Bus deregulation in Great Britain: A review of the opening stages

The Transport Act 1985 abolished quantity control of bus services in Great Britain (outside London) and allowed subsidy to be paid for bus services only after competitive tendering. Preparations for the change started in January 1986, and the new regime effectively began on 26 October 1986. Between 70 and 80 per cent of previous bus services were operated commercially, without subsidy, although not always in exactly the same form as before. Local authorities specified subsidised services to supplement commercial ones, attempting to preserve broadly the same overall service levels as before, and invited tenders for them. Tender prices were such that most authorities were able to let contracts for all the services they required, at subsidy levels well within their budgets. Competition between bus services has occurred in only a limited number of cases so far, and has caused few serious traffic congestion problems. There have been random fluctuations in fares, but no systematic trend has yet been detected. As far as can be judged from the evidence available so far, the transition to deregulated bus services has been accomplished successfully, albeit with a number of difficulties still to be resolved. (A)