Net Zero, Energy and Transport Committee

Meeting date: Tuesday, January 16, 2024

Official Report 699KB pdf

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Subordinate Legislation

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Bus Services Improvement Partnerships (Objections) (Scotland) Regulations 2024 [Draft]

Agenda item 3 is consideration of a draft statutory instrument: the Bus Services Improvement Partnerships (Objections) (Scotland) Regulations 2024. I am pleased to welcome Fiona Hyslop, the Minister for Transport. The minister is joined by Liana Waclawski, a lawyer for the Scottish Government; Orsolya Keri—I might not have got the pronunciations right; I always struggle a wee bit, and I apologise, so if I have been clumsy, forgive me—the bus regulatory policy manager for Transport Scotland; and Bettina Sizeland, the director of bus, accessibility and active travel for Transport Scotland. Thank you very much for joining us today.

Following the evidence session, the committee will be invited, under the next agenda item, to consider a motion calling for the committee to recommend approval of the draft instrument. I remind everyone that the officials can speak during this item but not in the debate that follows.

I invite the minister to make a brief opening statement.

Good morning, committee members. Thank you for inviting me to discuss the draft Bus Services Improvement Partnerships (Objections) (Scotland) Regulations 2024.

The Transport (Scotland) Act 2019 was designed to make Scotland’s transport network cleaner, smarter and more accessible than ever before. For bus services specifically, it provides an enhanced suite of flexible options for local transport authorities to improve bus services according to local needs. The 2019 act offers wider powers for local transport authorities to run their own services, and it provides viable options for partnership working and franchising. Bus services improvement partnerships—or BSIPs, as they are known—provide a formal form of partnership working between local transport authorities and bus operators, with both sides working together to develop a partnership plan and related schemes to improve services in their area, and with both taking joint responsibility for delivery.

Once a bus services improvement partnership is in place, all operators in the area are required to meet the service standards that it sets out, regardless of whether they supported its development. As such, the objection process is key to ensuring that bus operators in an area are able to meaningfully engage with the BSIP, as it provides a mechanism for them to object to proposals. That ensures that the final partnership is based on mutual agreement and buy-in from both the transport authorities and operators so that they can serve the needs of local communities.

The regulations that are under consideration today prescribe who can object to a BSIP when it is being made, varied or revoked, and the minimum number of objections that are needed to pause or halt the proposals. A local transport authority can progress with a proposal only if a sufficient number of operators do not object. The regulations are intended to balance the right of a local transport authority to bring forward a BSIP against the right of operators to object to what is proposed.

In developing the regulations, we have sought to account for the significant variations in local bus markets across Scotland and have considered the wide range of possible scenarios in which a BSIP may be developed. We have also sought to ensure that no single operator is able to have undue influence in a BSIP. We have engaged closely with key stakeholders such as local authority transport officers and operators. Their involvement in the development of the mechanism and the regulations has been crucial in creating a practical approach that is designed to address local needs flexibly. The regulations are a key part of creating successful partnerships between local transport authorities and operators in order to improve services for passengers.

I am happy to answer any questions that members have.

Thank you very much, minister. I seem to remember that, when we were considering the bill that became the 2019 act, there was quite a lot of support for local transport authorities establishing local bus companies. If I remember rightly, Lothian Buses was an anomaly as a result of the law not having been complied with in relation to its disbandment and privatisation.

There is encouragement for the establishment of such companies, but there is no money for it in the budget this year. If you are not going to give local transport authorities any money, how will they be able to do that, given the huge costs involved?

That is not quite the case. You referred to Lothian Buses, which is a municipal bus company that is owned by the local authority. These regulations are not anything to do with that—

I accept that. I am asking how other local transport authorities will be able to take the plan forward if you are not giving them any money.

We are, as I will set out if you let me continue, convener. The 2019 act provides for local authorities to run their own bus companies, like Lothian Buses, and bus partnerships, which are the subject of the regulations. It also provides for them to develop franchises. The funding that supports the development of policies relating to those aspects of the 2019 act, to which you referred, is still in the budget. It comes under the community bus fund, and £1 million in revenue funding and £5 million in capital funding have been set aside for that for 2024-25. Your question was whether the budget supports the work of the 2019 act? Yes, it does, and that is the mechanism by which it does so.

There continues to be funding for buses through the network support grant, which primarily goes to supporting the operation of bus services. There is also the concessionary scheme, which has been given a small uplift in funding. Funding to support the operation of bus services is still being provided. That is still being fully funded, as it was in 2023-24.

Okay. I was not going to get into concessionary funding, because that funds only a proportion of the actual costs. I am asking whether local transport partnerships have the money to create their own bus companies. I do not think that there is much money available. You said that £5 million in capital funding has been provided. I cannot remember the cost of a bus, but that would not even cover 15 buses, would it?

Buses would be bought through a capital fund. It is not necessarily our responsibility to fund local authorities to buy buses, but we have funded and supported them significantly to transfer buses within their local areas. As has been indicated, the operating model for Lothian Buses is different from that of others in relation to the transfer from diesel buses to electric ones. In the case of Aberdeen, the transfer is to hydrogen. That has happened through bids for capital funding.

I think that you are talking about the operation of buses. Local authorities have a responsibility to help when there is a problem. For example, some operators have pulled out of some areas. About £55 million has been spent by local authorities in that regard. That is part of the local government settlement.

On the development of the powers in the 2019 act, local authorities are interested in different models and are trying to take forward that work, which is primarily policy work. If they come up with their own solutions, they will have to take them to their own committees and so on. However, funding for the development and policy work is available, as it was previously.

With regard to your question about the 2024-25 budget and whether all the local authorities will do everything overnight and set up everything next year, I am not aware of the pace of the work being such that there would be major demands on the 2024-25 budget.

I am sure that local authorities will have a view on where they will struggle to find the money from.

I was interested in the minister’s comments about the community bus fund. A modest amount of money has been allocated to it. Which local authorities are taking up the opportunity, particularly on the revenue side, to work on a business case and look at the options for franchising and municipalisation? Are they predominantly rural local authorities or urban local authorities? It would be useful to get a sense of how local authorities are responding to the money that is available and what work they are doing.

This discussion does not relate to the regulations that are in front of us; I think that everybody will acknowledge that your question is about wider issues.

I might ask Bettina Sizeland whether she can give more information on the developments. My understanding from my discussions with different transport authorities is that it is important, as the convener referred to, that a lot of the issues are driven by local authorities themselves. The South West of Scotland Transport Partnership has interests, and I had a meeting with it two weeks ago about its different models. It is still working on them. I do not want to speak for it, because it is an autonomous body, but, in the summer, it gave an indication that it has been considering the type of scheme that it would want to have. In the Highlands, people are also interested in different models. It is quite interesting that rural areas in particular are taking forward work in that area.

In Glasgow, the transport authority is interested in wider issues that also affect other local authorities. I do not know the details of the talks that have taken place, because the issue is not my direct responsibility, but we provided enabling powers in the 2019 act so that people could take that work forward. There is strong lobbying in different areas for a franchise model in Glasgow.

All that work is at an early stage, as all the local authorities would acknowledge. That might address the initial question about the funding that is available for the next financial year.

Would Bettina Sizeland like to add anything?

09:30  

We received a number of bids from local authorities and regional transport partners to explore the powers in the 2019 act. I do not have the list of bidders in front of me, so we will write to the committee to provide that information.

Have Transport Scotland officials engaged with their United Kingdom counterparts, especially those in Greater Manchester, to learn about the development of bus franchising in major metropolitan areas in England?

Yes, we have. We are in contact with Department for Transport colleagues and colleagues in Manchester so that we understand their experiences of developing franchising arrangements.

Thank you for confirming that. What has it proven? What has come of it?

It is still early days for them. We are still learning with them.

Okay. It appears that I am not going to get much further on the issue of money or on that issue, so I will bring in Jackie Dunbar to ask the next question.

Part of my question has already been answered by the transport minister.

Good morning to you all—sorry, I was being a bit rude.

Regarding the powers allowing local authorities to establish bus companies, you said that some have already started discussions. Why do you think that some have not? Is there a reason for that? What can or will the Scottish Government do to help those that are keen to establish a bus company?

There are three different models: the bus company, the partnership—the regulations that you have before you are about objections to setting partnerships up in a more formal way—and franchising. We expect to provide—this might help in relation to the previous question—more guidance and help, including by sharing best practice that will have been learned from elsewhere in relation to the different models. It is early doors when it comes to local authorities setting up their own bus companies. It is up to them; it is not up to us. We would keep a watching brief, as would the committee, but this is an issue that you might want to raise with the transport officers, the Convention of Scottish Local Authorities or the councils themselves.

There are different bus markets in different areas, and some are stronger than others. The patronage of buses has not recovered to its previous level. The vast majority of local authorities, apart from in Lothian, rely on private operators. There is a tension if councils want to set up their own bus company, which would then be in competition with those operators; there are also competition law issues in relation to bus operators. At the same time, although they are dependent just now on all the different operators and companies for the sustainability of bus services, some local authorities may want to take that step of setting up their own companies. The Transport (Scotland) Act 2019 allows them to do that, but they have to take the step themselves and have confidence that they are in a position to do that. That is for them; it is not for us.

We can keep a watching brief, and that is what we would do. When I visit local authorities—I have visited a number of them—they can share with me the state that they have got to and the steps that they are taking but, again, that is for them. It is not for me to account for them in this committee, because I do not want to misrepresent them in any way.

Apologies, minister, for rewinding the clock slightly to talk about franchising. There is a little bit of mission drift in some of the questions, but this is for my own clarity. Clearly, we have to learn lessons on franchising from elsewhere, but my experience in Glasgow is that there are some very profitable routes. I think of the 61 bus in my constituency, where you can pack them in, the bus is always full and there is a high frequency of service. However, after a certain time at night, you cannot get the 8 or the 90; there are connectivity issues in my constituency. Quite often, routes are subsidised—I think that the minister mentioned £55 million-worth of subsidies. If franchising were to roll out in a meaningful way and routes were bundled as part of the franchising process, should we expect to see that public subsidy in other areas, where bus companies withdraw from a service because they have no compulsion to continue to offer a commercial service and require a public subsidy? Could we see a shift in that relationship with franchising? Has there been modelling work done in that regard? You do not need to answer today necessarily, but I am keen to better understand that relationship, because it is central to a lot of it.

I am not familiar with the different local buses and the numbers that you referred to, but the principles—

I was not grilling you on that, minister.

The principles of it are probably achieved by formal bus partnerships and franchising, because we are trying to set out something that is more sustainable just now in the financing of the bus market. A huge amount of money is going into concessionary travel, but it was set up in the previous legislation so that operators would be no worse off but no better off. It helps patronage and, hopefully, as we discussed previously, younger people, for example, will become fare-paying passengers. I have heard that and have had that discussion about franchising with councils in Glasgow. Bundling can enable the geographical coverage of an area to be complete.

As we all know, there are certain times of the day when buses are more popular. You can understand the position of operators. Remember that we are in a market that has been deregulated for a long time. Obviously, private operators need to ensure that they are making some kind of profit so that their services are viable, and it is therefore more attractive to do certain routes rather than others. That has led to local authorities having to pick up the pieces in areas where buses have been withdrawn in particular ways.

The whole point of the Transport (Scotland) Act 2019 and, I hope, the fair fares review is to try to provide more sustainability in the system. I have written to the committee to say that we are expecting that review imminently. That is what we need for bus services. If we are going to get more people back on to the bus, they need to know that they have sustainable, reliable services and services at different times of the day, because we know that people are working on different shift patterns. In answer to your question on whether this will help to address the problems that you have, my answer is yes. It will not necessarily just be through franchising. It would also be possible to build it into the bus partnership, for example, and the schemes that come as a result of that.

In future, when the commercial sector withdraws and services are tendered and replaced at a subsidised level, would it be worth tracking those subsidies over time? If the partnerships and the franchises are successful, a sustainable model would not see subsidising done in that way. It would be done in a more proactive, strategic way.

Ideally, yes, but the pressures in the bus market, particularly coming through the pandemic with the reduced number of people using the bus service, are challenging that. That is why it is more important than ever that our local authorities look at models that can help to provide a reliable, sustainable service in their area that is less reliant on subsidy because, over the piece, there is enough income. That also includes trying to increase patronage.

Good morning, minister. What is the Scottish Government doing to support the roll-out of bus priority measures, especially on the trunk road network, over which the Scottish ministers have direct control?

That is a good and important question. We have supported bus priority measures in the past number of years. You will be familiar with the Aberdeen system, and it is my understanding that the bus gates are operational there. I also understand that the local authority, with the local bus company, is looking to provide free bus services at the weekend. Again, that is a proactive measure. I think that that is part of a more complete area.

The convener, who I see is in conversation, asked about funding in the budget. The bus priority fund, which helps to address some of the congestion issues and the capital issues, is the area that we will not be able to fund next year. It has been paused. We know the consequences of the severe capital budget reduction that the Scottish Government has received. We will have 10 per cent less capital funding over the next five years. The Scottish Fiscal Commission has reported to Parliament that it expects that that reduction will be to the value of 20 per cent over the next 10 years. Therefore, decisions have had to be taken on our capital budget in transport, and that is the one area that will see a marked change for next year. It is a longer-term commitment that we want to try to restore, but the bus priority fund, which funds, for example, bus lanes and bus gates, has been paused for next year, and there is no funding for that. All the plans that are in place and have been agreed will continue to be funded in 2023-24.

Part of the question was to ask about the fact that there is no money in the bus partnership fund for the coming financial year. Given the Government’s commitment to getting more people on to public transport, why was that part of the budget and not something else chosen to be not just cut but zeroed?

Again, that is an important question for the committee to consider in its wider budget scrutiny. I know that, appropriately, you have the cabinet secretary coming in to discuss wider bus issues. On this one, thinking about the wider budget, we have to keep road and rail safety paramount. That makes up the bulk of the funding for our operations. It is similar for ferries; we have lifeline ferries and we have to make sure that they continue to be supported to provide a service.

The fund is about additionality and improvement, as you are right to identify, and I hope that you are expressing support for the work in Aberdeen that has introduced those bus gates and that change in the city centre to try to encourage more people in. That was a good scheme that came forward quite promptly. Other schemes that have been ready to be invested in have probably come in a bit more slowly than we might have anticipated. These are additional projects; they are not legally or financially contracted. They are highly desirable but, in a tight budget settlement, with a 10 per cent cut in overall capital for Government, tough choices have had to be made.

Although the bus partnership fund is paused for next year, we want to continue it because—you are quite right—in trying to encourage more people to use buses, freeing up lanes to ensure that we have more reliable buses, so that people can then start to use them and increase their patronage, is desirable. I have been an MSP for a long time and remember all the budgets when people had additional funds. The questions were then about why you were giving more additional funding to some areas and less to others. It was all about additional funding. I am afraid that we cannot have additional funds in the financial climate that we have just now. It is regrettable, but I think that it is understandable in the circumstances.

Can I just clarify whether it is the case that there was not really the demand for the bus partnership fund from local authorities, or whether projects were coming forward but the Government has just chosen not to spend that money in that area next year?

I suspect that there is a range of different factors. When I came into the Government, I was struck by the fact that there were fewer worked-up, ready schemes; it was not that there was a lack of demand. You will know from the experience in Aberdeen that, obviously, a lot of work has to go into preparation, because it is not just a case of designating a lane; there are a lot of planning issues and there is a lot of engineering work involved. There is a lot of preparatory work to be done. It is not as though there is a lack of desire for such schemes. I know that a number of local authorities will want to do them. We are actually honouring all the schemes that have come in. People will want to do it, but the issue is the pace of implementation. They may have other priorities. There are challenges in particular areas. There will be a number of different factors for different local authorities. Again, Bettina Sizeland might have better insight into the types of schemes that have been coming in and the pace at which they are coming in.

09:45  

As the minister says, there were not as many construction-ready projects or quick wins as we anticipated, so we have had to take time with the 11 informal partnerships to develop those schemes, go through the appraisal work and carry out the public consultation, because most of those are being, if you like, retrofitted into existing road space, so there needs to be quite a lot of local conversation as well as technical appraisal work before they can be ready to be delivered. That has taken some time.

Is that £500 million commitment on-going, minister? What was the timescale for that commitment when it was made?

I think that it was set out initially in 2019-20. Obviously, the pandemic overtook a lot of issues, so a lot of things were not progressed. It is a longer-term commitment. I am not in the position to be able to tell you for how long and when that will be. We cannot, because of the financial situation that we are in. I think that everybody recognises that, for a variety of reasons, the financial position of the UK and, subsequently, the Scottish Government is not nearly as strong as it was prior to a number of incidents, which I will not relay just now, even since 2019-20.

What I can reassure you about is that increasing and improving bus patronage is important for a variety of reasons. One is because people need it for their jobs but another is climate change. We have to make that shift. I assure you that I will continue to make sure that we can reinvest in that area—the answer is yes—but I cannot do it next year.

Thank you, minister.

I will move on from capital to revenue for my next question. With regard to the budget for next year, the network support grant is 11 per cent less than it was for 2023-24, and the rate per kilometre travelled is not being increased either. How do you justify reducing support for the provision of bus services when, as we all agree, increased bus travel is vital for us to meet our climate change targets?

That is a very good question. I can answer it by assuring you that the network support grant has been fully funded. That means that we have worked with the bus operators to identify what they have experienced in the past year and what they anticipate experiencing this year—that is done by a kilometre rate—and, relative to that, it is continuing to be funded at a similar rate. Last year, the network support grant did not get drawn down as much as anticipated because of the reduced patronage numbers and, as we know, bus services in a number of our local authority areas were cut, so the funding for them was not needed.

I reassure you that the funding in the current year has been reinvested in bus services but, for 2024-25, the network support grant is fully funded, albeit at a reduced rate, because the demand and need for it is not as much as anticipated. That is because, unfortunately, some bus companies have reduced their routes, which means that, on the formula basis that is used, they will not need as much. That is the explanation. It is still fully funded and it is stable; it is just at a different level than we anticipated because of the reduced patronage on routes in some areas.

Just to clarify for my understanding, the money is being reduced for the network support grant because we have fewer buses and fewer routes. Is that a fair comment?

Yes, that is fair, and that is why we need to—this is the critical question facing bus services—find means by which we can have greater sustainability in the bus service. It has been weakened because of the pandemic. The numbers of passengers have not returned to what they were and, with private operators in a deregulated market, that makes some services more vulnerable.

Just briefly, has analysis been done of that? Why are there fewer routes? Is it because people are using trains, for example, or are they staying in their cars or working from home? Has any analysis at all been done?

It has, and we can identify how we can share that with you. The Confederation of Passenger Transport has also done work. That relates to the age profile: over-60s in particular have not returned to the services. We also know that, for some people, working patterns and transport patterns have changed completely. The busiest day for transport by rail, for example, is Saturday. When I visited Lothian Buses, I was told that Sunday is becoming more of a travel day because people want to visit family, and weekends are busier. That may be a consequence of more people working from home during the week, so they want to get out and about at the weekend. There is quite a variability in behaviour in the bus system that everybody is looking to analyse, but the consequences, particularly the reduction, are seen in the older age group. That is anecdotal, but I know that the bus academics and researchers are looking into questions such as whether people of that age profile are more reluctant to be out and about after having had the very serious experience of a pandemic when they were used to not going out as much, and how that has affected them.

There are a number of different reasons for that. Again, it comes back to the sustainability of the market. Remember that there were fuel price increases as well, and those will have hit a number of transport authorities, not least bus operators, in the profitability of routes. There is a knock-on impact on reliability and sustainability, which is why I, as minister, am very keen to address the issue. I hope that, when I come back to the committee with the fair fares review, we can discuss how we can try openly—the matter is not just for this Government but for any Government in the future—to address how we ensure the sustainability of our bus system.

Bob, I think that you have a further question, and then I will bring in Sarah Boyack. Sarah, if you want to bring up any points that you have heard in the session, this will be your chance to do it.

Minister, on the funding going into bus services in Scotland, I see a significant financial commitment of £429.7 million, but I am also conscious that £370 million of that is for concessionary travel, be that for under-22s, the over-60s or other groups. Will any unintended consequences arise from such a significant split of investment between concessionary travel and the wider funding of bus services? What is the Government’s rationale for doing that? Is there a relationship between that and what we all see from time to time in our constituencies, namely certain routes being less commercially viable and the withdrawal of certain services? Is there a relationship between increasing that concessionary scheme—with the massive public investment that has gone into it—and some services being less commercially viable?

Perhaps I can give you my overview as minister rather than any concrete correlation or evidence.

There is a relationship in that respect, I think. The more funding that you have for concessionary travel, the more that you limit the market for what you might call full-fare-paying passengers. If your concessionary fare scheme is based on a system in which bus operators are no better and no worse off and there are 2 million people getting concessionary fares, obviously there is less scope for operators to rely on full-fare-paying passengers to fund their services.

You are right, though; internationally speaking, we are perhaps disproportionate in the amount that we fund concessionary fares and free bus travel. I do not want to pre-empt the fair fares review, but I can tell you that the amount is considerable. As I have said to the committee, free bus travel for the under-22s is an extremely popular measure that is helping families address the cost of living. That is good in and of itself, as is the concessionary fare for older people; it is good for social reasons as well as for economic reasons in families.

However, there is a challenge. A considerable amount of public funding is being used—when you add in the other bus funding that we are providing, you are talking about half a billion pounds—so the question is: can we use that money better to provide more sustainable bus services? It is great to have a free bus pass when you are under 22, but if you live in certain parts of the country where there are no bus services to go on, the benefit is not as great as it might be in, say, Glasgow or other parts of the country.

As for whether there will be any unintended consequences, I think that, over the piece, there have been, and that is why, working with the committee, I am keen to look at the overall sustainability and reliability of the bus market to ensure that we can make better use of public funding to support it.

That was just a general overview. I think that the fair fares review, once it is published, will provide the evidence that you want in a more concrete way.

Thanks, minister. I have a slight reflection and then want to ask a follow-up question.

You are right. I cannot, as an urban MSP, deny that there will be unintended consequences for some remote and rural areas. However, I would point out that, in densely populated urban areas, there are large volumes of young people at school and children who use certain travel routes. Within cities, there can be unintended consequences, too; it is not simply a remote and rural issue. As a city MSP, I think that that is worth putting on the record.

Are you effectively saying, minister, that, in a few years’ time, we could be nudging towards half a billion pounds of public investment in bus services? While keeping that rock-solid commitment to concessionary travel, we must be able to find a better way of using that half a billion pounds so that, in a few years’ time, we have a more sustainable and affordable bus service. That level of investment is a pretty good start for bus companies. Is that a reasonable picture to paint?

It is something that every MSP should be thinking about.

Okay. Thank you.

It is fascinating to come in on the back of those questions, because, although I have not declared this, I actually introduced the first free bus travel scheme for the over-60s in Scotland. It is interesting to see the extent to which members of the public are now using concessionary bus passes, whether they be over 60 or under 22.

I just wanted to follow up on that by asking about the Scottish Government’s strategy and funding streams to ensure that we get more people using buses. As colleagues have pointed out, we have lost a lot of bus services over the last few years. For the piece of work that we are looking at today on bus services improvement partnerships, what analysis have you done of the benefits of such partnerships versus bus franchising and the costs and benefits of the different options? One thing that feels clear is the resource issue so that local authorities can choose what to do, whether it be BSIPs, as you have mentioned, or bus franchising. After all, there will be start-up as well as on-going costs. Do you have a cost benefit analysis that you can share with us about the choices to increase modal shift?

You will understand that I was not the transport minister who took the 2019 act through Parliament and, as the committee has pointed out, there have been a number of things since then, too. The choices that local authorities face with regard to the different models are exactly as the member has said. Some will, for example, want to take on full bus ownership in all its aspects and implementations; indeed, many look enviously at the Lothian Buses system. Some will want to look at franchising, while others will want to consider bus services improvement partnerships, as they might better reflect some of the informal bus partnerships that currently exist and might therefore require less resource funding.

I think that Sarah Boyack is referring not only to the capital resource—in these operations, you are still dealing primarily with buses that are owned or leased—but to the people resource that local authorities will need to run partnerships. You should remember that local authorities are already local transport authorities, with significant departments that run their transport work, and these are decisions that they will make.

I ask Bettina Sizeland to look back at the different models and the work that has been done. Obviously, part of that will involve sharing best practice and looking at other parts of the country and the rest of the UK to consider different models and the cost benefit aspects. That is why people are interested in Manchester, although there are negatives to that system, too. Indeed, people will tell you about the amount of resource and time that it took to set it up.

So it is not all easy sailing—there are challenges to face. However, that is the sort of information that we want to share and, as I have said, the guidance that will come out later this year will address some of those issues, too.

10:00  

The work to date has focused on the regulations and the legislation required to give local authorities the powers to look at the different arrangements that might be appropriate in their local areas. These are very much tools for local authorities to use. As the minister has said, the community bus fund provides a bit of resource for local authorities to look at the costs and benefits of using the different powers in their particular area. That is the level at which we would expect the cost benefit analysis to be taken up.

Have you analysed the different costs of increasing modal shift? We have lost so many bus services. Part of the issue is how you stabilise and sustain those services, as the minister has said, but it also about creating new services that attract people, which could be a matter of timings or routes. The community bus fund is £1 million. Is there some issue with start-up costs in order to get this going? Is that the block? Having introduced the 2001 act, I know that there is a huge gap between having the powers available and actually using them.

There are two aspects to that question. Work will have been done on overall modal shift, and we can look at what we have on the costs and benefits in that respect.

As for individual areas, I would also say that, with regard to my conversation with SWestrans, that is exactly what it is looking at: the different models and the costs and benefits. That is its work. We must remember that, for buses, there is no one-size-fits-all solution in Scotland—that is the challenge. However, it is not necessarily up to me as minister to set that out; it is something for local authorities and the transport authorities, which have the legal responsibility in their local area, to look at, and it is really important that they have the ability to share their analyses.

For example, Highland might be different to Dumfries and Galloway, but there might also be similarities. Bob Doris used the phrase “remote and rural”, but I do not like to use the word “remote”—it all depends on where you are starting from. After all, a lot of people think that Glasgow is remote.

One of the biggest challenges is semi-rural areas. The issue is not just what might be called more dispersed communities when it comes to geography, land and availability of buses; some of the dynamics and how the market works in areas that are relatively close to cities can be more problematic than the situation in more rural areas.

This will be my final question, as we have to move on. Have you done any analysis of how many routes will be saved or added through the bus priority fund partnerships? What analysis has been done on modal shift?

They are not bus priority partnerships. They are bus services improvement partnerships.

I am sorry—I was using the fund.

Too many of the names are similar. The bus partnership fund is not for saving bus services. As we said in our discussion with Douglas Lumsden, it is actually about making things more convenient.

There might be a correlation in that respect; if you were to make more bus lanes that allow people in Aberdeenshire, for example, to get into Aberdeen more quickly and reliably, you could potentially save services in Aberdeen. That kind of analysis is really a job for local transport partnerships and authorities. They will say, “If we can get more people in Aberdeenshire coming into Aberdeen, using those bus gates, we can say it is becoming more reliable.” We know that the patronage in Aberdeen has gone up, which is good, but I am frustrated that, unfortunately, because the financial settlement, the 10 per cent cut in our capital budget and the escalation of inflation and construction costs are putting pressure on the transport budget, we are having to pause the bus priority fund that we discussed earlier. I do think that it will help.

As for your question whether the fund saves buses and routes, that is not necessarily its purpose. It might do that unintentionally and consequentially, because it is about the sustainability of buses, and the sustainability of the market will help save routes. Even from that, you will see that this is a very complex area. Every single part of Scotland will have a different experience and the cost benefit analysis will be different in different parts of the country.

Mark Ruskell has the final question.

It has been an interesting evidence session. I was just reflecting on the number of constituents who write to me every week with concerns about the quality of services. They write not just about whether the services are running but about whether they are running on time or whether buses are breaking down.

I want to ask you about the conditionality applied to public sector funding. Jenny Gilruth, as a previous Minister for Transport, announced a review of bus sector funding, part of which was going to be a consideration of what conditionality could be applied. Obviously, we have the Traffic Commissioner for Scotland, who is able to hold some of the bus companies to account, but I am interested in hearing about the work that the Government has done to make the substantial investment in the bus sector every year conditional on some basic standards of service and improvements going forward.

I remember being a member of this committee when this question was previously discussed. How do we use the considerable amount of grant funding in this area to deliver the changes that we want in line with fair work first principles? We are working through all the different funding streams to ensure that we can maximise that.

The stream that we looked at most recently was the network support grant. Although it is not the same amount as it was last year, it is still fully funded for the kilometres that are being met. The expectation and requirement on those who are in receipt of the network support grant is that they look at and implement the fair work first approach. For example, one aspect of the fair work first principles relates to the real living wage, and only recently, I had a letter from First Bus to let me know about its commitment in that respect.

Work has been done as part of the network support grant. Perhaps following this session we can relay to the committee information on where we are with the review of the conditionality of the other funding and also our findings from the review that we started on the network support grant.

Do you think that conditionality needs to go beyond fair work to actual quality of delivery of services?

Yes—sorry. With regard to the quality of delivery of services, I suppose that, in that respect, conditionality will come down to the expectations of customers. I will take that issue back and discuss with CPT and, indeed, the bus providers whether the conditions of a grant should include, say, buses having to be warm. However, I know that that will be a challenge in certain parts on a day such as this, and the buses might not be of that quality.

Interestingly, again, there can be a lot of variability across the country. I do not know to what extent we can enforce, within the conditions of a grant, a requirement to meet a certain level of service. As you have said, that is more for the traffic commissioner.

With your agreement, convener, I will take that issue away and think more about the conditions of service. My understanding is that conditionality has more to do with standards of operation in relation to the workforce and fair work first principles.

Obviously, basic legal requirements are enforced by the commissioner. I get a steady stream of complaints about buses regularly failing to turn up, which, presumably, is something that the commissioner could enforce. However, now that we are in this space of how we improve bus services working in partnership and given the substantial amount of money that is going in, I am interested to hear more about how the Government can extend conditionality further and beyond just basic legal compliance with a timetable.

Experiences are different in different parts of the country. We know that the availability of bus drivers has a considerable impact on the reliability of services. If there are no bus drivers, that causes an issue. The situation seems to be improving slightly, but, again, it all depends on the wages and on operators’ conditions of service—indeed, the operators that want to keep and retain drivers have worked on that issue—as well as on really important recruitment drives in different parts of the country to try to get more people to train as bus drivers.

Mark, I said that you had the final question, and you have now had three. I have pushed it as far as I can with the timing, so I am afraid that I will have to move on to the next agenda item.

The next item is a debate on motion S6M-11609, which calls on the committee to recommend approval of the draft Bus Services Improvement Partnerships (Objections) (Scotland) Regulations 2024. I remind everyone at the other end of the committee room that only the minister may speak in the debate.

Minister, do you want to speak to and move the motion?

I detect from the questions very little concern about these actual regulations on the objection system, so I simply refer the committee to my opening remarks, in which I set out the rationale for the legislation. From a technical point of view, this is about making sure that we have all the systems in place, and the regulations complete what is required for bus services improvement partnerships to ensure that, when they are developed, any plans that are put in place have co-operative agreement and buy-in from all concerned, and that, if operators have an objection, there is an understood mechanism and route by which they can raise it.

With that, convener, I am happy to move the motion.

Motion moved,

That the Net Zero, Energy and Transport Committee recommends that the Bus Services Improvement Partnerships (Objections) (Scotland) Regulations 2024 [draft] be approved.—[Fiona Hyslop]

Does anyone want to make any contributions at this stage? The minister will get a chance to sum up and answer questions at the end.

Very briefly, there have been a lot of questions to the minister, because there is a degree of scepticism whether it will deliver big change. At the end of the day, the question is whether bus users will get better and more reliable and sustainable services. I will let this piece of legislation go through today, but what I am really interested in is the report and the action that is taken afterwards.

Just to give a slight balance to the debate, I have to say that I did not detect any scepticism. Instead, what I heard today from the questioning, including that from myself, was the fact that there are huge challenges in achieving that modal shift—that is, getting individuals and families out of cars and on to buses—as well as the fact that significant public investment is already sitting there and that the existing money can be used better. I suppose that the subordinate legislation is part of that, as it ensures that local authorities can use the new powers but that bus operators—who are the main, key and strategic partners—can object, as appropriate, to certain measures.

The statutory instrument appears to be quite balanced, so we did really not ask about that. Instead, we used the session more as an opportunity to take a strategic look again at how we take forward publicly funded buses in Scotland in a strategic manner and to have a wee bit of wider budget scrutiny. I did not detect any cynicism—I want to put that on the record—but I did detect significant challenges that not just Government but all of us together in Parliament have a responsibility to address.

I will leave it at that, convener.

I will be brief.

During the questioning, the bus lanes in Aberdeen city were mentioned. People, sometimes, think that I am against them, but I am not—I am against the way in which they were done. When we introduce, say, bus priority measures, it should happen after full consultation with businesses and residents in the area. In Aberdeen, those regulations came forward as experimental traffic orders. To be fair, it probably meant that the Scottish Government was spending a substantial amount of money on a scheme that had not got long-term approval and that the money could therefore have been wasted.

I want to put that on the record, because it is often mentioned that I am not in favour of these things. That is not the case—I just think that it was not done in the correct way.

Having mentioned that, Douglas, do you want to make a declaration of interest to remind committee members of your previous role?

Thank you, convener, for reminding me. I remind everyone that, at the start of the session, I was a councillor on Aberdeen City Council.

I should say to the minister that I had been checking with the clerks whether Mr Lumsden needed to make a declaration when you pulled me up for talking while you were speaking. I can do two things at once, minister, as you will have noticed.

Before you respond to the comments, minister, I want to make one comment. I understand your comments about funding, but I would suggest that any significant changes to the way in which buses are operated and run will require significant funding.

On that note, minister, I hand back to you to sum up.

I want a strong, sustainable, reliable, affordable, accessible bus system, and that will rely on local authorities and bus operators being able to work in partnership. As Mr Doris, I think, pointed out, we face big challenges coming out of the pandemic, but we all need to work collectively to identify how to address them, given that, as we all know, bus services are frequently the issues that our constituents contact us about.

Motion agreed to,

That the Net Zero, Energy and Transport Committee recommends that the Bus Services Improvement Partnerships (Objections) (Scotland) Regulations 2024 [draft] be approved.

The committee will report on the outcome of the instrument in due course, and I invite the committee to delegate authority to me, as convener, to finalise the report for publication. Is the committee happy with that?

Members indicated agreement.

I thank the minister and her officials for attending and suspend the meeting until 10:25 to allow for a changeover of witnesses.

10:16 Meeting suspended.  

10:25 On resuming—