Two Bus Operators Questioned on Level;
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Mr. Amos Cross-examined During Hearing on Scottish Omnibuses Group's Application
ALTHOUGH most of the hearings of fares applications last week Went through smoothly, two companies faced close questioning on their levels of profit. Mr. James Amos, head of the Scottish Omnibuses group, was asked, in cross-examination, whether his undertaking's application was made so that profits could be maintained. Representing the objectors to the application by Southdown Motor Services, Ltd., Mr. John MacManus asserted that the company's profits had gone up with every fares increase.
The Scottish Traffic Commissioners have reserved their decision on the application for higher fares made last week by Scottish Omnibuses. Ltd., and their associated companies. There were objections by 38 local authorities and 13 other operators.
For the applicants, Mr. G. C. Emslie. Q.C., said that their wages bill would cost an extra £1.5m. a year. If fares did not rise, the group could earn only £1,756,000, about £750,000 below the minimum necessary to enable them to continue to serve the public and pay a reasonable and modest dividend to the shareholders.
Mr. J. M. 0. Mackenzie. for the objectors. cross-examined Mr. James Amos. chairman of the group, on the question of minimum profit. Mr. Amos said that all costs of maintenance, repairs and improvements were met before the applicants arrived at a figure for net profit. This was used to pay a dividend and put a sum into reserves.
£2.5m. Required
Mr. Mackenzie: "You come here to say that you require £2.5m. to run these buses efficiently. but you are in fact coming here for an increase in fares to maintain dividend?
Mr. Amos: To maintain the stability of the company,"
In recent years. submitted Mr. Mackenzie, increases had been granted to the group on the basis of hypothetical figures which were always found later to be inaccurate. The public had paid some £2m. more in fares rises than was necessary. The Commissioners should defer their decision until December 31, when the results of the current year's working were known.
When Highland Omnibuses, Lid.. applied to the Commissioners at Inverness to increase fares last week. Mr. Amos said that the rise in the number or bus passengers since the closing of certain railway services in the north of Scotland on June 13 had been "almost infinitesimal."
Mr. William Will, legal assistant to Inverness Corporation, had asked Mr. Amos why an increase of only £7,000 was allowed in the estimated receipts for 1960, as compared with 1959 when there were 250,000 rail journeys made in the area between Inverness and Tain.
Mr. Amos said that Highland Omnibuses had agreed to put on such buses as were necessary to carry passengers cz1 inconvenienced as a result of the rail withdrawals.
"That has been done. both in the spirit and the letter." he declared, "and our experience, so far as it affects this area, is that the passengers are extremely few, and quite insufficient to justify the operation of extra bus services."
Mr. Emslie, representing Highland Omnibuses, stated that the company were conscious of their special position in the Highlands, and no attempt was being made to seek an unreasonable margin of profit.
Mr. Alex Robertson. chairman, announced that a decision would be reserved.
Scottish Omnibuses, Ltd., and the Western S.M.T. Co., Ltd., successfully applied to the Northern Traffic Commissioners last week to raise fares, and there was no opposition from any local authority. Single, return and limitedjourney tickets are to be advanced.
Mr. R. M. Palmer, for the applicants. said that their costs had been increased and every possible economy had been exercised, but it would still be impossible for existing revenue to suffice.
Mr. J. A. T. Hanlon. chairman. observed that the only substantial source of extra revenue was the fare-paying public.
On a Shoe-string When Southdown Motor Services. Ltd., applied to the South Eastern Traffic Commissioners to raise fares last week, Mr. Gerald Duckworth, traffic manager. said that the company were being run on a " shoe-string " and might not be able to carry on.
He agreed with Mr. John MacManus. for Bognor and Littlehampton Urban District Councils, that the company's profits last year were greater than in the past 10 years.
"But that profit is only 7.47 per cent. surplus, which I would not consider a reasonable amount on Om. capital," Mr. Duckworth added, The company were meeting a large part of the extra cost of wages themselves, he explained.
Mr. MacManus: "Whenever you have been in front of this commission for an increase in fares, or a reduction in services, your profits have gone up."
The Commissioners granted the company's application, which provided for the addition of 1 d. to fares up to a denomination of I Id. and 2d. to those of Is.-1s.
Increases to secure an extra £168,450 a year for Nottingham Transport Department were described as "reasonable" by Mr. C. R. Hodgson, chairman of the East Midland Traffic Commissioners, last week. The department's application to raise fares was approved.
On Sunday, one-mile 21d. fares will go up to 3d.; 44. fares covering over 2-i miles will be 5d.; and 5d, fares for over three miles will be increased to 6d. In addition, a distance between 4i and seven miles will entail a further Id. fare, and tickets will go up by similar amounts on works services and football buses. The price for a dog carried will be increased from Id. to 2d.
Mr. R. 0. F. Hickman, deputy town clerk, pointed out that even with the extra revenue they hoped to obtain, the department would be operating within a tight margin. The March wage award might have resulted in an £86,400 deficit this year and 05,467 next year unless remedial action were taken,
Cheap Bus Travel
Mr. B. England. general manager, remarked that people really did not realize how cheap bus travel was in Nottingham. If the application were granted, it would mean that fares had gone up by only 138.08 per cent. since 1938-39.
Mr. Hodgson remarked that Nottingham was one of the few cities that had not sought immediate increases after last year's pay award. The department's application was reasonable.
At the same sitting, West Bridgford Urban District Council, who run many joint services with Nottingham over Trent Bridge. were granted similar rises to offset a threatened loss of £10,620 on the year.
Mr. Hodgson agreed that the council obviously "badly needed the money, if only for replacing their fleet, which has got rather long in the tooth."
Although the recent wages award had added 1122,000 to the expenses of the West Riding Automobile Co., Ltd., the company were content "for the time being" to bear £52,000 of it and ask the public to contribute £67,000 in higher fares. The Yorkshire Traffic Commissioners were told this by Mr. W. R. Hargrave, for the company, when the company successfully applied last week to put up their fares.
The application was based on a revised mileage scale under which, for example. a 2d. fare would cover 0.69 mile instead of 0.75 mile.
The Commissioners also sanctioned an application by Bradford Transport Department to increase all fares above 5d., and to bring up to 5d. those 4d. tickets which remained unaffected by the previous revision. The undertaking's wages bill had advanced by £110,000 a year. but the higher fares would bring in only an extra £60,000, said Mr. R. H. Hargreaves. for the department.
Maj. F. S. Eastwood, chairman, commented that the application was the 30th of its kind in Yorkshire, and the total cost of increases in the area amounted to 12.2m.
The East Midland Traffic Cornmissioners last week approved Northampton Transport Department's proposals to add id. to existing 21d. fares and advance certain 4d. tickets to 5d. The changes will come into effect on Sunday and add £35,000 to annual revenue. This might yield a £2,305 surplus, said Mr. L. S. Salt, borough treasurer.
Mr. J.. A. Fielden, general manager, told the Commissioners that the department were 15 per cent, under strength in drivers and 6 per cent. in conductors. The overtime bill was therefore high.
Lincoln Transport Department were granted their first application for fares increases since 1957 by the East Midland Traffic Commissioners, at Lincoln last week, Nearly all adult fares will go up by td. and children's fares will be half the adult fare. Pupils' fares go up by id. bat 18 adult 2d. fares will be retained.
Mr. K. J. Orrell, for the corporation, said that the estimated yield in a full year would be £28,200. The recent wage award and shorter working week added £16,500 to annual costs.
News of cuts in fares comes from West Hartlepool, where it is proposed to lop id. off the 2d. minimum and 5d. maxi mum tickets. The idea is to try to attract more passengers. Return tickets on all workmen's services are to be abolished. It is hoped that an extra £20,000 will be earned. Operating costs have gone up by f17,000.