Passenger Transport: July 26, 2024

NAO adds to pressure to find HS2 solution

National Audit Office report warns that decision to axe northern leg of high speed line will result in trains having fewer seats than existing services

Pressure is building on the government to revive plans to extend HS2 north of Birmingham after the National Audit Office warned that the last govertnment’s decision to scrap the northern leg of the project could lead to lower capacity, and potentially higher prices for trains between London and Manchester.

“Department for Transport plans for HS2 trains to run from the phase 1 track onto the West Coast Main Line in place of conventional trains, but the trains will have fewer seats than existing services unless changes are made to existing infrastructure and stations to accommodate longer trains,” said the NAO in a report. Unlike existing Pendolino

HOP ABOARD THE ‘99 BUS’

Cadbury Flake and First Bus have launched the ‘99 Bus’, a free, pre-bookable service, whisking families away to the seaside, after research from Cadbury found that most parents find it too difficult and stressful to organise day trips to the coast. The partners have created two new bus routes that will run across the weekends of August 10/11 and 17/18. West Yorkshire families can travel to Bridlington while Londoners can visit Southend-on-Sea.

rolling stock, HS2 trains will be unable to tilt to take corners on the WCML at a higher speed. They also carry fewer passengers. It’s a point that many in the rail industry have been making since then prime minister Rishi Sunak announced his decision scrap the northern leg last October.

Responding to the NAO report, Greater Manchester mayor Andy Burnham called for

“This is an urgent problem that needs a coherent solution” Andy Burnham

the DfT to explore construction of an alternative new rail line, potentially using land already purchased for the HS2 project.

He said: “By the Department for Transport’s assessment, the West Coast Main Line will be at capacity by the mid-2030s. Not doing anything to address this would be a brake on growth.”

He added: “The idea that we are going to make rail services worse by the middle of the century is a complete non-starter - a different plan is needed. This is an urgent problem that needs a coherent solution. No-one is talking about going back to HS2, but there has to be additional capacity between the West Midlands and Greater Manchester.”

SUMMER BREAK

PassengerTransport is taking its annual summer break. There will be no edition on August 9. The next edition of the magazine will come out on August 23.

Solution must be found to WCML capacity

Robert Jack Managing Editor

The National Audit Office this month set out the national embarrassment that those who work in the rail sector have been pointing to since Rishi Sunak cancelled the northern leg of HS2 last October. As a consequence of this, non-tilting HS2 trains will need to use the West Coast Main Line north of Birmingham, slowing Pendolinos down and causing a reduction in capacity. Urgent action is required.

“No-one is talking about going back to HS2, but there has to be additional capacity between the West Midlands and Greater Manchester,” says Andy Burnham, mayor of Greater Manchester. This could be done through expanding and upgrading the WCML although this would be very disruptive. Burnham is among those who believe that a new, lower-cost, dedicated line is the only real solution.

There are reasons to be optimistic. In Lord Hendy of Richmond Hill, the government has a rail minister who has plenty of first hand experience with major transport infrastructure projects. Meanwhile, the King’s Speech included the repurposing of the High Speed Rail (Crewe - Manchester) Bill, originally intended for the second phase of HS2. The government has clarified that this does not represent a reversal of Sunak’s decision to cancel HS2 north of Birmingham - but it does open up options for an alternative capacity-enhancing project. If a solution can be found, the scheme could become an early test for the new government’s streamlined planning process.

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IN THIS ISSUE

OR G ANISAT ION PAG E

Aberdeen City Council 11 Alexander Dennis 12 Arriva London 12, 15

Bee Network 5, 6, 9

CitySwift 16, 17 CPT Cymru 10

CPT (UK) 5, 8, 9

Eastern Transport Holdings 8 First Bus 1, 9, 11

Go-Ahead London 5, 12 KPMG 8 MCV 15

Merseyrail 7 Metrolink 6 Midlands Connect 26 National Audit Office 1

National Express West Midlands 26 Network Rail 26 NewPower 9 NIBS Buses 8 Nottingham City Transport 5 QBuzz 9 Reading Buses 8

Scottish Rail Holdings 26 Serco 7

Stagecoach 11, 12 Stephensons 8

Transdev Blazefield 9

Transport for Greater Manchester 9, 16 Transport for London 12

Transport UK Group 7, 26 Van Hool 9 Volvo Buses 15

Warrington’s Own Buses 26

West Midlands Combined Authority 7 Wrightbus 9

Yutong 9 Zenobe 15

16

TFGM USES CI T YSWIF T T ECH TO I M PROVE BUSES

Transport for Greater Manchester has partnered with CitySwift, leader in performance optimisation for the public transport sector across the globe, to power the future of its public transport network through the use of AI and data.

15

ZENOBE AWARDED £41 M FOR S COTT ISH EXPANSION

Zenobe has been awarded £41.7m in phase 2 of the Scottish Zero Emission Bus Challenge Fund (ScotZEB). The funding enables eight small to medium sized enterprise, mid-market and major operators to transition their fleets to zero-emission vehicles.

22 IT ’S T I M E TO RE T HINK T HE ISSUE OF FARES

Rail fares have risen and ticket structures remain as complicated as ever while revenue has not increased as much as was hoped. “We were led to believe that the whole problem of ticket pricing was to be overhauled,” says Nick Richardson

25 FO UR BILLS HAVE BROU G H T A LOT OF BU ZZ

Great Minster Grumbles: Our Whitehall insider imagines what’s going on inside the minds of the mandarins at Great Minster House, home of the DfT. “So we start to wave goodbye to our private sector franchise operators. It’s been nice knowing you.”

King’s Speech opens door to nationalisation

Passenger Railway Services Bill aims to smooth the way for passenger rail operations to be transferred to publicly-owned companies

RAIL REFORM

The King’s Speech has announced new legislation aimed at transitioning the operation of passenger rail services in Great Britain from private sector contractors to public sector companies.

The Passenger Railway Services (Public Ownership) Bill will amend the Railways Act 1993, making the direct award of contracts to public sector operators the default approach. More extensive legislation covering wider rail reform, including the creation of Great British Railways, will follow later in the parliamentary session.

The Passenger Railway Services Bill will facilitate the transfer of rail operations to public sector companies when the current National Rail Contracts with private operators expire, either

at the end of their core term or at their end date. The bill also removes the requirement to give at least 12 months’ notice before awarding contracts to public sector companies.

The secretary of state, Scottish and Welsh ministers will be authorised to award contracts solely to public sector operators. However, the transport secretary may extend contracts with incumbents when it is impractical to award a new contract to a public sector company. This provision does not apply to

“As Passengerin-Chief, I said we’d move fast and fix things” Louise Haigh

Scottish or Welsh Ministers, as their services are already publicly operated.

The government estimates that transitioning services to the public sector could save between £110m and £150m in management fees by October 2027. Mobilisation and due diligence costs are projected at £1m to £1.5m per transaction, similar to franchise award costs.

The first contracts potentially moving to state control include the East Anglia and West Midlands contracts, expiring in September 2024. A significant number of contracts, such as Chiltern, Thameslink, Southern & Great Northern, South Western, Greater Western, and Essex Thameside, are set to expire in 2025. The latest contract to end will be CrossCountry. Its core term is due to expire in October 2027.

“As Passenger-in-Chief, I said we’d move fast and fix things, and that’s exactly what we’re doing with this weighty, radical legislative agenda,” said transport secretary Louise Haigh. “Our transport system is broken, but today’s bill will pave the way for better trains that work for everyone, no matter where you live. After years of inefficiency, we’re two weeks in and the first steps towards rail reform are being taken today. Change starts now.”

The move has been welcomed by the Urban Transport Group. “The King’s Speech sends a strong signal of intent that this government is serious about transforming our transport sector,” said UTG director Jason Prince. “Our rail services need reform, so it is encouraging that the government is moving ahead with the creation of Great British Railways.”

However, Rail Partners warned the government against going down the wrong track.

‘We want the same outcomes as the new Labour government - a better railway for those that use it and pay for it,” said Rail Partners chief executive Andy Bagnall. “But to change the railway for the better, we must correctly understand the causes of the current challenges to get the right solutions - and full nationalisation is a political not a practical solution, which will increase costs over time.”

Meanwhile, the King’s Speech also announced the repurposing of the High Speed Rail (Crewe - Manchester) Bill, originally intended for the second phase of HS2, to improve rail connectivity elsewhere in the North of England. However, the government clarified that this does not reverse the decision previous government’s decision to cancel HS2 Phase 2.

GRUMBLES: PAGE 25

“This new government will give local leaders the tools they need to deliver better buses”

Haigh confirms plans for major bus reforms

Better Buses Bill aims to offer new powers to franchise services

BUS REFORM

Transport secretary Louise Haigh has reiterated her plans to reform bus services through franchising and public ownership.

In her first official visit as the new transport secretary, Haigh visited Greater Manchester where she pledged to support communities regain control of their local bus services, drawing inspiration from the region’s franchised Bee Network. She met Greater Manchester mayor Andy Burnham to discuss the potential for replicating the Bee Network franchised bus network model across the country.

“Buses are the lifeblood of communities, but the system is broken,” Haigh said. “Too often, passengers are left waiting hours for buses that don’t turn up - and some have been cut off altogether.

Change starts now. This new government will give local leaders the tools they need to deliver better buses up and down the country.”

Last week, the transport secretary also visited Go-Ahead London’s Waterloo Garage with London mayor Sadiq Khan to explore how London’s bus franchising model could be extended elsehwere.

This visit coincided with the unveiling of new bus legislation in the King’s Speech. The Better Buses Bill aims to empower local leaders by granting them new powers to bring bus services back into public control and streamline the franchising process. It seeks to address what the government claimed are the deficiencies of the current deregulated system.

The Department for Transport

CPT supports plans but urges partnership

Vidler: ‘Regulatory changes alone won’t improve services

Graham Vidler, chief executive of the Confederation of Passenger Transport (CPT), has expressed support for the Better Buses Bill included in the King’s Speech.

“Bus services are already being transformed in many parts of the country,” Vidler said, highlighting successful “enhanced partnerships” in

places like Leicester, Portsmouth, and Norfolk.

He added that CPT and its members will continue to work with authorities preferring the partnership model to deliver regular, fast, and punctual bus services. They also plan to share lessons from early adopters of bus franchising with ministers, mayors, and transport authorities

to ensure success in other areas.

Vidler stressed that regulatory changes alone won’t improve services. He called for swift action from local, regional, and national governments to prioritise buses on the road network, reduce congestion, and encourage public transport use over private car journeys.

“Stable long-term investment in the sector is critical,” Vidler concluded, warning against a “cliff edge” return to fully commercial fares when the £2 fare cap ends in November.

said the legislation is part of the government’s broader ambition to develop a long-term national strategy for transport. This strategy aims to ensure efficient infrastructure delivery and greater local control over public transport.

“Our Better Buses Bill will remove barriers and empower local leaders to replicate London’s world-class bus network across the country, giving passengers a transport system they can truly rely on,” Haigh added.

In related developments, buses minister Simon Lightwood, on his first official engagement, visited council-owned bus operator Nottingham City Transport. Accompanied by East Midlands mayor Claire Ward and Nottingham City Council leader Neghat Khan, Lightwood toured NCT’s Trent Bridge Garage to observe the municipal operator’s investment in zero-emission electric buses and infrastructure. Lightwood commented: “Buses are critical to connect our communities, and Nottingham is a shining example of how we can fix the broken bus system. Yesterday’s King’s Speech is proof of just how important improving buses is to this government. For too long, people have suffered because of unreliable services, but the bus revolution starts now. The Better Buses Bill will create and save vital bus routes across the country, giving every community the power to take back control of their buses and deliver better and more affordable services.”

However, NCT managing director David Astill warned that the ever-increasing levels of traffic congestion remain a major cause of unreliable bus services.

“Further bus priority is essential if we are to continue to provide services that are seen as a real alternative to travelling by car,” he added.

Burnham’s plans for Bee Network expansion

Burnham’s plan aims to meet growth ambitions

Andy Burnham suggests eight regional rail routes could join the Bee Network by 2028 with plans also announced for further expansion

NETWORKS

Greater Manchester mayor Andy Burnham has unveiled an ambitious plan to expand the nascent Bee Network, which includes taking control of rail routes, further Metrolink extensions and new Bus Rapid Transit (BRT) corridors.

The plan aims to ensure that public transport drives growth opportunities throughout the decade and beyond. Greater Manchester’s population is currently 2.8 million people but the Greater Manchester Strategy sets out a plan for 280,000 new residents, 175,000 new homes and 100,000 new jobs.

The impetus is the completion of the bus elements of the Bee Network in January 2025. Burnham’s plan calls for eight regional rail lines to be incorporated into the Bee Network by 2028.

These services are: Rochdale stopping services; Ashton-underLyne and Stalybridge; Glossop, Hadfield, and Rose Hill Marple via Guide Bridge; Alderley Edge and Buxton via Stockport; Manchester Airport stopping services; Wigan via Golborne; Wigan via Atherton (continuing to Southport); and Wigan via Bolton (continuing to Southport); Meanwhile, around 15 emerging

Reddish;

Tram and/or tram-train from South Manchester to Stockport and Hazel Grove; Tram-train from Stockport to Manchester Airport; Metrolink Airport line ‘Western Leg’ completion;

Tram-train services to the northwest, west and south-west of Manchester Airport connecting Altrincham line to the Airport via the Mid Cheshire line; Busway corridors to the west and east of Manchester Airport; Metrolink Trafford Park line extension;

Tram-train on the line to Warrington Central; Tram connection from Salford Quays to Salford Crescent; Further tram connections between the city centre and Salford Crescent; Tram-train on the Wigan via Atherton line; and Longer-term options for major new tunnelled capacity across central Manchester for local rail and Metrolink services that would release additional capacity. Meanwhile, new figures suggest the franchised Bee Network is delivering a more reliable bus service with bus use increasing.

priorities for expanding the network have been identified, with a focus on integrating existing infrastructure, serving major population centres, and providing frequent, fast services. Projects include:

Tram-train Pathfinder: connecting Bury, Heywood, Rochdale, and Oldham; Tram and busway options from North Manchester toward Middleton and Northern Gateway; Tram-train through East Manchester towards Glossop, Hadfield and Marple; Tram-train from Tameside to Stockport via Denton and

Over the past six months, bus patronage on franchised services has increased by 5%. Service punctuality has also improved significantly, consistently outperforming the current nonfranchised and pre-franchised networks from the same period last year. Between April 28 and June 23, over 80% of services (82.9%) ran on time, compared to 68.7% during the same period 12 months ago.

Additionally, record numbers of people are using Metrolink, with a 20% increase in usage over the past year. May saw the highest number of passengers on the system in its 32-year history.

“We need to make our buses a greener, dependable and more affordable option”

£108m bus investment as Merseyrail probed

Bus funding, franchising sped up and Merseyrail options are examined

FUNDING

Mayor Steve Rotheram has announced plans for a significant investment in the Liverpool City Region’s bus network, with the aim of improving journey times and reliability.

A total of £108.1m will be drawn from the region’s £710m City Region Sustainable Transport Settlement (CRSTS) funding pot. It will be used to purchase new zero-emission buses, upgrade and acquire depot facilities, and construct a new bus interchange in St Helens.

In addition, funds will be allocated to reinstating dedicated bus lanes in Liverpool, which were removed a decade ago by former Liverpool mayor Joe Anderson.

“We need to make our buses a greener, dependable and more affordable option,” said

WEST MIDLANDS PROJECT REVIEW

Mayoral concerns over delays and rising costs

PROJECTS

New West Midlands mayor Richard Parker has ordered an “urgent review” of the region’s transport policy following significant delays and rising costs on several projects, which are straining the West Midlands Combined Authority’s (WMCA) finances.

Taking office in May after a tight election, Parker’s decision comes in response to a WMCA report that attributed financial pressures to

Rotheram. “This investment is laying the groundwork for those improvements as franchised services begin to hit the roads in 2026.”

Rotheram has also announced plans to accelerate franchising the region’s bus services. Franchised services are expected to commence in St Helens in 2026, with the entire process now scheduled to be completed by the end of 2027, a year earlier than expected. The procurement of the first contracts is anticipated to begin later this year, following a market engagement exercise that attracted interest from over 20 bus operators from the UK and overseas.

Concurrently, combined authority officials are examining future options for the Merseyrail network as the current concession with Serco and Transport UK Group (formerly Abellio) ends in 2028. With the network’s ongoing evolution, potential for further

excessive inflation, supply chain issues, and contractor delays. Several rail projects are set to be impacted. The first phase of the Wednesbury to Brierley Hill Metro Extension, already over budget, has forced WMCA to stagger its development to control costs. The Camp Hill Line, another affected project, is now expected to be delayed until autumn 2025. Additionally, the construction of two new stations at Darleston and Willenhall on the WolverhamptonWalsall line, part of the West Midlands Rail Programme (WMRP), is facing cost overruns. Originally budgeted at £55m, these stations

devolution, and imminent bus franchising, they believe there is a significant opportunity to explore new operating models for the Merseyrail network.

“The new government is keen to implement an agenda of rail reform which includes public control of the rail network as a key policy commitment,” said Richard McGuckin, the combined authority’s executive director - place in a joint paper with Rotheram. “As a result, work has been initiated to begin to identify and evaluate options for the future Merseyrail operating network.”

Operating models deployed by major transport authorities across other cities (in the UK and abroad) will be considered, and the existing model will be analysed to ensure that any current strengths can be built upon. A complete analysis of the options and recommendations on the next steps will be provided at a future combined authority meeting.

are now £30m over budget, pushing costs to nearly £85m. They are also delayed, with passenger service not expected until 2026.

The review may also impact newly initiated projects, such as the reopening of Aldridge train station, which was scheduled to begin soon and open in 2027.

Commenting on the situation, Parker said: “Our ambitious transport plans must be delivered realistically, with accurate funding and feasible timelines. I am initiating an independent review of all our transport projects in collaboration with local authorities to address these issues.”

WEST MIDLANDS TAKES FIRST STEP TO FRANCHISING

‘Public sector has carried majority of risk since 2020’

REGULATION

West Midlands Combined Authority (WMCA) board members have agreed to initiate the process of franchising the region’s bus services following a detailed study.

In a report to the board, Pete Bond, WMCA’s director of integrated services, explained that the full franchising assessment (FFA) found franchising would provide more service per pound of public money than partnership-based alternatives.

“This is due to several factors including the unique market dynamics within the West Midlands, which is dominated by a single operator and lacks competition, as well as the projected impacts of a declining commercial network over many years,” said Bond.

He added that a key concern was whether a franchised network could be managed within existing budgets. The FFA concluded the network can be adjusted according to available funding, giving the combined authority full control over scaling services up or down. This contrasts with the current deregulated market where local authorities must react to operators’ commercial decisions.

Bond added: “Although, in theory, the private sector currently takes the risk on bus service delivery, in practice, since the pandemic in 2020, it has been clear that the public sector has carried the majority of risk, propping up the network through grants, subsidy, and incentives such as the £2 fare.”

The next steps will see an independent audit of the franchise assessment, followed by public consultation later this year. A final decision on whether to proceed is expected by April 2025.

Industry speculates on future of £2 fare cap

As buses minister Simon Lightwood suggests new government is looking at fare cap’s future, thoughts are turning to how the scheme could evolve

PATRONAGE

Industry figures are speculating about the future of England’s £2 bus fare cap, which was introduced in January 2023 as a temporary measure to alleviate the cost of living crisis and encourage bus usage. Initially set to increase to £2.50 in October 2023, the fare cap was extended to November 30, 2024, with the planned increase subsequently cancelled.

As the scheme’s end approaches, concerns are increasing about a sudden reversion to previous fares and the potential impact on patronagage on an industry still recovering from the pandemic.

Bill Hiron, chairman and chief executive of Eastern Transport Holdings, the parent company of Stephensons and NIBS Buses, and chair of the ALBUM group of municipal and SME-owned bus operators, described the £2 cap as “a bit of a blunt instrument, undoubtedly introduced for political reasons”.

“Passenger growth seems to have been variable,” he told Passenger Transport. “If it is to continue, we need to ensure reimbursement is matched to increases in industry costs – or it’ll become like concessionary fares all over again but worse.

“The £2 cap was introduced without any thought to its exit, but the industry – both the Confederation of Passenger Transport (CPT) and ALBUM –have repeatedly highlighted that there needs to be an exit strategy.

“I can’t envisage the new

government just dropping the scheme at the end of November – the fallout for such a ‘relatively’ small sum would be vast,” he said. “But we certainly need to continue engagement over what might follow.”

Earlier this year, CPT released a KPMG report outlining transition options. While recognising the fare cap’s benefits in easing cost-of-living pressures, KPMG highlighted its limited advantages for day or season ticket holders and the disproportionate discount for long-distance travellers. The report warned that a prolonged fare cap would complicate the

“I can’t envisage the government just dropping the scheme at the end of December ”

companies and make it affordable for people? Affordability is really important for us.”

Some in the industry have already begun to speculate about that future support and proposed some form of fare support for young people.

Hiron warned this could be a challenging proposition.

“There have been several suggestions for its replacement,” he said. “I think all these stem from the idea that we don’t want to lose the monies involved coming into the industry for the benefit of our customers (and hopefully therefore long term ridership).

transition to standard fares.

KPMG stated: “When the current £2 fare cap policy ends in 2024, policymakers will have three options: retain or reform the existing single fare cap, gradually transition away from the single fare cap, or fully transition away from the single fare cap instantly... The gradual transition is likely the only feasible option.”

During a visit to Nottingham City Transport last week, buses minister Simon Lightwood confirmed the fare cap will be reviewed by the government.

He said: “We’ll be looking at the £2 bus fare... looking at the data that we’ve received from that to look at what the future of that is - whether a national scheme is the right way forward or whether a more targeted approach would be necessary.

“We’re absolutely certainly not going to have a cliff edge. What we will look at, is that the best use of funding to achieve support for bus

“Discounted travel for young people is one idea. Depending how it’s applied that could be very challenging where there are networks of dedicated peak time services aimed mainly at scholars. Inevitably there would be a requirement for extra buses and drivers for duplication – and even if these could be sourced, the costs for extra peak vehicles would be considerable.”

Hiron added that increasing the cap for everyone would allow the government to ‘save’ some of the funding allocated to the scheme.

Robert Williams, chief executive of council-owned operator Reading Buses, said if the fare cap’s goal was modal shift, then the adult population needed to be considered too.

“A young persons’ scheme would create a larger increase in fare at exactly the age getting a car becomes an option,” he told Passenger Transport. “This could actually encourage car use.

“I think I would favour something like a £2.50 cap or other schemes to help make services more affordable to operate, supporting higher frequencies and higher quality services that would undoubtedly generate passenger growth.”

North East mayor set to assess bus regulation

McGuinness pledges to restore trust in local bus network

REGULATION

North East mayor Kim McGuinness has announced a £100m investment in buses, pledged to pursue the franchising of local bus services, and vowed to support plans to reopen the Leamside Line.

Bus reform options will be discussed at a combined authority cabinet meeting next week, where a report will recommend the mayor and cabinet prepare an assessment for a franchising scheme.

“Our bus system needs to work better for local people,” said McGuinness. “I promised to greatly improve public transport in my manifesto, and I will make

COSTS INCREASES START TO SLOW

But data reveals variations in rises around the country

COSTS

The February 2024 Confederation of Passenger Transport Cost Monitor survey reveals that the increase in unit costs for bus operators slowed after two years of double-digit rises. Data for the survey was supplied by 58 operators across the country. Overall, gross costs rose by 3.1% over the year to February 2024 in Great Britain outside London, with increases of 5.0% in the English shires, 4.3% in London, and 3.3% in England’s former metropolitan counties. Conversely, costs fell by 0.7% in Wales and 1.9% in Scotland during the same period.

this a reality. We need to recognise that the existing system is broken and needs change to grow bus use and improve services for passengers.”

In a report to McGuinness and cabinet members, Tobyn Hughes, the region’s director of transport, emphasised the mayor’s strong mandate to bring buses back into public control.

“Both the mayor and cabinet have previously set out a vision for the region to be recognised as an outstanding place to live, work, visit, and invest. For this to happen, more people will use buses, not fewer,” Hughes said.

“The existing system is broken”

Kim McGuinness

At the same meeting, McGuinness and the cabinet are expected to approve £102.1m in spending as part of the region’s new Bus Service Improvement Plan. This funding will support a wide range of schemes, including affordable fare programmes and enhancements to local bus services.

Additionally, a report will recommend allocating £8.6m to develop the business case for reopening the disused Leamside Line. The reopening is planned in three phases: creating a new Tyne and Wear Metro loop connecting Washington with Pelaw and South Hylton; linking Washington and Sunderland with the East Coast Main Line; and establishing a new station at Ferryhill, allowing rail connections with Teesside.

FIRST INVESTS IN ROCHDALE DEPOT First Bus has completed a £750,000 investment programme at its Rochdale depot, which operates 30 bus routes, six schools services and 65 buses as part of Greater Manchester’s franchised Bee Network. The focus of the improvementsis enhanced engineering facilities, including a new double height workshop bay.

IN BRIEF

BEE NETWORK NIGHT BUSES

Transport for Greater Manchester has announced it will launch a 24-hour bus pilot from September 1. Night buses will run on the V1 and the 36, connecting Manchester with Leigh and Bolton via Salford. The trial will see services run at least every hour and aims to support the region’s night-time economy and those who work within it.

FIRST OPTS FOR NEWPOWER

Wrightbus’s NewPower startup which aims to convert existing diesel buses to zero-emission battery-electric propulsion has confirmed its first order for 30 conversions from First Bus. The move follows the successful initial conversion of two Wrightbus Streetdeck double deckers.

CITAROS FLYING HIGH

Transdev Blazefield has confirmed it has placed an order for 15 Mercedes-Benz Citaro Hybrid single deckers for use on its FLYER services linking Leeds, Bradford and Harrogate with Leeds Bradford Airport. The buses will be delivered at the end of this year and represent an investment worth £4m.

QBUZZ DITCHES VAN HOOLS

Dutch bus operator QBuzz will replace an order for 15-metre Van Hool buses with 50 Yutong U15 battery-electric vehicles of a similar length. The change comes as QBuzz prepares to take over the Zuid-Holland Noord bus concession later this year. The switch to the Chinese manufacturer was necessitated by Van Hool’s bankruptcy earlier this year and VDL’s decision, as Van Hool’s new owner, to cease building Van Hool buses.

New 20mph guidance supports bus priority

Updated guidance for Wales says ‘implementation of bus priority measures along the affected routes should be considered’ if buses are impacted

BUS PRIORITIES

The Welsh Government has published revised guidance for local authorities on exemptions to the 20mph default speed limit in built-up areas, which came into force across Wales in September. Bus operators are pleased that the guidance recognises 20mph’s impact on their services and passengers and that it highlights bus priority measures as part of the solution.

Many routes, particularly inter-urban ones, saw changes to timetabled journey times or frequencies in the weeks before or after the law changed to make 20mph the default limit. Some operators provided an additional vehicle to maintain frequency on certain routes.

The percentage of built-up roads exempted from the new default limit, with 30mph retained, varied widely between counties. The government acknowledged that mistakes had been made and there had been inadequate consultation. It ordered an expert review of the guidance and promised that some 20mph road sections would revert to 30mph following a listening exercise, involving the public, bus operators and other stakeholders. Ken Skates, cabinet secretary for North Wales and transport, published the revised guidance this month. He said local authorities would use the guidance from September to decide which roads should revert to 30mph. The proposed

changes would be subject to Traffic Regulation Orders, the consultation on which would give people and organisations another chance to have their say.

The guidance emphasises the need to balance the priorities of different groups of people

when deciding where 20mph and 30mph limits should apply. It says: “If the assessment undertaken largely supports retaining the 20mph speed limit but evidence shows that there are significant impacts on bus routes, resulting in increased journey

“We need that engagement with government, at national and local level, on bus priority”

Aaron Hill, CPT Cymru

CASE STUDY: LLANDUDNO BUS DELAYS

A textbook example of a lack of bus priority compounding the effects of the 20mph speed limit can be found in Llandudno, where every bus arriving from the east has to take a detour because there is no direct approach from Mostyn Broadway to Mostyn Street, the main commercial street. That western end of Mostyn Broadway is one-way eastbound for about 300 metres, where the carriageway is taken up with a two-lane filter for straight ahead or right turn. The high cost of that filter to public transport operators and passengers, not to mention the Welsh Government’s modal shift

targets, was apparent on a wet Saturday last November, when PassengerTransport timed a journey into Llandudno on Arriva’s highfrequency route 12 from Rhyl. Despite the 20mph limits along large sections of the route, the bus was one minute early leaving the stop outside B&Q on Mostyn Broadway. It then had to queue with cars for several traffic-light phases on the detour route, which takes buses into the heart of the conflicted area where the main road into Llandudno passes a large supermarket and a shoppers’ car park.

The bus was six minutes late entering Mostyn Street. It had taken

times and subsequent cuts to services or areas served, then the implementation of bus priority measures along the affected routes should be considered.”

Aaron Hill, director of CPT Cymru, welcomed this. He told Passenger Transport: “There’s a long-term frustration among bus operators that they have identified bus lanes and bus priority schemes for a long period of time and not had much engagement from government on this. A large number of those [schemes] could have avoided many of the problems with 20mph which we’re now seeing.

“We need that engagement with government, at national and local level, on bus priority.”

Some sections of road used by buses are likely to revert to 30mph by the end of this financial year. The guidance says assessment of the potential benefits of a higher limit than 20mph should consider “the expected journey time savings particularly for buses, freight and non-emergency services”.

nine minutes to travel about 400 metres from the B&Q stop to the first stop in Mostyn Street. As the largest seaside resort in Wales, Llandudno is not at its busiest on wet November Saturdays! A contra-flow bus lane of about 300 metres at the western end of Mostyn Broadway, with priority for buses across the junctions at each end, could save seven or eight minutes in average traffic conditions. This saving would compensate for the additional running time resulting from the 20mph default limit on several routes into Llandudno, from Rhyl, Caernarfon and Colwyn Bay.

SW Wales buses need franchising and funding

Region’s Corporate

Joint Committee offers Case for Change

BUS FRANCHISING

Improving bus services in South West Wales depends on changing governance and funding methods, the region’s Corporate Joint Committee (CJC) says in the first consultation on its future Regional Transport Plan (RTP). However, plans for major rail investment are already receiving development funding.

The Welsh Government established four statutory CJCs, which bring together local authorities for development and delivery of RTPs and Strategic Development Plans. Wales has 22 unitary authorities, some covering small areas, and has been without a regional transport focus since

ABERDEEN BUS GATES REVERSAL?

Council officers to report on bus priority measures

BUS PRIORITIES

Council officers in Aberdeen have been instructed to report as soon as possible on reversing more of the bus priority measures which have delivered faster bus journeys and passenger growth since August 2023. Officers are currently working on a wider Aberdeen bus priority scheme which aims to replicate the success of Belfast’s Glider, but the chances of the scheme receiving funding could be reduced if significant elements of last year’s bus priority in the city centre are removed.

The bus gates and bus lanes were installed using money from

the Welsh Government abolished the four non-statutory regional transport consortiums in 2014.

The CJCs must submit their RTPs to the government next year. Initially each CJC has worked on an RTP Case for Change.

The South West Wales CJC is now consulting on its Case for Change, which says: “We wish to see the Metro network concept of an integrated public transport network extended to bus, thus driving improvements in the network where rail links are not feasible. This will require changes

“This change on operational model presents a major opportunity”

the Scottish Government’s Bus Partnership Fund. One of the key functions of last year’s bus priority measures is to prevent cars from passing along Union Street while enabling access by buses, bicycles, taxis and delivery vehicles. The accompanying changes to the road layout maintain access to all city centre car parks. However, traders have claimed the measures have reduced footfall in the city centre.

In June an Aberdeen City Council committee voted for temporary suspension of bus gates at the junction of Union Street and Market Street while construction work is undertaken nearby (PT317). Opposition councillors requested a special meeting of the full council on the subject.

At the special meeting, on July 16,

to the current governance and funding approaches for bus.

“At present access to traditional hourly bus services is limited to the urban areas and interurban connections. This creates challenges for making bus a mode of choice outside of these areas.

“The bus network will evolve through franchising undertaken by TfW but with local input to define the network involved. This change on operational model presents a major opportunity for RTP to shape the network’s outputs unlike the current approach of a network initially defined by commercial imperatives.

“An imperative is for the RTP to establish how, where and why interchange between travel modes can be enabled to allow the ‘network’ approach to be deliverable.”

the council reaffirmed the City Centre Masterplan objective of turning Union Street into a destination, rather than a through route. However, the council also issued new instructions to the chief officer, strategic place planning, to use funding from the Bus Lane Enforcement reserve in order to report “as soon as possible” on: The feasibility and impact of reopening Bridge Street to all vehicles in one or both directions; and The feasibility and impact of removing the ban on right turns from Union Terrace onto Rosemount Viaduct.

PassengerTransport asked First and Stagecoach, the city’s main bus operators, what impact the proposed changes might have on bus journey times and passenger numbers but did not receive any responses.

Welsh transport secretary Ken Skates warned last month that the plan for bus franchising in all areas of Wales is based on no “uplift in total funding to bus”, but said that council tax could be used to purchase more services locally (PT317).

The SWWCJC’s Case for Change says “strong business cases have been developed for major investment in the rail elements of Metro”, and funding secured for this year will ensure the schemes are developed in line with the RTP delivery programme.

The principal Metro scheme requires construction of new stations for a circuitous halfhourly train service between Pontarddulais and Swansea via Neath. TfW’s consultants said in 2021 that the service would deliver a Benefit:Cost Ratio of 2.9 and cover its operating costs from farebox revenue (PT306). No current Welsh rail service covers its costs. TfW Rail’s Manchester routes are the only ones it operates without subsidy.

The full council said that it recognised the importance of consistent messaging about Aberdeen’s city centre being open for business. Officers will work with partner organisations to promote this. It also said that the chief officer, strategic place planning, would confirm to councillors how much had been spent to date on Aberdeen Rapid Transit (ART).

Although the Bus Partnership Fund for bus priority measures is paused this year, the city council has used City Region Deal funding to continue developing ART. Consultants recently identified two cross-city corridors for ART. Their modelling was based on the previously proposed parameters, which include use of multi-door vehicles calling at “platforms” spaced about every 800 metres.

TfL debt upgraded amid call for funding

Moody’s impressed with patronage and financial management

FINANCIALS

Transport for London finances have been boosted after ratings agency Moody’s upgraded its debt rating from A3 to A2, amid a steady recovery in passenger numbers from Covid-era lows and tight cost control.

Moody’s attributed the upgrade to a “significant improvement” in TfL’s operating performance, which it anticipates will be maintained alongside growing operating surpluses in the medium term.

This positive outlook has been driven by the rebound in passenger revenue post-pandemic, with London Underground ridership reaching 85% of

STAGECOACH OPTS FOR ADL

Group places orders for electric buses for London

VEHICLES

Stagecoach has placed orders with Alexander Dennis for 24 Enviro100EV midibuses and 17 next generation Enviro400EV double deckers for delivery in early 2025 for routes operated on behalf of Transport for London. In London specification, the Enviro400EV can accommodate up to 62 seated passengers. The Enviro100EV midibus will seat 21.

“This new order further confirms the incredible success of our next-generation vehicle platform buses’ potential,” said Ben Werth, ADL’s group sales and business development manager.

pre-pandemic levels and strong results from the first full year of Elizabeth Line operations.

For the 2023-2024 financial year, passenger income surged to £5 billion, exceeding the £4.5 billion reported in 2019, propelled by a 5.9% increase in average fares.

“This decision is testament to the hard work taking place across our organisation to rebuild our ridership, ensure we are operationally financially sustainable and deliver a safe and reliable transport network that serves London and the wider UK, night and day,” said Rachel McLean, TfL’s chief finance officer, who called for the government to offer long-term funding for capital projects.

“Whilst we are now able to cover our day-to-day costs, with any surplus going directly into

infrastructure improvements, we cannot fund major capital projects entirely from our own resources, just like other transport authorities,” McLean said.

“That’s why we are keen to work with transport authorities across the country to secure multi-year funding settlements from the government, like those that are already in place for National Highways and Network Rail.”

She added that a long-term deal would allow TfL to deliver a programme of sustainable investment “offering better outcomes for a lower cost.”

McLean continued: “This will both support jobs and growth outside of London, and protect London’s position as a leading global city and economic powerhouse for the benefit of the whole UK.”

Over

LONDON BUS FLEET INCREASES AGAIN

Marginal rise in fleet but still below 2017 peak

STATISTICS

New figures from Transport for London reveal that the capital’s bus fleet has grown for the first time since 2021. As of March 31, 2024, there were 8,776 buses in London, marking an increase of 133 buses from the previous year. However, this number remains well below the 2017 peak of 9,616 vehicles.

The data also shows that by the end of March, there were 1,397 electric buses in service, including 543 single deckers and 854 double deckers. The number of electric buses has surged in recent years, with 424 added to the fleet in 2023, up from just 49 in 2016.

The increase in electric buses has significantly impacted the conventionally powered diesel fleet. In March 2020, there were 5,000 pure diesel buses, but by March this year this had fallen to 3,532.

Regarding operators, Go-Ahead London remained the largest in the capital, with 2,270 buses, accounting for 25.87% of the London fleet. This was well ahead of the second-largest operator, Arriva, which had 1,528 buses and a fleet share of 17.41%. Stagecoach, having grown in recent years by acquiring operations from HCT Group and Tower Transit, operated 1,488 buses, representing a 16.96% share.

NET ZERO

Action required to cut transport emissions

Committee for Climate Change reports on progress

POLICY

The Committee for Climate Change has set out its priority policy recommendations for the next year, including a number that address surface transport.

The committee is an independent, statutory body established under the Climate Change Act 2008. Its purpose is to advise the UK and devolved governments on emissions targets and to report to Parliament on progress made in reducing greenhouse gas emissions and preparing for and adapting to the impacts of climate change.

Published this month, its latest report on progress in reducing emissions observes that surface

transport emissions fell by 0.9% in 2023, despite overall vehiclekilometres increasing. This represents the first time that the uptake of electric vehicles (EVs) has had a meaningful impact on the direction of emissions trends.

With surface transport creating more UK carbon emissions than any other sector, the report states: “The coming seven years will require substantial reductions in surface transport emissions. The recent rate of emissions reductions will need

“The recent rate of emissions reductions will need to increase significantly”

TRANSPORT’S NET ZERO PRIORITIES

to increase significantly, which will require the rate of electric vehicle uptake to accelerate rapidly.”

The report observes that total car-kilometres remain 6% below pre-pandemic levels. Only a very modest increase of 2% was seen in 2023 compared to 2022 levels, suggesting that changes in travel patterns have resulted in a sustained reduction in car travel demand. However, the committee warns that “there is a risk that previous demand growth trends could resume without policy to build on these changes”.

The committee makes four priority policy recommendations to the UK Government for surface transport for the next year, alongside further recommendations for leaders in Scotland, Wales and Northern

Priority policy recommendations for surface transport for the next year

UK GOVERNMENT

Reinstate the phase-out of new fossil-fuel cars and vans by 2030. Bring forward the phase-out date for new petrol and diesel cars from 2035 to 2030, and remove barriers to people choosing electric vehicles. Remove planning barriers for EV chargers. Make it easier to install electric vehicle charge points. Accelerate EV van uptake. Develop further policies and incentives to accelerate zero-emission van uptake.

Publish local transport plan guidance. Publish guidance to local authorities on what should be

covered in local transport plans to enable people to switch to lower-carbon modes of travel. This should include consistent guidance on how to quantify the emissions reductions that these measures can be expected to deliver as well as long-term clarity on what funding streams will be available to implement plans.

SCOTTISH GOVERNMENT

Develop an EV charging implementation plan. Develop an implementation plan to deliver the Scottish Government’s vision for the public EV charging network.

Publish a car-km reduction strategy. Publish a detailed strategy, building on the Route Map consultation of 2022, setting out how the Scottish Government will achieve a reduction in car-kilometres and deliver 20-minute neighbourhoods. This should include investment in more sustainable modes of travel, improvements in the affordability and reliability of public transport and measures to reduce dependency on driving.

WELSH GOVERNMENT

Take action on enablers of EV uptake. Monitor electric vehicle

Ireland (see below). Two-thirds of them relate to to the roll-out of EVs (electric vehicles) - but three recommendations relate to efforts to reduce car dependency.

The UK Government is advised to publish local transport plan guidance to local authorities on what should be covered in local transport plans to enable people to switch to lower-carbon modes of travel. Meanwhile, the Scottish and Welsh Governments are advised to publish detailed car-kilometre reduction strategies, setting out how they will deliver their stated targets.

Responding to the report, Silviya Barrett from Campaign for Better Transport said: “To help reduce emissions from transport, we need to be investing more in public transport and active travel and setting targets to increase their use. The previous government’s decision to cancel HS2’s Northern leg and redistribute almost a third of the money to road building must now be re-examined as a matter of urgency.”

uptake in Wales and assess whether there are opportunities for further policies and incentives.

Publish a car-km reduction delivery plan. Publish a full delivery plan for how to realise the ambition of reducing per-person car demand by 10% by 2030. This should include consideration of how measures that limit car usage will interact with those that enable more sustainable modes.

NORTHERN IRELAND EXECUTIVE

Provide EV charging support. Support deployment of public charge points.

Zenobe awarded £41m for Scottish expansion

ScotZEB funding will provide vehicles for eight bus operators

ZERO EMISSION BUSES

Zenobe has been awarded £41.7m in phase 2 of the Scottish Zero Emission Bus Challenge Fund (ScotZEB). John Swinney, first minister of Scotland, made the announcement this week at an event in Dunfermline.

Zenobe, a leader in vehicle fleet electrification and battery storage innovation, will play a lead role for a network of operators in a consortium, providing tailored financing structures to reduce both upfront and lifetime costs of electric fleet operations - while also delivering key infrastructure and ongoing support for electric vehicle operation.

The grant-subsidised electrification projects will add to the 110 vehicles that Zenobe already supports in Scotland, and 1,200 globally, and will be delivered alongside the company’s £750m commitment to battery energy storage systems in the region.

The operators in the consortium include D&E Coaches, Ember, Hairy Haggis, Maynes Coaches, McGill’s, NHS GGC, Premier Coaches and Stagecoach.

The consortium has also committed to opening up their new charging infrastructure to third party fleet operators, creating a Scotland-wide rapid-charging network for use by

The funding enables eight small to medium sized enterprise (SME), mid-market and major operators to transition their fleets to zero-emission vehicles, adding more than 250 electric buses to Scotland and expanding the current number of e-buses in the nation by 40% by the end of 2026.

ARRIVA LONDON VOLVO ORDER

51 BZL all-electric double deck buses

ZERO EMISSION BUSES

Volvo Buses has landed its first all-electric order with Arriva London. It will see 51 Volvo BZL electric double deck buses, in the capital’s famous red livery, join the operator’s Tottenham garage.

Arriva London’s zero tailpipe emission Volvos will operate on its newly contracted 341 and 243 routes across Tottenham, linking Meridian Water, Wood Green and

buses, coaches and heavy goods vehicles (HGVs), significantly enhancing electrified transport connectivity across the nation.

Phase 2 of ScotZEB differed from Phase 1 in that applicants had to cooperatively pitch as part of a consortium, under a lead applicant, rather than individual operators and local authorities.

John Swinney commented: “Tackling the climate crisis and eradicating child poverty are two of the Scottish Government’s main priorities, and supporting zero-carbon buses as a sustainable means of public transport across Scotland will contribute to achieving both by connecting communities and opening up economic and social opportunities. “This investment will deliver

“The private sector is now leading the way on removing carbon emissions from our bus and coach fleets”

John Swinney, first minister of Scotland

Waterloo. Deliveries are expected to commence in 2025.

Each of the new 10.9-metre BZL electric double deck buses will be bodied by MCV to Transport for London specifications. Passengers can also enjoy high-back seats and USB charging points, while glass skylights on the upper deck create a lighter, brighter interior.

Domenico Bondi, managing director of Volvo Bus UK & Ireland, said: “Our relationship with Arriva stretches back years and our respective teams have collaborated to meet the requirements from TfL and help reduce emissions in the capital.”

100 new inter-city bus routes and reduce greenhouse gas emissions by more than 600,000 tonnes over the lifetime of the fleet by encouraging more people to swap the car for efficient public transport, which is crucial if we are to reach Net Zero by 2045.

“Every £1 from the Scottish Government will leverage £3.20 of private sector investmentdemonstrating that our shared decarbonisation goals can be met by working together and that the private sector is now leading the way on removing carbon emissions from our bus and coach fleets.

“All bus and coach operators, including those operating in smaller towns and communities, will benefit from both the novel approach to financing and the Scotland-wide charging network that will be delivered, helping other modes of transport make the switch to electric vehicles too.”

Steven Meersman, founder and director, Zenobe said: “The consortium brings together family-owned coach companies, well established bus operators, an innovative electric bus start-up and the NHS, showing how private capital can help public funding go the extra mile.”

The buses will be bodied by MCV to Transport for London specifications

TfGM to use CitySwift tech to improve buses

Authority becomes first in the UK to roll out performance optimisation platform to deliver more reliable, frequent and quicker bus journeys

OPTIMISATION

Transport for Greater Manchester has partnered with CitySwift, leader in performance optimisation for the public transport sector across the globe, to power the future of its public transport network through the use of AI and data.

This move makes TfGM the first franchised transport authority in the UK to utilise AI to deliver more reliable, frequent and quicker bus journeys, building on the Greater Manchester Bus Strategy announced last year. The plans laid out in this report highlight Greater Manchester’s vision for the future bus network, aiming to make buses the first

choice for more journeys within the Bee Network. The strategy sets an initial target of a 30% increase in bus patronage by 2030 from 2022/23 levels, equating to nearly 50 million additional bus journeys annually. This growth will be driven by improvements such as a more integrated, user-friendly, and frequent network, and better infrastructure for reliable bus journeys, with CitySwift playing a key role in this transition.

Founded in 2016 by Brian O’Rourke and Alan Farrelly, CitySwift’s performance optimisation platform gives operators and transport authorities insights, recommendations, and predictions, supporting them in the delivery of efficient, reliable and in-demand services. CitySwift empowers public transport authorities and operators to achieve unparalleled efficiency by leveraging advanced analytics,

“By working with CitySwift we will be able to see more clearly than ever how services are performing”

Catherine Towey, TfGM

simulations, and optimisations. With its easy-to-use industryleading technology, CitySwift envisions a future where public transport is the travel mode of choice for all people.

Catherine Towey, senior lead for bus franchising at TfGM said: “Customers are at the heart of the Bee Network and by working with CitySwift we will be able to see more clearly than ever how services are performing. We can then use this information to prioritise improvements and deliver a better service for passengers.”

Through this partnership, TfGM will have access to CitySwift’s performance data across the entire Bee Network, helping to identify trends and pain points such as traveller destinations and service performance, allowing them to recognise where improvements should be made to benefit passengers. Additionally TfGM will leverage CitySwift’s latest product offering, Spotlight, a globally leading intelligent recommendation engine for bus network enhancements.

Designed for stakeholders, the product enhances decision-making by providing AI-powered insights into performance and resource parameters like timeliness, cost, and vehicle numbers through scanning the whole network, executing optimisation variations, and proposing ROI improvements.

Commenting on the announcement, Brian O’Rourke, CEO of CitySwift said: “The goals and vision set out in the Greater Manchester Bus Strategy speak clearly to our mission at CitySwiftgrow patronage with frequent and more reliable buses ... I am thrilled that we’re partnering with TfGM, supporting them in achieving this goal through our transport datasolutions, as we continue to build the smart cities of the future.”

Sector seeks new data tools

Technology is already shaping public transport networks - and there’s an appetite for more

DATA AND TECHNOLOGY

Passenger transport organisations are harnessing a range of technologies to track mobility patterns and tailor networks to meet demand in the most efficient way. However, not everyone is satisfied that the job is being done as well as it could be, and there is interest in accessing new technologies to enhance the quality of decision-making.

These are the findings of a survey of 49 passenger transport professionals undertaken by Passenger Transport and data specialists CitySwift. Many wellknown industry faces responded to The State of UK Public Transport survey, which included a series of questions on technology.

Respondents were hungry for technological solutions to boost the performance of public transport networks. One cited the need to improve revenue optimisation versus cost over a whole network. Others spoke of the need to deliver “more realistic schedules,” “optimise service reliability,” “reduce lost mileage,” and harness “AI for predictive schedules using past data to project forwards.”

“It’s absolutely vital to use data to better match

Jeremy Meal, an independent transport consultant, said it was “absolutely vital to use data to better match capacity and demand”.

Ticketing and Automatic Vehicle Location (AVL) are popular forms of network data in planning. More than half of the respondents use these sources of data when planning their networks. Almost a fifth use TransXChange, the UK nationwide standard for exchanging bus schedules and related data.

There are wide variations in terms of how frequently network data is reviewed - with equally sized groups doing it daily, weekly and monthly. Half-yearly is the most common timeframe for implementing changes to networks.

There is interest in more dynamic scheduling. A third of respondents (33.3%) believe that the network they are responsible for would benefit from offering a more dynamic service.

Most are confident that their organisation understands current mobility patterns - but there’s room for improvement. Confidence is much lower when it comes to balancing supply and demand on public transport networks. Only 5.9% awarded their organisation full marks for accurately and efficiently balancing supply with demand. The overwhelming majority (72.5%) rated their organisation three or less out of five on this measure.

What network data, if any, do you use in planning?

How often do you review this data, on average?

(2%)

or N/A (35.2%)

How often do you make changes to the network, on average?

Daily (2.0%) Weekly (5.9%) Monthly (9.8%)

Other or N/A (43.1%) Ticketing

Three-monthly (2.0%)

Half-yearly (33.3%)

Yearly (3.9%)

a scale of 1-5, do you think the network you’re responsible for would benefit from offering a more dynamic service?

COMMENT

NORMAN BAKER

Ministers need new sources of funding

Delivering ‘the biggest overhaul to transport in a generation’ won’t be easy without extra funding. Some creative thinking is required

The new Labour government has made an impressive and well planned start, with announcements across the spectrum of departments. Keir Starmer’s poll ratings have rocketed in just two weeks.

They have also been rolling out the no doubt the pre-planned message that everything they have inherited is a right mess which will limit their room for manoeuvre, especially financially. This line has the benefit of being largely true.

For a change, the Department for Transport has scored well when it comes to legislative slots in the forthcoming parliamentary session, with five Bills: Passenger Railway Services (Public Ownership) Bill; Better Buses Bill; Railways Bill; High Speed Rail (Crewe to Manchester) Bill; Sustainable Aviation Fuel (Revenue Support Mechanism) Bill.

I confess to being jealous. In my three and a half years at the DfT from 2010, we were not allocated time for even one Bill, and had to creatively do what we could in other ways.

I wish Louise Haigh and her team well. It is particularly pleasing to see Lilian Greenwood in the department. She was a good chair of the Transport Select Committee as well as being a likeable MP.

So what I say below aims to be helpful, rather than critical.

The first three of these Bills place trains and buses firmly back in the public sector but that

in itself will not deliver the improvements in service that our new passenger-in-chief wants to see. Where, for example, are we with the long overdue radical changes to fares and ticketing? The shadow GBR team seems to have taken a very long time to make very little progress.

I was also alarmed to read a pre-election report in The Times suggesting Labour intends to cut the number of train services to stop lastminute cancellations. I agree this is a problem that needs attention but turning last minute cancellations into permanent ones does not seem to me to be a very helpful way forward.

Incidentally, it is right that the government is taking action to try to end the long-running ASLEF strikes on the railways, but I did raise my eyebrows when I learnt that the reconvened talks are to be between ministers and the union, with the Rail Delivery Group of private sector operators, who had been handling the negotiations, cut out entirely. A small sign of the shape of things to come. It will be interesting to see if the final outcome, and I think we will get one soon, deals solely with pay, or whether there will any

“I confess to being jealous. In my three and a half years at the DfT from 2010, we were not allocated time for even one Bill”

amendments at all to terms and conditions, some of which are pretty outdated and unjustifiable, to be honest.

The fourth Bill, on the HS2 route, needs very careful thought. Here the Labour party has indeed inherited a dog’s breakfast and this week’s National Audit Office report is rightly scathing. As I warned before the election, the cancellation of Phase 2 north of Birmingham by train-hating Rishi Sunak will add enormously to the already overcrowded West Coast Main Line, with potentially fewer seats overall than at present because of the nature of the rolling stock. As things stand, the public is in danger of paying a whopping bill of some £66bn to get a worse service.

I hope the government will take a courageous decision and reverse the cancellation of this section. I do not doubt that Louise Haigh and Peter Hendy would love to reinstate Phase 2 - it makes so much sense to do so. But that, alas, will not be a matter for them to decide, but for Rachel Reeves in the Treasury.

And what the Treasury thinks and does will run through transport policy like the word Brighton through a stick of rock, just as it always does. The transport secretary and her team will have a financial and policy envelope within which they can operate with freedom. But I fear that envelope will not be big enough to allow the really radical changes in transport that we need to see.

The calls that require more cash will be very difficult to get past the Treasury unless the DfT team can clearly demonstrate how this will help grow the economy. The reinstatement of Phase 2 of HS2 comes into this category.

Yet there are other steps they could take that would pay for themselves, or even generate a profit, and that would help meet the government’s wider objectives.

Take aviation, the subject of the fifth proposed transport Bill. It is not entirely clear, to me at least, what this will do, but I imagine it will set a quota for the use of sustainable fuel, in a similar way to the quotas set for road fuels now, E10 and so on. If so, that essentially continues the previous government’s policy of relying on advances in fuel technology to clean up the industry. Indeed, this is most likely a Bill that the new government has inherited from the last.

I am pretty sceptical that there will be enough genuinely sustainable fuel to be had,

“Everyone knows that we need to move to a pay-as-you-drive alternative to fuel duty”

but even if there is, that will not help much if the number of flights is increasing, as is happening. The Guardian reported in April that emissions from aviation are projected to reach a record high this year. This breaks the Jet Zero commitment that emissions would not be allowed to pass their pre-Covid 2019 levels. In Scotland, the government has been planning to use taxation to hike up the cost of domestic flights and so nudge people onto trains. In England, however, the last government actually cut the rate of Air Passenger Duty, the only tax or charge of any sort that is levied on flights. There is no tax on kerosene, the aviation fuel. That immediately gives polluting aviation a cutting edge against cleaner rail.

Scotland’s plan will help cut carbon emissions while potentially increasing revenue for the government. It is a policy Rachel Reeves ought to adopt but will she? And will Louise Haigh push for it? At the very least, the cuts to APD should be reversed.

But the signs are not good. The aviation industry has seductively presented itself to the Treasury as an engine for growth, or a lot of engines perhaps. Tell them what they want to hear is the tactic, and it seems to be working. The new Labour government has even said it is “open-minded” about a possible expansion of Heathrow airport, as long as it meets various tests including on the climate. Spoiler alert: it won’t.

Let me suggest this idea of mine to Rachel Reeves, one which the Lib Dems have in fact adopted. Why not increase tenfold the amount of Air Passenger Duty payable by private jets? They are hugely wasteful in carbon terms, and their passengers can afford it. Here is an easy income stream for the Treasury that can also help the environment if some people opt instead for scheduled flights.

On rail, will the Treasury take steps to protect and indeed further encourage transit of goods by rail? Just after the election, Royal Mail announced it was ending the use of trains to carry mail, instead switching all deliveries to road. This is despite their earlier commitments to boost the use of rail, and the opening last year of the country’s largest parcel facility at Daventry freight terminal. I know the new ministers have a lot to absorb, but can Peter Hendy get on this case quickly please? Perhaps he could have a word with the chair of postal

Transport secretary Louise Haigh and her team will have a financial and policy envelope within which they can operate with freedom. But will it be big enough to allow the really radical changes in transport?

services, Keith Williams, he of the Williams review that recommended more freight on rail.

But it is on roads where a smarter Treasury approach could make a real difference to Treasury income, traveller behaviour and the potential for modal shift to public transport. The last government dug itself into a hole over fuel duty with the result that the level applied has not been increased since 2011, and has actually been cut. As a result of this freeze, a freeze like a rabbit in the headlights, the Treasury has thrown away billions that would have rolled in if even an inflationary increase had been added each year.

And of course this freeze has taken place while rail fares have risen year on year, thereby encouraging reverse modal shift, from clean to dirty. Perhaps the Treasury can also be made to see that clogging streets with vehicles is hardly the way to generate economic growth.

Yet the situation is even starker. The inexorable replacement of diesel and petrol vehicles with electric ones is going to pull the fuel duty rug from under the Treasury entirely, taking away the £35bn a year from motoring taxes that they have not yet given away. Everyone knows in their heart of hearts, especially Treasury officials, that we need to move to a pay-as-you-drive alternative to fuel duty before that £35bn disappears slowly down

the plughole.

The problem is that no politician seems to have the courage to take this forward, for fear of an explosion from motorists and their champions in the right-wing press. Yet the longer that passes before the medicine is taken, the worse the symptoms get.

I understand Labour, warned off by what happened when Sadiq Khan stuck his toe in the water, have now ruled out doing anything this parliament. That may be good politics, but it is terrible policy.

Pay-as-you-drive can be sold, as the detailed and ground-breaking work from the Campaign for Better Transport showed about 18 months ago. The government should convene a meeting of all the political parties and try to get some cross-party consensus on the issue.

In the meantime, if DfT ministers find it hard to persuade the Treasury of the need to take action to help deliver modal shift, they need to find allies elsewhere in government. I suggest they start with Ed Miliband at energy.

ABOUT THE AUTHOR

Norman Baker served as transport minister from May 2010 until October 2013. He was Lib Dem MP for Lewes between 1997 and 2015.

ALEX WARNER

We are letting down our young talent

How would you feel if your son or daughter was recruited as a ‘rising star’, but not supported and unceremoniously cast aside?

Last week there have been some lovely pictures on LinkedIn of proud parents at their offspring’s graduation ceremonies. It’s been touching to see and also interesting to look at the physical resemblance of some of the youngsters to their parents! However, alongside this, I’ve spent a week ruminating about the troublesome way in which the industry treats its young, fledgling folk. There have been a few cases where I’ve been thinking, ‘how would you feel if your son or daughter had been subjected to this kind of treatment?’.

‘Treat customers the way you would look after your Mum’, is a phrase often spewed out in many a customer service training course, and this principle extends to how we look after employees in the industry and it’s something readers of my column will know has been alarming me more and more in recent years. Forget Keir Starmer’s edict around making it illegal to contact staff out of office hours, that’s the least of the worries of today’s generation. They’re quite happy to take calls and answer emails at all times, they just want their career to be a concern for others and some respect shown for their aspirations and be given some development and tutelage.

Recently, I have stumbled across a couple of situations of late twenty-somethings who have been graduate trainees within transport owning groups, working for several years in the same subsidiary companies - clearly bright, intelligent and customer-centric individuals. Yet, when there’s a change in

leadership, a different approach taken within their organisation, they have been cast aside, on notice of redundancy. Investment in their career through the graduate scheme and since, has just been ridden roughshod over. They have been left to fend for themselves, without support from line managers and bereft of pastoral support on a subsidiary and parent company basis. Those clinical, dispassionate decision-makers who control careers and lives, not once, I suspect, pause for a second and think to themselves, ‘how would I feel if my daughter or son were treated in the way that these folk are now having to experience?’. Some have gone weeks, if not months, without even a one-to-one with their line manager or any contact during a challenging reorganisation or redundancy process. It always raises my eyebrows when I consider the role of Human Resources departments in all this. There’s no point having folk with fancy names, such as ‘Talent Acquisition Partner’ and the like, if your colleagues in HR do nothing when organisations let talent that has been cultivated from such a young age on a development programme walk out of the door, and without any guidance or support. Sometimes the industry acts so arrogantly

“It always raises my eyebrows the role of HR departments in all this”

that it seems to think that young folk should feel grateful to work in the sector. This isn’t showbiz, or a Premier League football club, or a cutting-edge customer service provider like Apple, John Lewis, Walt Disney or Virgin we’re talking about here, where having these names on your CV is gold dust. We work in an unglamorous and increasingly less relevant sector, that is seen as having regressed. One where the structure is opaque and uncertain and the workforce, at senior management level, lacks diversity in terms of gender, ethnicity and background.

As a consultant and industry observer, I am highly networked and get a very good helicopter view of the strengths and weaknesses of a very wide breadth of businesses. There are some that are very wellrun, almost impeccably so. Such companies are customer-centric, treating suppliers with respect and high on engagement. It is in these organisations where you can see and hear examples of younger folk, in particular, having a development plan, a mentor, a clear career path and where losing them from the business is a barely contemplatable scenario.

However, there are other transport companies - not just operators - where there is a clear correlation between their poor performance - financial, customer service and other key indicators - and the moodmusic. Again, sometimes that’s discernible to an outsider like me, looking in, through unanswered emails, an inability to make decisions quickly, or just picking up a downbeat demeanour in conversations with employees. You can tell ‘all is not well’, yet, hand on heart, I genuinely believe that those at the top in such organisations are either blissfully unaware, uninterested or in denial. If I can see it, surely they can, or as I said to a colleague about one organisation that is clearly imploding right now, “do you think the CEO and the executive team genuinely think they are doing a good job?”.

There’s one such company that is in such disarray that it is cutting roles in profitable parts of its organisation wholesale, letting talent walk out the business, making people redundant on Teams calls without providing opportunities for support or pastoral care. Young employees, some barely into their twenties, with no one to talk to, no idea as to what to do and folk whose skills are highly technical and specialist but where perhaps

“This

laissez-faire

approach to developing and retaining talent must stop right now”

their abilities to sell themselves are less finely tuned than generalists. Yet within these organisations, there have been much lauded, costly development programmes, the kind that HR teams love to show off about on LinkedIn or put on their own CVs or hype-up for industry award schemes.

Part of the problem is my generation - the ‘fend for yourself’ mob - and it will only get worse. With some exceptions admittedly, middle-aged folk are, in my view, more selfish than our predecessors. Maybe we resided in a previous era of ruthlessness and the emergence of compromise agreements where it was a case of survival of the fittest , we were too focused on our own requirements to worry about others. This has bred a generation with two following us who the media has often suggested are self-centred and overly focused on their own emotional and materialistic needs. Whilst I am a great believer in the need to focus on mental health, one particular downside of this is that in some quarters it has been taken to the extreme of making folk focused entirely on themselves and their own requirements. I do think that taking all this into account, there are fewer leaders out there prepared to give others the benefit of the support and direction they had in their own careers.

What surprises me most though is that even through a selfish lens, there can be few more satisfying sights than to be part of the development of others; to have influenced in even the smallest way the success of the next generation. So too, watching the energy and enthusiasm of aspiring managers unleashed. The highlight of my year, as it always is, has been the West Midlands Grand Rail Collaboration Awayday that I helped facilitate. It involved frontline employees and senior managers across 12 organisations coming together to share ideas around how to improve customer service and plot the next stage towards creating a more customer-centric environment. The sheer passion in the room and the excitement among all attendees at being involved in this exercise is always a joy to behold and keeps me motivated for the whole year. However, it does make me wonder why across the whole of the UK transport sector, this kind of exercise, where frontline folk collaborate with those in other companies and those at the top of the industry’s organisation chart to jointly craft and deliver action plans,

isn’t ‘business as usual’. It’s not rocket science. It’s not just the pleasure of being involved in developing talent, but there’s a great delight to progress towards the latter stages of a career and remember fondly and keep in touch with those managers who help shape you and created memories. Whilst I’ve had a handful of less impressive bosses and some who have completely annoyed me, I still cherish some of the advice and difficult moments, even if I didn’t appreciate them at the time.

‘How would you feel if your son or daughter came home and told you they’d been treated in this way at work?’ is a real litmus test for many bosses. All parents at some time will have to listen to the employment travails of their offspring. No doubt, as I have done, you listen and sometimes feel annoyed, whilst on other occasions you can see the perspective of their employer and give suitable advice and the benefit of your own experience. But it’s a lonely environment these days for a young person trying to make their way at work, particularly in the era in which we reside where working in an office alongside colleagues and with leaders is less prevalent. Don’t always assume they are getting advice from family and friends - many are having to make it up as they go along. My son, aged 19, is an employee of my business and a fine job he is doing. I’m proud of him, but also cautious of what he will walk into if and when he works for a different company. I’m making the most of being able to guide him a little, based on my own experience, as I think there will be less tutelage and support available to him when he makes his way in his career, than I benefited from back in the day.

I also believe that as an industry we’re less clear these days about what constitutes success from young people, even those who are on formal development programmes. Cynically, I would suggest that an ability not to ruffle feathers, to be conservative, cautious, risk averse and to say the right thing, savvy with spreadsheets and good at glitzy PowerPoint slides is more important than being entrepreneurial, quirky and innovative. Keep your head down. But equally, with fewer role models around, it’s difficult to glean great characteristics from others. Where success is actually managed, it’s done so in a cloned, stultified, procedural way - some bland Performance Appraisal process that could be completed with anodyne catchphrases by Chat

GPT. This does nothing to stimulate open and honest discussions around an individual’s strengths, weaknesses and development plan. I come back to my original reference to the role of the HR team. To justify their existence as a support function, they need to get their head out of the sand and not just limit themselves to creating clunky, soul-sapping processes or going AWOL for those on their development programmes, the moment the going gets tough. They skulk off, ensconced in clinical compromise agreement or re-organisation territory and enforcing contractual clauses, nowhere to be seen for their so-called company proteges and rising stars. A few months later they suddenly lament the lack of talent in the organisation, despite sleepwalking them out of the business. As the transport industry transitions into a new structure, this selfish abdication of responsibility from its leaders will be more damaging than ever during these uncertain times. It also needs those in second tier roles as well as non-executive directors to challenge poor behaviours. At several organisations on the brink or midst of implosion, too many senior managers must know what is happening is wrong, but they either haven’t the confidence, or they’re too concerned about self-preservation, to question the path being pursued by those at the very top. And yet, as they pose next to their son or daughter on their graduation day, they should reflect for a second on how much graft, emotional and financial investment went into getting them to that proud moment, and how deeply sad they would be if they then went on to experience the treatment that their company is dishing out to young employees. The time has come for change. This laissez-faire approach to developing and retaining talent must stop right now. It’s a disgrace.

ABOUT THE AUTHOR

Alex Warner has over 30 years’ experience in the transport sector, having held senior roles on a multi-modal basis across the sector. He is co-founder of transport technology business Lost Group and transport consultancy AJW Experience Group (which includes Great Scenic Journeys). He is also chair of West Midlands Grand Rail Collaboration.

COMMENT

NICK RICHARDSON

It’s time to rethink the issue of fares

Rail fares have risen and ticket structures remain as complicated as ever while revenue has not increased as much as was hoped

On the face of it, a simple question is how much it costs to get from one place to another by train. The answer is usually difficult to articulate and devoid of any logical explanation. For example, from my local station to the next city it depends on the usual range of time bands, loosely equating to peak and off-peak (likely to be determined by when the train ends its journey rather than the actual time) but more recently with an evening ticket that applies in the afternoon for some trains. There are three operators each with their own fare structure which sounds good except that many train users don’t care which it is as long as it gets them to where they need to be. However, the price depends on which sort of train is selected with Southern Railway having slightly less expensive tickets than the others if users can commit to using its trains only. Online prices vary throughout the day and all the discounts associated with various railcards (all with their own set of conditions and territories) apply at different times. The result is that from this one station to another, there are dozens of prices. Anyone new to the complex process that is buying a ticket is naturally baffled. If you purchased any other commodity, the price wouldn’t vary; for example, one tin of beans of one brand would be expected to be the same price as the identical one next to it. It has all got rather silly. For longer distance trains, the price seems to vary by the minute depending on which agent is the supplier and how the train

company feels at the time; the airline style of variable pricing is all very well from the providers’ point of view but what it maximizes in revenue, it undermines in the confidence of the consumer.

We were led to believe that the whole problem of ticket pricing was to be overhauled but little appears to have resulted. The starting point was CrossCountry, the immediate effects apparently being a significant increase in prices. This review doesn’t seem to have to got off the ground and a good start would be to work towards consistent pricing to reflect an integrated railway, something that it is a long way from currently. Now it is being left to Great British Railways to sort it all out, and it is not a simple conundrum to address.

Peak or non-peak?

It appears that while the number of passenger journeys has reached 93% of pre-pandemic levels, revenue has only managed 78%. This is a fundamental problem associated with changed travel to work patterns with many people travelling less regularly. Even with

“We were led to believe that the whole problem of ticket pricing was to be overhauled but little appears to have resulted”

tickets designed to accommodate new forms of commuting, it seems that recreating the railway’s dependence on peak hour journeys remains elusive. Longer term this is a big problem because a mismatch between service provision, revenue and demand has no easy fix. In Scotland, the experimental abolition of peak fares may provide some clues as to how this can be dealt with but the underlying absence of much of the former revenue base needs to be compensated by more users, either at peak times or throughout the day. However, the Scotland experience tells us that overall, an absence of peak time prices makes little difference to revenue so it is likely to revert to the old system of peak pricing. Perhaps if it makes little difference, it would be worth keeping to help the passengers.

Uncollected revenue

A further problem is fare evasion. Government does not have any figures for how much fraud and evasion occurs, possibly because it is often hard to identify. Instead, the Rail Delivery Group estimates that approximately £240 million is lost annually. In many instances, tickets are not checked and therefore evasion is relatively easy. Underpayment is another possibility and Transport for London puts a great deal of effort towards identifying culprits and taking action to recover lost revenue. On the wider network, it’s remarkably common to purchase a ticket which is then never checked because staff are not in place or don’t undertake checks. The swoop squads that blockade station exits from time to time seem effective but cannot be everywhere all the time. The millions of pounds that are uncollected could be useful revenue which is simply overlooked. Despite penalties increasing, it is unlikely that this will deter the most persistent offenders.

Affordability

Behind all this is the fact that train fares have continued to rise faster than inflation for years. This reflects the notion that passengers should cover a greater proportion of therailway’s cost than the contribution made by the wider population paying for a national asset through taxation. Pity then that this principle doesn’t apply to other modes, notably roads. Successive price increases are making trains less attractive – one of the reasons that peak

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commuter demand has declined is that people woke up to the reality that a disproportionate amount of their salary was being diverted to getting to and from work. The pandemic provided the opportunity to avoid wasting disposable income on train travel and both employers and employees discovered that they didn’t need to do what they had been doing for decades. The legacy of milking peak period passengers is that there is ever-increasing resistance to paying fares. Typical journeys to work of 10 to 20 miles by train are in some areas now so expensive that driving a car is both cheaper and easier, even with regular congestion. Put simply, many train journeys are unaffordable and in the absence of any demand restraint on car use, policies to promote sustainable travel are largely meaningless. Those that venture to work by car complain vociferously about parking charges and Low Emission Zones but anyone who makes the

journey by train is often paying more. There is no price incentive to use trains and even if fares appear reasonable, poor quality services undermine the offer.

We are reminded that there are lots of offpeak offers available but these are limited in number and usually require booking specific trains so there is no flexibility and have lots of conditions attached. It is quite likely that a weekend away by train is priced beyond many people’s means and for those with a car is irrelevant, particularly if more than one person is involved. A journey I have been making regularly now costs around £100 return by train and an hour’s bus journey needs to be added; the same journey by car costs £48 return in fuel.

Price can be a huge incentive to travelmost bus services in England are benefitting from the government’s £2 fare cap - but train fares are spiralling out of control in price and

complexity. A coherent pricing strategy could work wonders, particularly if train operators (working under government contracts) can bring themselves to cooperate. If they don’t then the railway will become and even more expensive asset that can’t recover anything like its costs. An integrated railway with coherent ticketing would be a huge step forward and be more likely to attract new and returning users than the current confusing and illogical offer.

We wait with interest to see what the next shake-up of the railway will deliver.

ABOUT THE AUTHOR

Nick Richardson is chair of CILT’s Bus and Coach Policy Group and is a former chair of the Transport Planning Society. In addition, he has held a PCV licence for over 36 years.

OIL MARKET REPORT

Why oil prices will trend sideways

Our prediction was for oil prices to stick in the $70-$80 per barrel bracket in 2024 - and we are sticking with it. Here’s why

A little bit later in the year than usual (because of the recent election frenzy), this month’s report will look at how the oil markets have fared so far in 2024 and whether the oil price predictions we made in January are on course to be correct.

Let’s start with crude and the Brent price, which started the year at $76 per barrel and finished the half-year (Jun 30) at $86. A 13% rise is clearly a decent increase, although in the context of the last few years, it would not be categorised as anything spectacular. Overall, the broad direction of travel has been steadily upwards, with the Q1 average (Jan-Mar) at $82 and Q2 (Apr-Jun) being $85 per barrel. At the beginning of April however, there was a steep drop in prices, as Brent quickly retreated from the highs of the year so far (April 5 = $91), to only $78 exactly two months later (June 5).

Readers of this report will remember that our start of year prediction (PT306) was for prices to largely trend sideways in 2024 and stick in the $70-$80 per barrel bracket. Evidently price movements from Jan-Jun have not been exactly in line with this forecast, but at the same time, the sharp correction downwards in April/May would suggest that a “price ceiling” had been hit. This is because oil markets were broadly balanced and with supply and demand in check, prices eased off. Global supply remains extremely buoyant

and there is no let-up in the flood of product coming on-stream, with 1.4 million barrels per day (bpd) being added to the market in the first half of this year. The supposedly “anti-oil” President Joe Biden, has overseen an increase in US production of 800,000 bpd this year and that was on top of a one million bpd increase in 2023.

In addition to the current healthy global supply position, some of the bullish (ie, upward) geopolitical price factors that we discussed in January have not come to pass. The Russia-Ukraine war seems to be set in stalemate, whilst the Palestinian conflict has not yet extended beyond Israeli-Palestinian borders. At the same time, the attacks on shipping in the Red Sea have decreased and many shippers are now re-routing their tankers around the Cape of Good Hope anyway, so that any extra freight charges have long been factored into the overall cost of crude.

If we now look at refining, we can see that the production “crack” at the beginning of the year was around $35 per barrel, but this has now fallen below $20. The crack (or “refining spread”) is how much gross profit a refinery makes and is based on the sale price of its refined products (eg, petrol, diesel, jet fuel)

“There is no let-up in the flood of product coming on-stream”

minus the buying price of its crude feedstock. The first point to note is that a $35 refining crack is a handsome margin indeed and by historical standards, the reduced crack of circa $20 isn’t bad either. Nonetheless, the relevance of the reduced crack spread is the impact it has had in lowering consumer prices, because end-users buy refined products rather than crude oil itself. So in January, refineries were buying their crude at $76 per barrel and then enjoying a gross margin of $35, which meant that the price of petrol, diesel etc was circa $111 per barrel. However, fast forward to the end of June and the refinery gross margin is now only $18 per barrel, which means that even though the price of crude had risen to $86, that still only gave a price for petrol and diesel of $104 per barrel.

The reason behind the drop in refinery margins has been well explored in previous Portland reports and is basically the result of increased refining capacity around the world. For the last five years, Indian refineries have massively increased their production capabilities, whilst more recently, the huge Dangote refinery in Nigeria has been having a serious impact on European fuel markets. A total of 18 new refineries/refinery expansions are scheduled globally for 2024 and in this light, it seems highly likely that refinery margins will continue to fall and the crack may well end the year at around $10 per barrel.

This ongoing drop in end-user prices is exactly what policy-makers around the world have been hoping for, because of its role in taming inflation. That in turn has been one of the factors behind the softening of interest rates to the point where we now have the million-dollar questions of when reduced rates will free-up spending, lift the economy and stimulate demand? This certainly hasn’t happened yet and nor have the lower prices for refined products generated an uptick in demand. In fact, world oil demand is currently decelerating, with the Chinese economy flatlining and consumption stagnant. At the same time, it seems unrealistic to think that reduced interest rates will start to enable growth before the back-end of this year or even Q1 2025. On that basis and considering the continued ample availability of crude supplies, we stick with our original prediction that prices will trend sideways for the rest of the year.

GREAT MINSTER GRUMBLES

Four Bills have brought a bit of buzz

Our Whitehall insider imagines what’s going on inside the minds of the mandarins at Great Minster House, home of the DfT

It was a smart move, was it not, to separate out the government’s plans to bring back all rail franchise contracts into the public sector by introducing a separate Bill - the Passenger Railway Services (Public Ownership) Billfrom the broader legislation to set up Great British Railways. I must confess that I was initially a little puzzled as to why a Bill to bring these franchises back under public sector control was necessary, given that I thought all the secretary of state had to do was simply not extend or re-bid a franchise contract when it came to an end.

But, of course, the 1993 Railways Act requires the secretary of state to procure private sector franchise contracts, so legally speaking you have to remove this requirement. Silly, silly me. I should have thought that through. Anyway, it’s clear that this government intends to move at pace to bring franchise operations back under public sector control as fast as it possibly can. The Passenger Railway Services Bill is only four clauses long so it wouldn’t surprise me in the least if the government’s plan is that it should secure Royal Assent before parliament rises for the summer recess on July 30. That would require the lifting of certain procedural norms and Standing Orders, but governments do occasionally push legislation through in a matter of days, and I suspect that is the plan in this case. So we start to wave goodbye to our private sector franchise operators. It’s been nice

knowing you these past 30 years. I can’t say you have always covered yourselves in glory, and the debate about the merits or otherwise of rail privatisation never went away. The irony is that ever since Network Rail was renationalised, the poorest performing part of the railway has been the public sector infrastructure owner and manager, Network Rail. Of course, the anonymity of Network Rail to the general rail passenger meant that it was the operators that always got it in the neck when trains were delayed or cancelled, and to be frank too often the quality of passenger information provided by the operators was woeful.

Nonetheless, at one level I feel sorry for the private operators. In recent years they have been the victim of a franchise procurement regime devised and implemented by this department which, in all honesty, was not fit for purpose; and they were increasingly shackled by a scale of micro-management by officials that made life impossible for them. But, equally, the private operators never won over a sceptical travelling public and they are not blame-free for their ultimate demise.

We will, I’m sure, also soon see the second

railways Bill to set up Great British Railways, and there is to be a Better Buses Bill, as well as a Bill to “repurpose” the HS2 CreweManchester Bill. We also have a Sustainable Aviation Fuel Bill. This department always seems to struggle to get much legislative time to take forward the legislative reforms that we need, but now we have not just one Bill, but four! I’ll resist the temptation to make that standard joke about waiting for a bus for ages and then three come along at once.

The rail and bus legislation represent, of course, the cornerstone of this government’s plans for transport. No surprises there. I’m just left wondering whether, in two years’ time, bus and rail passengers will have noticed much difference. If they do, and if performance and reliability really do move in the right direction, then this Labour government will be well within its rights to say that privatisation and deregulation were a failure. Let’s see.

Meanwhile, since my last column we have had the appointments of three parliamentary under secretaries of state - Lilian Greenwood who takes the roads brief, Simon Lightwood who keeps the buses brief and Mike Kane who keeps the aviation brief. I’m pleased to see Lilian Greenwood here in Great Minister House. As a former shadow transport secretary and chair of the Transport Select Committee she knows and understands the issues. I suspect she would have preferred the buses brief but as Simon Lightwood held this brief as a shadow minister, as did Mike Kane with aviation, it was perhaps inevitable she would take roads. But at least with Lord Hendy of Richmond Hill as rail minister and Lilian Greenwood as roads minister we do have two knowledgeable and experienced operators at the helm, thank goodness.

With four Bills to get through parliament in this session it’s going to be a busy time. Actually it’s all feeling rather fun. Life was drifting under the previous government, perhaps inevitably. Now there is a bit of a buzz about the place once more.

“I feel sorry for the private operators ... But they never won over a sceptical travelling public and they are not blame-free for their ultimate demise”

Apprentices wins IRTE Skills Challenge awards

National Express West Midlands apprentices win top awards following a IRTE Bus and Coach Skills Challenge competition earlier this year

Two National Express West Midlands apprentices have achieved success at the recent IRTE Skills Challenge, where over 60 qualified and apprentice bus and coach engineers from across the UK competed.

Neave Sproson, a mechanical and electrical apprentice, won the best Electric Driveline Apprentice trophy and the prestigious Judges’ Choice award. She also secured the runner-up position in the Electrical Apprentice category. Sproson, from Northfield in Birmingham, showcased her

APPOINTMENTS

NETWORK RAIL

Following the appointment of Lord Peter Hendy as a transport minister, Mike Putnam, Network Rail’s senior non-executive director, has been appointed as acting chair of the infrastructure controller.

Putnam (pictured) joined the Board of Network Rail in 2018 and has over 25 years’ executive experience across the development, construction and services sectors. He was president and chief executive officer of the UK arm of Swedish contractor Skanska until May 2017.

The process of appointing a successor to Lord Hendy will begin in due course and be led by transport secretary Louise Haigh

mechanical and electrical skills during the IRTE Skills Challenge in June, achieving the highest score in her category.

SCOTTISH RAIL HOLDINGS

Scottish Rail Holdings has announced the appointment of Hannah Ross chief executive.

Ross (pictured) is currently head of major projects and commissioning at City of Edinburgh Council and will start her new role on September 30. She will also chair the boards of ScotRail and Caledonian Sleeper. Ross was recently recognised with the Outstanding Contribution to Transport Award at the Scottish Transport Awards last month.

MIDLANDS CONNECT

Midlands Connect has announced the appointment of Mike Bull as programme director.

“From feeling very nervous to hearing my name called out as a winner is a feeling like no other,” Sproson said. “I feel really proud

Bull (pictured) has more than 19 years of experience in leading projects and delivering improved transport infrastructure and services. He has previously held roles with Highways England, the Highways Agency and British Transport Police.

TRANSPORT UK LONDON BUS

Transport UK London Bus has announced the appointment of Paul Hennigan as the bus operator’s new fleet and facilities director.

Hennigan (pictured) joins Transport UK London Bus from Go-Ahead where he was latterly service delivery director at Oxford Bus Company. In that role he had been responsible for introducing the operator’s new electric bus fleet.

of my achievements.”

Meanwhile, Thomas Moore, a 20-year-old bodymaker apprentice from Bushbury in Wolverhampton, also competed in the IRTE Skills Challenge. Moore repaired a dent in a wing panel, completed online tests, and undertook a three-hour welding task, including precisely measuring and cutting part of a vehicle before carrying out the required repair work.

Moore triumphed in the bodymaker apprentice category and was awarded the best Apprentice Bodymaker at the IRTE Skills Challenge Awards ceremony.

“I didn’t think I had a chance of winning - especially as I am a first-year apprentice!” said Moore. “I took part for the experience and hoped it would help me if I competed next year, so to win is an unimaginable feeling.”.

WARRINGTON’S OWN BUSES

Warrington’s Own Buses has appointed Andy Rigby as head of commercial. Rigby (pictured), who joined the council-owned operator in 2022 as project manager, successfully led the move to a new depot and later served as head of facilities.

WARRINGTON’S OWN BUSES

Warrington’s Own Buses has announced the appointment of Mike Tickle as training and wellbeing coordinator. Tickle (pictured) has held a number of senior roles with hospitality companies that have included Subway and Starbucks.

DIVERSIONS

Pioneering HST train designer passes away

Sir Kenneth Grange dies aged 95

Sir Kenneth Grange, the highly influential industrial designer of the High Speed Train, has passed away at the age of 95.

Grange had already made a name for himself as an influential industrial designer when he co-founded design consultancy Pentagram in the early 1970s. His diverse portfolio included the first UK parking meters, the Kenwood Chef mixer, Wilkinson Sword razors, Kodak cameras, and Royal Mail

On the beach

Sir Kenneth Grange: 1929-2024

its new prototype of the train, Grange was dissatisfied with the prototype’s shape and external form. Taking matters into his own hands, he reimagined the shape and styling of the power car to create the design that is now considered a classic.

However, Grange is perhaps best remembered for his groundbreaking work on the HST, better known as the InterCity 125. Commissioned by British Rail to create a livery for

The result was a sleek, aerodynamic shape with a striking livery that entered service in 1976 and became a symbol of highspeed intercity rail travel in the UK. It’s a testament to his skills that Grange’s iconic design remains popular to this day.

In recognition of his contributions to design, Grange was knighted in 2013.

FREE TRAVEL GETS PUPPIES ONBOARD

HOME FROM HOME FOR LOTHIAN BUS

Kim Ricardo and Ted Dwight now live just metres from a palmfringed beach on the peninsula of Sinclair Bay, Queensland, but their new home is quite unusual - it’s a

former Edinburgh Corporation, Alexander-bodied, Leyland Atlantean double-decker bus.

Eight months ago, the pair discovered the bus for sale online, decaying in a local garden. Since then, they have spent around £30,000 restoring it and transforming it into a comfortable home with a view of a mountain known locally as Ben Lomond.

The bus itself, EWS812D for our spotting chums, has an interesting history. After being retired from service in Edinburgh in the 1980s, it served as staff

transport on a fruit farm near Dundee. In 1993, it was sold to two bus enthusiasts who restored it. The bus then became a regular on the rally circuit and was even displayed at the Scottish Vintage Bus Museum at Lathalmond. In 2014, it was sold to an Australian buyer who shipped it Down Under to New South Wales.

Kim and Ted have never been to Edinburgh, but they are very grateful to the city for providing them with a home. “Now we have a beautiful, moveable flat that we can drive anywhere,” said Ted.

Go-Ahead subsidiary Pulhams has partnered with national charity Guide Dogs for the Blind Association to offer trainers of puppies’ free travel on its services across the Cotswolds and in Oxfordshire and Wiltshire. Haley Andrews, head of puppy raising for Guide Dogs said: “We’re extremely grateful to Pulhams for offering free travel to our volunteers, meaning our dogs can gain experiences around public transport and continue to learn about the world around them.”

This also gives us a good excuse to print a picture of a Guide Dogs puppy. Awwww.

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