The Chartered Institute of Logistics and Transport (CILT) has written to the Secretary of State for Transport to urge government to examine the problems that face local public transport, especially commercial bus services, as a result of measures to battle the Coronavirus and ensure that all parts of the public transport network must receive equality of treatment.
In a letter to The Rt Hon. Grant Shapps, Kevin Richardson, Chief Executive, CILT(UK), said:
"As you know, CILT is the membership organisation for professionals leading supply chain operations for the movement of goods and people. There is emerging concern amongst members in bus companies and local authority transport co-ordination that the consequences of the loss of passengers resulting from measures to control the spread of the virus have not been fully appreciated.
In recent days there has been welcome advice from your Department to bus operators and local authorities that BSOG, concessionary travel reimbursement and contracts for supported local bus services should be maintained at pre-crisis levels to assist the cash flows and financial stability of bus operators. Your Department has also assumed the entire revenue risk for franchised rail services, just as Transport for London does for London Bus Services.
Bus operators’ income in Great Britain outside London comes from the public sector as above and from commercial services operated at the operator’s sole risk. Industry wide around 60% of income is generated by commercial services, but this average conceals significant variations from smaller operators largely dependent on contracted services to larger concerns with relatively little contract income. Available information suggests that the overall loss of patronage is probably averaging at least 75% and in some areas may be approaching 90%. The Government has not so far offered any support to compensate for this loss of patronage, much of which arguably results from the Government’s (entirely justifiable) policy of avoiding use of public transport whilst the crisis lasts.
This is perverse. Operators whose business derives substantially from the public sector will be protected to a great extent from the impacts of the virus on their businesses – indeed to the extent that they are able to save on operating costs the outcome might be close to pre-crisis levels. Operators whose business is largely commercial have far higher inescapable fleet, premises and staffing costs and their peak services are essential for many low-paid key workers. Maintaining BSOG and concessionary travel payments will help but a fully commercial operator will see a drop of over half their income with little scope for cost reduction. Inevitably as normality returns significant fares increases or cuts in service levels in the busiest parts of the network can be expected, both of which are contrary to the Government’s strategy of protecting the economy so that pre-crisis performance levels can be resumed as quickly as possible.
Ministers have often referred to buses as the most popular form of public transport, perhaps confusing popularity with frequency of use which was almost 60% of all public transport journeys in 2019, almost three times as many as on the national rail network. In contrast, current expenditure on local public transport from public funds was only 40% of current expenditure on railways in 2018/19. Buses are not the only form of local public transport of course, tram and Metro systems and services provided by community transport operators are also included under this heading.
CILT is very appreciative of support and communication from the Department of Transport during the last few weeks and we ask you to extend that together with your Treasury colleagues and examine the problems that face local public transport, especially commercial bus services, as a result of measures to battle the Corona Virus and ensure that all parts of the public transport network receive equality of treatment. When the current crisis has passed we shall be dependent on those services playing their part in continuing campaigns towards net zero carbon and minimal levels of harmful emissions."