Month: July 2012

The work continues on subsidised bus routes for Brighton & Hove. You can read the story so far in my previous posts. We made some important decisions at yesterday’s Policy & Resources Committee.

In summary: To cope with government cuts the council budget, agreed by all parties, included the need to find a saving from the bus subsidy budget. Combined with the pressure of increasing fuel costs and a government cut to bus operator subsidy this made for a challenging, pressured issue.

Strictly speaking the law requires bus companies to not run any routes or parts of routes which are unprofitable. This was probably intended to prevent anti-competitive ‘loss-leader’ services by one company to undercut another. The result however is that some routes don’t operate without a council subsidy.

Two key issues at hand were school bus routes, some of which were costing the council over £1,000 per child per year (plus the £240/year parents pay for a pass) while child numbers are declining and also some non-school routes which were costly to keep going.

As we have long said, we are working on alternative approaches to school transport. So yesterday Greens proposed, and the committee agreed, that we procure one year contracts for services on the 74 and 96 school routes. These will be for smaller vehicles under more flexible terms which we estimate will be half the cost of the services as they were currently run. These will be funded from one-off funds.

For the other services, as I have said many times, only by proceeding with the procurement as we did last month could we flush out which services could continue commercially, without subsidies. It was a strong approach which has shown that a number of evening services will now continue without council taxpayer support.

The one change to the services previously run is the 52 route which will now terminate at the Marina. There was also a very unfortunate administrative error which resulted in one route being given to the incorrect operator – that is being corrected, and everything has been reviewed by senior officers to ensure it’s all now proper and correct.

Still now with the information we have from the commercial bus companies, which was only possible by the approach we took, we are in a position to keep services going on all routes that were previously subsidised but with a saving of £230,000 per year.

The opposition, particularly the Labour group, have been continuing to claim that they did ‘deals’ with the largest bus company to ‘save’ routes and also that their ‘campaign’ including a petition had pressured us into changes. This continues to be complete nonsense. We said we’d do what we have, and we have. No deals have been done with the bus companies – Roger French has made absolutely clear that there hasn’t been a deal. Indeed it wouldn’t be legal, the bus companies have to make their own commercial decisions on which routes they run. The remainder have been procured through EU rules.

Both opposition parties have been in administration and know the way you have to negotiate procurements with bus companies, as we have successfully done. Their comments and campaigning indicate that they are either naive over these processes or being intentionally misleading about how they work. Either way it’s not good for them. They’ve been completely wrong-footed by our actions.

So let’s remember, we’ve delivered on what we said we do and all the services keep running with a significant saving for council tax payers.

There has been, understandably, some controversy since the council proceeded with a reduction in bus subsidies. This was a reduction agreed at budget council which we have now had to implement at a recent Policy & Resources Committee meeting. The impact was exacerbated by a government cut in the bus operator subsidy as well as increasing fuel costs. Still we have proceed with the smallest reduction in subsidies we’ve been able to identify compared to any other council, affecting less than 0.33% of bus passenger journeys in the city. You can read much more on this in my previous posts.

Two points to re-iterate from my earlier posts are that:

1. We have been saying since January that we will be looking to provide school transport in different, and lower cost ways. Some school bus routes were costing over £1,000 per child per year (in addition to the £240 their parents were paying for a bus pass each year).
2. We have always said during this bus subsidy procurement process that it was likely we would see some services being continued by the bus operators on a commercial basis, even after the subsidies were withdrawn.

Despite the decision on the procurement having been properly agreed by a committee of the council, the opposition have been threatening to suspend the rules at the next full council meeting, ignore administrative law and revert the committee’s decision to save the services at risk.

This would be a very foolhardy approach by the opposition, for reasons I am likely to need to go into in another post soon. However, as I also did before the Policy & Resources Committee meeting, I have been speaking to the opposition group leaders to see if there was another way through all this. Now, as is usual, these are private discussions and negotiations. Regardless of whether they succeed or not, they are not for public consumption. Those private conversations are key to successfully finding productive compromises and seeking out agreement. Sadly that privacy was breached today.

I rang Cllr Gill Mitchell, leader of the Labour & Co-operative Group, to discuss an offer in reply to her opening pitch. She asked me to explain my reasoning, and I did so. She then said that she would “get back to me” on the offer. She didn’t. But Labour then put out some tweets and a press release partially quoting what I said in that call.

This was a clear breach of trust. I am left with the need to explain what has happened. The confidence has been broken so I will expand on discussions I would ordinarily not have explored publicly.

In seeking to negotiate the opposition haven’t budged their positions one inch and were looking to commit the council to almost £200k more of spending each year for the next 4 years (the Tory request was marginally cheaper than the Labour one, but the same order of magnitude). I couldn’t commit to spend that much extra money as we don’t have that amount of spare cash in the budget as recurring income. One-off spend from last year’s underspend or capital investment could not be used to support such a four year commitment.

The offer I made this morning was just over £55k a year being used to procure more cost effective school transport for the 96 and 74 routes. (I seek to treat each opposition leader equally. However I had not been able to speak to Cllr Geoffrey Theobald for the Conservatives, but managed to speak to Cllr Mitchell, who I was told was at work.)

It seems to me that Labour had no desire to find an agreement nor common ground, otherwise they could have responded to me with a counter-offer or some kind of comment. But they didn’t, they went straight to the press.

Not only did they partially report our conversation, Labour also claimed that they had negotiated a ‘deal’ with Brighton & Hove Bus Company to save a number of routes at no cost the council. Yet this was completely untrue. As I confirmed this afternoon with Roger French, who heads the bus company, no deal was done with anyone. He was going to make a commercial decision, on his own, to keeping running some of the services after the subsidy went. Just as I have been saying was likely for some time, and indeed happened before in the past when subsidies were withdrawn.

For Labour to suggest they had made this happen was simply untrue, and not in their gift. There was and is no deal there, and the bus company have confirmed this to the media. The council ran a procurement, companies won different subsidised routes to operate out of that, then they make commercial decisions on what else they run. This is the proper and legal way in which buses have to operate outside of London in this country.

It’s sad that Labour are seeking to make short term political points out of the bus issue, even more disappointing that they’ve done so by attempting to mislead.

These are difficult times for the council and our local economy, all parties should be putting the city before politics. But there is good news… so far since the new parking charges came in Roger French reports a 4 to 5% increase in bus journeys on an average week, and visitor numbers continue to go up.