What should be in the national bus strategy? PART 1
Which way?
JRR Tolkein spent 12 years writing The Lord of the Rings. It feels like we’ve been waiting for the National Bus Strategy for a similar length of time.
While there’s a lot of excitement about buses going strategic, it’s worth remembering that it’s twenty years since the railway attempted its own exercise in being ‘strategic’, and we’re still living with the consequences.
So what should and shouldn’t be in the national bus strategy when it finally emerges?
Use power wisely
The benefit of a bus strategy must be to deploy the huge power of Government wisely.
The risk is that the bus strategy focuses too much on buses, and on too much central control of them. Virtually all the big challenges for buses are things that the bus industry cannot control.
So the bus strategy must focus above all on the management of the road network, on housing policy, on infrastructure investment and, above all, on taxation. It should not focus on buses.
The decisions on the list above will determine success far more than any policy decisions on buses.
Today we’ll look at these many areas where the bus strategy should focus on areas outside the bus industry’s control. Tomorrow we’ll focus in on the (smaller) areas directly pertaining to the bus industry.
Not that pot culture…
No more pot culture
While the strategy should not focus on buses too much, it must focus a bit on the DfT itself. Like many parts of Government, DfT has allowed itself to be swamped by what I call ‘pot culture’. I don’t mean that civil servants tend to be high most of the time; I mean that funding tends to be released in micro-tranches, each one allocated to a specific purpose.
This is not civil servants’ fault. Ministers tend to be like to have a specific announcement to make. Instead of announcing a single funding settlement worth £500m over five years to be spent on whatever the most appropriate priorities are at the time (booooorrrring…), ministers would much rather announce five £20m pots every single year for five years, each one with an eye-catching purpose.
(Indeed, I seem to remember DfT pots got their moment in the sun in spectacular style last year, when Grant Shapps valiantly tried to distract the Downing Street media pack from questions about Dom Cummings’ trip to Barnard Castle by announcing and re-announcing an upgrade to the A66; a road that goes within touching distance of, yes, Barnard Castle).
The problem with this approach is that it makes funding unpredictable, prevents long-term thinking by operators or local authorities and results in half-arsed initiatives all over the place that rapidly get forgotten.
The bus strategy is the moment for civil servants to get one over on ministers by extracting a commitment to long-term funding.
Last February’s announcement “A better deal for bus users” was not an encouraging precedent. It had more pots than a Derbyshire diner. But a ‘strategy’ is meant to be long-term in the way that an announcement is not, so make sure that any funding that is announced comes with a committed five-year settlement. This would do no more than equal the funding settlement for Network Rail or Highways England.
The funding that is announced should not be for zero-emission towns, demand responsive pilots or superbus networks: it should be for structural change that enables growth and improvement everywhere.
When backing new companies, venture capital investors focus most of all on whether a business is ‘scalable’. i.e. whether or not the business model proposed can achieve the same thing everywhere or whether it needs to be repeated over and again. The reason Uber was able to raise fantastic amounts of money is that once you’ve built the Uber app, it can be deployed anywhere. Whereas, for example, railway lines are ‘unscalable’ - you need to keep starting again. Funding zero emission towns is unscalable, funding a network of demand responsive routes is unscalable; whereas road pricing (to give an example) is scalable: once you’ve set it up once, it then benefits everywhere, forever.
You’ll pay for this
Road pricing
The first copy of the bus strategy should be sent not to the bus industry, but to HM Treasury. Why? Because the single most critical transformational change for buses will be road user pricing. I’ve written extensively about this here, so won’t repeat everything. But suffice to say that road pricing has the twin benefits of making car use on crowded streets (i.e. the ones bus users actually want to use) more expensive while simultaneously making buses faster (so making buses more competitive).
Road pricing is so overwhelmingly, jaw-droppingly sensible, that pages 1-50 of the strategy need to talk about nothing else. Remember, there are few things that are given away for free by Government without either pricing or rationing: healthcare, school places and road space are the biggest examples. Even drinking water is user-charged. Food is charged at commercial rates. And the Government has a black hole of £40bn of motoring taxes linked to fossil fuels that it must backfill. If it doesn’t, then motoring becomes cheaper and buses are doomed (meaning that everyone will be in jams forever and no-one will get anywhere). There is no more important strategic issue.
Moreover, if road pricing happens, many of the other items on the agenda fall away. A £2 bus fare becomes much more appealing if the car ride will cost you £10. Meaning more people will pay £2. Meaning that the bus will be commercial. Meaning the rows about subsidy, cuts and austerity can go away.
Lode Lane: seven words in white paint have made buses here cheaper to run and more attractive to use
Bus priority
However, let’s not just rely on road pricing as a silver bullet. It’s also absolutely critical that the strategy includes funding for bus priority infrastructure. As a reminder of how important this is, the Lode Lane bus lane in Solihull reduced bus journey times by 45%.
This should not be an endless series of one-off pots.
Instead, like everything else local authorities do, they should have statutory guidance combined with certainty of funding.
The strategy should pave the way for a further update to the Traffic Management Act 2004 statutory guidance published last year in response to Covid. This guidance was hugely encouraging. If anyone had told you, at the start of 2020, that by the end of the year, the Government would have issued guidance (with legal force) to ‘reallocate road space’, I don’t think you’d have believed them:
“Local authorities in areas with high levels of public transport use should take measures to reallocate road space to people walking and cycling”
But, of course, this guidance is very focused on active travel, buses are a distinct after-thought. The early messages from the DfT are not encouraging. Stephen Fidlar, DfT director of local transport, speaking last year about the bus strategy said the strategy would set an expectation:
'that when the government is funding road schemes going forward, we will absolutely be looking for those schemes to include active travel provision and to consider bus use'.
I’m a bit worried about ‘consider’ there.
The statutory guidance should require local authorities to upgrade main roads for bus and cycle priority.
Funding should come with it, but this shouldn’t be pots of funding, but instead DfT should simply work out a national budget, divide it up between local authorities and add it to their grants as part of a five year funding settlement.
That way, councils know what they’ve got to play with. The most efficient councils will do more, some will do less. That’s life. Some may even find they can save on the algorithm’s assumption on how much it will cost to meet their new statutory obligations and divert some cash to other council priorities. That’s ok - it’s their prerogative. Some will do the opposite. The government needs to treat councils exactly as good managers are expected to treat their teams: set clear expectations, provide the tools to do the job and then get out of the way.
Safe as houses
After the Treasury, the second copy needs to go to the Department for Communities and Local Government.
The DfT bus strategy must be a tool with which to beat their civil servant colleagues to ensure that housing policy finally supports, as opposed to damages, the prospects for bus growth.
Bus-friendly houses
There are some important litmus tests coming up: the new Garden Towns project is in danger of replicating the experience of virtually all new housing estates of the last 30 years: houses surrounded by car parking spaces on winding dead-ends. The car parking incentivises car use while reducing population density to the point where buses would be unviable; while the street layout makes it impossible to get a bus to peoples’ homes anyway.
The bus strategy needs to focus heavily on the necessary reforms of the planning system, and then drive through those changes with colleagues in DCLG.
One of the weaknesses of the British system of independent Government departments is a tendency for civil servants to focus on what they can control. In this case, they need to focus on what other civil servants can control. Because no-one else can fix the planning system.
Building the supply base
Another element of the bus strategy that should be the catalyst for more phone calls within Government is the need to strengthen the industry’s supply base.
The transport industry as a whole (and bus is much better than rail in this regard) suffers from the problem that it is large enough to use lots of bespoke kit but small enough that there aren’t many buyers. If you want to break into the bus industry, you’ll find that 70% of the bus industry is controlled by the ‘big five’ operators. To put this into context, Amazon’s share of UK e-commerce is 30%. There just aren’t enough small bus companies for suppliers to be able to break into the bus industry and scale, meaning that bus companies are dependent on effective monopolies in many areas. This isn’t healthy.
There are two potential solutions: the first is to enable new suppliers to grow. InnovateUK grants already do a great job in this area, and the bus strategy should be used to ensure that transport project gets a decent share of competition funding and prioritisation. As per the discussion on ‘pots’, these competitions should move from being one-off competitions to bids for longer-term support so that suppliers can scale up with confidence.
However, R&D funding is only part of the challenge. There is still the problem that there are just too few buyers. The bus strategy should be an opportunity to put the ‘big five’ on notice that there are many areas in which they need to demonstrate the value the industry gets from its current levels of centralisation (leadership development being another).
In summary…
The big issues for the bus strategy aren’t about buses. They’re about road pricing, housing and use of road space.
Only when it’s finished that lot should the focus turn to the actual buses. This should not take the form of structural change but on intelligent reform of concessionary fare reimbursement, mobility credits and supporting marketing.
We’ll talk about these points tomorrow.
