A quarter-of-a-century after former National Bus Company subsidiaries Badgerline and Midland Red West merged, the Competition and Markets Authority (CMA) is to poised to remove long-standing undertakings.
In 1988 Badgerline (which operated Bristol Country Bus) bought management buy-out Midland Red West (which operated Bristol Citybus, trading as City Line), triggering a Monopolies and Mergers Commission (MMC) investigation.
In 1989 the MMC ruled that the merger would remove competition for tendered bus services contracted by the then Avon County Council.
FirstBus, as Badgerline was renamed in 1995, was subject to restrictions, including a cap on the amount it could receive from the local authority for running a tendered service, and a requirement to return any excess profit from such services.
Those restrictions are still in place today.
A review of the undertakings earlier this year has led the CMA – the MMCs successor – to rule that they can cease.
The CMA found that First’s share of tendered bus services in the region has reduced significantly since the 1989 report and, that in the most recent tender rounds, First did not win any contracts at three of the four local transport authorities.
The CMA engaged with local stakeholders and no party it spoke to argued that the undertakings were having a beneficial effect and should be retained. A date to lift the restrictions has yet to be set, while the CMA consults on its provisional decision.
Against a background of a sharp reduction in Bristol tendered services, most of First Bristol’s work is commercial.
First Bristol MD James Freeman told routeone: “Tendered work now forms a relatively small part of operations in terms of what is achievable for us. Also, the tendered market is significantly smaller than it was in 1989.”
