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

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.

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.

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.

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.

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.

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.

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.

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.

We have some estimates, but again we are working with SCOTS—that is, the transportation officers—and with local authorities on what they think that they will need. Obviously, it is part of the on-going discussion that we are having with COSLA and local authorities.