|By paying more for their fuel the bus companies will need|
recover the costs through higher ticket prices.
In spite of the disadvantages the bus companies face, they manage to run services at competitive prices and each year invest in their fleet and in doing so demonstrate how real businesses are run. The forthcoming rebate reduction will hit passengers but the bus companies will be in the firing line.
TAS has published its latest survey of over 1,000 individual bus fares which shows that the average fare for a typical three-mile journey had risen from £1.74 in 2009 to £1.91 in 2011 - an increase of 9.8 per cent, slightly below the 10.1 per cent rise in the Retail Prices Index over the same period.
TAS Partnership operations director Steve Warburton warns that the reduction of BSOG in April could push fares up by over 5 per cent, risking a sharp drop in passenger numbers. “If we’re not careful, we could end up with a 1970s-style spiral of decline,” says Warburton.
Now, in a very late announcement, the Welsh Government has said that it will reduce its BSOG payments by 25% from 1 April 2012. The cut will effectively mean a 12p per litre rise in the cost of diesel for the Welsh bus operators. The decision and the short notice of the proposal have met criticism from Welsh operators. Padarn Bus MD, David Hulme, said, ‘In England there was about 18 months notice of the cut, we effectively only have two weeks to make service changes in line with the cut because of the notice we have to give. It’s the people who need the bus the most that will suffer the most"