See our readers’ comments. And add your own.
Bus franchising: what is it?
The Bus Services Act 2017 – passed under a Conservative government, with all-party support – provides Mayoral Combined Authorities (including the Cambridgeshire and Peterborough Combined Authority) with the powers to implement bus franchising in their area, akin to the system operated by Transport for London.
The current situation
Bus services outside London were deregulated in 1986. Since then, there have been two systems of bus provision – one for London and one for the rest of Britain.
In London, Transport for London (accountable to the Mayor) specifies what bus services are to be provided. TfL decides the routes, timetables and fares. The services themselves are operated under contract by private companies* through a competitive tendering process.
[* These companies include Stagecoach, First Bus, Go-Ahead, Arriva and others.]
In the rest of the country, it’s a free market, meaning that anyone (subject to minimum safety and operating standards) can operate bus services. Bus operators are free to run whatever services they like, [decide] the fares they will charge and the vehicles they will use. This results in an uncoordinated network with a confusing array of ticketing options.
Although in theory it is a competitive market, in reality most bus services are now provided by five large companies who rarely compete against each other (Arriva, First, Go-Ahead, National Express and Stagecoach). Operators focus on the most profitable journeys, with local transport authorities having to pay operators to run journeys on some routes that are socially necessary.
What does franchising offer?
Under bus franchising, the deregulated bus market is suspended and bus operators are only able to provide services under contract to the local transport authority. This approach is used extensively across Europe, in London and elsewhere as it offers a range of significant advantages that are impossible under partnership – such as integrated ticketing, network planning, cross subsidy across bus services and other modes and unified marketing.
In short, franchising brings together the strengths of private operators in efficient service delivery but within a co-ordinated and planned public transport network… [allowing] the sensible co-ordination of bus services within a competitive market that drives operators to deliver better value for the public purse. [Urban Transport Group, Briefing document]
Further reading
- The Bus Services Act 2017 – New powers and opportunities [DfT 2017, PDF]
- Three stages to better bus services using the Bus Services Act [Campaign for Better Transport, July 2018, PDF]
- Practical bus franchising – the Jersey model [HCT Group, 2016, PDF]
What are the operators’ views?
In 2018, Andy Campbell, then managing director of Stagecoach East, wrote for the Cambridge Independent newspaper:
It’s easy to make a sweeping statement to say that bus franchising is the answer to everything, when in reality there are plenty of smaller, practical details that would make a huge difference to the reliability of bus services in and around Cambridge – and at minimal cost.
Read the full article here: Franchise the buses? You need money in the tank.
Whereas Whippet Coaches held (and still hold) the opposite view:
We strongly believe that a franchising model, like that of London, will create the conditions for high-quality bus services to be operated with the single-minded purpose of serving the community here in Cambridgeshire. Full statement here.
Charlie Hamilton, then Managing Director of Whippet published a response to Andy Campbell, again in the Cambridge Independent newspaper.
Franchise the Buses? You need money in the tank (May 30 – June 05 2018) clearly sets out a view of an operator who is fearful of losing their stranglehold on a region which deserves much more from a public transport network. Unfortunately, the article is littered with misrepresentations in a poor attempt to guide the reader away from the opportunity that franchising presents – please allow me an attempt to provide some clarity to the matter.
Contrary to what my industry colleague says, the London bus franchising system is admired throughout the world and has seen passenger numbers grow since de-regulation of buses in the 1980s whilst outside of London it has fallen dramatically (DfT Annual Bus Statistics report). Read the full article here: Response to Article on Bus Franchising from Stagecoach East (PDF 64KB)
Whilst trade magazine Route-One reported:
The imminent Bus Services Bill may have thrown up a lot of uncertainty in the industry, but there is one rural operator in the UK that advocates a franchising regime.
It’s not surprising, seeing as Cambridgeshire-based Whippet has been owned since 2014 by Tower Transit*– a British bus operator with an Australian heritage, with strong businesses in London and Singapore, both of which are franchised.
A re-regulated industry would make it far easier for Tower Transit to compete with the big operators in cities, not least in Cambridge, nine miles from Whippet’s Swavsey depot.
* Note: Tower Transit later de-merged, with Whippet’s ownership transferring to Ascendal Group.
Read the full article here: Whipping it into shape [routeone Team – January 26, 2017]
Update on Stagecoach’s attitude to bus franchising
Did fear of protracted legal action delay progress at the Cambridgeshire and Peterborough Combined Authority? See The slow pace of bus reform at the Combined Authority, below.
Readers may be aware of Greater Manchester Combined Authority mayor, Andy Burnham’s, long legal battle to implement bus franchising.
The combined authority had been trying for years to become the first region to bring its bus system under public control, but two operators – Stagecoach Manchester and Rotala Plc – sought a judicial review.
Burnham and the combined authority won their case in 2022. Further details are in the link below.
Judge rules in favour of Andy Burnham’s major bus reform in historic moment for Greater Manchester’s passengers
“In my judgement the mayor’s decision and the process by which the Greater Manchester Combined Authority came to recommend the scheme was lawful” [Charlotte Cox, Manchester Evening News, 9 March 2022]
However…
In a recent ‘catch-up’ meeting with Cambridge Area Bus Users secretary, Stagecoach East’s Operations Director, Ross Barton, expressed the view that whilst the company would prefer to work in partnership with local authorities, they could ‘live with’ franchising, if that was the decision which the Combined Authority reached.
And two independent views
Edward Leigh of Smarter Cambridge Transport [group now dissolved] argued the case for franchising here:
The Case for Bus Franchising.
Any suggestion that profits are excessive or could be used to subsidise unprofitable services is met with short shrift: Mr Campbell states, “it’s profits that enables us to upgrade our buses every year and it’s our passengers who benefit.”
But not all profits are reinvested: in 2016–17 Stagecoach paid out £67.1m to shareholders in dividends, £3.5m of which may be attributed pro-rata to Cambus Ltd, which trades as Stagecoach East.
Cambus’s profits in 2016–17 were £8.7m or 15.3% of revenue. This is well above the average of 11.9% for all of Stagecoach’s bus operations outside London. (Previous years were better still: £10.6m/18.5% in 2015–16; £9.9m/16.7% in 2014–15.)
More significantly though, Cambus’s profit margin is well above the 7.0% Stagecoach earned on its London bus services – which are franchised. If Cambus services were operated at a 7% profit, with the saving of £2.8m accruing to the local authorities, it would almost triple the current budget for subsidising unprofitable services.
Three stages to better bus services using the Bus Services Act
The Campaign for Better Transport says that new powers in the Bus Services Act can be used to make real improvements in bus services and has published a guide for local authorities on how to use it.
Three stages to better bus services using the Bus Services Act (PDF) aims to help councils by offering step by step advice on how to use the new powers available to them and provide examples of existing initiatives which have already improved the quality and level of bus services.
The Cambridgeshire and Peterborough Independent Economic Review – developed by the Cambridgeshire and Peterborough Independent Economic Commission – also came out in favour of bus franchising. Read and download the report here.
Connectivity is a key issue for market towns, the majority of which are served only by buses by way of public transport. It is vital that steps are taken to improve their connectivity.
Subsidiary Recommendation xiii): The Mayor should use his bus franchising
powers under the Devolution Deal to improve the regularity of bus services to and between market towns. (p16)University of Cambridge spin-out Echion Technologies has developed new technology to improve the battery capacity and charging speed of electric vehicles. The technology is based on innovation around the fundamental chemistry and nanostructure of a lithium ion battery’s active anode material. The company’s aim is to commercialize an improvement to lithium-ion batteries allowing them to hold more electricity and charge more quickly. The company is primarily targeting electric buses and light duty fleet vehicles as customers. (p49)
More effective buses, including through the use of the Mayor’s powers for introducing bus franchising are vital for the less well-off in areas where other forms of public transport would fail any cost-benefit calculation. They can connect students to education and widen employment opportunities, as well as work to alleviate loneliness and isolation among the elderly. (p79)
The Commission believes the Combined Authority is absolutely right to be looking at ambitious, and potentially novel, transport modes in its plans for Cambridge. But for the market towns, especially those further from Cambridge, more everyday modes, particularly buses, are important. We have heard that many bus services are increasingly infrequent, and unreliable. The hours which some bus services run are also very limited – for instance, there are three buses from March to Chatteris and Huntingdon in the morning, and only one back in the evening.
We believe that in this area of bus travel, the Combined Authority is in a strong position tomake a difference. The Devolution Deal agreed with government stated that “A new, directly elected Mayor of the proposed Combined Authority will… Have the ability to franchise bus services in the Combined Authority area, subject to necessary legislation and local consultation and agreement”85. Only Mayoral Combined Authorities have this power without the need for secondary legislation (according to the Bus Services Act, 2017). London has employed this power to great effect, bringing about reduced costs for buses and allowing for full network control. In a rural area, buses are even more important – particularly for tackling isolation, as in rural areas the social cost of not being able to travel is higher.
Subsidiary Recommendation xiii): The Mayor should use his bus franchising powers under the Devolution Deal to improve the regularity of bus services to and between market towns. (p119)
Read and download the report here.
Ideas for improvements from Antony Carpen
What are the ‘easy wins’ for improving bus transport in and around Cambridge?
Summary
Because bringing in bus franchising or going full #CommissarPuffles and nationalising the buses is not something that is going to happen overnight.
This follows on from my previous post about being dependent on public transport. By ‘Easy win’ I don’t mean that the implementation itself is necessarily easy in the current context, but that the difference the passengers will notice could be significant when considered in proportion to the amount of additional money thrown at the problem.
Three types of bus to serve our futures?
A view from Jim Chisholm
Within Greater Cambridge we have three types of bus service (and we should question that word) but they are neither fit for purpose nor economic.
I maintain that we could have three types of service that did serve the populace and were economic.
The lowest in the current hierarchy is the supported or community bus. These have been drastically cut throughout the country, as local government finances come under increasing strain, and suffer through legal restrictions. This means that getting a lift from a friend, a community support car or even using a private hire car, may be the only option especially for the elderly.
Next is the conventional service bus, normally Stagecoach or Whippet. These companies are required by their shareholders to make a profit, so the word ‘service’ bus can be questioned. The law permits changes of routes and fares at short notice, and there are few regulations that control service provision. Even shared agreements between operators over routes and ticketing may be deemed illegal as ‘uncompetitive’. They suffer from the feedback issue of congestion, meaning that increased delays makes running buses less reliable and people then using cars which they see as the only alternative. That results in yet more congestion!
This group covers most routes in and around Cambridge including Park & Ride. P&R can be seen as a subtle but legal way of supporting those who own a car, but who may well have access to a direct but more expensive and slower service bus.
Finally we have an expanding ‘private’ bus and coach services to support those who work at science and business parks in and around Cambridge, together with school services, some of which are County funded, with others supported by parents or private schools. Again there are heavy and complex restrictions on such buses. ‘Works’ buses, if supported by business, get big tax breaks, but not if fare paying passengers are also carried, and legal restriction normally prevent adults from being carried on school buses. Look at private buses and coaches in the morning peak on some radial routes around Cambridge and it is likely to out-number the public service buses, with some such vehicles traveling empty into Cambridge! Works and school buses do also have disadvantages. They will normally only work at peak times, and hence may not be available for those who work part time or anti-social hours. I’m told one establishment spends tens of thousands of pounds on taxis for staff required to work anti-social hours.
Can we change provision such that buses provide an efficient service for the majority of potential users yet are not a drain on public finance?
Yes we can!
It will require the Mayor of the Combined Authority to use franchising powers but, well done, it could entice many who currently drive for all or part of their trip to use public transport instead. With three broad types of service I believe we can reduce congestion and pollution, bringing an increasing efficiency to public transport that benefits all.
Firstly we need a frequent reliable and quick service along the main radial routes from adjacent towns that runs from early morning to late evening.
This should have limited set down and pick-up points within the City and make best use of the guided bus routes, but any ticket should allow interchange to and from other buses within the city without penalty. I’d call these express buses ‘Countri’ buses and they should run at not less than 15min frequency for the working day. They could run from adjacent towns and connect with science and business parks so as to replace ‘works’ buses, but would not trundle on obscure routes through small settlements, parts of larger villages or the outskirts of Cambridge. For example a No7 Stagecoach bus could ‘save’ over 20mins on a trip from Saffron Walden yet serve the Genome Campus in addition to Addenbrooke’s and larger villages. This would best suit high-capacity single deck buses.
Secondly we could have a modified ‘Citi’ service incorporating ‘Park & Ride’. This would have a flat fare but, as now in London, allowing ‘interchange’ within an hour without penalty.
These would not reach much beyond the City boundary, as that would generally be covered by ‘Countri’ services, but would offer longer hours to advantage those using local rail station(s) or P&R sites.
Lastly but not least, outside Cambridge we would, and do, need ‘travel hubs’ as a base for ‘community’ buses. These vehicles would serve smaller villages and settlements within say 3 miles of the hub and link to rail or Countri buses for onward travel. Locations could be the science or business parks, bigger secondary schools, rural train stations or larger health centres. Remote from Cambridge (8 miles plus) they could also act as mini P&R sites to capture some longer distance car traffic well outside the congested fringes of Cambridge. These local buses must be fully ‘accessible’ (not modified minibuses) to speed boarding for those with buggies or mobility issues.
Such buses at peak times would serve direct local access to secondary schools, business and science parks. Out of peak they would support transport to local shops, health centres. They would need financial support but, well-designed, they would bring increased revenue to Countri services, reduce both the need for school services, and congestion.
In conclusion:
We need an integrated transport system that better serves those with a car, and those without. The current system discourages use of buses by those with a car and deprives the old, the young and the poor of the independent travel opportunities they need, including for their health and well-being.
These are all good ‘carrots’, but we also need ‘sticks’. Reducing the amount of ‘free’ commuter parking on Cambridge streets and in workplaces will help, as would ensuring that P&R charges mean it is cheaper to catch a bus from a necklace village. In this ‘win-win’ environment, buses become more frequent, efficient and cheaper, as loadings increase and congestion and pollution reduce.
In the longer term, as Greater Cambridge expands we will need an underground metro within the City core, that extends to surface running both west and east away from existing rail lines, but the ease of delivery and flexibility for both operators and users means that bus changes are urgently needed now.
Yes there are issues, but these are minute and solvable compared with running untried autonomous vehicles on new wide tarmac routes over our precious green belt, and which are unlikely to be even test running within 5 years!
[Jim worked in the ‘Public Transport’ division at then Transport and Road Research Laboratory in the 1970s, but is perhaps better known for ‘The Chisholm Trail’, a cycling and walking route across Cambridge following the rail corridor, which is being funded by the Greater Cambridge Partnership. A longer, more detailed submission was made to the Cambridgeshire and Peterborough Combined Authority‘s Strategic Bus Review, set up by Mayor James Palmer and undertaken by SYSTRA.]
Is Bus Franchising a left-right political issue?
No. The Bus Services Act 2017 received cross-party support.
Ahead of the mayoral election for the Cambridgeshire and Peterborough Combined Authority, Cambridge’s Labour MP, Daniel Zeichner, urged the new regional mayor to use bus franchising powers.
South Cambridgeshire’s Conservative MP, at the time, Heidi Allen blogged:
Clearly, the Bus Services Act 2017, allows the elected Mayor, Conservative James Palmer, to bring in Bus Franchising which means the route selection, fares, timetables, and vehicle specification are all under the control of an elected representative – Whippet are firm believers that this is the best way to deliver a comprehensive network that is suitable for the market.
[Heidi’s full blogpost has since been removed when her term as MP ended.]
And the Cambridge Area Bus Users view?
We want to see co-ordinated, reliable services, with comprehensive route coverage, clear maps of all operators’ services, with simplified ticketing – valid across all operators – with daily capping. This can be achieved through bus franchising. It might be achieved some other way. We believe that the Cambridgeshire and Peterborough Combined Authority must deliver a clear vision for improved bus services, however this is achieved.
The slow pace of bus reform at the Combined Authority
Questions asked… in January 2019
Cary ambridge Area Bus Users’ secretary asked these questions of Mayor Palmer at the Cambridgeshire and Peterborough Combined Authority Board Meeting on Wednesday 30th January 2019.
Cambridge Area Bus Users welcomes the publication of the Cambridgeshire and Peterborough Combined Authority’s strategic bus review, almost two years after the first official Combined Authority meeting.Our group support Mayor Palmer’s aspirations for integrated multi-mode public transport, with roles for conventional rail, guided light transport, sub-surface and conventional buses.
Passengers, however cannot ride on aspirations and there is, currently, a crisis in local bus services.
- What improvements to bus services will you implement within six months?
- What improvements to bus services will you implement within one year?
- What improvements to bus services will you implement within two years?
- What improvements to bus services do you envisage thereafter?
Mayor Palmer responded that he could and would not commit to a timetable of aims beyond spring 2021 as this is a significant task that will be handled by the Bus Task Force.
Our secretary referred to the “glacial pace” or reform compared to the “crisis” in bus services. Could a “Quick Win” setting up back office facilities for multi-operator ticketing for all services be achieved? MultiBus tickets are expensive and not accepted on Stagecoach’s X5 service nor the guided busway.
Mayor Palmer responded by posing a false dichotomy between doing things quickly and doing things properly…
Councillor Lewis Herbert (Cambridge City Council, Labour) referred to the “monopoly position of Stagecoach,” which means “they are dictating to us how things are run.” Councillors Lucy Nethsingha and Bridget Smith (South Cambridgeshire District Council, Liberal Democrat) expressed frustrations about the “slow pace to establish enhanced partnerships or Bus Franchising,” of how we “need improvements immediately,” that we “need to work with operators to prevent further deterioration, and to examine best way for delivery – partnership or franchising.”
Cambridge News kept up the pressure, with this article – Cambridge buses are some of the most unreliable in the country [Annie Gouk & Freddie Lynne, 11 Feb 2019].
Department of Transport figures show Cambridge has some of the most unreliable bus services
And Cambridge News’ Ella Pengelly contacted us for out views, resulting in this article, in the Cambridge News – Calls for Cambridgeshire Mayor to improve bus services and FAST [23 Feb 2019].
The local bus services have been described as patchy, with some areas badly-covered and too many delays
Bus reform Task Force
To be fair to Palmer, he did – in December 2019 – instigate a ‘Bus reform Task Force’ to examine how to improve bus services. This was, however over three years after the devolution deal was agreed by the constituent local councils in November 2016, and the first meeting of the shadow combined authority, held in December 2016. Mayor Palmer was elected on 4 May 2017.
Little progress had been made by the time of the mayoral election in May 2021, when Dr Nik Johnson took office.
Mayor Johnson took office during the time of Covid19, with central government supporting bus services and, crucially, the ‘business case’ for bus reform changing. This, latter, formed part of the case for the judicial review sought by Stagecoach Manchester and Rotala Plc of the Greater Manchester combined authority decision to implement bus franchising.
Was our Combined Authority daunted by the potential for a legal battle with Stagecoach?
In May 2022 German infrastructure investor DWS, which is owned ultimately by Deutsche Bank, won a takeover battle for ownership of Stagecoach.
I am delighted to confirm that we are now part of a portfolio of transport and infrastructure assets managed by DWS Infrastructure. DWS Infrastructure has a positive track record of working with companies for the long term, and it has made significant investment in businesses that are crucial to the infrastructure that countries and communities need to flourish. This includes investments in the transport, energy and utility sectors.
Martin Griffiths, Chief Executive, Stagecoach Group, Business Bulletin, August 2022
Could it be that the new owners are more attuned to the stability of a guaranteed revenue-stream deriving from public contracts, rather than the uncertainties of on-road competition?
However…
The Combined Authority board, meeting on 30 November 2022, put bus franchising firmly back on the agenda.
With regards to franchising, I would set the challenge to the team that if it is the right appropriate way forward I would think two-and-a-half years would be […] appropriate […]. I think we need to try and put our foot on the accelerator on that. I can challenge the team to do that, they may well be interested in that as well.
Tim Bellamy, interim head of transport at the Combined Authority
Read a full report on on that aspect of the meeting here: When Combined Authority’s bus franchising across Cambs and Peterborough for major strategy could happen [Hannah Brown, Local Democracy Reporter, Cambridge News, 1 December 2022]
October 23022 bus service withdrawals had people worrying how they would get to work or college. And it necessitated a breakneck scramble to find new operators by the Cambridgeshire and Peterborough Combined Authority.
Together with the continuing disruption caused by cancellations, this rather makes the case for democratic control over bus operators.
We need better reliability, more services, and more affordable fares.
How could improved bus services be funded?
The Greater Cambridge Partnership’s City Access proposals are riding to the rescue
The Greater Cambridge Partnership have promised £50 million annually for radically-improved bus services, funded by money from the city deal, signed with central government in 2014 and not from council tax or business rates.
But, longer-term, this money will run out and a sustainable revenue-stream will be required. Under national legislation, this will be legally ring-fenced for transport improvements.
And public money must be safeguarded: the benefits should be for bus passengers, not for bumper payouts to bus company shareholders (and foreign owners in some cases).
The GCP is working closely with the Cambridgeshire and Peterborough Combined Authority who can exercise powers (under the Bus Services Act 2017) to prevent bus operators ever again repeating the October 2022 disruption to people’s lives.
Click here to read our earlier blogpost on this topic.
Greater Cambridge Partnership, Cambridgeshire and Peterborough Combined Authority, Cambridgeshire County Council, District Councils…
What are all of these bodies?
Cambridge City Council and the four District Councils are ‘lower tier’ councils. Cambridgeshire County Council is an ‘upper tier council’. Peterborough City Council is a ‘unitary authority’.
Understand how your council works [Gov-UK]
The Greater Cambridge Partnership has some money to make improvements to our bus services, but the Cambridgeshire and Peterborough Combined Authority has the powers to control bus services.
The Greater Cambridge Partnership…
… is the local delivery body for a city deal with central government, bringing powers and investment, worth up to £500 million over 15 years, to vital improvements in infrastructure, supporting and accelerating the creation of 44,000 new jobs, 33,500 new homes and 420 additional apprenticeships.
The partnership of councils, business and academia will work together, and with partners and local communities, to grow and share prosperity and improve the quality of life for the people of Greater Cambridge, now and in the future.
The four partners are:
- Cambridge City Council
- Cambridgeshire County Council
- South Cambridgeshire District Council
- University of Cambridge
Click the logo to read more on the Greater Cambridge Partnership website.
The Cambridgeshire & Peterborough Combined Authority…
… was established, on 3rd March 2017 as a Mayoral Combined Authority for the Cambridgeshire and Peterborough area.
The Combined Authority works with our local councils, the Business Board (Local Enterprise Partnership), local public services, Government departments and agencies, universities and businesses to grow the local and national economy.
The mission of the Combined Authority is to make life better, healthier, and fairer for all.
It is made up of a directly elected Mayor and the following seven local authorities (referred to as the Constituent Councils) and the Business Board (Local Enterprise Partnership):
- Cambridge City Council
- Cambridgeshire County Council
- East Cambridgeshire District Council
- Fenland District Council
- Huntingdonshire District Council
- Peterborough City Council
- South Cambridgeshire District Council
Quick wins?
Edward Leigh of Smarter Cambridge Transport [group now dissolved] argued, at that time, for more ‘quick wins’. We are still waiting…
Let’s make sure that the bus passenger’s voice – your voice – is heard. Why not join us?
See also:
Travel Hubs or Park&Ride
Can traffic-choked Harston be saved?
Please note that any advertisements which appear in association with these posts are not indicative of any endorsement by Cambridge Area Bus Users. They are placed there by a WordPress algorithm.
And do add your own comments, below.
Cambridge Area Bus Users 
As with all things plenty of endless talk but precious little ACTION with the growth of the City with significant housing at land adjacent to Marshalls, Waterbeach and the ever expanding Addenbrookes site we need a 10 year plan with stages plotted from mid 2020 more provision of Buses with another key supplier to give Stagecoach real competition soon
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I personally don’t have a problem with the deregulated system – Stagecoach aren’t great and the maintenance of the X5 coaches over at Bedford has been dire in recent times, but the biggest problems are the lack of any sort of control on car traffic around Cambridge, and the planning authorities allowing massive expansion of the tech industry in Cambridge while the housing expansion is spread around a much wider area – forcing people to drive. I can’t imagine any bus operator, franchised or deregulated, doing an effective job in the conditions. This morning (14 March), for example – 45 minutes in a queue from Madingley Mulch down to the new Eddington crossroads.
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