Proposed Provision of Bus and Coach Services Legislative Competence Order (LCO)

Response from the Confederation of Passenger Transport Wales (Cydffederasiwn Cludwyr Teithwyr Cymru)

The Confederation of Passenger Transport Cymru ("CPTCymru”) is pleased to submit its written response to the initial non-statutory consultation on the proposed Legal Competence Order sponsored by Huw Lewis AM.

CPTCymru is the professional trade association representing the bus and coach industry in Wales and is part of CPTUK. Its members include major national and international transport operators, municipal operators, large independents and small family businesses, operating over 70% of all public transport journeys across Wales.

The governance of CPTCymru includes a Bus & Coach Commission, which consults all members in Wales, and a Committee for Wales, which all members can attend and contribute to.

In submitting this response, it is essential to point out that no indication of what proposals the LCO may contain have been received and that the response is likely to require amendedment in the light of the publication of the Draft LCO.

Moreover, if enacted, the provisions of the Local Transport Bill currently before Parliament will give the Welsh Assembly Government an extended range of transport powers. Our response may differ once the WAG indicates how it intends to use these powers.

CPTCymru has no objection to this response being available within the public domain.

1. Do you agree with the principle that legislative competence for "the provision of bus and coach services” in Wales should be conferred on the National Assembly for Wales?

CPTCymru supports the principle of transfer of further transport powers to Wales where it can be demonstrated that: -

There is a clear evidence base that there is a problem that needs to be addressed.
Attempts to resolve such problems through partnership working and through the use of existing regulations and powers have been exhausted.
There is clear evidence that new powers will resolve any residual problems, and not merely create a different set of potentially greater problems and issues (the dangers of "bad law” and the law of unintended consequences).
There is a clear understanding of both the legal and financial consequences associated with such powers.

Taking these points in turn:

The evidence base

a. What is the evidence base to support the inference that current bus services in Wales are unsafe, unclean, not modern, and irregular?

b. What is the evidence base to support the inference that a London style franchise model, applied on a like for like basis, provides services that are safer, cleaner, more modern and regular than those provided in Wales?

c. What economic arguments have been considered to justify the proposal that bus passengers on commercial routes, through the fares that they pay (effectively a surtax on bus travel), be asked to subsidise the travel of passengers on socially necessary but loss making routes, as an alternative to the current arrangement whereby such subsidies are met through the public purse?

Use of the existing tool kit

a. It is well recognised that the primary key to both the quality and quantity of bus services is the question of reliability, which is also the single most important factor in determining modal shift. Improved reliability leads to growing passenger numbers, resulting in increased frequency, which is the second most important factor in achieving modal shift.

b. The modal shift that ensues from improved reliability and frequency encourages commercial route development and investment, with many marginal or loss making social routes becoming commercial, with a reduction or elimination in the need for support.

c. Operators have for some considerable time been actively advocating their support for both voluntary and statutory bus partnerships to address these issues, as well as punctuality improvement partnerships. The lack of progress on these issues is a direct consequence of a failure at the political level to introduce road allocation measures and intelligent priority schemes that allow the bus to compete on a level playing field with the private car.

d. Operators have also been actively campaigning for a programme of decriminalisation of parking enforcement controls - vital to reliability, but seemingly undeliverable by local authorities in the areas it is most needed.

e. To operate services in the evenings, and in particular in some of the more socially deprived areas of Wales, bus company staff requires the support of the police and other agencies to ensure their safety. Such help has not, for the most part, been forthcoming, with requests for bus operational safety to be a police KPI having been ignored.

f. Operators have been campaigning for better quality bus station and other operational infrastructure such as bus shelters to be provided, but again for the most part local authorities have not made this a priority issue, despite its potential impact on modal shift.

g. Operators and local authorities (by working together) can already do much to achieve better integration of the public transport network within the existing legal structure-including competition law. Where there has been "real” engagement significant progress has been made. Further powers are not a substitute for engagement and should only be sought where the existing framework prevents such progress.

What research has been carried out to understand the political issues and local authority constraints that are affecting reliability and service level provision, as opposed to an inferred market failure?

Unintended consequences

a. The comparison with the London model is misleading - the geography, demographics and economics of such a large capital city bear no relationship to any part of Wales.

b. The London model is misleadingly entitled 'franchising’. It is not - it is in fact compulsory competitive tendering for individual routes. The level of service provision in London is a direct consequence of very high levels of public funding, without which the model simply would not work.

c. To avoid the law of unintended consequences, and the dangers of introducing 'bad law’ that merely creates another set of problems, we would expect that prior to seeking an LCO there is a thorough and rigorous investigation of how a model based on a high density urban environment would translate in practice into the Welsh environment. Have any such studies been carried out? As part of this we would also expect to see a proper assessment of the costs of introducing the London model and the implications that it would have on taxpayers were it to be introduced in Wales

Legal and financial consequences

a. What research has been carried out into the financial costs associated with the sorts of measures envisaged by this LCO, how are such costs to be funded? How are such financial demands to be assessed, both in determining the justification for services at the marginal level, and in aggregate terms in relation to other demands on the public purse?

b. What research has been carried out into the feasibility and cost of setting up the major administrative requirements for introducing a franchised bus and coach framework, in absolute terms, and relative to the size of the transport sector in Wales?

c. What consideration has been given to the impact of franchising on the human rights and employment legislation provisions of current transport workers?

d. What research has been carried out into the financial consequences of what is effectively reregulation of the bus and coach industry?

2. If you agree with the principle, do you think that the wording of the proposed legislative competence order is correct, or do you think it is too broad or too narrow?

CPTCymru is unable to agree with the principle, or to comment on its wording, until the issues raised in question 1 have been answered

3. Do you think that the National Assembly for Wales should be given competence over some or all of the exceptions listed above in relation to the provision of bus and coach services in Wales?

Before responding to this question, CPTCymru would require information on:-

a. What research has been carried out into the legal, economic and administrative implications of such powers being transferred?

b. What consideration has been given to the practical implications of implementing any proposals in the provision of the specialist management skills required together with the supporting IT systems?

c. How for example would changing construction and use regulations for Wales work in practice as this could be at odds with EU Directives? This could lead to an inability to operate vehicles built to Welsh specifications in England or Scotland, or vice versa, thus affecting residual capital values and the willingness of manufacturers to supply vehicles without premium pricing to reflect small order volumes.

d. Drivers' licensing and hours, and operator licensing. These are already subject to EU or UK stringent controls. Any incompatibility between rules in Wales and England would add to operators' costs where they have operations on both sides of the border.

e. What are the perceived benefits of acquiring such powers? What evidence is there of failings in these areas which might justify such an approach?

f. CPTCymru has however consistently been in favour of a dedicated Traffic Commissioner for Wales, although it is understood that this could be achieved without the need for an LCO.

4. What are your views on the main objective of the proposed LCO, which is to introduce a bus franchising system in Wales?

CPTCymru is unable to express a view on such a controversial proposal without sight of the evidence base and objective research referred to in the answers it has requested to the above questions. Until such information is produced, CPTCymru wishes to alert both the public and the National Assembly of the dangers of seeking to acquire powers that may be unusable in practice or which if used could create damaging legal, financial and other consequences, both situations then potentially undermining the ongoing process of devolution.

As a general principle CPTCymru members believe that efficiency and innovation are encouraged by a deregulated, rather than a regulated regime. Bus operators have to plan networks to survive in business therefore they are bound to develop more cost effective solutions than those dictated by a command economy regulator.

The London model has been held up as a possible basis for bus services in Wales. It is not, however, a franchise model, rather, it is compulsory competitive tendering of individual routes, and there is no evidence that in many parts of Wales it would be an effective way of providing bus services

5. What are your views on the use of the proposed LCO to provide the Assembly with the necessary powers to improve school transport safety?

CPTCymru has made clear its views on school transport issues through both its written evidence to the consultation on the Learner Travel Measure, and in its verbal evidence to the Scrutiny Committee. CPTCymru believes that the fundamental problem to be addressed is that of student behaviour rather than vehicle safety, and would welcome any measures that address the problem at source.

Cydffederasiwn Cludwyr Teithwyr Cymru
Confederation of Passenger Transport Wales
Medi 2008 : September 2008