What is the national picture of the
emerging situation for supported bus
services in the light of the Spending
Review?
Headline results from the ATCO snapshot survey of English
councils, February 2011.
Planned cuts in 2011/12
100%
80%
Shires
Unitaries
PTE
60%
%
40%
20%
0%
<25%
26-49%
>50%
Volume of spend (supported bus services)
In 2011/12, 65% of Shire Counties will cut their budgets by 25% or less, another 30% of
Shires will cut by up to 50% and 5% of Shires will spend more than 50% less compared with
the current financial year.
Estimated cuts in 2012/13
100%
80%
Shires
Unitaries
PTE
60%
%
40%
20%
0%
<25%
26-49%
>50%
Volume of spend (supported bus services)
This trend continues in 2012/13, although the percentage of the budget increases as the
overall investment in supported services declines as a proportion of councils spending.
Local authorities were asked about their strategies to deliver reductions.
These are typical responses received.
Levels of patronage based on cost per passenger, but also re-designing services
using DRT/feeder services to protect core daytime network.
Mixture of cost per passenger and main purpose of service - with leisure services
having the lowest priority for funding and a service which is the sole or major
provider of access to employment, shopping, health or training opportunities
having the highest priority for funding.
Net subsidy per passenger
Total withdrawal of all subsidised routes over 4 years.
Service reduction based on principle of, where possible, avoiding complete route
withdrawals, seeking instead to reduce frequencies and choice of travel times.
Also targeting for withdrawal services which cater for non-entitled school
travellers.
There are service reductions being brought about by concessionary fares but also
daytime frequency reductions on local routes. A further route will be reduced
from all day Monday to Friday to morning, evening and one lunchtime journey.
Services which no longer meet the criteria, where reasonable alternatives exist
and then in order of cost on the day of the week - so most expensive Sunday
contracts first, then evenings and Saturdays.
Revenue to cost ratio i.e. contracts are required to meet 40% of their costs
through revenue. Proposed withdrawals are for services that fall below this.
2011/12 fares increase and withdrawal of out of policy services, Further cuts
following review of bus subsidy
Currently based on a £ per passenger/ passengers per bus hour strategy
Focussing on services which are lower priority and high cost / passenger. In
practice Sunday evenings, some low use / high cost journeys or services, and
services which provide a wider choice of destination (e.g. shoppers buses to not
the nearest town), thinning out secondary strategic routes and rural networks
where they are relatively poorly used and / or where would not leave an area with
less than a daily weekday service. Could undermine the daytime service viability.
Across the board reductions, typically Sundays, evenings, rural routes.
Weekends and evenings make up a large proportion along with reduced
frequencies but also include services to academy schools.
ATCO asked what councils anticipate the operators’ response will be to
both Comprehensive Spending Review and Concessionary Fares
reductions. Councils said:
•
We anticipate some withdrawals of services, contract and fare increases
•
Higher fares, higher tender prices, reduced frequencies on commercial services
and commercial deregistration
•
A combination of withdrawal of poorest performing commercial services, higher
tender prices and handing in of some contracts
•
Services / part of service analyzed on basis of subsidy cost per passenger trip with
differing maximum thresholds for categories of service - daily, less than daily, last
remaining weekly link, leisure, evenings & Sundays. Differential thresholds afford
some protection to less than daily (typically rural) services
•
Operator response to CSR - hope to work with us and retain as many services as
possible but nothing is set in stone
•
We are not currently expecting a huge response from operators. If we had used the
reimbursement calculator as initially provided, before additional data was
submitted from the bus companies, we could have seen some significant off peak
and supported journey reductions
•
We believe that CSR will not have a direct effect on the main commercial
operators as they operate very few of the tendered services which are likely to be
withdrawn. CF (and BSOG) is likely to lead to increased commercial fares first and
service rationalisations second. In respect of other operators, we do anticipate
having existing tenders handed back throughout the course of the year, but have
no specific knowledge as yet of the scale
•
Concessionary fare reductions have been agreed with operators and CSR reductions
causing some concern
•
Already started with significant service cuts
•
No significant concerns for 2011. Our major operator has already cut a number
of evening and Sunday journeys in the city over the past year or two. These cuts
have largely not been picked up by the Council (with a couple of exceptions). The
proposed BSOG reductions in 2012 could well result in marginally commercial
services no longer being viable. With the Council not being a position to bear the
resulting cost, it could be a difficult year with cuts in bus services anticipated
•
Concerned that some of supported service reductions may undermine viability of
commercial services (e.g. where are withdrawing support for higher level of
service on an otherwise commercial route). Have assumed that will need to find
estimated £500,000 to replace commercial withdrawals and fund increased
contract costs resulting from reduction in BSOG from 2012 - this is included in the
derivation of the savings targets. Aim of CF 'fixed pot' negotiations is to avoid
major service withdrawals and uncertainties that all our operators have made it
clear would result from application of the new DfT calculator. We have been
advised by our CF consultant that to use the calculator without
significant amendment to reflect local circumstances would not achieve 'no better
no worse'.
•
We are optimistic that part of the currently non-commercial network will be taken
on commercially from September. The ongoing local significant shortfall in
concessionary fares funding is of huge concern to the Council and in turn to the
principal operator
•
fairly significant reductions in commercial services
•
Increased deregistration of commercial services. There is no evidence (yet) of
increasing tender prices
•
Fares increase already announced in this patch. Network of major operator is
shrinking, deregistration account for around a 10% reduction in their total network
Concessionary fares are a key factor in the budget situation facing each
council. ATCO wanted to know what the typical position was, and
whether councils were managing to reduce the costs of the scheme, in
line with the Government’s aspiration.
Estimated change in reimbursement costs,
comparing 2010/11 to 2011/12
10%
5%
%
0%
Shires
Unitaries
PTE
-5%
-10%
Local authority type
The results suggest that the reductions in reimbursement are not meeting the reduction
targets of around 15%, suggested by Government. In some instances, councils said
networks were already reducing as a result of commercial deregistration and the use of
the DfT calculator was patchy.
Snapshot ATCO survey February 2011