The Tees Valley Combined Authority (TVCA) has commissioned a £150,000 study into the possibility of introducing bus franchising. As a combined authority with an elected mayor, it has the power to introduce franchising without central government approval.
TVCA says it wants to gather ‘a true picture of the operating costs and revenues of the Tees Valley bus network’ in order to understand whether the financial performance of bus operators represents ‘a fair return on investment’.
It wants to know if ‘any excess profits [could] potentially buy the TVCA… more services or lower fares’ and ‘what mitigating measures would TVCA and local authorities need to implement in order to lower operating costs or grow revenue’.
Tees Valley mayor Ben Houchen says: ‘People rightly demand that our bus network should be modern, accessible, affordable, and everyone should be able to use it. That’s why we need to look at all options on the table – including bus franchising.
‘Our bus companies are doing the best they can in the face of subsidy cuts by local councils, but it would be wrong of us not to look at whether there are other models that would work too.’
The outcome of the study should enable TVCA to understand whether the costs and risks associated with franchising offer a better way of delivering a better network than is currently provided under the deregulated system.