‘Spending Review will decide whether bus strategy aspirations will be met’

Report shows current funding falls well short of what will be needed for levelling up

A new report by the Urban Transport Group has shown that the Spending Review will need to make significantly more funding available for bus if the aspirations of the national bus strategy, and the Government’s wider levelling up agenda, are to be to met.

The report (Back the Bus to Level Up: The case for bus revenue funding and reform of how it is provided) uses the Urban Transport Group’s Metropolitan Bus Model (the most sophisticated bus policy modelling tool currently available) to look at what levels of additional revenue funding would be needed in the six largest city regions outside London if the bus strategy’s goals for more extensive and cheaper bus networks are to be met.

The model found that if revenue support for bus services in the six largest city regions increased by between £1.7 billion and £2.3 billion a year above pre-pandemic levels then bus services and networks could be significantly enhanced (by between 145% and 165%) to serve more places, more frequently, more of the time. Fares could also be reduced (by between 10 and 20%). This in turn would drive growth in patronage of between 15 and 34 per cent by 2026/27. This would meet key objectives of the national bus strategy.

At present the Government has pledged £3bn to transforming bus services (alongside funding designed to support existing networks). How this funding is to be allocated is as yet unclear. However, if the £3bn were divided equally between capital and revenue, by transport authorities and by year this would amount to less than £6.5 million a year in additional bus revenue funding for each of the city regions. The report concludes that this would not be sufficient to meet the objectives of the national bus strategy.

The report also shows a better deal for bus from the Spending Review would represent excellent value for money achieving multiple public policy goals including key Government objectives for levelling up and carbon reduction.

The report finds that: ‘The bus is intrinsically targeted at the people and places most in need of support to level up’ and quotes the National Bus Strategy which says that ‘buses are vital to ensuring the economy meets Net Zero carbon emissions.’

The report also calls for a review of DfT spending priorities and says:

‘There are…wider choices to be made within the finite DfT budget…In particular the £27 billion National Road Programme which cannot match the environmental, social and economic benefits that supporting bus services can bring.’

Chair of the Urban Transport Group, Laura Shoaf, said:

“We share the national bus strategy’s aspirations for more, better and cheaper bus services and we will do everything in our power to deliver these objectives. However, in the context of driver shortages, the long shadow of the pandemic and the decline that was taking place nationally in bus use prior to the pandemic, the Spending Review needs to back the national bus strategy through a further step change in funding for bus. Otherwise, we risk the bus strategy being a false start rather than the starting gun for the revival of the urban bus that we all want to see."

The report also makes the case for reform of the way bus funding is currently routed and targeted. It describes the way in which additional bus funding has been provided during the pandemic as ‘patch and mend’ of an existing pre-pandemic system of bus funding which has ‘no consistent or coherent objectives’ and which leaves transport authorities unable to plan and oversee wider public transport networks in the public and passenger interest.

On funding it finds that: ‘The national bus strategy has transformed the context for bus funding by significantly raising aspirations for the sector and by giving Local Transport Authorities a key role in its local delivery. The approach to bus funding has not kept pace with the transformation on national bus policy that has occurred.’

It calls for bus funding to be simplified and devolved to those Local Transport Authorities which wish to take it on by April 2022 in a way which reflects the costs of achieving the objectives of the national bus strategy but also allows city region transport authorities to target funding in the most effective way, consistent with local circumstances and aspirations.