Transport Committee calls for sustained financial support for bus services in England

• Read the Government Response
• Read the full report: Implementation of the National Bus Strategy
• Find all publications related to this inquiry, including oral and written evidence

Iain Stewart MP welcomed the recent announcement of additional funding to 2025 and now calls on the Department for Transport (DfT) to continue working closely with England’s councils to upgrade local bus services. 

His reaction comes as the Committee publishes DfT’s response to its own report that scrutinised the National Bus Strategy. 

The Strategy was published in March 2021 with the aim of both improving services and encouraging more people to stop using their cars and go back to using buses, following a slump seen during the pandemic that was exacerbated by a decline in service quality. Reversing the shift from bus use to private cars will also help cut carbon emissions, as per the Government’s net zero emissions policies. 

Chair's comment

Transport Committee Chair Iain Stewart MP said: 

“Our report warned that if the Government did not loosen the purse strings and give at least some BSIP funding to all areas of the country, a two-tier system could emerge, with some areas having notably worse services than others in neighbouring towns and cities. Although the Government did not explicitly acknowledge this warning, we are pleased it appears to have taken the idea on board, and that the latest round of funding saw those councils that missed out last time getting some of the pie. 

“We still believe the Government should find more funding beyond 2025 to truly transform local services in the way its original Strategy envisaged. We look forward to hearing the outcome of the evaluation of BSIP funding that DfT now plans to conduct. 

“Elsewhere ministers deserve credit for sticking with the £2 fare cap. Ridership has been gradually recovering partially thanks to this, which is exactly what we need to get emissions down and quality bus services on a sustainable footing. But we need ministers to keep this up and realise this really is money well spent. 

“We can only hope DfT has a breakthrough with its efforts to get 4,000 zero-emission buses on the road. It boasts that 3,400 zero emission buses have been funded since February 2020, but what that actually means in terms of how long before they’ll be on the road feels very unclear.” 

BSIP funding 

Bus Service Improvement Plans (BSIPs) were the Government’s challenge to councils – to partner with local bus firms and come up with detailed, costed plans of how they could improve services in their patches by investing in upgrades like new priority bus routes, cashless payments and smart ticketing systems.  

County and city councils across the country followed suit and sent BSIPs to DfT, but 60% found their bids, from a £1.1bn pot, were rejected. All received less than they asked for, leaving some council chiefs and bus operators deeply disappointed. 

In its report, the cross-party Committee urged DfT to make more funding available, warning that otherwise the ambitions in its National Bus Strategy would not be achieved. It also warned that a two-tier system could emerge, with areas that received funding able to improve services, while those that did not continuing to see services decline. 

DfT recently announced a second smaller round of BSIP funding totalling £160m, which ensured all councils had received some funding. However, DfT’s response to the report makes no commitments to “significant further funding”, as the Committee recommended.  

The 4,000 zero-emission buses target 

The response did not directly address MPs’ scepticism that DfT will hit its target of getting 4,000 zero-emission buses (ZEBs) on UK roads by the end of the parliament, via its Zero Emission Bus Regional Areas scheme. The Department said approximately 3,400 ZEBs have been “funded” across the UK. However, in response to a recent written question it told the House it had not estimated what the average length time is between funding being allocated for ZEBs and them becoming operational. 

The Committee’s report said DfT should produce a clear, staged plan for the full transition to ZEBs, in tandem with the delayed response to its consultation on ending the sale of non-ZEBs. This should include a clear long-term funding plan focused on “difficult to decarbonise rural routes” and supporting the installation of costly new charging infrastructure.  

The Government reiterated its commitment to setting an end date for the sale of new non-zero emission buses “shortly” and says “in due course” it will publish a plan for phasing out non-electric buses entirely.  

Reforming the Bus Service Operators Grant 

The Committee said DfT must consult as soon as possible on reforming the Bus Service Operators Grant, a subsidy for fuel paid to bus operators and local authorities, which does not incentivise operators to transition to zero-emission buses. In the Strategy, the Government accepted the current funding formula was “outdated” and “not right for the twenty-first century”. 

The response committed to launching a consultation “later this year”. DfT will also “explore mechanisms by which [the Grant] could support ZEB uptake”. 

Socially and economically necessary services 

In the National Bus Strategy, DfT said it would issue new guidance on socially and economically necessary services and consider introducing a statutory requirement on councils to provide them. The report expressed disappointment at the lack of progress two years on and urged minister to “put its promises into action”. 

The response said new guidance will be published “during this parliament”, and will “consider statutorily requiring” socially and economically necessary bus services if the BSIP process does not result in improvements. 

Municipal bus companies, franchising and Enhanced Partnerships 

DfT’s Strategy said the ban on councils having in-house municipal bus companies was “ripe for review” and that it would issue new guidance on bus franchising – the model used by TfL and is only available to metro mayors and councils with ‘devolution deals’. MPs said DfT should get on with this as two years had now passed. The response said new franchising guidance will be issued “as soon as possible”, and that a call for evidence on allowing new municipal bus companies will be launched “during this parliament”. 

The National Bus Strategy pushed for local authorities to instead adopt statutory ‘Enhanced Partnerships’ (EPs) with local bus firms. The Committee said EPs were “largely untested”,  and that ministers had “made a big bet” on them being the best model. The report said DfT must carefully monitor how well EPs are working and ensure appropriate contingencies are in place. 

DfT’s response said councils are obliged to carry out such monitoring, but that it will provide support for EPs via its new Bus Centre of Excellence. It also highlighted positive feedback from councils using EPs, while acknowledging they are a “new and untested mechanism”.  

Further information

• Inquiry: National bus strategy: one year on
• Transport Committee

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