A lesson from history

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The supporters of Quality Contracts might not fully appreciate what’s in store if franchising becomes a reality.

Drawing on his own experiences from 50 years in the bus industry, Jim Hulme gives a warning from the old days: There isn’t enough public money.

I wonder sometimes if the supporters of Quality Contracts really appreciate what might be in store if network franchising becomes reality, and I would ask them to take a moment or two to heed warnings from history.

Life wasn’t quite as rosy as some would have us believe in the days of public control. In Greater Manchester, for example, there were huge cuts in bus services in the 16-year period before deregulation. And nothing compared to events of 1975 which saw two fares rises of 48% and 25% respectively – which saw passenger numbers fall by a staggering 20%.

And apart from one year, putting up fares was an annual necessity, with 15% rises being par for the course. They were very difficult times.

The problem was simple. There just wasn’t enough money from the public purse for transport purposes and when it ran out, fares rose and services were cut.

And history may very well repeat itself if network franchising becomes the norm. Using the ‘fat’ created by well-used services to finance the system under the veil of the failed doctrine of cross-subsidy is a dangerous aspiration.

It looks to be so fair and logical. Let the profitable and well-used services prop up those that are unprofitable and not very well-used. That’s what I was brought up to believe, and it was a doctrine that was applied by public sector bus managers prior to 1986. But the more we applied the principle, the more it dawned on us just how counterproductive it was.

When I was in Oldham in the late 1970s, I was faced with having to cut services to balance the books. The frequencies of my unprofitable services couldn’t be cut any more as they were down to the bone, and so I was forced to apply the cuts to my profitable services. Passenger numbers fell as a consequence which resulted in services moving from profit to loss.

I now had fewer profitable services propping up even more loss-makers, and when cuts had to be made again there were fewer profitable services remaining. In effect the good services were sacrificed and passenger numbers fell as a result. And in the end, there just weren’t enough profitable services left to carry the burden.

Commuters who needed high frequency services had fewer buses with longer waiting times at bus stops. And in social terms it was a disaster. Passengers on my best-performing services which ran to low-income council estates paid the price through lower frequencies and higher fares, so that those in better-heeled communities could retain services that were used by only a handful of passengers.

Surely the last thing that is needed is an army of people designing timetables under a franchising regime, who are quite remote from operational realities. Because of the detail associated with large networks of bus services, it will be they who exercise control rather than politicians. That was the reality in pre-deregulation days where the magnitude of the task meant that elected representatives could not scrutinise the detail.

The current regime gives politicians the best of all worlds. Commercial operators have rebuilt core services and in so doing they take the risk, while franchising is an existing option where non-commercial services are concerned.

Exercising real influence through partnership seems by far the best option, and there are plenty of experienced politicians who are well-placed to work with bus operators and see that partnership delivers value-for-money through the provision of quality bus services.