Rural Bus Services (Hansard, 9 June 1986)

§ Mr. Geoffrey Dickens (Littleborough and Saddleworth)
I sought to secure an Adjournment debate on rural bus services because I felt that, although the Government are past masters at introducing sound legislation, I was not at all sure that they are past masters at selling some of it to the general public. I often feel that we have lost the propaganda war on rural bus services.
Littleborough and Saddleworth is a collection of small towns and villages nestling in the Pennines on the outskirts of Rochdale and Oldham. These villages rely very much on—[Interruption.] —public transport——

§ Mr. Deputy Speaker (Mr. Harold Walker)
Order. I ask hon. Members who wish to have private conversations to conduct them outside the Chamber.

§ Mr. Dickens
As I was saying, Mr. Deputy Speaker, the villages in my constituency rely heavily on public transport. That is especially so for the elderly, who have no vehicles of their own. This being the position, I was greatly disturbed during the local elections when Opposition parties made it their business to circulate misinformation and indulge in scaremongering by pushing leaflets through the letterboxes of my constituents, which were disgraceful and in many instances entirely untruthful. One example bears the headline: Prepare for the worst. Your local bus may soon disappear. It sets out all the instances where routes have not been registered.
The Government's deregulation legislation was carefully designed. One of the major objectives—this must be said, as it is no good mincing words—was to save taxpayers' money. In the old Greater Manchester council area it was costing £30 per head of population per year to run the bus services. In many of the shire counties it was costing only £5 on the same basis. That was crazy and there was a tremendous drain on the taxpayers and ratepayers in my constituency.
When the Opposition parties were telling the elderly in the villages in my constituency that they would lose their bus services, they neglected to tell them that in place of the large, single-decker bus that used to run infrequently to the villages, at times not linking passengers with the return buses for two hours, which meant that they had to spend a long time in the freezing cold or enter a cafe for a cup of coffee, for example — it was a deplorable service about which they were always grumbling—it would be possible for operators with taxis and minibuses to tender for the routes which other operators found less favourable.
Without question, the more profitable-looking routes have been tendered for and secured by the deadline. D-day for the buses to come into the new system is 26 October, at which time the small operators may be invited to tender for the less profitable routes. If they win the routes in proper tender the Government have made available £20 million in subsidies for rural transport areas. The operators will be able to take advantage of cheaper prices for diesel and petrol. In addition, the leaflets neglected to state that arrangements can easily be made for concessionary passes to be used for taxis and minibuses.
152 These issues must be brought to the attention of the public.

§ Mr. Tom Sackville (Bolton, West)
In Bolton, which is not far from my hon. Friend's constituency, there has been a mischievous and misleading campaign — especially frightening for the elderly — about bus services being withdrawn later this year. No mention has been made of the considerable subsidy that will be available and of the considerable saving that can be found. All in all, that has been misleading. I am certain that it will turn out that no necessary, and certainly no socially necessary, bus routes will be withdrawn, and many of those fears will turn out to be ill-founded.

§ Mr. Dickens
I am obliged to my hon. Friend. That is the point that I am making.
The small operators can bid for those routes until 26 October. If they secure them, they have to give a guarantee that they will run them for a minimum of three months. so that there is security for the villagers. If they drop out, others can take their place. If we reach D-day for buses— 26 October — and the local passenger transport authority has not gone to the trouble of putting the routes out to tender, people can just take on those routes. I could get my lads to drive minibuses, if I wanted, or unemployed people could start a transport company of their own, as long as they maintained the high safety standards that we would continue to expect.
All in all, there are many frightened people in the villages. When one lives in a village, one is pretty isolated, and villages die without transport links. Even the youngsters start to move away if they do not have the proper transport, village to village, and village to town and back for major shopping. The matter is critical.
One can understand how the Conservative party took such a thumping at the two by-elections, because the local buses became a big issue. All the misinformation, scaremongering and myths created were ingredients for winning votes. One wins votes by fanning anxieties. If one can introduce an anxiety into somebody's mind, one confuses the person. He feels, "For goodness' sake, if the Conservatives are going to leave us without buses, I had better vote for one of the other parties." We were left in a vulnerable position, which was reflected in the opinion polls, which then started to reflect on the local government elections. So rural buses was a big issue, bigger than I think Her Majesty's Government realised. We lost the propaganda war because we did not sell our excellent policy.
I have said locally that what we are seeking to do is provide a more regular service with tailor-made vehicles of the right size, perhaps running more frequently, at sensible prices. They can take advantage of subsidies and low petrol costs. Concessionary passes can he used on those smaller vehicles. That can be done if the routes are secured through competitive tender.
It is time that we spoke up about the matter and started to sell our policies. I feel deeply that it is no good putting forward sound, sensible legislation in the House and then failing to explain in careful detail to the public exactly how it will affect them. I felt that the misinformation was a disgrace, so I applied for this Adjournment debate so that at long last we could start to forge through and win the propaganda argument and sell an excellent scheme. I hope to see the small buses running in and out of my villages 153 with great frequency, to the town centres and between the villages, as they are in many parts of the country, happily and successfully.

§ The Minister of State, Department of Transport (Mr. David Mitchell)
My hon. Friend the Member for Littleborough and Saddleworth (Mr. Dickens) has admirably redressed the balance in the argument about rural bus services, and I am grateful to him. For far too long we have had one horror story after another put about by the Government's critics.
My hon. Friend referred to leaflets that were put out during the local government elections. My hon. Friend the Member for Bolton, West (Mr. Sackville) referred to problems in his constituency, where similar leaflets and attempts to deceive people have occurred. It must be a matter for great regret that the hon. Member for Ryedale (Mrs. Shields) is not here. If she had been, we would have been able to hear whether she just did not understand the bus legislation when she made it such a central part of her election campaign, or whether she did understand it and knowingly deceived her constituents into believing, as the propaganda that went around at the time suggested, that if services had not been registered, people would be without a bus service.
My hon. Friend the Member for Littleborough and Saddleworth has given us an opportunity to redress the balance. Party politicking is one thing, but frightening the elderly by deceiving them into believing that they will have no bus service is quite another. It is wholly reprehensible when parties play politics on the worries of the elderly.
To listen to people, one would think that we deliberately set out to do as much harm as possible to people who live in towns and villages and who depend on bus services to get around. One would also think that those bus services were doing quite well until we disturbed them. The facts, of course, are very different. There is a sorry tale of 30 years of decline. Our policies must be seen in their true historical context.
During the past 30 years, there has been a steady decline in bus services, especially in rural areas — rising fares have helped to create that— and a loss of passengers. Bus services have operated at a loss in their thousands. They have been cut, and villages have been left without services. Sunday services have been cut and there has been chronic decline. If anyone doubts that, they should ask the 10,000 National Bus Company employees who have lost their jobs what they have to say about the past decade.
During the past 10 years, subsidies have risen from £83 million to a massive £558 million. My hon. Friend spoke of reducing the subsidy as one of the Government's primary objectives. That is not so. The Government are trying to stem the decline. We accept that chucking money at it does not resolve the problem. If it did, the problem would have been resolved.
Our purpose is not to cut expenditure in the Transport Act 1985. We estimate that the £100 million spent in the shire counties is about the right amount. It is quite true that expenditure in the metropolitan counties has been wildly in excess of what any reasonable person would judge to be right and proper. There are mechanisms for cutting extravagant local government expenditure other than the bus legislation. Saving money and reorganising bus services are two separate matters.
154 The decline in bus services has been due partly to the growth of car ownership, but local monopoly and lack of competition have been enormously important in stifling innovation and enterprise. A fresh approach is urgently needed to to adapt to changing patterns of passenger demand. In his admirable speech, my hon. Friend talked of a large bus and frequent service. That is an example of how local monopoly has inhibited change and innovation to meet the market. We see passing our doors double-decker buses carrying only a couple of people, when people want more frequent services of smaller vehicles, which more nearly match the size of the market. If there are only two people, it is much cheaper to carry them in a taxi operating as a bus service.
My hon. Friend and I both recognise the tremendous need for bus services, especially in rural areas. Many people do not own a car and many families own only one car, which is used by the breadwinner to travel to work, leaving the rest of the family dependent on buses for the rest of the day. Our concern for such people is a major influence on our policy for deregulation. The 1985 Act was introduced to stem the ongoing chronic decline which year by year produced fewer buses to serve our rural communities.
As my hon. Friend is aware, the first phase of transition to competitive and deregulated services was passed on 28 February, when operators had to register those services which they intend to operate commercially after "deregulation day", which is 26 October. Unfortunately, owing to much irresponsible scaremongering from people who should know better, it is still necessary for me to stress that the registration of commercially viable services by 28 February was only the first stage in the abolition of road service licensing. My hon. Friend has given some examples of this black propaganda. Not so long ago, people were predicting that disaster would strike on registration day, with only a small fraction of existing services surviving the test of commercial viability. In fact, 75 per cent. of existing services have been registered.
That is an immensely encouraging result, when one considers the high level of blanket subsidies now being paid. Obviously, when we point out that the cup is three quarters full, there will always be those who try to turn that against us by complaining that it is one quarter empty. But local councils will now fill up that one quarter. They have the resources and the opportunity to do so. Anybody who has been led to believe that services which have not been registered will not be run have been deceived by those who suggested that.
Councils are at present considering which of the missing services they should direct their considerable sums of subsidy to purchasing. The new system of competitive tendering for local authority subsidy will ensure that local authorities will get more services for ratepayers' money than previously.
Only last week the newspapers reported that the Highland region—not an area which one would expect to produce a great deal of competition for tenders— has already reported savings of £179,000 of ratepayers' money. That is an encouraging, but not unexpected result which augurs will for the rest of the country.
Local authorities have sufficient funds to support socially necessary services, and the new requirement to go out to tender for services which need financial support will ensure that they obtain better value for money and can make their funds go further.
155 For many rural services, minibuses, shared taxis and other unconventional solutions will suit local circumstances far better than a double-decker bus running down country lanes with only a few people on it. Indeed only last week I read that a new taxi bus service which has started in Somerset and replaced a conventional service, has been so successful that the operator is considering extending it. We hope to see many other taxi and minibus firms tendering for services or, even better, running them commercially.
Now that the registration network is known, there may be cases where people can see that there is a service that the lower operating cost of the smaller vehicle could make commercial. Although the registration date is passed, I would like such people to know that they still have an opportunity to seek a registration of such a service with the consent of the county council or the PTE. There is plenty of scope for new services to come in, and I hope that they will do so on the routes on which nobody has yet registered a service under the registration opportunity.
I can illustrate the sort of things that might happen. I understand that some 70 taxi-operated local services have already been registered to run from October. My hon. Friend will have seen the series of leaflets that we have already produced, and distributed widely. We have a further leaflet and booklet called "Getting on the Road", which we shall publish very shortly, offering advice to people contemplating setting up a bus service for the first time. Once we have got past the transitional period, which is necessary to ensure a smooth transition from licensing to registration, operators will be able to register services to start at any time from 26 January 1987 onwards with just 42 days' notice.
In this context, operators do not need to ask the consent of anyone to do it. They register their service, and provided that they have an operators' licence, with 42 days' notice, they can go ahead. We have already seen evidence of the enterprise which deregulation has introduced in Brighton, where taxi operators are planning to run a circular taxi-bus service to outlying suburbs late at night, and in Hampshire, where Hampshire Bus has reversed past thinking by increasing the frequency and using smaller vehicles on loss-making services in the Hythe area instead of giving up and reducing frequency. In many parts of England—in country towns such as Taunton and Exeter — as well as bigger cities, we are seeing minibus services spring up, giving the sort of frequent, rapid services that customers deserve.
My hon. Friend made a point about the transitional rural bus grant. We realise that it will take longer for the financial benefits of competition and tendering to work through in rural areas than in town and cities where the scope for competitive services is greater. Therefore, we have introduced the transitional rural bus grant, which will be worth £20 million in the first year, reducing gradually 156 during the next three years. In the first year, the current year, operators of most local bus services will receive 6p for every vehicle mile they run in rural areas. That can tot up to a considerable sum. In addition, they get the fuel duty rebate, which is 74.5p per gallon for diesel and 88p for petrol. This demonstrates the Government's very real commitment to supporting existing rural services and encouraging new ones.
Just so that we have it clearly on the record, I point out that these sums are in addition to the subsidy that can come on a tender. The county councils and the PTEs are now in the process of preparing invitations to tender for socially necessary services for which any operator with a licence can put in a bid. If he gets that bid, and the route is in a rural area, he will get not only his 6p a mile, and on top of that his fuel duty rebate, but on top of that, a monthly cheque from the county council or the PTE for the agreed contract price for providing that service. This adds up to an attractive package which should be more widely known.
To help rural communities take advantage of the opportunities provided by the new services, we are providing the Development Commission with £1 million a year for innovative ideas and to help to get new services off the ground in the rural areas.
In conclusion, I share my hon. Friend's concern at the campaign of distortion and innuendo which is designed to alarm people unjustifiably and to turn them against our policies before they have been given a chance to work. Our opponents have had a field day because the transition to deregulation has left a period of uncertainty before local authorities have made known their decisions on subsidies and contract services.
I am confident that our opponents will be proved wrong. The proof of our policies will come after deregulation day on 26 October. People will see that their local bus networks have not disintegrated as the Jeremiahs predicted. They will see the benefits of deregulation in terms of competition in fares, wider choice on popular routes and innovative minibus and taxi services which will cater for their needs better than before. We shall win the argument where it counts—among the bus passengers in our cities, towns and villages. I am grateful to my hon. Friend for giving the House this opportunity to discuss these matters, even at this hour.
Perhaps when the next election comes around or when, in the autumn, services do not disintegrate as our opponents have predicted, some people may be courageous enough to stand up locally, to be reported in their local paper, possibly with banner headlines as were used in the scare stories, and say that they deceived people. Perhaps they will then accept that we have brought to an end the reduction in bus services which has been such a feature of recent years.