Examination of Witnesses (Questions 440-459)
MR JOHN SPELLAR MP, MR ALAN DAVIS AND MS SANDRA WEBBER
TUESDAY 21 MAY 2002
440. You can have or you do have?
(Mr Spellar) We do have, but on the question of many of these which are about areas with low levels of usage but extremely important access to all the facilities that Mrs Ellman was identifying, it is very much a case-by-case issue at local level, and indeed these are the areas we are exploring with local authorities on the extent to which these services are the most appropriatefor example, whether it is better to have a ring-and-ride service in some of these areas or to have a scheduled route.
441. And that decision would be based on what? Your negotiations with a local authority?
(Mr Spellar) It is also about the
442. It would not be on numbers, because you made that quite clear.
(Mr Spellar) Sorry, it might be based on discussions as to whether a particular bus route is viable in the first instance and then whether it is worth retaining, because in a number of areas I think there would be agreement that a bus route may not be in any way still viable.
443. But the point Mrs Ellman was making is the very opposite. She was referring you to the Social Exclusion Unit's evidence and the fact that they have given us very specific evidence that the failure to take into account the cost to the Health Service and to employment of a lack of decent transport system is absolutely fundamental, so you are not looking at which ones you can take away, but how you can expand.
(Mr Spellar) You may also be looking at how you can reallocate, because employment patterns have changed enormously over the last ten years. A considerable number of enterprises have closed down: in other cases new centres have opened up. I mentioned retail and it is the same with health facilities; there is a changing pattern. One of the questions is the extent to which the industry responds, and one of the industry's concerns with regard to too rigid a pattern is the extent to which they can then respond to the changing pattern of demand.
444. Can I bring this back to the peoplepeople who might find they have a job but have difficulty getting there? Are you trying to evaluate how much that system is being improved? Is that built into your assessment?
(Mr Spellar) Yes, we are certainly looking at that and are very keen that that should be looked at. All I am saying is that it is a question of whether a scheduled bus service is necessarily the most appropriate mechanism.
445. I am not asking you about the means to do it; what I am trying to find out is whether these things are part of your evaluation and whether you are going to be assessing how many of these issues will be addressed. The question of the needs by which they will be addressed is a matter for local authorities.
(Mr Spellar) Yes, very much so, and for this reason: along with by-passes, and probably exceeding by-passes, the cutting-back or the trimming of peripheral bus routes is probably the greatest source of complaint from Members of Parliament to me as a Minister of Transport and has been ever since we took over in June. This is precisely why I have been pressing both the bus operators and the local authorities in order to try and get them to argue out and clarify the underlying situation that they are dealing with. I do have to say there is not as yet an agreed view as to what is happening. I think one of the reasons as expressed to me by a senior member in local government is that there is a very mixed pattern across the country between different local authorities and different bus companies. It may be that the evidence that you have taken will clarify that and, as you rightly say, there has been the work of the Social Exclusion Unit which we are incorporating into our thinking.
Chairman: I do not think we want to go round and round the same point.
446. About 30 per cent of bus operators' income comes from public funds. Do you think the public get value for money?
(Mr Spellar) Again, this is variable, and an issue that the local authorities are pressing on us is the general nature of some of the subsidies on the fuel duty rebate or the concessionary fares and whether, if those were more specifically targeted in order to achieve certain route coverage, they would be more effective. To some extent that slightly implies that there are routes that are highly profitable and from which therefore there is money within the system which, if re-directed, would enable some of these other routes to be profitable.
447. Not cross-subsidisation?
(Mr Spellar) Cross-subsidisation within the system, as long as it is not predatory, is in accordance with the regulations of the Office of Fair Trading which is exactly how we got back to Nottingham and the problems they had.
448. Is there a case for local authorities purchasing buses and running the services where tenders are very expensive and where there is not any competition?
(Mr Spellar) It is an issue that I think they have been looking at. One of the difficulties is that there are very few authorities now who have the in-house competence required to run the service, and therefore the cost of setting that up might well be considerable. There are, as you know, a number of existing authorities that still have arm's length bus companies but I think there is a serious question as to whether the start-up costs for that might be prohibitive, or indeed as to whether in a number of those areas there may be alternative operators. You remember I said that it is not necessarily a case of monopoly but there may well be a dominant supplier with other suppliers operating who might then step in.
449. Is the Government ideologically opposed to local authorities running public services in those circumstances?
(Mr Spellar) No; we look at what works. I have merely posed some of the obstacles on the way given the situation we are in.
450. Minister, do you think it is confusing that concessionary fares are so diverse between the different local authorities?
(Mr Spellar) I think there is some scope for confusion but I think also we come up against a fundamental dilemma that local residents are able to vote for the sort of pattern of provision. We have a national minimum but, if local government is to have proper focus and meaning, then there are considerable advantages in local authorities, if they have the agreement and the support of their local communities, being able to make different provision for different residents, depending on their local services and the priorities they want to allocate according to different services.
451. On the question of accessibility and stability of services in rural areas, particularly for the very old and very young, are you concerned at the cost of changing buses leading to payment of an extra ticket and the additional charge of taking a taxi as part of a journey?
(Mr Spellar) We are concerned generally about a number of the issues in rural areas which is not necessarily, by the way, just maybe the sort of traditional image of rural areas. Many, for example, of the pit village areas qualify for the rural bus challenge precisely because their problems are very similar to those maybe of some of the more traditionally viewed rural areas, and that is precisely why we have quite significant sums of money in the rural bus challenge. We are looking all the time at evaluating what sort of service best achieves the objective. The objective is mobility: access to services and broadening people's opportunities and mobility. The mechanism by which we achieve that may be scheduled bus services; it may be provision of other services.
Chairman: It is always very helpful to have these enormously broadbrush expositions of views but I wonder if I could ask Members of the Committeeand perhaps even youif we could have a little short and sharp concentration on the question that is being put.
452. You mentioned in your introductory remarks the withdrawal of services, and you now mention some new schemes that have come in through the challenge scheme. Would you agree that there are two issues: one is bus services within an urban areasfor example, Yorkand one is the rural service from York to another city like Wetherby, and that the danger of the challenge scheme you have introduced is that, while it might lead to new services being introduced, it has led to the withdrawal of some very good services which have been discontinued?
(Mr Spellar) Yes. There is always a difficulty that an advance in one area may set up sometimes some perverse results. For example, I think that the Member for Epsom has previously raised issues about the competitive nature of the London bus service as it borders on his constituency and the impact that has had on other services, so I accept that. That is precisely why we have to look at what we were intending to achieve, what has been the outcome, whether it actually achieved the objective as opposed to the mechanism, because the mechanism is not the key issueit is the objective we are trying to achieve, and therefore whether we need to refine the service so we are giving the right signals and the right support in order to achieve that outcome. I do not believe, firstly, that you ever achieve that in one go. What you do is you evaluate the evidence and then move on to improving the scheme.
453. One of the objectives must surely have been stability of servicethat you do need a certain level of stability in rural areas?
(Mr Spellar) That can certainly be desirable as long as that service is meeting the needs of the residents in that area, and we do see on some routes increasing numbers and in some we see decreasing numbers for a whole number of reasons, be they car ownership or changing attractions in the points people are wanting to go to.
454. Coming back to quality partnerships, we are told that something like 20 per cent of all routes, mainly in major conurbations and urban routes, are subject to partnerships and we are also told by ATCO that they commissioned a study suggesting that about 20 per cent of the remaining 80 per cent could be suitable for quality partnerships. If that evidence is credible and near the mark, what do you think is going to happen to the other 60 per cent?
(Mr Spellar) I think those are areas where the local authorities and bus companies may decide that the service is being appropriately delivered by the commercial companies, and they may believe that there is not a requirement to have that further level of agreement, but again this is where the local authorities will be looking at the needs of their communities.
455. Is there not sufficient evidence developing to suggest, as evidence we have taken suggests, that there are a number of what might be termed star performers in quality partnerships but that there is a really large second division of services that are benefiting from no more than new buses here and there, which probably would need replacing anyway?
(Mr Spellar) I would not necessarily dismiss those; new buses are welcome. What we are encouraging is the development of those partnerships on both sideswith the operators looking at how they can grow the business but with the co-operation of the local authorities, particularly in terms of bus priority routes. I think there is sufficient evidence that in a number of areas local councils have been reluctant because of opposition from either householders or frontage business frontages along the routes, but there are ways we can look at where this has been successful and where there has been sufficient benefit for the residents, for example in provision of additional bus stops to provide a better service for those residents who will be affected by the bus priority route, or at how parking can be provided for shops, or at a degree of flexibility on the parking. Those are important elements in moving that along and that is certainly what we are trying to encourage local authorities to do.
456. We are told by bus companies that quality partnerships have led to increases of between 20 and 30 per cent in ridership in some instances. If that is the case yet we have seen no overall increase in bus passenger ridership outside London, does that not mean that quality partnerships outside London, of course, have massed a considerable decline in overall bus ridership?
(Mr Spellar) I think what we have to look at is, up until last year, there had been a steady decline taking place anyway, and quite a bit of that running parallel to increased levels of car ownership. Also, there are changing travel patternsyou do not have 30,000 odd people now going into the Austin works at Longbridge; there is a much more dispersed pattern of travel which inclines more towards car use, and I think there have been a number of successes which we are hoping will arrest that trend. As I said earlier, a one per cent increase would enable us to get the 10 per cent over ten years but we are not satisfied with that and are not complacent. That is precisely why we are looking at developing the bus service further.
457. You would accept that outside London there has been a significant decrease according to latest statistics for 2001 in bus ridership overall?
(Mr Spellar) Yes. Equally though, outside London there have been very wide variations. I think the north east has shown a decline; West Yorkshire showed something like a 5 per cent increase over the last year; and West Midlands is either stable or has a 1 per cent increase. What we need to do is look at the factors underlying these variations to see what is working and what is not.
458. Do you think that quality contract is a last resort?
(Mr Spellar) I think we would want to see quality partnerships tested before we wanted to move further on quality contracts.
459. A last resort?
(Mr Spellar) A further stage.