4839fg3sheffield by Passenger Transport Publishing Ltd

Driving Growth: The Sheffield Bus Partnership

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SHEFFIELD PARTNERSHIP

Foreword Sheffield has a very well-deserved reputation for being a city where successful partnerships are forged, so I am absolutely delighted to have been invited to make a contribution to mark the achievements of the first two years of the Sheffield Bus Partnership in this special publication

B Baroness Kramer: 'Successful bus services need everyone interested to be working hand-in-hand'

uses are the backbone of Britain’s public transport system. They carry more passengers than any other mode of public transport and are an absolutely vital public service linking people to essential services, shops and leisure. So buses matter. We want everyone to have a good bus service in their local area. That is why we funded £70m of bus improvement projects across England – including nearly £5m in South Yorkshire. We want to see more regular, reliable services with the kind of improvements that make catching the bus simpler including network-wide smart tickets and real time passenger information. By improving bus services and carrying more passengers you cut congestion on the roads, improve the quality of the air we breathe and make our cities more liveable. Sheffield has been a pioneer

for the Better Bus Area initiative and is showing just what can be achieved. The reason Sheffield was chosen to be the first designated Better Bus Area was the scale of the ambition for just how much better the bus network could be and I am pleased to say they are delivering on that ambition through their bus partnership. You can read the detail of what has happened, how they did it and what has been achieved so far in this supplement. The trail blazed in Sheffield has been followed by the creation of four more Better Bus Areas on Merseyside, in York, in Nottingham and across the West of England. I hope they will enjoy similar success. As important as operators are, successful bus services need everyone interested to be working hand-in-hand. This includes, local Councillors, local authority transport planners and providers as well as passengers. It needs

everyone pulling in the same direction to improve services and I would like to take this opportunity to commend everyone involved in the Sheffield Bus Partnership. As well as funding through the Better Bus Area initiative, the Sheffield City Region has secured £295 million from the Local Growth Fund to support economic growth in the area. That will mean improved transport connections, investing in the skills of local people and growing local businesses. Working together, we are backing better buses, backing Sheffield and backing this fantastic partnership. Many congratulations to all the Sheffield bus partners on their first two years. May there be many more to come.

Baroness Kramer Minister of State for Transport Brought to you by

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SHEFFIELD PARTNERSHIP : OVERVIEW

A breakthrough for Sheffield Bus use is growing in Sheffield for the first time in decades, thanks to the groundbreaking Sheffield Bus Partnership

heffield’s buses are finally moving in the right direction. A long spiral of decline has been broken, thanks to the formation of a ground-breaking partnership working agreement between the city’s bus operators, First and Stagecoach, South Yorkshire's Integrated Transport Authority, its Passenger Transport Executive and Sheffield City Council. This blueprint for success, which is delivering a high quality bus network where passengers are benefiting from good value alongside high levels of satisfaction and which plays a key role in supporting the Sheffield city region, its economy and its growth aspirations for the future, is using many of the tools that are at the bus industry’s disposal. Launched in October 2012, a minimum five-year Voluntary Partnership Agreement (VPA) has delivered a single, stable network with joint, co-ordinated timetables

THE ROAD TO PARTNERSHIP... May 1, 2007: ‘The Sheffield Bus Agreement’ signed ‘The Sheffield Bus Agreement’ signed by First, SYPTE and Sheffield City Council. Covering two bus routes in the city, the voluntary quality partnership was intended to see £16.9m invested in the city’s bus network, of which around £10m was to be spent by First over two years on 40 new buses, extra CCTV cameras and customer

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on the main corridors – backed up by significant investment by all partners. There are 120 new buses on Sheffield’s streets and £4.5m has so far been invested in bus stops, bus routes and traffic management. A multi-operator travelcard (MTC) and two multi-operator individual tickets (MITs) have meanwhile provided discounted multi-operator travel, allowing seamless bus-to-bus interchange. In addition to all of that, the city has been the first to adopt the pioneering new funding initiative as part of the Sheffield City Region’s City Deal. Under the new agreement, Bus Service Operators Grant (BSOG) payments to bus operators in Sheffield are being gradually devolved to SYPTE while at the same time being topped up with nearly £1.6m a year from government - enabling the city to invest more in bus infrastructure and traffic management. Taken together, this partnership working arrangement is unique in

care training for drivers. SYPTE was in the process of developing plans for Quality Contracts, but David Brown, then the PTE’s passenger services director, said that it showed that the executive still had an open mind about the best way forward. May 3, 2007: Labour loses control of Sheffield City Council Following local elections, Sheffield City Council switched from being Labour-controlled to no overall control.

May 1, 2008: First anniversary of ‘The Sheffield Bus Agreement’ Partners claim that Sheffield Bus Agreement has arrested patronage decline on the two routes that it covers. There was a 0.4% increase in 2007/08 – 200,000 extra journeys – compared to the previous decline of approximately 4% a year. “We have had a very successful first year,” said David Brown, who was then SYPTE’s director general.

May 1, 2008: Lib Dems take overall control of Sheffield City Council The Liberal Democrats take overall control of Sheffield City Council in the wake of local elections. March 2009: OFT announces investigation into the bus industry The Office of Fair Trading launches a new market study into the supply of local bus services. Local authorities and bus operators voice fears that efforts to deliver improved

services for passengers could be undermined if the probe obstructs partnership working. March 2009: ‘The Sheffield Bus Agreement’ breaks down Less than two years after it was signed, First walks away from the Sheffield Bus Agreement. The operator claims that the city council had backed away from commitments to improve bus priority in parts of the city. However, SYPTE said First had quit

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Above: The partners at an event to mark the start of the Sheffield Bus Partnership. Below: First and Stagecoach vehicles on Sheffield's high frequency 120 service

both scope and scale. It is a watershed for Britain’s bus industry. The result has been a turnaround in the historic decline of bus use in the city that had spanned nearly three decades. Overall ridership grew by 0.9% in the first 18 months of the partnership, but fare-paying passengers made nearly 10% more journeys (an increase of 4.65 million). Records also show continued improvements in punctuality and reliability, with punctuality at 91.0% and 98.7% of buses operating. And customer complaints are down by around a third, compared to pre-partnership levels, and passenger satisfaction for South Yorkshire has risen to 89%. It is proof, the partners say, that partnership can deliver results much more quickly than the alternative Quality Contracts route, which would see the passenger transport executive assume complete control of the network – and the associated risks that come with it. The Quality Contracts route was explored extensively by SYPTE and it remains an option, but as long as the partnership agreement keeps delivering results there is little incentive to resort to it. One measure of the partnership’s success is that the ‘We Want Our Buses Back’ lobby group, which had campaigned hard for Quality Contracts, no longer actively exists. Not so long ago, however, SYPTE came very close to pressing the ‘Quality Contracts’ button. There was an imperative to do

January 2010: OFT refers UK bus market to Competition Commission The Office of Fair Trading refers UK local bus services, excluding London and Northern Ireland, to the Competition Commission.

Auckland, tabled a motion to an ITA meeting calling for the Sheffield and South Rotherham areas to be the first in the conurbation to test bus QC powers, ahead of Doncaster, where the PTE was studying delivery options – but the move was blocked by the Labourcontrolled ITA.

March 24, 2010: SYITA rejects bus QC plan for Sheffield Lib Dem councillor and Sheffield’s cabinet member for transport, Ian

March 24, 2010: Stagecoach unveils ‘Better Buses for Sheffield’ plan On the same day, Stagecoach proposed a radical strategy to revitalise

the partnership because it wanted to make cuts to the city's bus service.

something to arrest the long term decline of buses and the partnership route had been tainted by the collapse of the ‘The Sheffield Bus Agreement’, a partnership between SYPTE, Sheffield City Council and First, the city’s main bus operator, which covered two bus routes in the city. Launched in May 2007, this agreement was initially hailed as a success, but it fell apart less than two years later amid claim and counter-claim. First accused the city council of backing out of commitments to improve buses. SYPTE said First

“Yes, they were very close to a Quality Contract, but they were very close to a Quality Contract because they believed that was needed to turn the situation around.” PAUL LY NCH

•

had quit the partnership because it wanted to axe services. At the time, the PTE had been pursuing a twin-track approach of developing plans for a Quality Contract while seeing what a partnership with First could deliver. The collapse of that partnership appeared to leave only the Quality Contracts option on the table, and in June 2010, the year after the collapse of the partnership with First, SYPTE launched a consultation exercise over plans to introduce them with residents in Sheffield and South Rotherham.

bus services for passengers and improve the local environment in Sheffield over the next decade. Its plan centres on a public-private partnership between bus operators, South Yorkshire Passenger Transport Executive and Sheffield City Council. Stagecoach said it wanted to bring the same dynamic approach to buses that it had used to transform the city’s Supertram network and boost rail services in Yorkshire at East Midlands Trains.

However, a combination of events, including changes at the city’s main operators in autumn 2010, saw partnership return to the agenda. At FirstGroup, Tim O’Toole took over as CEO and he was quick to acknowledge that the group needed to change its approach to running buses. Soon afterwards, in early 2011, Giles Fearnley was appointed as managing director of First UK Bus, with a mission to halt the decline of the business and return it to growth. Stagecoach meanwhile launched a major expansion in Sheffield in autumn 2010, growing its operations in the city by around 30%. Having entered the market as a fringe player with the acquisition of Yorkshire Traction in 2005, the Perth-based group now operated around a third of the city’s buses. While keen to continue to compete, both operators wished to grow the overall market rather than fight over an ever decreasing pool of bus users. They also had a shared interest in avoiding a Quality Contract. So, with renewed impetus from all parties to make a breakthrough, discussions began late in 2010 between the two operators, SYPTE and the city council about a new partnership agreement. Significantly, the next May saw the political backdrop change when Labour regained control of the city council. With less political capital invested in Quality Contracts than their Lib Dem counterparts, who had controlled the council

May 6, 2010: Lib Dems enter coalition government, but lose control of Sheffield City Council The general election sees the Liberal Democrats form a coalition government with the Conservatives, with a Lib Dem minister, Norman Baker, taking responsibility for buses at the Department for Transport. However, local elections on the same day see the Lib Dems lose control of Sheffield City Council, which returns to no overall control.

June 2010: SYPTE launches Quality Contracts consultation SYPTE launches a consultation exercise with residents in Sheffield and South Rotherham over plans to introduce Quality Contracts. November 1, 2010: Tim O’Toole is appointed CEO of FirstGroup Former London Underground MD Tim O’Toole takes charge at the UK’s largest bus and rail operator, FirstGroup, following the retirement Brought to you by

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SHEFFIELD PARTNERSHIP : OVERVIEW

Bus, represented the group during the discussions. He says that the partners did a lot of groundwork on identifying their shared strategic objectives before fleshing out the details of the partnership. The discussions considered the bus network as a component of the cities economic development, and this helped to get the politicians on board. What emerged was more than a ‘bus’ partnership - it was a ‘Sheffield’ partnership. “We were lucky in that the people at the PTE were pragmatic people,” says Paul Lynch, managing director of Stagecoach Yorkshire. “Yes, they were very close to a Quality Contract, but they were very close to a Quality Contract because they believed that was needed to turn the situation around. But they were pragmatic enough that if you could persuade them that there was another and quicker and easier way of achieving it they’d consider it.” In July 2011, little more than six months after partnership discussions had begun, Phase 1 of the new ‘Optio’ partnership was launched on a major corridor operated by both First and Stagecoach, providing co-ordinated timetables and interavailable ticketing. This initial ‘Orange’ corridor covered around 50 of the buses in Sheffield, about 12% of the city’s total fleet. The Phase 1 corridor was complicated but relatively selfcontained, and it represented a bite-sized chunk that enabled the partners to demonstrate what of the group’s co-founder, Sir Moir Lockhead. Autumn 2010: Stagecoach launches Sheffield expansion Stagecoach Yorkshire marks a £10m investment in Sheffield with the launch of 15 new double deckers for the city. They spearheaded three new Stagecoach routes in Sheffield, representing a 30% increase in the company’s city area operations. Late 2010: Discussions start on plans for a new

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could be achieved and win people over to the partnership approach. The partners were sufficiently encouraged by the progress made to launch Phase 2 of the Optio partnership, ‘Red’, on another major corridor in October 2011, doubling the size of the agreement. With a quarter of Sheffield’s bus network now covered by the new partnership, the partners took the decision to abandon the phased approach and in one bold move create a partnership that covered Sheffield’s entire bus network. The partners could see that the partnership was starting to work and they were keen to get on with it. They were also aware that maintaining the support of politicians would be harder if the partnership was rolled out gradually. The months that followed tested the resolve of all parties. There

was intense debate about how it should be done and concerns about ensuring compliance with competition law, and all the while the politicians were growing impatient. “It was an easy and natural decision to do the rest of the network in one go, but it could have gone wrong,” Alexander admits. “Doing the rest of the network in one go was more risky than carrying on with the bitesized chunks, but in the end it was the right thing to do – otherwise we wouldn’t have the progress now that we’ve got.” The decision was taken to divide the work into six packages – network, investment, fares and ticketing, market and information, monitoring and management – each led by one of the partners. Throughout this period, the parties informed and consulted the

Bus passenger numbers in Sheffield have increased since the partnership was launched

partnership agreement Discussion open between First, Stagecoach, Sheffield City Council and SYPTE about bus partnership options in Sheffield. February 2011: Giles Fearnley joins First UK Bus Giles Fearnley joins First UK Bus as managing director, tasked with turning the struggling operator around. May 5, 2011: Labour regains overall control of Sheffield City Council Four years after

losing control of Sheffield City Council, Labour is back in overall control again. July 2011: Optio Phase 1 (Orange) launched What would be the forerunner of the region-wide bus service co-ordination begun with the launch of integrated services and ticketing on one crosscity corridor in Sheffield. October 2011: Optio Phase 2 (Red) launched The new Optio Red scheme covers another cross-city route,

Department for Transport and the Office of Fair Trading. The operators were extremely nervous and doing anything that might be regarded as anti-competitive. During the discussion period, on December 20, 2011, the Competition Commission published its final report on its market investigation into local bus services. Lynch comments: “As a partnership, we did have one or two meetings with the Department for Transport where they were very supportive. They could see that this was a good thing, so they took an interest in how we got on in our talks with the OFT and they came with us to make clear that they thought it was a good thing.” However, the partners received only limited reassurance. The best the OFT could say was along the lines of ‘we can’t see a problem, but we’ll watch this closely’. However, the partners were encouraged that the networkwide bus partnership in Oxford, which involved co-ordinated fares and timetables, had not been considered anti-competitive. A further concern for First and Stagecoach was that the PTE and the city council were expecting high levels of investment by the operators, but were committing to relatively little themselves. “We had a lot of pushing to do to get them to commit funding to this,” says Lynch. “In the end we got there, and in fact there’s a huge amount going on now. But at one point it looked like it might be something that was a dealbreaker.”

the 52 between Crookes and Woodhouse End of 2011: Partners agree to do rest of the network in one go Encouraged by the achievements of Optio Phase 1 and 2 and conscious of the need to maintain momentum, the partners agree to extend the partnership across Sheffield’s entire bus network. June-July 2012: Consultation on the Sheffield Bus

Partnership network Public consultation begins on the network proposed by the Sheffield Bus Partnership July 2012: First announces fare reductions First announces significant fare reductions to be introduced in October 2012, co-inciding with the launch of the new bus partnership. Maximum single fare is now £2. A First Day is reduced to £3.40 from £4.60. A First Week is reduced to £11 from £18.50.

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got there, and in fact there’s a huge amount going on now. But at one point it looked like it might be something that was a deal breaker.” Once these hurdles had been cleared, a way forward was agreed and in summer 2012 the partners launched a public consultation on their new network. In July, the partnership plans then received two significant boosts. First announced that significant fare reductions would be introduced in October 2012, co-inciding with the planned launch of the new bus partnership. A First Day was reduced to £3.40 from £4.60 while a First Week was reduced to £11 from £18.50. This meant that the majority of bus users in Sheffield would pay lower fares once the partnership was in place. Alexander is quick to point out that First would not have made this degree of cuts without the security offered by the partnership. Meanwhile, the partnership was provided with significant new financial assistance when it was announced that, under its new City Deal, the government had named Sheffield as a Better Bus Areas pilot area. This paved the way for £4.8m a year of BSOG payments to bus operators gradually devolved to the PTE and topped up with an additional £1.6m a year, a 33% increase. And, importantly, the operators have a say over how the money is spent. The next month, August, saw South Yorkshire Integrated Transport Authority approve the full partnership after comparing it with the alternative Quality August 2012: ITA gives approval for the full Sheffield Bus Partnership Having compared the pros and cons of the Quality Contracts and partnership routes, members of South Yorkshire’s Integrated Transport Authority vote in favour of the partnership option. October 28, 2012: Sheffield Bus Partnership is implemented Only two years after initial discussions began, the city-wide Sheffield Bus Partnership is implemented

Partners, pictured in July 2011 (left to right): Paul Lynch (Stagecoach), David Brown (formerly of SYPTE, now of Merseytravel) and Dave Alexander (First)

“It’s a sign of that mature partnership really. There’s a real degree of trust coming out of it.” DICK P RO CTO R

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Contracts route. The two options were compared against one another on key criteria (see page 11), and while the partnership option could not offer everything that Quality Contracts promised, such as a single brand for the network, the offer was considered close enough. The then Labour chair of the ITA, Mick Jamieson, explained that he favoured the partnership option because it could deliver results ‘within three months, not three years’. And so, on October 28, 2012, two years after initial discussions about a partnership had begun, the Sheffield Bus Partnership was implemented.

February 26, 2013: SYPTE confirmed as first Better Bus Area (BBA) The Department for Transport announces that South Yorkshire Passenger Transport Executive has successfully developed the first Better Bus Area (BBA) in Sheffield. This was agreed as part of the Sheffield ‘city deal’. November 2013: Sheffield Bus Partnership recognised at UK Bus Awards The Sheffield Bus Partnership is named the winner of the

The results speak for themselves – patronage and punctuality are up, car use and complaints are down. There has even been a noticeable decline in the number of negative stories about buses in the local press. But one improvement that is harder to quantify although no less significant, is the increase in trust and mutual understanding. “None of us are perfect and we all have our off days, but you do feel able to come along and say, ‘sorry guys, we messed up’ says Dick Proctor, transport planning manager at Sheffield City Council. “That will get chewed over but we all recognise everybody’s strengths in this as well.” He continues: “It’s much easier to find £1m capital sometimes than it is to find £10,000 of revenue for marketing or something like that. There’s some quite nice openended discussions as to how if we can inject a little bit more capital

into something then the operators can find a way of putting in a little bit more revenue. “It’s a sign of that mature partnership really. There’s a real degree of trust coming out of it.” The partners are now bonded closely together in a way that would have seemed unthinkable not very long ago. “We find ourselves defending the operators in a discussion with some third party as part of that partnership work, which we might not have been quite so inclined to do a few years ago and vice versa.” Having given their approval for the partnership two years ago, most politicians remain supportive. “They welcome the partnership and its tangible signs, including a single map illustrating every single bus service in Sheffield, a single network change, a single set of ticketing products and a sense of unity and ownership,” says David Young, deputy interim director general and director of customer experience at SYPTE. “There’s quiet pride in it.” With the partners all happily working together, and with political support, Young’s ambition is to get more and more people in Sheffield to embrace the bus. “It’s about people choosing to use the bus,” says Young. “We start from ‘I don’t understand why you use the bus’. The moment I hear people say ‘I don’t understand why you don’t use the bus’ will be the real breakthrough moment. We’re seeing some of that beginning to happen.” Q

‘Making Buses a Better Choice Award’ and the ‘Local Authority Bus Project of the Year Award’, and runner-up in the ‘Award for Innovation’. June 20, 2014: Patronage growth reported SYPTE reports to the Sheffield City Region Combined Authority that bus passenger numbers have risen by 0.74 million (0.9%) over the first 18 months of the Sheffield Bus Partnership. The number of fare-paying passengers is up by 4.65 million (9.6%).

The Sheffield Bus Partnership won the 'Making Buses a Better Choice Award' at the 2013 UK Bus Awards. Collecting the prize (left to right): David Young (SYPTE), Paul Lynch (Stagecoach) and Ben Gilligan (First) Brought to you by

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SHEFFIELD PARTNERSHIP : THE STATS

INPUTS : IN VESTM E NT :

FA RES :

Fares have fallen by as much as

41%

£4.4m 120 new, greener, low floor buses have been introduced

At least 60% of adult fare-paying passengers are benefiting from reduced fares

FUNDING :

invested in bus stops, bus routes and traffic management

OUTPUTS : PASSENGER SATIS FACTIO N :

SO U T H YO RKS H I RE

FIRST

Bus Service Operators Grant topped up by

33% (£1.6m a year)

STAGECOACH

March 2012

86%

65%

83%

53%

87%

78%

March 2013

83%

59%

81%

56%

87%

67%

Autumn 2013

89%

69%

88%

63%

89%

75%

Overall Journey

Value for money – fare paying

Overall Journey

Value for money – fare paying

Overall Journey

Value for money – fare paying

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PUNCTUALIT Y :

REL I A B I L I T Y :

98.7%

91.0%

Across all of the bus operators, reliability performed above a target (98.5%) for the eleven months in a row to April 2014 at 98.7%

Across all of the bus operators, punctuality (departures from terminus) was 1.0% above target at 91.0% over the year to April 2014

RIDERS HIP :

CO MP L A I N TS :

MO DA L S H I F T :

-34%

-4,489

Complaints about buses in Sheffield are down from 1,100-1,200 per quarter before the partnership to 700-800 since Q2 of Year 1 â&#x20AC;&#x201C; a drop of around a third.

+4.65m +9.6%

Fare payers

Change in passenger numbers over the first 18 months of the partnership

Over the past two years, the number of people travelling by car has fallen by 1.6% (by 4,489 people)

ENCTS (older people & mobility impaired

-2.55m -9.6%

Child fares

-1.35m -12.4%

+0.74m +0.9%

2.0%

Total

Market research conducted by SYPTE has found that 2% of bus passengers say that they have switched from using a car

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SHEFFIELD PARTNERSHIP : BBA

BSOG is being invested on measures that will help to grow bus use in Sheffield, such as bus priority measures, and operators have a say

Better Bus Area It’s a question that Paul Lynch, managing director of Stagecoach Yorkshire, says he is often asked by operators from around the country: “What on earth have you agreed to a BBA for?”

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he operators are referring to the decision of Stagecoach Yorkshire and its fellow operator, First South Yorkshire, to sign up to a Better Bus Area (BBA) pilot initiative in Sheffield that will see them surrender a combined £4.8m a year in Bus Service Operators Grant (BSOG) - £3.2m from First, £1.4m from Stagecoach and the remainder from a variety of smaller bus operators. Better Bus Areas have been designed by the Department for Transport to promote economic growth and reduce emissions by improving bus services for passengers. Under this trail-blazing initiative, which came as a result of Sheffield’s City Deal discussions, the BSOG payments will gradually be devolved from central government to South Yorkshire Passenger Transport Executive. At the end of the initial five-year agreement, 100% of this funding will be retained by the PTE. With implications for bus operations across England, it was not something they entered into lightly. When SYPTE first came forward with their BBA ambition in the summer of 2012, the issue was deemed sufficiently important that Giles Fearnley and Les Warneford, the then managing directors of First and Stagecoach’s UK bus businesses, attended the meetings. “It’s a big issue. It’s game changing stuff,” explains Dave Alexander, regional managing director Scotland & North England for First UK Bus. So why did First and Stagecoach agree to it? The plan is for BSOG to provide new funding for investment that helps to make bus travel a more attractive option, such as better roadside information and faster, more punctual journeys. The intended result is that the bus companies will be trading BSOG payments, which may not be around forever, for volume-driven revenue growth. In short, BSOG is

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being used as kickstart funding. To aid progress towards this goal, the government is topping up BSOG payments by a further 33% - £1.6m a year – for the duration of the five-year agreement. This was a more generous deal for the first city to make the leap – subsequent Better Bus Area agreements in Nottingham, Liverpool and Manchester and York have only awarded a 20% top-up. The phased withdrawal also provided the operators with comfort. There was a difficult balance to be struck. In order to generate growth and create the revenue that replaces BSOG quickly, the money needed to be invested at the earliest opportunity. However, taking all the money off the operators on Day One would leave them with a big gap in their finances that could take years to fill. It was therefore decided that in the first year of the five-year agreement the operators would continue to receive 100% of BSOG,

'Replacement BSOG': First and Stagecoach no longer pay departure charges to the PTE for using its Sheffield Interchange

falling in subsequent years to 75%, 50%, 25% and finally 0%. “That mitigates our risk because we are losing the money in stages and it gives time for the benefits to build up,” Lynch explains. “It does have the disadvantage that there is less money to be spent up front, because we are still getting some of it, and it’s not being spent on things out on the street – but you can see it is a better compromise.” Further comfort for the operators is provided by their estimates that only around half of the BSOG money will actually be

foregone – the rest of it will simply come via different means and effectively create a replacement to the BSOG funding that aims to help drive up passenger demand. For example, First and Stagecoach no longer pay departure charges of £383,000 a year for using the PTE’s Sheffield Interchange, the city's main bus station. Meanwhile, the PTE has also waived its charges for providing retail, customer information, administrative costs relating to its support for the TravelMaster range of multi-modal and multi-operator tickets. There has also been an increase in the reimbursement that operators receive for participating in concessionary travel schemes, using the logic that reduced BSOG funding would lead to higher fares and thus higher concessions payments. So the challenge of offsetting the loss of BSOG is phased, and only around half of it needs to be replaced. However, there’s still a lot of money at stake and there was therefore one final element of the deal that was pivotal in getting the operators to sign up to it – they have a say in how it is spent. “We sit on the board that decides how this money is spent,” says Lynch. “It won’t be spent on anything we don’t agree with. We have to be persuaded that it is being spent in a way that is going to help the customer, increase the market and replace our money.” So perhaps the decision to voluntarily sign over BSOG is not as crazy as it might have sounded to some. And how secure is the future of BSOG anyway? Having reduced it by 20%, the government has said that it won’t reduce it again, but what will happen after the 2015 general election? Critics of BSOG question the merits of a payment made by the government to bus operators on the basis of the amount of fuel used. If BSOG becomes a casualty of a further round of spending cuts, Sheffield’s operators will be ahead of their peers by trading it in for a combination of growth and other funding streams. Q

Summary of key attributes Voluntary Quality Partnership versus Quality Contract Q UA L I T Y CO N T RACT

VO LU N TARY QUAL I T Y PA RT NERSH I P

Number of bus routes

Number of buses (PVR)

374

398

Frequency

Standardised

Linked to demand

Major change consultation

Yes

Change frequency

1 x year

1 x year (major change) plus 2 x year (punctuality adjustments)

Change decision

PTE

Joint – operators, SYPTE and SCC

Day fare – all services

£4.25

£4.30 + cheaper single operator tickets

Adult single fare winners

35%

Modest %

Adult single fare losers

60%

Period ticket winners

72%

35%

Period ticket losers

27%

Fleet age

Max 5 years (core) Max 10 years (other)

Average 9.6 years (current) reducing to average 8.0 years October 2017

Engine type

Euro III or IV at launch (3 years away)

90% Euro III or better – October 2015. 100% Euro III or better – October 2016. 50% Euro V or better – October 2017

CCTV

Yes

Accessibility PSV

PSV regulations

100% low floor leading to regulations by 2015

Real time

Yes

Driver training

NVQ

NVQ or Driver CPC

Cleaning specification

Specified in contract

As per operator negotiation

Smart ticket machines

Yes

Brand

Single Travel South Yorkshire brand

Operators' own

Customer Charter

Yes

Network map

Yes

At launch and ongoing if need evidenced

Fare information (stop and timetable)

Comprehensive

Summary

Marketing

PTE-led

Joint-agreed

Published performance

By route

Summary

10 years

5 years minimum

NETWOR K

TIC KETING

BUS QUALIT Y

MA RKETING

AGREEMENT

Duration

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SHEFFIELD PARTNERSHIP : GREENER FLEET

Air Quality The Sheffield Bus Partnership has triggered investment in cleaner, greener vehicles

heffield is highlighted as a troublesome air quality area, perhaps due to its unique geographical attributes. The city nestles in a natural amphitheatre meaning that polluted air can easily become trapped, leading to some serious air pollution issues. The air quality debate has been rising up the agenda and Sheffield City Council has been particularly keen to find the means to get to grips with the issue. With this in mind, the council obviously wanted to see bus emissions tackled as part of the city’s wideranging bus partnership. The most obvious way to solve these issues is to acquire new vehicles, either conventional diesel-powered buses or more sophisticated alternatives like hybrids, which meet stricter emissions legislation. However, there were some difficulties agreeing on the levels of investment that would be enshrined in the partnership. “We had a real practical problem,” says Paul Lynch, managing director of Stagecoach’s operations in the city. “At the time both First and ourselves had very different commercial models when it came to investment priorities. We’d invested quite a bit in the fleet over the last few years, but for First, and I’m sure they would agree, they weren’t quite there in keeping up with investment.” He adds candidly that Stagecoach had a particular concern that any agreement had to

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be fair and to reflect investments already made. Lynch continues: “So the partners had to come to an agreement that on the one hand reassured Stagecoach that they wouldn’t have to invest what they’d already invested, but which still committed them to something extra, but then didn’t leave First with an impossible commitment. “It was about striking the balance, given that the two fleets were in such different places. It was actually quite difficult, but in the end we found a formula to do that.” This saw the baseline for the city’s bus fleet put back a

little to account for some of the investments that Stagecoach had already made in the city, which Lynch admits de-risked the plans as far as Stagecoach were concerned. “In the end we tied it to Euro emissions standards and to stretch the commitments out until 2017 so there was time for both sides to meet the commitment and feel comfortable about that.” The agreement ties the operators to a series of commitments until 2017. At the start all vehicles on city services were required to be both low floor and accessible and backed up by GPS technology, that

One of the 40 Alexander Dennis hybrid buses now operated by Stagecoach in Sheffield

T I M E TA BLE FOR I N VEST MEN T 2012

100% low floor, GPS, smart ETMs

2015

100% CCTV

2015

100% DDA

2016

100% Euro 3

2017

50% Euro 5

would interact with the region’s real time information system, and smart-enabled ticketing equipment. By October 2015 CCTV will be required on every vehicle and all vehicles will have to be DDA compliant. October 2016 will require all vehicles to meet Euro 3 emissions legislation, tightening to Euro 5 a year later and an average fleet age of under eight years. “So,” notes Lynch, “the targets are tied to Euro emissions standards and age, but there is no strict requirement to invest in new vehicles.” Despite this both operators have still invested heavily in new vehicles for Sheffield. First has introduced 82 new buses in the city since October 2012 with Stagecoach introducing 84 over the same period. The latter operator has also expanded its hybrid bus fleet by 19 vehicles, thanks to funding from the Green Bus Fund, over the same period, meaning the Perth-based group now has a total of 40 hybrid buses at work on two Sheffield bus routes. Both operators are also on track to achieve their Euro emissions requirements. David Young, South Yorkshire PTE’s interim deputy director general speaks with satisfaction about the fleet investment. “They’ve both invested in 80-odd buses over the last year,” he says. “A huge amount have come through.” However, he admits that the strict adherence to Euro emissions requirements may not be practical. As Young says a Euro 5 bus on the street does not perform as a Euro 5 bus does on the test track. “They’re probably better than the fleet that were there, but they haven’t solved the [air pollution] problem,” he adds, noting that Rotherham’s bus partnership, which went live earlier this year, instead offers scope for alternative and retrofit technology rather than following Euro emissions. He says that Sheffield's partnership could move this way in the future, but it would be subject to negotiation. “That’s what partnership’s about,” he adds. Q

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FA RES

Under the Sheffield Bus Partnership, bus operators have agreed to limit fare increases to once per year for each fare, but not neccessarily all on the same date

Fares With cheaper fares for most passengers, Fares and ticketing is a major element of the Sheffield Bus Partnership

hen bus operators First and Stagecoach entered into discussions with South Yorkshire PTE and Sheffield City Council about a new partnership in late 2010, they were told that affordable, inter-available ticketing, allowing passengers a greater choice of the buses they can use, was non-negotiable. Without it, partnership could not be considered as a viable alternative to Quality Contracts, under which the PTE would set fares and define ticketing products. The issue of fares has been a controversial one in Sheffield. When Sheffield’s buses were publicly-owned, they were heavily subsidised. Many people still remember that fares were 10p – 5p or even 2p if they have longer

memories! Trapped in a spiral of decline, First, the city’s largest operator, had consistently increased fares in order to offset falling revenues. Prior to the launch of the Sheffield Bus Partnership the company was charging £4.60 for a FirstDay ticket and £18.50 for FirstWeek fare. Meanwhile, rival operator Stagecoach, which had built up its position in the city and was competing head-to-head with First on a growing number of corridors, was charging significantly lower prices - £3.40 for a day ticket and £11 for its weekly Megarider fare. The multi-operator ticket, administrated by TravelMaster,was relatively unattractive at £5 for day or £22.50 for a week. The partnership began by introducing attractively-priced, inter-available tickets on specific routes in the city, starting with Brought to you by

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SHEFFIELD PARTNERSHIP : FARES

'We're not telling porkies': Promotional material produced by First to publicise the large reductions in fares that it introduced when the Sheffield Bus Partnership launched in October 2012. A FirstWeek ticket was reduced from £18 to £11.50

FARES STRUCTURE TICKET T YPE

PRE AG R E E M E NT

P OST AG R E E M E NT

% CH A NGE

M U LT I - O P E R ATO R (administered by the TravelMaster panel)

Day

£5.00

£4.30

- 14%

Week

£22.50

£17.00

- 24%

Month

£80.75

£63.75

- 21%

Annual

£863.00

£695.00

- 19%

Day

£4.60

£3.40

- 26%

Week

£18.50

£11.00

- 41%

Month

£65.90

£42.00

- 36%

Day

£3.40

No change

Week

£11.00

No change

Month

£42.00

No change

F I RST

STAG ECOAC H

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routes in the city, starting with the Optio Orange corridor in July 2011. “We learnt quite a bit from that,” says David Young, deputy interim director general at SYPTE, which, alongside the city council, was able to act as a facilitator. “It wasn’t perfectly right. Some of the ticketing was complicated and didn’t work, and there were things that we over-estimated. But, importantly, Young says that it proved that the operators could work together, and inter-available tickets were then introduced on the Optio Red corridor in October 2011. The decision was then taken to go for a big bang approach. Rather than continuing with a phased introduction, corridor by corridor, the partnership would be extended across the entire city. There were a number of reasons for doing this, but one was that

there were legal constraints about multi-operator individual tickets (MITs) that meant they could only be used on up to three corridors. Attention shifted to a MTC (multi-operator travelcard) solution. While the operators did and still do have their own ticket products and compete for market share, they did agree to a big reduction in TravelMaster’s inter-available ticket, covering bus and tram services. The price of the weekly ticket plummeted from £22.50 to a more palatable £17 – a drop of 24%. At the same time, the price of a day ticket fell from £5 to £4.30. These prices were cheaper than the prices charged by First so it was clear that the operator was going to slash its own prices – but nobody knew how much by. The move came at a time when First was reassessing its approach

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“It was more evidence of a change of heart, a change of direction, a change of commercial strategy.” However, Alexander adds that although First has cut fares in other cities, it would not have had the confidence to go as far as it has in Sheffield if the move had not been backed up by a partnership agreement. “We have done it faster and deeper here because of the partnership,” he says. “We would not have done it to the extent that we did in the time that we did if it had not been for the partnership. Definitely not.” The partners were therefore able to put a proposal before South

“A real advantage of the partnership option is that we haven’t impacted negatively on the farepaying passenger. We’ve brought TravelMaster products down... and First has dropped [its fares] further than even I thought that they would.” DAV ID YOUNG

• to fares. The group’s attempts to offset rising costs with fare increases in January 2012 backfired in some parts of the country, with disappointing yields. Speaking to City analysts, FirstGroup chief executive Tim O’Toole said: “The only good thing to come out of January was we could see that the old time religion [of raising fares] definitely doesn’t work and to change direction we really had no choice.” When the reductions were announced in the summer of 2012, they were deeper than anyone had expected. First decided to match Stagecoach’s prices, slashing its FirstDay fare by 26% and its FirstWeek fare by 41%. “It was more evidence of the commitment [from First],” says Dave Alexander, regional managing director Scotland & North England for First UK Bus.

YOUNG PEOPLE The partners are also looking to the future with the new range of multi-operator products for young people. For example, those aged 16-18 can purchase a TravelMaster18 weekly ticket for £13.80. “Before we had these product ranges, when you’d left education you were a full adult fare-paying passenger. You paid the going rate. No mercy,” says David Young, acting director general at South Yorkshire PTE. “These are the sort of things that we’re doing through the framework of the partnership … to sustainably keep young people from child into adult as bus users, and for that matter tram and train.”

Yorkshire Integrated Transport Authority that guaranteed reductions in fares for those purchasing multi-operators tickets or tickets from First, with no change for those purchasing Stagecoach products. In short, many bus users would gain, and there would be no losers. This contrasted with the Quality Contract option, under which SYPTE had said that there would be both winners and losers. Under the PTE’s detailed Quality Contract plans, the ‘losers’ would amount to 60% of Adult single fare payers and 27% of period ticket users. “A real advantage of the partnership option is that we haven’t impacted negatively on the fare-paying passenger,” says David Young. “We’ve brought TravelMaster products down … and First has dropped [its fares]

further than even I thought that they would. “Quality Contracts couldn’t deliver that, not unless you throw more taxpayers money at it.” Meanwhile, under the Sheffield Bus Partnership, bus operators have agreed to limit fare increases to once per year for each fare, but not necessarily all on the same date. The new, lower (and more stable) fares have undoubtedly played a huge part in the 9.6% increase in fare-paying passengers that have been seen since the start of the partnership. Overall patronage is up by a more modest 0.9%, but this is because of falling ridership by children and older people entitled to free travel. Child fares are subsidised by the PTE, but the price has been increased, rising by 10p to 70p last April. Meanwhile, there has been a smaller decline in travel by older people. It’s a trend that has been seen across the country and it is believed to be a by-product of new limitations on eligibility for free travel. If the partnership is to be successful, continued growth in fare-paying passengers is vital. It’s therefore encouraging that satisfaction with value for money provided by bus tickets has risen since the partnership, and the new, lower fares, were introduced. In July 2010, a survey by Passenger Focus found that 57% of fare-paying passengers in South Yorkshire (not just Sheffield) were satisfied with value for money. The most recent survey, undertaken last autumn, found that this figure had reached 68% (a figure matched only by Greater Manchester among England’s PTE regions). While First and Stagecoach have increased fares (each now charge £12 for a weekly ticket) the CityWide tickets remain unchanged. Sheffield’s bus fares now compare favourably with the rest of the country and provide a major incentive for the extra ridership that the partnership aspires to achieve. Q Brought to you by

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