbying had been successful in retaining subsidised operation for rural bus services. He thought (and I believe still thinks) that a viable non-subsidised model of rural bus would emerge rapidly, once the subsidided (in the broadest sense) operations had gone to the wall.

 

[Robertj21a]

His point is that this would be a good thing; as the vanishing of the old is a precondition for the emerging of the new. Hence he shared Hibbs frustration that Tory partisan lobbying had been successful in retaining subsidised operation for rural bus services. He thought (and I believe still thinks) that a viable non-subsidised model of rural bus would emerge rapidly, once the subsidided (in the broadest sense) operations had gone to the wall.

So why doesn't this happen already when a subsidised route has to be taken off due to insufficient demand ? Are we all awaiting for a whole load of bus entrepreneurs who are currently watching from the sidelines for their opportunity to capture this essential market ?

 

[overthewater]

How Clydeside dealth with the changes

Just before: * https://www.youtube.com/watch?v=Bi3JLt-6BPc

6 months later: * https://www.youtube.com/watch?v=6dTrmSsKTW0

one of the best books going... https://www.amazon.co.uk/Clydeside-...eside+Scottish:+We+Tried+to+Run+a+Bus+Company

 

[Busaholic]

I had the misfortune to have Hibbs as an external examiner for the transport part of my Business Studies degree. I'm well aware of his rather extreme views about how public transport should be organised. However I've clearly not been paying enough attention to Glaister. I thought he was a tad more rational but clearly not from your remarks above.

I note, with my usual sigh of resignation, that the old classic of "you weren't pure enough in implementing our ideas" was trotted out as to why their predictions didn't materialise. That's usually a good sign of some level of lunacy on the part of the proponents. Thank goodness politicians did interfere with their ideas or else we'd be in even more of a mess than we already are. Can you imagine how they'd be feeling about the never ending pressure to re-regulate?

No quibble with your thoughts as to why their predictions failed. Of course we now have in London a collision between your two points. Although London has been successful in regrowing the patronage base the fact that buses are getting slower and slower, for a whole pile of reasons, has put patronage back on a declining trend. That's a mess that seems beyond TfL's ability to rectify. If nothing else it sort of proves the point that time is precious to passengers and they don't like being delayed by long journey times.

Interesting. I had Hibbs as one of three lecturers at the then City of London Poly back in 1971/2 on day release from London Transport in the days when I still had ambitions in the public transport world before they were cruelly squashed (partly at my own instigation) and he was by far the best of the three, but that says more about the other two... A pleasant enough guy, and opinions worth listening to, but I think he was just plain wrong on so many things. Perhaps if he had not enjoyed such a cosy life in academia and had to get out into the real world of bus operation it might have been different, but, to me, he is the Thomas Hardy of the period i.e. eloquent enough but harking back to a rural idyll which had long ceased to exist, if it ever had in the first place.

 

[nerd]

So why doesn't this happen already when a subsidised route has to be taken off due to insufficient demand ? Are we all awaiting for a whole load of bus entrepreneurs who are currently watching from the sidelines for their opportunity to capture this essential market ?

Glaister - and I am sure Hibbs too - would maintain that potential entrepeneurs are inhibited from acting; as they know that they could be (and likely would be) driven off the road through predatory and anti-competitive practices from the big operators; who are patently the main beneficiaries of current operator public subsidy payments. Nor do you need to look very hard to find instances of this exact thing happening.

To allow free-market processes to work; all subsidy has to cease across the entire terrtiory.

 

[carlberry]

Glaister - and I am sure Hibbs too - would maintain that potential entrepeneurs are inhibited from acting; as they know that they could be (and likely would be) driven off the road through predatory and anti-competitive practices from the big operators; who are patently the main beneficiaries of current operator public subsidy payments. Nor do you need to look very hard to find instances of this exact thing happening.

To allow free-market processes to work; all subsidy has to cease across the entire terrtiory.

I'm sure there's a few examples, but there wont be many. How many entrepreneurs have suddenly flooded Cumbria with new services, as an example of a county that's actually switched off subsidies.
If all council and BSOG subsidy was withdrawn how many of the big groups would close; none. How many of the current operators that are not in groups would close; about 30% I'd guess. The mainstream business will always consolidate towards size, the subsidies is what's kept the number of operators up over the years.

 

[overthewater]

Another look at those time

* South from 1987: https://www.youtube.com/watch?v=Hltajs9dI6Y

 

[Baxenden Bank]

Interesting. I had Hibbs as one of three lecturers at the then City of London Poly back in 1971/2 on day release from London Transport in the days when I still had ambitions in the public transport world before they were cruelly squashed (partly at my own instigation) and he was by far the best of the three, but that says more about the other two... A pleasant enough guy, and opinions worth listening to, but I think he was just plain wrong on so many things. Perhaps if he had not enjoyed such a cosy life in academia and had to get out into the real world of bus operation it might have been different, but, to me, he is the Thomas Hardy of the period i.e. eloquent enough but harking back to a rural idyll which had long ceased to exist, if it ever had in the first place.

He did have experience of working in the bus industry. Corona Coaches in Suffolk. See 'The Country Bus' by John Hibbs. David & Charles. 1986. ISBN 0 7153 8687.

I had him as a lecturer whilst at Birmingham Polytechnic.

I have kept a eye on a number of local routes, out of personal interest, to see how they have changed over the years. Some are at the same frequency, some at an increased frequency, some disappeared completely.

For example:

Rossendale / Hyndburn - mainline Accrington to Bacup (464). Was every 10 minutes, now every 15 minutes but with extra buses Accrington to Haslingden every 7/8 minutes.
Ribble - X3 Clitheroe to Manchester, was every hour, declined to a handful of buses under Blackburn Transport stewardship, now half hourly as the X41 but not operating the rural bit between Accrington and Clitheroe.
Ribble - 244 Blackburn to Rochdale. The Blackburn to Rawtenstall bit survives as an hourly service, the Rawtenstall to Rochdale bit disappeared a good while ago.
Ribble - X43 Skipton to Manchester. Was hourly / half hourly, now every 15 minutes and every 10 at peak times.

So, a completely mixed bag overall. Some very rural routes operate at the exact same frequencies as though de-regulation didn't happen. Some urban routes (the ones that were supposedly cross-subsidising the rural routes) now operate at lower frequencies and with shorter periods of operation.

It's all the luck of the draw as far as I can tell.

 

[Tetchytyke]

I'm sure there's a few examples, but there wont be many. How many entrepreneurs have suddenly flooded Cumbria with new services, as an example of a county that's actually switched off subsidies.

Cumbria pretty much proves the opposite. Reays managed to make a good fist of taking the fight to Stagecoach mainly on the back of all the tendered work in and around Carlisle that they won. Now the tendered work has gone Reays don't have the reliable income to run the commercial stuff, and so Stagecoach have largely seen them off in Carlisle. Stagecoach were able to bring in new buses to compete with Reays- and brand new buses were something Carlisle hadn't really seen for 20 years, other than the insurance stuff after the floods- and were less reliant on the tendered stuff.

We've seen that in Northumberland too, where cuts to the tendered service to Rothbury has pretty much seen off the community buses to upper Coquetdale.

 

[TheGrandWazoo]

I have kept a eye on a number of local routes, out of personal interest, to see how they have changed over the years. Some are at the same frequency, some at an increased frequency, some disappeared completely.

I see that same as that in Darlington (quoted already). The town routes are all on the same frequencies as 1986 except one (though a number are operated by Optare Solos rather than Seddon RUs or Ward Dalesmans).

Inter-urban services are a mixed bag (frequencies shown 1986/2016):

Northallerton - (120/120)
Richmond - (30/20)
Catterick Aerodrome & villages - (60/120)
Stockton (30/15) & Middlesbrough (60/15) *
Barnard Castle (60/30) **
Newton Aycliffe (10/6)
Sunderland (60/60)
Bishop Auckland (30/15)
Durham (30/15)

Where the real changes have occurred have been in the more rural areas where * the villages of Sadberge and Long Newton have been bypassed and ** the services to Upper Teesdale no longer run through (and are now tendered in entirety). Moreover, away from Darlington around Wear Valley and Central Durham, bus services have declined markedly but this reflects the decline in the area generally which is all too apparent. Perhaps sadly this because "proportionately fewer people are in work in County Durham because significantly more people are on incapacity benefit than the national average and because there are fewer jobs in County Durham than the national average"

So I don't think it's luck of the draw but sadly a product of a wider issue in many areas

 

[DunsBus]

It has been suggested by some industry commentators that bus deregulation was an act of revenge by Nicholas Ridley for his family's road transport interests being nationalised, and his belief in a free market aided his cause. It was Ridley who famously said that he could see no difference between running buses and running a sweetshop and it was also he, when steering the 1985 Transport Act through Parliament, who dismissed a suggestion by the NBC that it should be privatised as one instead of being broken up as "cuckoo".

Incidentally it was Tom King who was originally charged with bringing in the legislation which became the Transport Act 1985. He was given the Transport brief after the 1983 Tory election victory, but was moved to Defence a few months later after news broke of the Cecil Parkinson/Sara Keays affair, that Keays was carrying Parkinson's child, and his subsequent resignation from the Government. This resulted in Nicholas Ridley being transferred from Secretary of State to the Treasury to take over the Transport brief. The rest is history.

It is very tempting to think that, had Cecil Parkinson kept his trousers on back in 1983, bus deregulation may have been very different...

 

[TheGrandWazoo]

We had cross-subsidy because some routes were profitable and some were loss-making. But we only have this argument because there were (and are) routes that are profitable. There is profit on those routes because the income is higher than the costs. Costs have been driven lower by greater efficiency which in some respects is desirable but other respects directly adversely affect the passenger experience.

But probably the main issue is the income. British bus operators are "lucky" that they is a sufficiently large underclass of people who cannot afford cars and will pay whatever fares are demanded. Those fares are unacceptable to me and many other people, but other people are forced to pay them.

So what would happen if fares were set at more acceptable levels? There would be few, if any, profitable routes. Similarly if costs increased so fast that fares could not be increased to compensate. The issue of cross-subsidy would then become irrelevant.

If you look at the places with world class transport, probably all routes would be considered to be "unprofitable" because the quality is too high and fares would be too low.

We still have cross-subsidy in this country - on the railways. There are routes which are classed as profitable and others not.

I'm not quite certain of what you actually mean.

However, if the view is that if you removed BSOG that there would be no commercially sustainable services, well that's not the case. There would simply be fewer of them.

Remember, we have actually done this before with massive amounts of cross subsidy. That was the regulated world though even this was propped up with massive amounts of public money AND still lost a shedload of cash.

• NBC losses 1973 and 1974 - £150m - average of two years but doesn't include new bus grant nor any support from council councils or rate levies (mainly in metropolitan councils) or that FDR was double that of current BSOG
• BSOG England 2014/5 - £244m

Now, the rather seductive thought is that the where revenue outstrips costs then that surplus can be used to prop up routes where cost outstrips revenue. Fine in it's purest socialist sense. However, the experience is that this means that investment into those good routes is lessened as they are milked. This reduces the yield on the good routes and so the ability to cross subsidise diminishes.

As an example, the Bristol to Glastonbury corridor gets new vehicles every 6 years on average and has grown from a 60 min headway to 30 mins and now with deckers rather than singles. However, could it really do that if a proportion of its "profit" was used to support a network of services based on Glastonbury rather than those being paid for by the county council. And indeed, what is the incentive to grow services if we have a centralised body that sets the service provision and merely pays the operator to run them?

Also, you talk about bus companies exploiting some sort of underclass. Really? Bus companies are actively targeting those who aren't in that underclass as, quite simply, they don't have the money. That's the whole point of Gold or Sapphire etc - to attract those passengers who DO have the money to spend.

 

[radamfi]

I'm not quite certain of what you actually mean.

However, if the view is that if you removed BSOG that there would be no commercially sustainable services, well that's not the case. There would simply be fewer of them.

Remember, we have actually done this before with massive amounts of cross subsidy. That was the regulated world though even this was propped up with massive amounts of public money AND still lost a shedload of cash.

• NBC losses 1973 and 1974 - £150m - average of two years but doesn't include new bus grant nor any support from council councils or rate levies (mainly in metropolitan councils) or that FDR was double that of current BSOG
• BSOG England 2014/5 - £244m

Now, the rather seductive thought is that the where revenue outstrips costs then that surplus can be used to prop up routes where cost outstrips revenue. Fine in it's purest socialist sense. However, the experience is that this means that investment into those good routes is lessened as they are milked. This reduces the yield on the good routes and so the ability to cross subsidise diminishes.

As an example, the Bristol to Glastonbury corridor gets new vehicles every 6 years on average and has grown from a 60 min headway to 30 mins and now with deckers rather than singles. However, could it really do that if a proportion of its "profit" was used to support a network of services based on Glastonbury rather than those being paid for by the county council. And indeed, what is the incentive to grow services if we have a centralised body that sets the service provision and merely pays the operator to run them?

Also, you talk about bus companies exploiting some sort of underclass. Really? Bus companies are actively targeting those who aren't in that underclass as, quite simply, they don't have the money. That's the whole point of Gold or Sapphire etc - to attract those passengers who DO have the money to spend.

If you removed BSOG, regulated fares at a fair level and imposed Dutch/German/Swiss standards of service and vehicles, then you would have few if any profitable services as the cost of it would be too expensive. That is probably the case in most major cities where the primary corridors are served by metro/tram service with buses filling in the gaps. I suppose you could still define cross-subsidy as providing heavily loss making services at the detriment of routes which make smaller losses. Inevitably, some routes will be busier than others. We need to decide what routes are needed and provide those services.

You always quote pre-1986 regulation as a comparison. But there was huge public sector inefficiency back then so not comparable with the modern day. By now buses would surely be run by private companies under competitive tendering as that is what has happened in many other public services such as waste disposal and leisure centres.

The number of routes covered by Gold or Sapphire or similar brands is a small proportion of the network and generally is applied to main routes which are already reasonably profitable. Operators want more revenue and there's no need to advertise to their captive market so of course they will attempt to gain extra custom by reaching out to other market segments if it is cost effective. But are they seriously getting lots of ABC1s onto buses through this kind of marketing when little has really changed? Fares are still expensive, buses are still slow and still get stuck in traffic and vehicle quality is often little better than the British standard.

 

[overthewater]

People keep on forgetting Lothian buses, its my still be owned by the council but its privately operated.

 

[radamfi]

People keep on forgetting Lothian buses, its my still be owned by the council but its privately operated.

It's the law and has been for 30 years. Council owned bus companies have to be run at arms length as private enterprises. There's nothing to remember here.

 

[Bletchleyite]

It's the law and has been for 30 years. Council owned bus companies have to be run at arms length as private enterprises. There's nothing to remember here.

Though Lothian does give you an impression of what we would likely have in many places if we hadn't deregulated.

It's also really quite good.

 

[carlberry]

Though Lothian does give you an impression of what we would likely have in many places if we hadn't deregulated.

It's also really quite good.

It is if you have the correct change before you get on, not exactually customer friendly otherwise!

 

[Robertj21a]

Though Lothian does give you an impression of what we would likely have in many places if we hadn't deregulated.

It's also really quite good.

Nottingham too !

 

[Busaholic]

It is if you have the correct change before you get on, not exactually customer friendly otherwise!

Buses that still take CASH, whatever next?

 

[TUC]

There is a low cost vehicle that is available when people are free. It's called a taxi!
.

Taxis low cost?
--- old post above --- --- new post below ---

Nottingham too !

Nottingham only started being decent when it became part-privately owned. Before then it was a very traditional local authority bus company with poor services and ugly buses.