Bus regulation in the United Kingdom

Guy, 20 seats, c1920 (ref 6)

Rural bus transport regulation has existed in the UK for almost one hundred years and the results of the various strategies, ranging from essentially anarchy, to strict regulation, to complete deregulation, subsequently diluted as needed, provide useful lessons. In the early days regulation was minimal as rural services were rare. In 1930 strict regulation was introduced which lasted until 1985. Bus transport was then deregulated. Subsequently changes were implemented to smooth out the rough edges. Recently, regulatory procedures and guidelines are being put in place to promote public transport in isolated areas where deregulation and competition from the car had eliminated it.

Motorbuses competed with the tram in urban and peri-urban areas from around 1903. By 1910, with the introduction of the reliable C -series workhorse, it grew rapidly. In rural areas, regular bus services really began only after the first world war and developed rapidly during the 1920's.

Guy 1927, 31 seats (ref 6)

Regulation was minimal, limited to locally-issued licences for drivers and vehicles. Safety inspections were not systematic: services were often uncoordinated and unpunctual; vehicles were sometimes decrepit, uncomfortable, noisy, and in poor condition and without preventive maintenance, often broke down. Legislation and the regulatory procedures necessary to enforce it had become necessary

In 1930, strict licensing procedures were introduced covering vehicles, operators and their personnel, and services. The first two, concerned with quality regulation, covered their fitness and competence and were granted fairly routinely. These measures had undoubted benefits for safety and comfort, helped by innovation in bus design.

Guy "Arab", c1935 (ref 6)

The third, however, covering quantity regulation, required public hearings for each contested route. They took into account whether the route was already served (which they were in most cases, as existing operators could retain them), whether the new service was necessary and in the public interest, and whether it was coordinated with existing services in the area. The applicant had to show proof of public support for his application, and provide a detailed schedule of the service proposed. Each route required a separate licence specifying schedule, fares and often even the specific vehicle to be assigned. Existing operators were free to oppose new applications which of course they did routinely.

At first glance these procedures and criteria seem reasonable enough. However, they did suppose considerably more knowledge of the transport market and what was best for it than the commissioners possessed. In any case they had neither the time or budget to analyse each application properly. Furthermore, existing operators systematically opposed every application and new applicants were easily shut out. Although some services did improve in regularity and coverage, it is likely that user demand was far from being satisfied to the extent it would have been with less regulation. Essentially, existing operators were protected from competition and as a result, preferred to provide services with guaranteed returns, for example, by limiting buses at peak periods, causing overcrowding and long waits at stops, instead of actively seeking unsatisfied demand and devising innovative ways of meeting it. On the positive side cross-subsidation from profitable routfes ensured that minimal service continued to be provided in some rural areas. It is likely that the growth of car ownership from this time was partly stimulated by the inadequacy of public transport.

The system persisted for many years, with bus services concentrated in the hands of municipalities and a few large private firms. However, from the 1950's onwards, demand began to decline, as car ownership become more widespread. The transport industry remained passive and did little to counter this trend until the early '80's, when it was severely shaken by deregulation. Now new operators could compete with existing operators with only minimal formalities. Route licensing was abandoned and operators could modify service condtions more or less as they wished. Considerable freedom was given to operators to charge fares reflecting costs of providing service, for example at different times of day.

Results were mixed at the outset and there was much instability, such as fare wars, buses clustered together at peak periods, lack of coordination and reductions and even closures of services in more isolated rural areas, previously cross-subsidised. However, deregulation, once the anomalies caused by over-zealous ideologues were ironed out, has proved to be a positive step. Services have visibly improved both in quality and quantity. Even average fare costs have not risen sharply due to the greater freedom to match fares to costs of providing service. In general much innovation has taken place despite the serious competition of the private car.

Rural transport in isolated areas lost out from deregulation. Close regulation had ensured minimal service through cross-subsidation, but this was now discarded, and the very high costs of providing service with large conventional vehicles makes it impossible for private operators. Innovative demand-responsive services using small vehicles or shared taxis are being introduced in the context of national policy seeking to reduce rural exclusion and of course global warming, by reducing car use. These require government subsidy, as cost-based fares are high due to long travel distances and few and dispersed passengers. However, licencing procedures are light in terms of service quality and even more so for quantity. Market entry is easy and service quality sufficient to attract even car users. Operators can be individuals, formal or informal cooperatives or profit or non-profit entities, possibly based in one of the villages served.

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