§ Lord Bradshawasked Her Majesty's Government:
Further to the decision by the Office of Fair Trading to let the Wales and the Borders franchise to Arriva Trains on the ground that Arriva operates bus services in part of the area covered, whether transport operators should have available a public interest defence when proposing through or joint tickets and services. [HL5262]
§ Lord Davies of OldhamThe Wales and the Borders Franchise was awarded to Arriva plc by the Strategic Rail Authority. Continued participation in existing integrated transport schemes (e.g. rail-bus links) was a requirement for all the bids for the franchise but it was not a critical factor in the selection of the franchise operator.
The Office of Fair Trading is required, under the Enterprise Act 2002, to investigate the impact of the franchise award on the bus operations of Arriva plc to the extent that they overlap with the rail services. In doing so they will take into account the views of third parties including user groups.
The sale of through tickets covering both a rail and bus journey seldom has competition implications because the operators of each stage of the journey are not normally competing with each other for the passengers making the journey.
The public transport ticketing schemes block exemption allows transport operators to agree to through or joint ticketing schemes, subject to certain conditions, notwithstanding the general prohibition on pricing agreements in the Competition Act 1998.
The Transport Act 2000 gives local authorities powers to make ticketing schemes for local buses which may include connecting rail or tram services. Even where a scheme has a significantly adverse effect on competition, but secures improvements in local bus services, or reduces congestion or pollution, it satisfies the competition test in that Act if the benefits achieved are proportionate to the restrictions on competition.