As good as London?
“If it’s good enough for London, it’s good enough for us!” So goes the argument. But is it necessarily true?
For a start, London didn’t start from where we in the North East started 25 years ago. London’s buses have been subject to one form of regulation or another since at least 1924 and ever since have always been considered to be a ‘special case.’
Chris Cheek of TAS Partnership, a well respected independent firm of transport consultants, went so far as to publish some facts about franchising in London, in an attempt to cut through some of the rhetoric. I paraphrase, but the facts are:
Bus services in London operated without public support on a ‘break even’ basis in one financial year (1997/98). However, it was quickly realised that this… had been achieved by depressing driver wages… and by… the pause in investment in new vehicles… What happened during that year was a serious slippage in service standards resulting from staff shortages, which resulted in the only fall in passenger demand seen in London in the fifteen years to 2009.
Either side of this one ‘subsidy free’ year, the London network cost taxpayers £12m in 1996/97 and £21m in 1998/99. Support doubled again in 1999/2000 to £44m. …Following the transfer of responsibility for transport to the London Mayor and the creation of Transport for London… the trajectory of spending increases was enormous: £84m in 2000/01, £186m in 2001/02, £421m in 2002/03 and £560m in 2003/04 – the latter two years seeing the preparations for the introduction of the congestion charge.
Thereafter, the growth slowed down, but expenditure in 2009/10 was still £690 million.
… to pretend that their success can be replicated elsewhere in the UK simply by changing the regulatory system and at no cost to the public purse is, frankly, not remotely credible.
And, not to put too fine a point on it, even the guy responsible for London doesn’t think that the model would work in other places. Peter Hendy, London’s transport commissioner, said in a magazine interview last year: “The only reason regulation in London is successful is because we have the money to buy what London needs. The Mayor – both Mayors have seen the necessity of that in London’s conditions. If other places in the UK want to benefit from regulation then they need the money to buy the services they want. Otherwise, there is no point. And if there’s not any money, then this form of regulation isn’t appropriate.”