Bus deregulation

Thank you for contacting me about EDM 382 and bus deregulation. 

Transport is one of my focus areas, as the South West has for too long been behind many areas of the UK in terms of connectivity. I welcome the Government’s funding announcements surrounding bus routes, namely the Rural Mobility Fund, and I am working with local councils and bus companies to ensure that Totnes and South Devon gets its fair share of any funding available. I am also working to ensure that all communities are served with a bus route, having recently conducted a survey to gauge local use and perception of services in Totnes and South Devon. The results of this survey were shared with Local Transport Authorities, who are submitting their bus proposals for their respective areas to the Department for Transport. 

As you are aware, since 1986, bussing in England outside London has been deregulated. This model hasn't always worked for passengers, which is why I am pleased the Government has committed to levelling-up bus services, tackling many of the issues that EDM 382 notes, and that Local Traffic Authorities (LTAs) face. 

Through the National Bus Strategy, the Government will ensure the skillsets of both private bus operators and LTAs are brought together in either an Enhanced Partnership, or through franchising agreements. This is a welcome approach which will develop and deliver improvements for passengers and is backed by the £3 billion investment pledged in 2020. I am glad to see that all LTAs have now confirmed that they are developing one, or both approaches, and that Bus Service Improvement Plans are being developed for the 31 October deadline. This strategy will prove equally beneficial in supporting decarbonisation goals, as £120 million has already been invested in zero-emission buses this year. 

This investment is in addition to the £50 million already pledged to delivering the first all-electric bus town in the UK, whilst striving towards the Prime Minister’s commitment to 4,000 new zero emission buses.

Bus fares are not currently regulated at a national level, but may be regulated at a local level, This is in a direct sense for Transport for London (TfL), and for any Local Authority that takes on bus franchising powers (although it must be noted that none have).

However, many local authorities provide support by subsidising local bus services. The subsidy of bus operating companies ensures that services which are socially necessary, but would not be deemed to be viable on a purely commercial basis, can continue to operate as a public service. This means that local authorities can regulate fares in an indirect sense through providing subsidies, without which fares would rise, or the service would be cancelled. 

The Government also helps subsidise bus services by funding the Bus Service Operators Grant (BSOG), which is paid to operators of eligible bus services and community transport organisations to help them recover some of their fuel costs. This aims to benefit passengers by helping operators keep fares down, and further enabling operators to run services that might otherwise be unprofitable and cancelled. 

More broadly, I welcome that the Government recently published the 'Bus Back Better' strategy, which will see lower, simpler flat fares in towns and cities, turn-up-and-go services on main routes and new flexible services to reconnect communities. Backed by £3 billion, this new national strategy will deliver better, more reliable bus services for passengers, strengthening communities and sustaining town centres across the country.

I will continue to follow the issue closely. Thank you again for taking the time to contact me.