Nineteen States members appeal to the Environment Department Board to bring for debate before the States of Deliberation the proposed bus fare increase

July 13th, 2010 by Matt Fallaize

The Environment Department recently announced proposals to increase bus fares by up to 67% with effect from 1st August, 2010. We should like to request that the department postpones the implementation of such increases, and instead submits the matter to the States of Deliberation for debate.

Although the department has indicated that the proposals form part of the Financial Transformation Programme, it is quite apparent that in no way can they be classified as efficiency savings. They should, according to the department, generate additional income of around £400,000 per year towards operational costs of the bus service, allowing for a reduction in the government subsidy from around £2.14m. to £1.74m. per year, according to the 2010 Budget. In simple terms, the proposals represent a straightforward transfer of the financial burden of funding the bus service from the taxpayer to the user of the service.

At the time of the debate on whether to establish the Financial Transformation Programme, the States resolved to establish a governance structure which ensured that the Assembly (and not the Policy Council or departmental boards) would “…make key decisions in the programme such as material capital items, policy changes and politically sensitive issues…”

We contend that cutting the government subsidy of Guernsey’s only form of public transport by just under 20% and increasing fares by up to 67% represents a policy change and is a politically sensitive issue, and should therefore be referred to the States of Deliberation as expeditiously as possible.

As recently as February, 2009, the States of Deliberation debated proposals from the department concerning the funding of the Road Transport Strategy. Members resolved that “…the island’s Road Transport Strategy shall be funded by a combination of a) the increases in bus fare revenues, administration charges for residents’ parking permits and vehicle registrations approved by Resolution 21 (a) and (b) on Article VIII of Billet d’Etat VII of 2006, and b) an increase of 1.2p per litre in the duty on petrol and gas oil other than fuel used for air or marine navigation…”

Although we acknowledge that the funding of certain elements of the Road Transport Strategy and the public subsidy of scheduled bus services are not considered by the States to be one and the same thing, given the undeniable link between the two, it must be considered highly unsatisfactory that the Assembly was invited to reach conclusions about the long-term funding of its transport strategy without the department even implying that within 18 months it would also introduce increases in fares of up to 67% and cut the subsidy of public transport by just under 20%. Had such information been made available at the time, it may have had a material effect on the outcome of the debate.

The last occasion on which the States of Deliberation considered the underlying principles of the Road Transport Strategy was at its meeting of March, 2006, when it debated and approved a range of proposals from the Environment Department which re-focused and broadened the purposes of the strategy.

Incidentally, among the proposals debated and approved on that occasion was one to increase the basic bus fare from 50p to 60p per journey. It is interesting to note that the board of that time felt it necessary to seek the approval of the Assembly before increasing fares by 20%, whereas the current board plans to introduce increases of up to 67% without any debate in the Assembly whatsoever.

The States Report of March, 2006 stated: “The Department will also seek to increase fares so they keep up with inflation so that the real cost of the current services to the taxpayer does not increase further.” Adding Guernsey RPI between 2006 and today to the price of a basic fare would result in an increase to about 67p, nowhere near the figure of £1 which the department now seems to have in mind.

That States Report also included analysis which indicated that the demand for public transport is relatively price elastic. Indeed, the Report stated: “[The effect of price increases]…can lead to a “vicious circle” of passenger decline, in turn necessitating further fare increases or reductions in service levels.” We are not confident that the department has given appropriate consideration to this matter in the formulation of its most-recent proposals.

The States Report also included the following: “The Department believes that, as a matter of principle, the main objective of the strategy should be to reduce the adverse environmental, economic and social impacts of vehicle use in the island, in particular, by: encouraging the use of alternative forms of transport; discouraging unnecessary motor vehicle usage; promoting more responsible use of vehicles; and promoting more efficient use of the island’s transport infrastructure.”

In general terms, we are of the opinion that a one-off increase in bus fares of up to 67%, and cutting the government subsidy of public transport by just under 20%, runs the very real risk of compromising or even undermining entirely the headline policy objectives of the Road Transport Strategy to the extent that what started life as the “Integrated Road Transport Strategy” appears to be rapidly and unhappily disintegrating in the life of this States.

We respectfully repeat our request that this matter be placed before the States of Deliberation. In the event that the department does not provoke such a debate of its own volition, we will give serious consideration to the lodging of a Requête before the end of this month.

We thank the Board in anticipation of its further reflections upon this matter.

  1. No Comments

Have your say