Better Transport

Before 1986, the bus industry in the UK was operated as a public service by the Government. In 1986 bus services were deregulated; a free market was introduced everywhere outside of London. This means that any company that has an operator’s licence can choose to run a bus service, as long as they register it with the area traffic commissioner 56 days before it starts. There are now a mixture of private companies, some large, some small and some owned by the local authority. The idea behind deregulation was that the creation of a free market would encourage competition and innovation that would benefit the bus passenger. In some areas bus companies have succeeded in providing high quality services that people want to use, but overall, the number of people using buses has declined.

The decline is due to various factors including higher car ownership rates; the low level of Government funding for buses; the falling cost of motoring; the growth of television; out of town development; the deregulated environment (which has stopped local authorities from planning buses); and congestion. Bus fare increases and service cuts have made the situation worse.

Five bus companies run most of the buses in England: Arriva, First, Go-Ahead, National Express and Stagecoach. Needing to make a profit, bus companies will always look at bus routes in terms of whether a profit can be made from them. Bus companies reinvest some of their profit in new buses and improved services. They want to promote growth in the market and improve the product they offer, as well as making profit for their shareholders.

Bus companies have to deal with rising costs in the bus industry – wages, fuel and insurance. When costs increase, bus companies try to work out how to maintain their profit margins. They can do this by increasing fares or cutting services. Unfortunately this has a knock-on effect on the number of people using the bus, but if bus companies feel they have no alternative, this is what they will do. Although bus companies would like to see an expanding market for bus services, their overriding concern does have to be to make money and they won't keep badly performing services running. You as a campaigner need to remember this when you speak with the companies and be prepared to make some financially sound proposals.