SIMON BAIN
Stagecoach has claimed an important political victory after the UK’s first plans for local authority control of the bus network were decisively rejected by a review board.
The transport executive in Tyne & Wear had proposed a takeover which would see bus contracts let as franchises, as happens only in London, with council taxpayers assuming the risks of a 10-year scheme costing £1.6billion.
The model had been hailed by Labour as an alternative to the current system where big operators such as Stagecoach and FirstGroup fund services on a largely commercial basis.
But after a year-long inquiry, the review board has said the Tyne & Wear scheme would fail to increase bus usage or improve service quality, would not contribute towards effective or economic transport policies, and would have a disproportionate negative impact on existing operators relative to local benefits.
Stagecoach chief executive Martin Griffiths said the scheme had been proved to be “unaffordable, inflexible, high risk and not in the public interest”.
The company said the decision had “clear implications for bus franchising powers linked to the government’s devolution programme”, as proposals had “failed to meet key practical and financial tests”.
The transport giant’s shares were up nearly four per cent while FirstGroup rallied by over two per cent.
Mr Griffiths said: “Tyne and Wear already has 90per cent bus customer satisfaction, amongst the highest levels of bus use in the country, and smart ticketing is being introduced across the region. Franchising does nothing to build on that successful, high-quality network.”
He said the plans put forward by public transport executive Nexus envisaged no more buses, no new routes and no more services. “When subjected to proper public scrutiny, it admitted its plan had a close to one in three chance of financial failure, it had no money to fund the bus network after 10 years and it had made numerous multi-million-pound mistakes in its calculations.”
Mr Griffiths called on local authorities to abandon the “misguided” franchising model and continue to work in partnership with bus operators to improve services further..
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