Monday, June 29, 2009

Buses v Dogma

We know that state provision of services is generally inefficient and unresponsive to customers' needs compared to the private sector. So if a service can reasonably be provided by the private sector, then it should be. This is why buses were deregulated in the 1980s and it was a disaster. Unlike, say, water or rail, there was no regulation of fares and these went through the roof, and are still rising year on year above inflation. Instead of profitable routes cross-subsidising unprofitable routes, extra public money had to be found to subsidise these routes. A very few routes enjoy competition, high frequencies and occasional discount fares. But the majority of profitable routes are not worth fighting over, and the customer is treated as a captive cash cow.

So why this discrepancy between theory and practise? Free markets are competitive, but attempts to introduce them so often seem to bring uncompetitive rip-off practises instead. We (rightly) aren't willing to stand the withdrawal of the only mobility option from millions of vulnerable people, so we try markets plus subsidies, which inevitably corrupts the markets. And for this, the publicly owned asset - the right to run buses on profitable routes - was given away for nothing.

Today government wants more people to take the bus instead of driving, and PTEs up and down the country will spend money on better bus stops and better bus lanes, and more subsidies. And up and down the country bus companies say "thanks very much, and by the way we're putting up the fares again, and cutting services", and there isn't a sausage that can be done about this but to offer even more subsidies.

Yes, my local service, the 86 is facing the axe. The government closed our post office earlier this year, many pensioners expected to walk miles uphill to another, or to catch the, er, bus. An angry local has postered the bus stop calling this cut barbaric, quite rightly. So we have a campaign of leaflets, petitions, complaints to the council, the PTE, the MP. The PTE write back offering an hourly daytime-only service, which is pretty miserable. When you can never entirely trust a bus to turn up at all, an hourly service is hardly worth using - with a 15 minute service such unreliability is not such a big deal.

The government has flirted a little with largely unusable powers for PTEs to take on regulation of fares and timetables, so there is some recognition of the problem, but clearly no determination to bring it to a resolution. It's another Labour failure and we know the Tories - the original culprits - will do nothing. And both will probably blame the Lib Dem council. This is a vital issue for millions of people, and for the environment, that we should be taking a strong lead on.

And all parties should learn the lesson that involving the private sector, and giving away public assets to the private sector, is not the same thing as introducting competition and markets; it doesn't bring any of the benefits, and if we're not careful we end up paying way over the odds for inferior services.

1 comment:

Libertarian said...

[usual shite about how it isn't a tr00 free market and if it was we'd all be happy ever after- might as well get in here before the usual suspects arrive]