Kickstarting growth in bus patronage: experience with targeted grants in England and Scotland.

Government support to the bus industry in Britain has risen in recent years and has now reached pre-deregulation levels in real terms. Over the past ten years in England (outside London) both bus patronage and bus kilometres have fallen and continue to fall. The decline in bus kilometres is largely driven by the withdrawal of commercial services, which is not wholly offset by increases in supported services. The Kickstart Scheme introduced in England in 2003 and the Bus Route Development Grant (BRDG) Scheme introduced in Scotland in 2005 attempted to address this problem through aiming to improve patronage and viability of services. The programmes award grants, through a competitive bidding process, of a maximum duration of three years to support the provision of new or enhanced bus services often in marginal operating territory. Supported services are expected to achieve financial sustainability and ideally to become commercially viable through patronage growth by the end of the funding period. This paper is based on an assessment of the performance of the Kickstart and BRDG schemes undertaken for the Department for Transport and the Scottish Executive in 2006. The performance analysis is limited by data availability and the short time periods of operation. However, where evidence is available the majority of schemes are achieving impressive levels of patronage growth on marginal or new services. There is also some, albeit limited, evidence of modal shift from car. Benefits to users have been delivered largely through frequency enhancements, new bus links and newer and more accessible vehicles. Levels of revenue support compare well with standard supported schemes and will fall over the lifetime of the schemes. The programmes have stimulated genuine partnership working between operators and local authorities leading to greater understanding. In many cases the schemes have delivered added value over and above the original aims in a variety of ways including: the delivery of further service enhancements beyond that specified in bids as patronage has risen, levering additional support from operators and other organisations, releasing support for other purposes and encouraging the development of Kickstart style schemes by Local Authorities in co-operation with operators. Finally the programmes are likely to leave a positive legacy and offer a better return than subsidy that supports the status quo. There is clearly scope for reform of the existing subsidy mechanisms to place more emphasis on growing the market. For the covering abstract see ITRD E137145.