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Cuts will push provincial bus services into decline

By Richard Johnstone | 23 August 2011

One in five bus services in cities outside London could have stopped operating by 2014 as government support is slashed, a report has found.

Pteg, the research group representing the six Passenger Transport Executives in England, has concluded that cuts in local government funding and wider support for bus services will lead to the number of kilometres operated by bus companies falling by 19%.

The report, commissioned by Pteg and produced by transport consultancy MVA, used the Department for Transport’s National Bus Model for predicting the impact of policy change. It anticipates that passenger numbers will fall by 20% and fares will increase by 24% above the rate of inflation.

This is due to the 20% cut in the Department for Transport’s bus service operators' grant, which provides a rebate on fuel costs, and cuts in local government funding.

The MVA report assumes that local government cuts will lead to an overall 23% cut in the budget to support the subsidised services by 2014. Councils, both independently and through membership of PTEs, subsidise services that are not viable for the private bus operators who run services outside London.

The forecast decline in passenger numbers would continue recent trends. Latest available DfT figures show metropolitan areas bus patronage fell by 2.9% between 2009/10 and 2010/11.

The report states: ‘These results show that the trend towards rising fares and falling demand, observed over the past decades in metropolitan areas, are likely to continue into the foreseeable future. If anything, this trend is likely to be compounded by the current economic climate and confirmed cuts in central and local government services.’ This could cost the economy as much as £68m due to increased congestion through greater car use.

The report follows warnings from the transportselect committee that more than 70% of local authorities were planning to reduce funding for supported services.

Mark Dowd, chair of the group of PTEs covering Greater Manchester, Merseyside, West Midlands, South Yorkshire, West Yorkshire and Tyne and Wear, said: ‘The scenario testing in this report gives an objective assessment of the likely impact of public spending reductions on bus services for the millions of passengers who rely on the bus in the largest urban areas outside London.

‘It gives a clear warning that without policy change we face further vertiginous decline in bus services which will have significant impact on traffic congestion, social division, carbon emissions and on the ability of our cities to play their full part in rebalancing the national economy.’

Dowd called on the government to take ‘a long hard look’ at both the level of support for bus services and how it can be most effectively deployed.

He also called on the Competition Commission to ‘do their bit’ and follow through on plans to recommend changes to the bus market.

The commission is currently investigating the local bus market, and its provisional findings concluded that local transport authorities should subject the largest bus companies to greater competition.





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