Local man Barry Hutton, recently wrote a comment for ‘Local Transport Today‘ with the title “Bus services can be profitable, or policy tools, but not both”. Given the recent brouhaha on our buses in East Lothian we’re reproducing his piece below.
Detailed analysis of Your report that East Lothian Council is considering setting up an arms-length company to operate bus services to replace those being withdrawn by FirstBus hides fundamental discontinuities between government policy and transport planning practice that are far from being confined to East Lothian. The Scottish Government, in common with the English, has adopted policies on climate change, on reducing CO2, on reducing car traffic and on tackling congestion, policies which rest in large part upon greater use of public transport. Those policies are echoed in the statutory Lothians Structure Plan, in the East Lothian Local Plan and by the South-east Scotland Transport Partnership.
A major issue at the Public Inquiry into the East Lothian Local Plan was a proposal to build upwards of 750 houses on the western flank of Haddington, the administrative centre of East Lothian, about 25km to the east of Edinburgh. This would swell the town’s population of 8,800 by about 25% and generate around an extra 2,000 journey-to-work/school trips per day.
Structure Plan policies TRAN3 and TRAN5 have the objective of reducing the length and CO2 of journeys-to-work by requiring major residential developments to be related to increased local job opportunities. Unbelievably, evidence that these Statutory Plan policies were important was rejected at the Inquiry on the grounds that such matters were the province of the South-East Scotland Transport Partnership who had not yet written their Plan, although they had adopted the objectives of the Structure Plan. This rejection also applied to evidence of the effects of ignoring those policies. The major area of growth in job opportunities was, and still is, on Edinburgh’s Western flank about 35km away across the diameter of the city and about two hours away by public transport with an intermediate change. By car it takes about 70 minutes, mainly around the congested Edinburgh by-pass. The rejected evidence suggested this extended car journey-to work would create a daily fuel burn of 1,250 litres– an annual 8,250 tonnes of CO2.
A second tranche of evidence suggesting it would be more in keeping with Government policy if new housing were built nearer the developing job opportunities was also rejected on the grounds that the allocations of new dwellings were embedded within the agreed Structure Plan and were therefore beyond question. To say that a cloud a cynicism enveloped the Inquiry would be a gross understatement.
Despite the rejection of the objectors’ evidence both in detail and in principle, evidence was accepted that the Government’s climate change policy objectives would be delivered by bus services, although the evidence was based upon misleading maps showing ‘accessibility’ no further than central Edinburgh, unsupported by any estimates of demand or of modal choice. It is those services that FirstBus is now withdrawing or reducing.
The ‘fault line’ between policy and practice has a number of strands:
There are no definitive connections between the published policies and their delivery. Any policy without a method of implementing it and then testing its effectiveness is nothing more than a daydream; an insubstantial aspiration. The Scottish Government’s policies on climate change together with their echoes in the Structure and Local Plans were demonstrated at the Inquiry to be no more than yearning postures. Effectiveness can only be measured against an explicit criterion, target or benchmark.
These need to be written into legislation together with the ways in which they are to be achieved. The fragmentation of policy making and delivery over a number of disparate organisations working on separate plans to separate timetables prevents cohesive, effective implementation.
The division between the definitions of public services by political process, but their delivery by private companies, cannot work. Governments and commercial companies have completely different reasons for their existence; they have different objectives, different accounts, different measures of success and failure. The ballot box is crucially different to the cash register and the fare-box.
The failure of FirstBus to deliver Government objectives is not the fault of a company whose prime duty, set in the Companies Acts, is to the shareholders, not to the public, nor to the public’s elected representatives, nor to public policy. Bus companies are not obliged to provide a public service. They are businesses, above political control: it is their fare box, not our ballot box, that wields the power.
But we need both sorts of boxes. It is the balance that is wrong. The price mechanism works a treat for most things but not for everything. Public services which are dependent upon precise timing like buses in East Lothian, or firefighters, or appendix operations, or the police, have to have more resources than are in constant use to ensure that an effective response is always possible – they are inherently ‘unprofitable’. Public services are not like Christmas cards that can be made at a constant rate throughout the year, stocked and then sold in a rush. A bus cannot clock up a few route-miles in the middle of the night, store them and then use them in the rush hour. New housing cannot be spread in penny packets over the Lothians and in the expectation that a profit-driven company will get everybody to school and office by a bus fleet which is then under-used for the rest of the day.
Public services have another basic characteristic that makes it difficult for companies working to commercial criteria to deliver them. Public services give more than a service to their users – they provide a potential service to those who are not users. The emergency services do not spend every minute of every day dealing with emergencies but their very presence adds to our personal security. We are comforted to know that a 999 call will bring help even though we might never make that call: that reassurance costs money and those costs cannot be charged out through the price mechanism. There is a basic difference between insurance, providing post-hoc compensation, which is a marketable product, and the comfort of protection against the unpredictable, which is not.
The worth of a bus service cannot be measured just by the numbers of people who use it but by the number of people who are re-assured by its existence, a value that cannot appear in company accounts. This ‘product’, fundamentally misunderstood in the Buses Act (1985), has to be defined by a political process able to make decisions about services which are inherently non-commercial. It is a major purpose of government from D-day to coping with foot-and-mouth.
Our political system is currently unfit for that purpose. It pretends that running the country is like running a company, uncoupling the politics of making policies from the commerce of delivering them. Recently there has been conflict and confusion between commercial and political objectives in the proposals for the NHS, for Education, for the Border Agency, for the Prison Service and now for bus services in the Lothians.
This conflict has flood-lighted the impotence of politicians: they have written policies in black and white but can do no more than lobby, posture and wheedle the private sector to deliver them. East Lothian politicians are wandering around in a no-man’s land: their policies were hopefully being delivered, more or less, by a company which had its own criteria the stringency of which has now induced it to resign.
Local politicians have drummed on the door of the FirstBus offices to no effect and are now, as you report, exploring the possibility of establishing their own operating company. That will not resolve the basic problem: if it is expected to act to commercial criteria it will not provide the services to satisfy politically defined environmental and planning objectives but, if it tries to deliver the adopted policies, it will make a loss.
That conundrum is false: we do not expect sewage works or fire stations to be commercial successes, just that their services should be neither over-expensive nor inefficient. The crucial realisation is that the difference between revenue and expenditure should be replaced as the measure of success by the minimisation of the cost per unit of the democratically defined and contracted ‘product’.
Barry Hutton
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