Charlie Marks has this, from Calvin Payne of Sheffield:
Despite deregulation in the 1980s, bus companies now receive annual subsidies totalling £1.2 billion. Companies profit from successful routes while claiming public money to ’subsidise’ the less profitable ones, such as those used by school children and the elderly. Public money is spent adding to the profits of some of the biggest companies in the country under the threat of service withdrawal or reduction.
These companies receive the equivalent adult fare whenever a free pass holder uses the service and have been accused of increasing fares on certain routes to take advantage of this arrangement.
The problem according to OFT is that there are not enough companies competing to run services. But whether in a monopoly situation, or with competition, private companies are still going to try to drive down wages and increase fares. In Sheffield some routes have seen fare cuts as a result of competing firms; however a couple of weeks after one firm increased fares by 20%, so did the other!
The OFT report also accuses large firms of undercutting smaller firms to drive them away, so any fare cuts are short-lived once that aim is achieved.
The Competition Commission is set to investigate the ‘unfair business practices’ of large bus companies. But a return to public ownership is not being considered by politicians or business friendly investigative bodies.
Amongst passengers though, that solution is still very much in mind and demanded. The cheap and good service run publicly in South Yorkshire until 1987 is still the benchmark as far as local passengers are concerned and is fondly remembered.
As well as passengers, the drivers and staff are angry at the current situation. Companies such as First and Stagecoach are attempting to freeze wages at a time of record profits and shareholder dividends. This has led to a series of strike ballots which are planned to culminate in nationwide action later this year.
If drivers and passengers can be united in one fight to restore public ownership, then fares could be cut, services maintained, and wages increased from current low levels back to their equivalent from regulated days. This task is down to campaigners and fighting union activists in the coming weeks and months.