The owner of defunct bus operator Little Gem has hit back at claims that Transport for Greater Manchester (TfGM) had no notice of a likely closure of the business, which was announced on Friday 21 April and came after service the following day.
Wesley Goodwin says that he first informed TfGM of the scale of Little Gem’s challenges in November 2022. Those were caused largely by fuel prices peaking at double the level in play when tenders were submitted, and rapidly increasing staff and insurance costs.
Mr Goodwin claims that he at that point informed the body of wishes for help with contract payments and to reallocate some work to another business, but that TfGM instead pointed to a need to continue running to the original terms. Doing so had left Little Gem losing up to £30,000 per month.
He adds that with after losses continued to mount, there was no option than to cease operation and liquidate the business. Its O-Licence has already been surrendered. “I was no longer willing to continue running Little Gem. To do so would eventually have left us unable to satisfy financial standing requirements,” Mr Goodwin explains.
“We sought to work with TfGM to find a solution. It threatened Little Gem with action if services did not continue to operate in accordance with the original terms. TfGM received notice several months ago that all was not well. We asked for help to reflect fuel prices, but none was offered. At the end, Little Gem could not afford to keep operating.”
TfGM acknowledges the challenges that Little Gem and others – including itself – have faced. Deputy Director of Bus Services Alison Chew adds: “The contracts awarded to Little Gem followed the standard tendering process undertaken for all contracted bus services, and it has been treated no differently to any other operator.”
Little Gem is a separate company to Go Goodwins Group and Mayne Coaches. Those businesses are unaffected by the development. Both continue to trade are in healthy financial positions, Mr Goodwin says.
While all contracts operated by Little Gem for TfGM ceased after 22 April, a service undertaken on behalf of Cheshire East Council was moved to the Go Goodwins Group O-Licence earlier in April with that local authority’s agreement. It continues to run and will see new vehicles shortly.
Little Gem had sought the same transfer of TfGM contracts. That would have allowed costs to be cut and financial stability to be regained if the Little Gem work was consolidated with services undertaken by Go Goodwins, Mr Goodwin claims.
Ms Chew says that TfGM had “spoken with Mr Goodwin on several occasions about the contracts, service and performance of Little Gem,” adding that while the body is happy to discuss concerns further, “our current focus remains on securing new contracts for these services to minimise any further disruption to passengers.”
She adds: “We try our best to work collaboratively with all operators that provide contracted bus services.”
To that end, TfGM quickly moved to arrange emergency cover for former Little Gem contracts, but as of 25 April, 10 such routes – including one home-to-school service – were suspended. Of those that have been placed, operators ABC Coach Hire, Belle Vue, First Manchester, Phantom Travel and Red Rose are currently involved in continuing provision.
TfGM says it has prioritised home-to-school routes and others where alternatives are limited. A tendering exercise has begun for longer-term cover with a view to contracts beginning on 2 May.
Driver-related issues have also been cited as a contributor to Little Gem’s difficulties, with Mr Goodwin noting that the franchising of Greater Manchester’s bus network currently underway had created uncertainty among some former staff.
That was based upon the lack of any franchise contracts for local services in the first round being awarded to small operators, he says. Mr Goodwin adds that such a position is leading drivers to consider moving to larger companies that they perceive as having a better chance of succeeding in subsequent tranches.
