Essentially, I think as most of us would expect, the report concludes that there's a "compelling case for change for the region’s bus service because of the instability in the bus network and the need to progress towards regional objectives.", and is recommending the Mayor and Cabinet proceed to a Franchising Scheme Assessment (FSA).
It's worth a read through for yourselves, but some key takes for me:
- A number of options are assessed in the report, but they mainly focus around either expanding the current EP, and evolving it to an "EP Max/EP+". This is described to retain the current delivery model while seeking to push the boundaries of the legislative framework, subsidy regulations and competition law to deliver expansive benefits for passengers. Very much a voluntary partnership, where the operators can pick and choose what they go with.
- The other option being a franchised bus network. Franchising significantly changes the operational structure. Buses are brought into public control meaning the authority can determine routes, timetables, fares and vehicle standards within the franchised area.
On the Franchising Scheme, the report claims:
- It would be a highly demanding process in terms of costs, increased risk and timescales.
- The FSA would compare franchising to other operational models and more comprehensively analyse the implications of franchising for the region. Conducting an FSA would require around £8.5 million in funding.
- If the decision after the FSA is to proceed with Franchising, then it's estimated this would likely take just over 5 years for the first bus services to enter operation, but a long estimate is between 4 and 7 years.
- The FSA itself (inclusive of audit, consultation and approvals) is likely to take around 2 years 8 months. Long estimate is 2 years to 3 years 9 months;
- Whereas the implementation and procurement may take between 2 years to 3 years and 6 month
It should be noted it is Labour Party policy to accelerate and de-risk the franchising process, so these timescales could dramatically decrease, subject to legislative change.
The report obviously goes into a lot of background and factors to support the decision. There's some pretty damning points within that, and some of the key ones for me are:
- Productivity: There's a claim that our transport network has a direct impact on the productivity levels in the North East. Poor infrastructure, including weak transport links, are some of the factors that contribute to lower levels of productivity. For labour productivity, output per hour worked in the North East was 17.4% below the UK average in 2021.
- Transport-related Social Exclusion: 31.5% of residents in the North East (622,000 residents) are at risk of transport related social exclusion, compared to 21% of northern England, and 18% of England. There's a map that shows our region, and it's mainly around the ex-Coal Field communities and the Northumberland Coast line, where it's rife.
- Funding: BSOG+ ends 31 March 2025
- Funding: The estimate is that approximately 43% of bus operator income during 2022/23 is directly attributable to public sector funding streams. This funding includes secured service payments (14% of total), concessionary travel reimbursement (17% of total), some coronavirus recovery support (5% of total), as well as BSOG and reimbursement for the £2 fare cap. This figure is consistent with pre-pandemic levels – public sector support in the North East was 40% in 2018/19 - as well as similar analysis conducted in other regions. Despite this high level of investment, the bus network has seen long term decline - 31% shrinkage since 2010 and 36% reduction in patrionage.
- Growth: North East is performing worst, compared to other areas, in growing passenger numbers post Covid. Most follow a similar upward spike from the big dip in 2020/2021, but Tyne and Wear's upward growth is a lot slower, whereas Durham and Northumberland has almost flatlined.
There's some interesting quotes from consultation too, including the Big Bus Survey and engagement with stakeholders.
- Respondents were asked how their perception of buses has changed over the last few years. A strong theme for this question was a decline in the perception of the bus services, with around 360 uses of phrases that indicate a lower perception. “Got worse” “Less frequent” “less reliable” “less buses” “Services cut”. “Worse” occurs 195 times, “better” 65 times and “Much better” only eight times.
- “Expensive” was the third most common word people used when asked what three words spring to mind when they thought about buses in 2023"
- Stakeholders commonly felt that current bus services in the North East did not meet the needs of our population, particularly those in work. Services were seen as too unreliable and infrequent for people to use them to travel to their workplace.
- Interviews coincided with the GNE drivers’ strike and some stakeholders argued the strike had further weakened confidence in the network – pushing some users to purchase cars and leading more people to view buses as unreliable; perceptions that could take significant time to reverse, even following the strike’s conclusion.
- Stakeholders felt that the bus services did not meet the standards they expect due to being infrequent and unreliable. Stakeholders were concerned about the ability of the current network to meet decarbonisation goals and felt that the drivers’ strike had weakened confidence in the network- leading to more people travelling by car. Interviewees also noted that they were paying more in subsidy to operators than they ever had before to sustain important services. Reform was seen as a desirable response to these issues.
Cross boundary services would need to be carefully considered as part of a franchising scheme. Only services within the boundaries of the scheme area can be franchised – cross-boundary services would either need to be exempted or subject to service permits. Service permits can insist on things like ticket acceptance or vehicle standards.
Public ownership was assessed in the report, but my reading is that the consensus doesn't feel that this is a good option at this stage. The report does state "Legislative change could enable the authority to establish a new public operator. The default position is that this new operator would need to compete against established private sector incumbents in the current deregulated market to gain market share. Most benefits of public ownership require the municipal operator to control a significant proportion of the network. It is theoretically possible for a publicly owned operator to compete for contracts under a franchised model, but the authority could not give preference to the operator solely because it was publicly owned."
Most interesting for me, is that a lot of what is covered in this report, is exactly what a handful of us on here have argued is the case or what is required for years now. Sometimes even ridiculed for it.
The QCS proposals a decade ago should have had alarm bells ringing, but on the most part, operators have continued on into the abyss.