Dereg solution?
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MOVES to encourage more competition in stage bus services need not end road service licensing according to the Adam Smith Institute.
The memorandum entitled Bus Deregulation — The Next Step, was produced for Transport Secretary Nicholas Ridley and suggests that all local services should continue to be provided under the authority of a route licence, but that the licence be issued as of right, with no powers of objection for any party.
It envisages requiring any applicants to specify in advance the minimum proposed period of operation and to give a period of advance warning whether they wanted to renew the licence at the end of a set period or not.
An allowance for mistaken judgment is suggested that would enable the operator to withdraw the service prematurely on submission to the Traffic Commissioners of financial data indicating severe losses. An operator withdrawing a service without such authority would put his operator's licence in jeopardy.
Dr Hibbs thinks that this system would discourage the "twin evils" of competition: "the fly by night operator seeking a quick killing and the large operator setting out to kill competitors by using superior reserves."
The criticism of "experimental areas" where a rapid turnover of services has been observed would be removed by this approach and county councils could use their existing powers of co-ordination to evaluate the consequences of a premature withdrawal and either seek a replacement with or without subsidy or decide that no such action was necessary.
Dr Hibbs suggests that a minimum element of quantity control of this kind would ensure that the forces of the market could operate with the least possible constraint while reassuring "those concerned with residual social need that the hardships that they feared can be mitigated so far as may be justified."
If this system was extended to all bus and coach operation Dr Hibbs thinks the "clumsy" 30 mile distinction between long distance and local services could be abandoned and this would free the market still further.