7. Plaid Cymru Debate: Bus emergency scheme

Part of the debate – in the Senedd at 6:30 pm on 22 March 2023.

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Photo of Lee Waters Lee Waters Labour 6:30, 22 March 2023

Well, the bus industry says it themselves; they're very clear that, without it, the bus industry would have collapsed. And I would say this seriously to the Conservative speakers: we have made choices in this Government to support bus, and we would like to continue making those choices, but in the face of the continued austerity budget that we have, we simply do not have the resources available to continue funding the emergency subsidy at the rate that we have. We've already spent over £100 million a year subsidising privatised companies to run buses. On top of that, a quarter of the education budget is spent on school transport. So, there are significant sums of public money going into private companies into a broken model, that has not delivered us the system that we need. And I think that this current crisis shows more than anything—it makes the case for reform of franchising that we set out in our White Paper.

So, I'm confident that we have the right medium-term plan to put many of the flaws set out this afternoon right. But, of course, we have a gap, and that is what we are currently grappling with. Now, I am meeting regularly with the bus operators, we're meeting weekly; I met them on Monday, and I'm meeting with Transport for Wales and the Welsh Local Government Association, and we are trying to come up with a way forward that bridges that gap from where we are to get to franchising. The money simply isn't there to keep all the current services running, and as Janet Finch Saunders rightly pointed out—this, I do agree with her on—the incentive built into the current BES system, which was an emergency response, disincentivises a recalibration of the bus services to meet the demands of today's passengers. We're running a bus network based on the pre-COVID footprint, with a guaranteed 7 per cent profit that operators have been protected from the market realities from, and that is not something we wish to continue to do. So, we want to bring the bus emergency scheme to an end in June, but we do want to create something in its wake that allows us to get to the next stage in a way that is rational and sensible and affordable.

The Conservatives say nothing about bus services in England which are collapsing; the UK Government, as a consequence of not spending any money on buses in England, we are then not getting a Barnett share of that. So, we have a real financial challenge here, and as Plaid Cymru know very well from the discussions they've been having with us about the rest of this year's budget, we collectively have prioritised really important other public services, but we can't spend that money twice, and I think that is something that they need to acknowledge about the choices that, collectively, we have made and the consequences of those choices. There are no easy options here. So, we face a real problem, there's no denying the fact. We are working through, with the industry, a way of making the best of the money that we do have, so we've extended the funding for three months; the First Minister has made clear that we are prepared to make further funding available, and we are trying to co-design with them a way to do that that protects as many services as possible, but there is simply less money than there was last year, and so, there will be a reduction in the bus network. It's not something that I want to see; it's not something anybody in this room wants to see, but it is a consequence of those four forces that I set out, and particularly of the austerity budget that we face.

To try and pick up some of the other points made in the wide-ranging debate, I would say to Janet Finch-Saunders that I also agree with her on the need for a major campaign, and with Huw Irranca-Davies too, to get people back onto buses. One of the biggest problems that we have on the bus network is that the fare box is down because passenger numbers aren't there. The revenue is not coming in and the model we have will not work. So, I'm very keen to work with the industry to get a campaign going to get people back onto buses.

I agree also with what Luke Fletcher said about the role of school transport in this. We currently have a really inefficient system where we are treating school transport as a separate entity. What I'd like to do as part of the franchising is to bring school transport into the scheduled links and we are working with Monmouthshire in particular to see if we can trial that with their school buses, as we build up to franchising. 

To Alun Davies's point on the Grange, it's a point he's made strongly and correctly for some time. I have written to him again today, setting out one of the reasons we've had, and one of the reasons we've had, as I've mentioned before, is because the current system of deregulation is broken. And we have tried to introduce publicly supported services, but they've been challenged by other operators, which prevented us, under current competition law, from bringing that in. But we think we've now found a way around that and we hope to be making announcements in the coming weeks on a service for his constituents to those key public health services. And on the Fflecsi, of course, he's right that it's had strengths and weaknesses, and that is the point of a pilot—it's to trial things. And we're evaluating it, and he is correct that, in many areas, a scheduled service is what is needed, and Fflecsi does that extra bit that the scheduled service hasn't done well. 

I can assure Jane Dodds that the ladies of Llangynog have not been forgotten, nor have the people of the Neath valley or the Gwendraeth valley or of any other part of Wales. We have a genuine problem here that all of us need to confront: for too long, we have not invested enough in public transport. We are dealing with a legacy of a broken system; COVID has tipped it over the edge and austerity is preventing us from coming to the rescue. Even given those very real constraints, I will do my utmost, working with the industry and local government, to come up with a solution that gets us from where we are to franchising, which I think offers us many of the medium-term solutions that we all agree are necessary.