'Benefits' of privatisation/Deregulation

[Isle of Stroma]

It's no secret that I'm not the greatest fan of the above, but it's occurred to me this morning that the 40th anniversary of deregulation is roughly 18 months away. Also this morning, I've been scanning through an ebay purchase that contained news of WMPTE's launch of an annual bus & rail Travelcard. So I thought I'd see just what financial benefits Deregulation has bought to our pockets:

A quick check on TfWM shows if you were to buy an annual Bus & all zones Rail pass today, it would cost £1540. Granted, you've got almost 15 miles of Metro to play with at the mo' as well.

The WMPTE bus rail pass??? When launched in 1985, it cost £180. The Bank of England's inflation calculator advises me that it equates to £549.25 today.

Nearly a threefold increase for something that we used to but no longer 'own'. Obviously I was wildly wide of the mark with my criticism... 

[Steve3229vp]

One of the main benefits of deregulation was a mistake that was made in November 1975 was finnally rectified. The former Midland Red service 154 (Birmingham - Solihull via Shirley and Bloosomfield) being withdrawn and replaced by a local 189 service with the idea of changing to the train, the link from Birmingham was made by the 92 extended from Hall Green to Cranmore Boulevard. The residents of Shirley and Solihull were furious.
When Deregulation arrived in October 1986 a new service 6 was introduced which was near enough close to the original 154 service.
The 6 will be 40 years old in October !

[j789]

It's no secret that I'm not the greatest fan of the above, but it's occurred to me this morning that the 40th anniversary of deregulation is roughly 18 months away. Also this morning, I've been scanning through an ebay purchase that contained news of WMPTE's launch of an annual bus & rail Travelcard. So I thought I'd see just what financial benefits Deregulation has bought to our pockets:

A quick check on TfWM shows if you were to buy an annual Bus & all zones Rail pass today, it would cost £1540. Granted, you've got almost 15 miles of Metro to play with at the mo' as well.

The WMPTE bus rail pass??? When launched in 1985, it cost £180. The Bank of England's inflation calculator advises me that it equates to £549.25 today.

Nearly a threefold increase for something that we used to but no longer 'own'. Obviously I was wildly wide of the mark with my criticism... 

if you compared fuel costs, wages, new vehicle costs, etc from the 89s with now, they will also have risen well beyond the inflation rate so fares have had to keep pace too. A regulated market would have had the same costs and no doubt the non-bus/train using majority of the population would have had plenty to say with their constantly increasing council tax to pay for this.

De-regulation has plenty of faults but ultimately, it is private companies who carry the risks, not tax payers. If Labour actually published real, not 'adjusted' figures for the actual costs of regulating London, Manchester, etc, people would certainly kick up a stink about it. Obviously though, political spin is used to make it all look great and 'cheap', the reality being the opposite of course. 

[Crosville]

One benefit, the ending of arrangements were companies [often NBC companies] were restricted from picking up & setting down passengers, in some Towns & Cities, particularly if their was a Municipal operating in the area, for example, before d-reg Ribble were prevented from carrying local passengers in Southport on all their interurban routes, d-reg ended that.

[Stu]

The benefit of deregulation was of course the removal of the financial burden on local taxpayers.

I was about 11 years old in 1986 so I'm not an 'old-timer' and I don't really know anything different to how things have been all my life.

As I see things though, with bus services switching into the hands of commercial businesses, I imagine many people would have been happy to see their 'rates' being reduced - the equivalent of council tax nowadays - as bus service operations were paid for by the people who used them, ie the private companies earned money through fare revenues, which covered their operating costs and allowed them to make profits, which could be reinvested into the business.

With the exception of tendered contracted services, taxpayers shouldered little burden. If bus services weren't making money, they could be withdrawn or revised in ways to attract more passengers to use them.

Bus services cost money to run, and they need paying passengers to make them financially viable. This wasn't really a problem for many years, and despite the 'dominance' of West Midlands Travel (today's NX Bus), other enterprising businesses were able to set up competing operations or offered innovative new routes to try out.

Where things have been going wrong in recent years, is that despite inflationary cost pressures - everything has been drastically going up in price, whether that be fuel, staff wages etc - there has been a resistance to increase bus fares and ticket prices.

My monthly bus pass costs me £59 by direct debit. That is still less than it was a few years ago - in 2020 this cost me £61 a month, and was only valid on NX Bus services at the time, now it is £59 a month and I can use on any bus operator.

In the meantime, many other things that I buy regularly have nearly doubled in price.

It's no wonder that so many bus services are now deemed 'commercially unviable' because the fares revenue being received has not increased in line with the inflationary costs of providing those services, at the same time as the number of passengers has not increased significantly since the 'pre-Covid' times'.

The Mayor bemoans having to provide £50m worth of funding a year to private companies to keep their commercial bus network from collapsing, yet is prepared to spend even more, just so the WMCA can 'take back control'.

It will cost more than £50m a year in contract value for a franchised (regulated) service delivery model - don't forget that the contract prices will cover the bus company's operating costs as well as allow for a small profit margin, which means that private companies will still end up running bus services and will make a profit, even if the buses run around empty. The WMCA has the ambition that fares revenue will cover the costs of these contracts and allow for paying for fleet renewals and other depot and network investments.

In my opinion, if private companies cannot make the current commercial deregulated market 'work' for them in the current economic conditions, which means they need grants and support funding from local and national government (ie, taxpayers), then I fail to see how a 'franchised model' will deliver benefits to taxpayers financially. Because any shortfall from fares revenues will have to be made up via increases in council taxes or 'mayoral precepts'.

The money has to come from somewhere - cheap fares, or a 'world-class' public transport system, I'm afraid you can't have both, without someone having to pay the price. And that's either the people who use the system, or those that don't.

Don't get me wrong, I do think that a franchised or 're regulated' model would have some advantages and benefits, with regards to deciding routes and setting timetables, but I do think that anyone who is expecting buses to be running every five minutes on all roads and to be keeping perfect time is going to be sadly disappointed.

As for downsides of deregulation, at some point bus companies weren't apparently allowed to use their more profitable routes to 'subsidise' their less-profitable ones, presumably for 'competition' reasons. This will be another reason why some 'marginal' routes have ended up becoming subsidised tender awards in the last few years.

[Steve3229vp]

My monthly bus pass costs me £59 by direct debit. That is still less than it was a few years ago - in 2020 this cost me £61 a month, and was only valid on NX Bus services at the time, now it is £59 a month and I can use on any bus operator.

You're right. The Buses only pass in 1987 was £21 which inflation adjusted would be £61.63 today and that was only on West Midlands Travel Buses, now as you said your paying £59 now on all opertors.

[Wumpty]

The benefit of deregulation was of course the removal of the financial burden on local taxpayers.

I was about 11 years old in 1986 so I'm not an 'old-timer' and I don't really know anything different to how things have been all my life.

As I see things though, with bus services switching into the hands of commercial businesses, I imagine many people would have been happy to see their 'rates' being reduced - the equivalent of council tax nowadays - as bus service operations were paid for by the people who used them, ie the private companies earned money through fare revenues, which covered their operating costs and allowed them to make profits, which could be reinvested into the business.

With the exception of tendered contracted services, taxpayers shouldered little burden. If bus services weren't making money, they could be withdrawn or revised in ways to attract more passengers to use them.

Bus services cost money to run, and they need paying passengers to make them financially viable. This wasn't really a problem for many years, and despite the 'dominance' of West Midlands Travel (today's NX Bus), other enterprising businesses were able to set up competing operations or offered innovative new routes to try out.

Where things have been going wrong in recent years, is that despite inflationary cost pressures - everything has been drastically going up in price, whether that be fuel, staff wages etc - there has been a resistance to increase bus fares and ticket prices.

My monthly bus pass costs me £59 by direct debit. That is still less than it was a few years ago - in 2020 this cost me £61 a month, and was only valid on NX Bus services at the time, now it is £59 a month and I can use on any bus operator.

In the meantime, many other things that I buy regularly have nearly doubled in price.

It's no wonder that so many bus services are now deemed 'commercially unviable' because the fares revenue being received has not increased in line with the inflationary costs of providing those services, at the same time as the number of passengers has not increased significantly since the 'pre-Covid' times'.

The Mayor bemoans having to provide £50m worth of funding a year to private companies to keep their commercial bus network from collapsing, yet is prepared to spend even more, just so the WMCA can 'take back control'.

It will cost more than £50m a year in contract value for a franchised (regulated) service delivery model - don't forget that the contract prices will cover the bus company's operating costs as well as allow for a small profit margin, which means that private companies will still end up running bus services and will make a profit, even if the buses run around empty. The WMCA has the ambition that fares revenue will cover the costs of these contracts and allow for paying for fleet renewals and other depot and network investments.

In my opinion, if private companies cannot make the current commercial deregulated market 'work' for them in the current economic conditions, which means they need grants and support funding from local and national government (ie, taxpayers), then I fail to see how a 'franchised model' will deliver benefits to taxpayers financially. Because any shortfall from fares revenues will have to be made up via increases in council taxes or 'mayoral precepts'.

The money has to come from somewhere - cheap fares, or a 'world-class' public transport system, I'm afraid you can't have both, without someone having to pay the price. And that's either the people who use the system, or those that don't.

Don't get me wrong, I do think that a franchised or 're regulated' model would have some advantages and benefits, with regards to deciding routes and setting timetables, but I do think that anyone who is expecting buses to be running every five minutes on all roads and to be keeping perfect time is going to be sadly disappointed.

As for downsides of deregulation, at some point bus companies weren't apparently allowed to use their more profitable routes to 'subsidise' their less-profitable ones, presumably for 'competition' reasons. This will be another reason why some 'marginal' routes have ended up becoming subsidised tender awards in the last few years.

I'm of a similar ilk to you Stu, and remember fondly the PTE operating around Walsall, indeed my best friend's Grandad was an Inspector at Walsall - halcyon days of riding my bike through the sheds at Carl Street!

I remember the explosion of colour and competition on deregulation where new operators, and some who'd already dipped their toe into subsidised services, were vying for passengers. From a young enthusiast's perspective, it was like nothing I'd ever experienced. New Timesaver services linking Bloxwich to Brum and beyond, the mew Metroriders penetrating local estates and, not to long after, I'd be part of the post deregulation onslaught working for Midland Choice, rival to WMT, on the lucrative Bloxwich corridor.

Dereg certainly created competition, though with it came some VERY questionable buses in both appearance and condition there to make a fast buck rather than providing a quality service. On some routes, it gave WMT a swift kick to up their game, which was great for passengers and WMT's reputation, and promote the "if you can't beat 'em, join 'em" approach with Superline and joint operator initiatives. It also gave other operators an opportunity to specialise on semi-rural operations, like Chase in Brownhills/Burntwood on their 94, giving WMT almost the opportunity they wanted to reduce their respective services in these less commercially viable areas.

Perhaps I look back through rose-tinted glasses in some respects, but the one thing I do know, is reregulating buses will be a massive step back that will see less variety for passengers, with a "like it or lump it" attitude from the local authority.

Right, where did I park my Raleigh Grifter....................

[Rachvince53]

With regards to letting profitable bus routes pay for less profitable ones, that is correct. I believe it was called 'cross-subsidy' and (I think) it was either the Secretary of State for Transport, Nicholas Ridley, or possibly the regulator who banned the practice. It was also the case that where two operators jointly operated a route (eg the X80 Torquay-Plymouth), they were instructed to compete with rather than co-ordinate their services. 

[Westy]

I'm of a similar ilk to you Stu, and remember fondly the PTE operating around Walsall, indeed my best friend's Grandad was an Inspector at Walsall - halcyon days of riding my bike through the sheds at Carl Street!

I remember the explosion of colour and competition on deregulation where new operators, and some who'd already dipped their toe into subsidised services, were vying for passengers. From a young enthusiast's perspective, it was like nothing I'd ever experienced. New Timesaver services linking Bloxwich to Brum and beyond, the mew Metroriders penetrating local estates and, not to long after, I'd be part of the post deregulation onslaught working for Midland Choice, rival to WMT, on the lucrative Bloxwich corridor.

Dereg certainly created competition, though with it came some VERY questionable buses in both appearance and condition there to make a fast buck rather than providing a quality service. On some routes, it gave WMT a swift kick to up their game, which was great for passengers and WMT's reputation, and promote the "if you can't beat 'em, join 'em" approach with Superline and joint operator initiatives. It also gave other operators an opportunity to specialise on semi-rural operations, like Chase in Brownhills/Burntwood on their 94, giving WMT almost the opportunity they wanted to reduce their respective services in these less commercially viable areas.

Perhaps I look back through rose-tinted glasses in some respects, but the one thing I do know, is reregulating buses will be a massive step back that will see less variety for passengers, with a "like it or lump it" attitude from the local authority.

Right, where did I park my Raleigh Grifter....................

Guy I went to school with, his dad was a driver at Walsall pre dereg!

[Crosville]

I'm of a similar ilk to you Stu, and remember fondly the PTE operating around Walsall, indeed my best friend's Grandad was an Inspector at Walsall - halcyon days of riding my bike through the sheds at Carl Street!

I remember the explosion of colour and competition on deregulation where new operators, and some who'd already dipped their toe into subsidised services, were vying for passengers. From a young enthusiast's perspective, it was like nothing I'd ever experienced. New Timesaver services linking Bloxwich to Brum and beyond, the mew Metroriders penetrating local estates and, not to long after, I'd be part of the post deregulation onslaught working for Midland Choice, rival to WMT, on the lucrative Bloxwich corridor.

Dereg certainly created competition, though with it came some VERY questionable buses in both appearance and condition there to make a fast buck rather than providing a quality service. On some routes, it gave WMT a swift kick to up their game, which was great for passengers and WMT's reputation, and promote the "if you can't beat 'em, join 'em" approach with Superline and joint operator initiatives. It also gave other operators an opportunity to specialise on semi-rural operations, like Chase in Brownhills/Burntwood on their 94, giving WMT almost the opportunity they wanted to reduce their respective services in these less commercially viable areas.

Perhaps I look back through rose-tinted glasses in some respects, but the one thing I do know, is reregulating buses will be a massive step back that will see less variety for passengers, with a "like it or lump it" attitude from the local authority.

Right, where did I park my Raleigh Grifter....................

I'm of a similar ilk to you Stu, and remember fondly the PTE operating around Walsall, indeed my best friend's Grandad was an Inspector at Walsall - halcyon days of riding my bike through the sheds at Carl Street!

I remember the explosion of colour and competition on deregulation where new operators, and some who'd already dipped their toe into subsidised services, were vying for passengers. From a young enthusiast's perspective, it was like nothing I'd ever experienced. New Timesaver services linking Bloxwich to Brum and beyond, the mew Metroriders penetrating local estates and, not to long after, I'd be part of the post deregulation onslaught working for Midland Choice, rival to WMT, on the lucrative Bloxwich corridor.

Dereg certainly created competition, though with it came some VERY questionable buses in both appearance and condition there to make a fast buck rather than providing a quality service. On some routes, it gave WMT a swift kick to up their game, which was great for passengers and WMT's reputation, and promote the "if you can't beat 'em, join 'em" approach with Superline and joint operator initiatives. It also gave other operators an opportunity to specialise on semi-rural operations, like Chase in Brownhills/Burntwood on their 94, giving WMT almost the opportunity they wanted to reduce their respective services in these less commercially viable areas.

Perhaps I look back through rose-tinted glasses in some respects, but the one thing I do know, is reregulating buses will be a massive step back that will see less variety for passengers, with a "like it or lump it" attitude from the local authority.

Right, where did I park my Raleigh Grifter....................

Whilst d-reg may have created competition, it also created bus wars, the area i live in has had a few bus wars since d-reg, although the last one was Arriva/First in 2006/07, things have calmed down since then, & one of the biggest bus was the MTL/GM Buses bus war in the early 90s.

[Wumpty]

Whilst d-reg may have created competition, it also created bus wars, the area i live in has had a few bus wars since d-reg, although the last one was Arriva/First in 2006/07, things have calmed down since then, & one of the biggest bus was the MTL/GM Buses bus war in the early 90s.

I agree about bus wars......I was caught up in one at Choice!

[Westy]

I agree about bus wars......I was caught up in one at Choice!

Does anyone know the reason why TWM (at the time) Walsall decided to alter the Walsall to Bloxwich corridor back in the 90's, that short lived attempt, where you had at the time, the 301 & 302(current 31 & 32), then you had the 303 & 304 replacing the 319 & 329 in Blakenall, swopping routes in Coalpool / Rycroft at the same time?

Can't remember if the 370(current 70) was cut back from a circular at the same time, but you also had a 309 running Walsall to Beechdale then to Leamore via the Four Crosses(now KFC), then up the Bloxwich Road to Bloxwich.

Choice, I believe, benefitted from that 'cock up'!

[karl724223]

I agree about bus wars......I was caught up in one at Choice!

I did the bus wars over Walsall when they shut hartshill on the track thandi taj transol Walsall travel
Then later on 247/8 and the 9 against bcc

[Wumpty]

Does anyone know the reason why TWM (at the time) Walsall decided to alter the Walsall to Bloxwich corridor back in the 90's, that short lived attempt, where you had at the time, the 301 & 302(current 31 & 32), then you had the 303 & 304 replacing the 319 & 329 in Blakenall, swopping routes in Coalpool / Rycroft at the same time?

Can't remember if the 370(current 70) was cut back from a circular at the same time, but you also had a 309 running Walsall to Beechdale then to Leamore via the Four Crosses(now KFC), then up the Bloxwich Road to Bloxwich.

Choice, I believe, benefitted from that 'cock up'!

I believe it was part of the new Beacon area routes which failed spectacularly. I understand heads rolled and we at Choice did clean up magnificently!!!!