June 13, 2012

The Route We’re Taking on Bus Subsidies

Category: Brighton & Hove City Council – Rob Shepherd – 9:57 am
  • Government-imposed subsidy cuts resisted
  • 99.7% passenger journeys unaffected
  • Most essential bus services protected
  • 17 threatened routes saved; only around a dozen services remain affected

Brighton & Hove BusAn unacceptable aspect of George Osborne’s failing austerity programme is that most coalition government cuts are stealth cuts: the axe doesn’t fall very often in Whitehall itself.

Instead, the government keeps making cuts to local authorities and – stealthiest of all – cuts to government funding of individual local council services and subsidies. Downing Street is chopping subsidies as harshly as it possibly can but leaves local councils to pick up the pieces and shoulder the blame.

The latest victim of this policy in Brighton & Hove is public subsidies for a small number of essential bus routes or part-routes, where a great deal of the subsidy actually relies on central government funding.

About 2% of bus services in Brighton & Hove are regarded by the bus companies as unprofitable (or not profitable enough), so the council subsidises them, to ensure they keep running*. These include services to hospitals, schools and the outer parts of the city which the council thinks are important but which don’t have enough fare-paying customers to be considered commercially viable.

The council doesn’t always subsidise whole bus routes. In most cases, it subsidises just part of a route, or services along a route at certain times of the day – for example, winter evening routes which the bus company does not regard as commercially viable and has so far declined to run without public subsidy.

For over a decade, the subsidies have been growing year on year, underwritten increasingly out of the public purse. But now the public purse is shrinking.

At the same time, some direct government subsidies to the local bus company have been axed: the Bus Service Operators Grant (BSOG) is effectively a partial rebate of fuel duty, which was cut by 20% in April 2012**. This has increased bus prices to all paying customers, including services supported by the council. (Ironically, at the same time, the coalition government is protecting the airline industry from paying any fuel duty at all!) And to make matters worse, the rising price of diesel means that each pound of subsidy goes even less far.

The net result is that, somehow, the city council has to save almost £230,000  to balance the books. So the Green administration has reluctantly had to accept that it cannot subsidise everything that has previously been subsidised.

Some people have asked why the council can’t use the surplus (sometimes called ‘profits’) from parking charges to underwrite these services. Well, it already does. The vast majority of the surplus supports concessionary bus travel for the over 60s and the rest is used for bus subsidies, underwriting the shrinking central government contribution***. That’s it.

So with less money and rising costs the administration can’t save everything that’s subsidised but it has been doing all it can to minimise the effects. If Downing Street had its way, the cuts would be harsh. And in some parts of the country, they are, but in Brighton and Hove they are not. The Greens are successfully resisting the cuts and avoiding the worst effects.

One thing they’re implementing is to encourage the current bus company to do all it can to maintain the services it runs.

Another has been to put almost £1m a year of services out to tender, to achieve the best value for limited money****.

A third is to take a good, hard look at the services traditionally subsidised. And it’s been found that, for example, changes to school catchment areas mean that two subsidised routes are no longer essential: the 96 (serving Blatchington Mill from Patcham) and the 74 (serving Patcham High from Lewes Road via Coldean). These will go and a small number of pupils will be affected but they can still get to school on other bus routes.

By applying some intelligent thinking, the Greens have managed to minimise the effects of reductions elsewhere, prioritising the most essential services and looking at where two services might partially run in parallel, so savings can be made if people change buses en route.

Most school bus services are being protected and some routes are having reduced services but are not disappearing altogether.

In fact, while other authorities are cutting subsidised bus routes by 50%, the Green administration is saving 17 threatened routes and only proposing to stop subsidising around a dozen services (that is, services, not routes) *****. And the bus companies may also choose, as they have before, to continue some services after subsidies are withdrawn.

We cannot be exact when we say “around a dozen”, because we do NOT mean that all affected bus numbers will disappear from the streets: what we mean most of the time is that routes will be made shorter where it’s possible to use alternative buses, while others will have reduced bus frequencies or will not run throughout evenings, when they are sometimes barely used.

For example, Number 52, which serves Woodingdean and Ovingdean, will continue to run but will stop at the Marina instead of going into the city centre. Passengers will still be able to make their journeys but will have to change at Ovingdean Gap or the Marina.

Meanwhile, the vast majority of city bus users, including those in the outer parts, won’t see any difference at all, as most services are not subsidised. In fact, less than a third of 1% of passenger journeys in Brighton & Hove are affected.

We don’t relish the fact that the council cannot subsidise services as much as we’d like but the city faces massive cuts in general government funding as well as cuts to direct bus subsidies and rising fuel costs.

Indeed, as Greens, we would prefer it if all bus prices could go down for everyone but in a time of austerity and with a privatised, commercial bus service, no-one can achieve that. However, to affect such a small number of routes while keeping so many essential bus services going is, we believe, the sort of result that the city expects of us, and that only the Greens could and would achieve.

We are continuing to resist government cuts and to provide a fair council service in hard times.



* By law, bus companies are not allowed to run loss-making routes, so if the council doesn’t step in, the route cannot operate.

** http://assets.dft.gov.uk/publications/bus-service-operators-grant/impact-assessment.pdf

*** See report at http://www.brighton-hove.gov.uk/index.cfm?request=c1247955. Page 38.

****  Tender winners are expected to be confirmed on June 14th.  These services are worth £905,000 per year over a four year contract that will start in September 2012.

***** At present these are in fact proposals and are severely restricted by a complex set of laws. The full recommendations for bus subsidies will be decided by the council’s Policy and Resources Committee on June 14 and then the final decision will be taken by the regional Traffic Commissioner, a civil servant who is appointed by central government, is based in Eastbourne and doesn’t answer directly to voters in Brighton and Hove. The recommendations are contained in a report on the council’s website.