A dispute has broken out between Grant Palmer and Bedford Borough Council over what the SME bus operator says is the local authority’s use of taxpayers’ money to provide subsidised journeys that compete with its commercial departures on the same service.
That allegation is vehemently denied by the council. Grant Palmer held a contract to provide service 25 between Bedford and Rushden for over 11 years until expiry on 31 July, during which time the business purchase four new buses for it.
Ahead of that end date, Grant Palmer saw scope to register some sections of those journeys commercially, albeit not over the full length of route. That position was forthcoming via its investment in the service when contracted, the operator adds.
It says that commercial journeys were duly registered with the Traffic Commissioner in good time, with printed timetables posted in advance and Bedford Borough Council consulted fully regarding the change.
Despite that, the SME operator says that the local authority retendered service 25 in its entirety “over the top” of the Grant Palmer registration. The contract was awarded alongside several others to Stagecoach East, which as a result is running some journeys at or around the same times as Grant Palmer’s commercial provision.
Commercial Manager Thomas Manship adds that Grant Palmer “recognised a commercial opportunity to provide bus services for customers on service 25” and adds that it is “frankly astonishing that Bedford Borough Council is choosing to waste taxpayers’ money at a time when local authority budgets are strained.”
In response to the allegation, Bedford Borough Council says that it needed to “speedily undertake a transparent tendering process in which Stagecoach has successfully been awarded some services in North Bedfordshire to ensure these villages continued to receive public transport.”
Deputy Mayor and Portfolio Holder for Environment Cllr Jim Weir adds: “We continue to work with Grant Palmer on its reduced 25 route but refute any claims that we have wasted taxpayers’ money. Stagecoach will be providing a similar 25 service – however, this will be covering all villages.”
Stagecoach East Managing Director Darren Roe notes that the operator is pleased to take over the work. “We always seek to provide a service that is best for Bedford, and so we are looking forward to operating the 25 to our usual high standards,” he adds.
Mr Roe says that the need to work quickly with the local authority meant that the transition “was not as smooth as we all would have liked.” As a result, there was a “slight delay” in acceptance of the registration for service 25 by the Traffic Commissioner. It is thus being operated free of charge to customers until that process is completed.
Grant Palmer has additionally questioned provision of a subsidised service that runs free of charge – albeit temporarily – while competing with a commercial alternative.
The SME operator believes that the Transport Act 1985 precludes such an occurrence. It says that local authorities are subject to a duty laid down within that legislation “to conduct themselves as not to inhibit competition between persons providing or seeking to provide public transport services in their area.”
Mr Manship believes that by subsidising journeys “at the exact same time, for free, as our own services, Bedford Borough Council is inhibiting competition.” He adds that Grant Palmer is now taking legal advice on that point.
