Bus economics issues highlighted

A new report highlights the huge reductions in public spending on buses across Great Britain since 2010, which now totals over half a billion pounds a year after adjusting for inflation (474m in cash terms).

The report, on the way in which demand, costs and supply for the bus industry are determined, has been published by respected passenger transport specialists TAS.

The 87-page Economics of Bus Operation is designed to provide a clear understanding of the whole issue of the market for bus services, and the influences upon it.

Since its previous edition it has been fully updated with extended analysis, including:

  • Costs of operation
  • The levels of revenue needed both to meet operator financial obligations and invest in the future
  • The principal drivers of demand for bus services
  • The competitive environment in which the industry operates
  • Trends in fare levels
  • Different types of public spending on buses
  • How and why the performance of the industry varies between different areas and different markets.

The report’s author Chris Cheek says: “We hope that this independent analysis will help the non-specialist to understand the complexity of the issues and how they all interact.

“Ultimately, the community has to pay the cost of providing the bus services it wants: As Alastair Darling once remarked, public transport has only two sources of income – the farebox and the taxpayer.

“It is a harsh reality that one or the other has to pay, or services are reduced to the levels that are affordable. To pretend otherwise is to mislead both policymakers and voters.”