Stagecoach’s Sir Brian Souter is digging in over Stalinist bus regulation in the north-east. Our transport supremo KEN HOUSTON explains why there’s no similar problem in Scotland…
The big bus industry story over several months has been the remarkable breakdown in communications and trust between the four most senior executive directors (earning between them £0.84 million per annum between them) at Lothian Buses, Scotland’s remaining publicly-owned undertaking.
At the same time a bus war has been hotting up just a short hop across the Border, on Tyneside, in which one of the main protagonists has been Sir Brian Souter, head of Perth-based Stagecoach and Scotland’s – and perhaps Britain’s – best-known transport tycoon.
Stagecoach, Go-ahead North-east, Arriva and smaller bus operators in the area are locked in a battle of wills over the regulation of buses with Nexus, the Tyne & Wear Passenger Transport Executive.
The PTE used to be responsible for operating bus services in the region until it was encouraged – through a mixture of carrot and stick – by the Thatcherite transport minister, the late Nicholas Ridley, to sell its undertaking following the Transport Act of 1985.
Since then the private sector has provided bus services in the region, which more or less covers Newcastle upon Tyne, Gateshead, North and South Shields and Sunderland.
Basically, this means the companies operating their respective networks on a commercial basis, with Nexus subsidising any loss-making but ‘socially necessary’ services.
However, Nexus believes it can do better and is pushing for a ‘Quality Contract’ arrangement similar to that operating in London (which was exempted from the Transport Act).
Nexus claims that the bus companies make excessive profits (some of it from subsidised routes) and that the money dished out to shareholders should be reinvested in lower fares and improved services.
This will be achieved by a ‘contract’ with the private operators who will bid to run services to the PTE’s own specifications (including routes and timetables).
Nexus wishes to go even further by having all buses branded in corporate-regional colours, as is the case in London where services are operated by several different companies but all the vehicles have retained the livery associated with the former London Transport on the basis that ‘red buses’ are a London icon.
Understandably, Sir Brian is vehemently opposed to the proposal and, typically not pulling any punches, he was reported in the trade magazine Passenger Transport, as criticising “a bunch of unreconstructed Stalinists who are completely driven by political dogma”.
And he went on to warn: “The first contract that they put out on my business, I’m out of Tyne and Wear completely, and they can buy 500 buses and find four bus depots. And when they do that, they’ll find that what I am delivering with my 500 buses and my four bus depots, and my fantastic workforce, is actually very good value for money.
“That’s why I am so hard on the issue, because unless you’re prepared to be as robust as that, then you’ll have your business taken off you incrementally.”
Kevin Carr, chief executive of Go-ahead North-east has claimed that more people are using Tyne & Wear buses (privately-owned) than they were ten years ago while ridership on the publicly-owned local metro system has declined.
Opponents of the Nexus plan also say that making comparisons between Tyne & Wear and a booming world city-region like London with its rapidly expanding population, is meaningless.
Nexus, nevertheless, is pressing ahead with its proposals to the Quality Contract Scheme board, although an anticipated May ruling has been put back until October.
The recent proposals by the Chancellor, George Osborne, to grant ‘devolution’ to Greater Manchester opens the opportunity for the re-regulation of bus services in that region and there are moves for more local authority control of bus services in the Leeds/Bradford conurbation.
All this regulatory activity in the North of England is strangely at odds with the situation in Scotland where despite its leftward drift, the SNP has remained remarkably quiet on the subject
Cynics might see a connection with Sir Brian’s role as a major donor to the SNP.
On the other hand, Labour has become committed to re-regulation of bus operations in Scotland but only since it lost the power to do so. Read into that what you will.