Stagecoach launches bid to halt bus franchising in Manchester

The authority announced on Friday (March 12) that Greater Manchester leaders will decide later this month whether to recommend to Mayor Andy Burnham the introduction of franchising in what would be the biggest shake-up to the region’s bus network since deregulation in 1986.

It comes after GMCA said two consultations it had carried out on proposals to change how buses are run in the region found a majority in favour of a franchising system. The most recent consultation, held between December 2, 2020, and January 29 this year, came after previously announced bus reform proposals were re-evaluated in light of the pandemic.

If approved, the proposed scheme would be introduced in three phases, in January 2023, January 2024 and January 25.

However, Perth-based Stagecoach, which has run buses in Manchester for 25 years, confirmed yesterday that it is challenging the proposals. The company said it has submitted a court application for a judicial review of the GMCA consultation, stating that it had failed to meet the “required standards on proper process, evidence and analysis required by law.”

Stagecoach chief executive Martin Griffiths said: “We are disappointed at GMCA’s recommendation. We believe the Combined Authority conducted an unlawful process and a flawed consultation on proposals which do not properly reflect the fundamental and material changes brought about by the Covid-19 pandemic.

“This is simply not the right time to be considering spending huge sums of money on a bus franchising scheme which does not meet the tests laid down in law. The proposed scheme also involves spending £135 million on transitional costs alone without delivering any improved services for customers when at the same time multi-million-pound cuts are being considered to vital frontline public services.

“It is clear from a significant number of consultation responses that there is widespread concern among local taxpayers, businesses and other organisations about the sustainability of the franchising plans and the dangers of proceeding with them now.”

Stagecoach employs more than 2,300 people and runs around 750 buses in Greater Manchester, and in the last year said it has invested more in its fleet of electric buses than any other firm in Europe. At present, it is one of a number of commercial bus companies that operate the majority of bus services in the area. Those companies currently make decisions on routes, fares, timetables and standards.

However, GMCA said there is “no coordination and limited oversight” of bus operations. It argues that franchising would mean that bus services, including routes, frequencies, fares and standards would be brought under local control. GMCA would commission bus operators to run the services.

A spokesperson for GMCA said: “GMCA has received a claim for judicial review, which has been submitted by Stagecoach Group PLC.

“We have reviewed and filed a response to the claim and are awaiting an update from the court on next steps. It would not be appropriate to comment further at this stage.”

Stagecoach said improved services in the area could be achieved through a partnership approach with the authority which would result in a lower cost to the public purse.

Mr Griffiths added: “Our priority has always been to ensure we have a bus network that works for local communities, taxpayers, and the bus operators whose success supports the economy and employment in Greater Manchester. While we await the decision of the court, we would urge the Combined Authority to rethink its approach and pause its plans. We remain ready to work in partnership with the Combined Authority, as we have done throughout the pandemic, on alternative plans to stabilise and rebuild bus services, and ensure the region has a sustainable, high-quality bus network for the long term.”

Stagecoach has largely focused on bus operations since withdrawing from rail franchising in 2019. That followed a bruising experience running the east coast franchise in partnership with Virgin, which resulted in the contract being renationalised by the Department for Transport. Its rail operations are now limited to the Sheffield Supertram light rail network.

Meanwhile, both Stagecoach and Aberdeen-based FirstGroup have broadly welcomed the publication of a new national bus strategy for England.

Janette Bell, managing director of First Bus, said: “Across the UK, we already work closely and effectively with local authorities and the enhanced partnership approach will enable us to build on these strong local relationships as we move toward recovery and work to improve customer experience.

“We are fully aligned with Government’s ambitions for a zero-emission bus fleet and have already committed to this by 2035, and not purchasing any new diesel buses after December 2022. We will continue to ensure that our progress doesn’t just exceed Government expectations as outlined today but also puts the demands and expectations of our customers front and centre.”

Shares in Stagecoach edged 1p, or 1.02 per cent, lower to 97.5p.