Committee for Infrastructure

OFFICIAL REPORT (Hansard)

Commercial Bus Service Permits and Transport Integration: Bus and Coach NI; Hannon Coach; Rooney International Coach Hire

2 June 2021 NORTHERN IRELAND ASSEMBLY

Committee for Infrastructure

Commercial Bus Service Permits and Transport Integration: Bus and Coach NI; Hannon Coach; Rooney International Coach Hire

2 June 2021

Members present for all or part of the proceedings: Miss Michelle McIlveen (Chairperson) Ms Martina Anderson Mr Roy Beggs Mr Cathal Boylan Mr Keith Buchanan Mrs Dolores Kelly Ms Liz Kimmins Mr Andrew Muir

Witnesses: Mrs Karen Magill Bus and Coach NI Mr Niall McKeever Bus and Coach NI Mr Owen McLaughlin Hannon Coach Mr Eamonn Rooney Rooney International Coach Hire

The Chairperson (Miss McIlveen): I welcome, via StarLeaf, Karen Magill, chief executive of Bus and Coach NI Ltd; Niall McKeever, chairman of Bus and Coach NI Ltd; Eamonn Rooney, owner of Rooney International Coach Hire; and Owen McLaughlin, group marketing manager for Hannon Coach. Thank you for attending the Committee this morning. The meeting will be recorded by Hansard. I invite you to make your opening statement and to defer to your colleagues when necessary.

Mrs Karen Magill (Bus and Coach NI): OK. Good morning, and thank you very much once again for the opportunity. I will try to keep things simple and short this morning because I am accompanied by three operators, two of whom have been operating bus permits for 20 years now. Owen McLaughlin, from Hannon Coach, has been submitting applications for permits for the last four years.

In simple terms, in Northern Ireland we have a public transport provider that operates about 1,500 socially necessary services for the network. That is how things have been done and how we do things in Northern Ireland, and it is [Inaudible.] It is obvious that there are gaps in the network and opportunities throughout the Province for other operators outside that, in that the private sector sees opportunities in local areas to run a service. Where that happens, there has been a process that, over the last number of years, has been neither adequate nor fair. In the work that we did 10 or 12 years ago on the Transport Act (Northern Ireland) 2011, part of the changes to the Act and the updated [Inaudible] through a formal process the private sector to come into the network in order to complement what already exists in the public transport provider. Other changes were made to the 2011 Act that allowed the new, stand-alone Department to look at those permits and to fairly manage the process. Some of that has not been enacted, and, at the moment, the Department considers the

1 applications. The premise is to allow the private sector to fill in gaps and to complement the network as it sits. Unfortunately, the process has always been awkward, and, at times, it has been obstructive. Regardless of what we did to change the 2011 Act, operators have always had to battle to be able to run their services. In the last couple of years, that seems to have become even more difficult and more concentrated. As you know, we have written to you with our thoughts on the latest new draft guidance. We have a list of issues on that guidance that we have presented to you. The first is that, during a meeting with departmental officials, we learned that Minister Mallon had agreed a new process. We were not consulted on it, nor were we party to that new process. It is a done deal. The new draft guidance reflects that new process.

The process allows for so much change in the application procedure and in the timescales. We are going from an eight-week process to one that is 32 weeks and beyond. The proof of demand has become more onerous, and there is no definitive list of demand requirements. Permanent renewals are being treated as new applications. The determination process has become more difficult. A decision for a new service can go as high as the Minister. There have been omissions of mention of the journey planner. The document is supposed to detail all the types of service you can apply for. The 30-minute rule is a massive change in the whole determination. There are a lot of issues for us in the guidance, and that is why we wrote to the Committee.

The new guidance has left us in a position where we do not believe we are welcome in the public transport network. We do not understand why the Department has changed the process in this last couple of years. It has changed where things are for us. We do not feel welcome or that the opportunities are there. We are being kept out of them, and the framework contradicts the opportunity for the private sector to help integrate. We are an asset that can be used in public transport and part of developing a network of new flexible services for the public in Northern Ireland.

With me are three operators who have all been part of that process and have experienced difficulties along the way. If it is OK, I would like to ask Mr Niall McKeever from Airporter to join us, and then we will ask Eamonn and Owen for their input.

Mr Niall McKeever (Bus and Coach NI): I will start by formally acknowledging the importance of the Committee engagements with our industry. Fundamentally, it is essential that our industry guidelines reflect the ambitions of our Government's aspirations and create an environment where they can happen. That is why it is vital for the issues raised in our report to be understood in the context of where we are now, have been and want to go. I highlight the correlation between the newly defined transport sector and the opportunities it presents for the future. Primarily, I want to share a personal view of being a permit holder and of the challenges that are imposed by the new guidelines.

Airporter is a multi-award-winning coach operation connecting Derry to the two Belfast airports. I have been owner/director of the operation for nearly 25 years, so you would think that I was safe in the knowledge that Airporter was fully integrated into the public transport network for Northern Ireland, but you would be surprised.

We have won countless industry operation awards, from innovation to customer service, and we were the first bus company in Ireland to provide online real-time reservations. Airporter created a new direct access route that was not there before, and it has grown that business from zero to 150,000 passengers per year. We are very much part of the connectivity infrastructure of the north-west and have carried over 2 million passengers since 1997. We have a fleet of 16 vehicles, employ over 30 people and travel over 2 million kilometres per year. In that time, we have never fallen foul of any operating legislation and have a very well respected name in the industry. In any other business sector, that level of operational excellence and compliance would be celebrated and encouraged — [Inaudible owing to poor sound quality.]

The Chairperson (Miss McIlveen): The sound has disappeared. We will see whether Niall can reconnect.

Karen, we have lost Niall. Is Owen in a position at this stage to make his contribution, and we can come back to Niall when he reconnects?

Mr Owen McLaughlin (Hannon Coach): Good morning. Thank you for having us today. I will give a brief background to Hannon Transport Ltd. We are a specialist chilled transport logistics company based in Aghalee, just outside Lurgan. We specialise in the fresh produce sector, and we have offices and transport in Rotterdam, Paris and Dublin. We employ over 400 people.

2 We are here today because, in 2017, we made an application to run an express service between Londonderry and Belfast, as well as five applications for other destinations across Northern Ireland. I will give you brief background to that to give you a flavour of how the Department has progressively frustrated, obstructed and ultimately blocked our attempts to enter the market despite our applications being in line with all the policy, legislation and regulations etc. For the sake of brevity, it is impossible to go into all the details, but I am happy to expand on any details that the Committee wants more detail on or to follow up with evidence on any of what we say today.

I have broken the process down into the five phases that we went through. The application process is supposed to be straightforward and to take eight weeks. It has been common practice and is implicit in the Department's guidelines that, if a similar service is not operating on the same route, an operator should automatically be awarded the permit. We put permit applications in for six routes. Our first application was put in in May 2017. In July 2017, the Department turned us down and refused our application for a Londonderry to Belfast route. It subsequently ignored all five of our other applications. We were forced into a judicial review (JR). At that stage, the Department failed to respond to a series of freedom of information requests, and the Information Commissioner's Office (ICO) eventually issued a decision notice on those for July 2020.

As I said, we were forced into a judicial review. The papers for the judicial review were put in in October 2017, and it was settled by the Department in February 2018. At that stage, on 15 February, the Department committed to a period of six weeks in which to make fresh redeterminations, bringing us up to the end of March 2018. In April 2018, the Department asked us to extend the process by six weeks in order to allow Translink to present to Derry city council. In the spirit of cooperation, we obliged, wanting to be partners of the Department and Translink for the next 10 to15 years. Throughout the next three months, we were asked for extra levels of information, including advice on station priority, access to the journey planner, ticketing, accessibility of vehicles and so on. We provided detailed responses at every stage. That brought us up to the end of June, which was our last agreed date at that stage.

There was then a period of complete radio silence. The Department ignored us for eight months despite us making polite requests, getting MLAs to write on our behalf and getting MPs to write to the permanent secretary. There was nothing. The Department simply seemed to wait for something to come along. It did so under the banner of the Northern Ireland (Executive Formation and Exercise of Functions) Act 2018. It cited that Act in February 2019, a full year after it committed to redetermine our applications. It said that that may be a matter for the Minister and that, in effect, it may not make any decision at all. At that stage, it also committed to a new four-step, 12-week process. That brought us up to 10 May 2019. That process concluded just before Easter this year. During that period, we also approached the Competition and Markets Authority (CMA), which made representations to the Department on our behalf. As Karen alluded to, at the tail end of that process and coming up to March 2020, the Department started to change the process and to tell the industry that it was changing it. In effect, that has raised a complete barrier that will make it impossible for anybody to make an application similar to ours again with any chance of it being successful.

The Department met to consider our applications in March last year. In June, it passed its decision to the Minister. That was with the Minister for another 10 months. In March this year, just before Easter, the Department wrote to us to refuse all six applications. We met departmental representatives afterwards to get an explanation, and they said that we did not supply sufficient evidence of demand. They said that there was no question of our proposals having an impact on Translink and that that did not come into their decision-making process. That conflicted with the evidence that, we believe, the Department gave to the Committee in February the previous year.

That is where we are. After four years, all our applications have been refused on the pretext that we did not supply sufficient evidence of demand. The evidence of demand that we supplied was extensive. We followed the rules throughout and showed a high level of goodwill. As I said, we supplied robust evidence of demand in excess of that which could be reasonably expected of any small- to medium-sized private operator. We have been through judicial review, have been successful and have been awarded costs. The Department has reneged on the terms of settlement of that judicial review. We have seen the dates and goalposts continually shift over almost four years. We have seen conflicting and misleading information provided to statutory stakeholders by departmental officials. We are left in a position where, in Northern Ireland, getting an express service permit is considered to be a matter for the Minister, which, I suggest, makes us a bit of a laughing stock in the rest of the United Kingdom. Standard transport economics evidence and advice from one of the UK's leading experts in the field has been labelled insufficient to secure a permit on a vacant route. A legislative need under the Transport Act (NI) 2011 to ensure fair competition was met with the statement:

3 "the panel are satisfied that there is no evidence the application would result in unfair competition".

That means that the Department's idea of fair competition is to make sure that unfair applications are denied. The Department, whose job it is as the local authority, is going ahead with a wholly irrational and distorted re-interpretation of the 30-minute rule that Karen mentioned, which effectively brings the shutters down on any express service permits being awarded in future. All that leads to a reduction in public transport service provision in Northern Ireland that is unique to the United Kingdom and Ireland. I remind the Committee that, in the Department's transport survey, the main reason that people cited to explain why they would not travel by public transport was that it takes too long and the journey is quicker by car. That is the number-one reason. The only way to get people out of their cars successfully is to shorten journey times to make them comparable to using a car and for there to be inter-urban connectivity, which means express, non-stop services of the type that we tried to offer. Thank you very much.

The Chairperson (Miss McIlveen): OK. Thank you. We have Niall back. Apologies for that, Niall, we seemed to lose you. Will you give us a recap?

Mr McKeever: Yes. I will do my best to stay connected and to get through what I want to say. If I cannot, I would like to submit my comments in writing.

I missed what Owen said, but I am sure that what I will say will only reiterate his frustrations. Having had 25 years' experience in the industry, I know that we now exist under a licence scheme that challenges our position to grow and means that we have to justify our existence on a three-year basis. Under the new guidelines, the renewal process means that we will be treated as a new applicant and will be potentially open to all the changes listed in the report that has been submitted. To put that in context, the financial agreement to purchase a new bus typically lasts for five years. You can imagine the challenges that that will present when fleet rotation is planned over a three-year period. In total, there are eight specific guideline changes that essentially turn our industry on its head. The changes not only raise barriers of entry to the sector but put at risk existing operations we have created with new routes and access across the Province. As I mentioned, we have been operating for 25 years and fully intend to be around for the next 25, but, if those changes are not reviewed, we will continue to operate and live with the threat of the permit being withdrawn on a three-year basis. The past 15 months have been extraordinary for the Government and society as we have adjusted our lives to the pandemic. As coach operators, we were the first to be hit, and, as business owners, we faced livelihood challenges with untold stress. Over the past 12 months, Bus and Coach NI has pursued a vigorous lobbying campaign in all walks of life and government. I am sure that, if you did not know Karen Magill 18 months ago, you will know her today. It was essential that funding be provided to help the industry, and, thankfully, support schemes were created. The due diligence process throughout those schemes was definitely frustrating for all, but I believe that the end result produced a new beginning for the narrative of our sector and our government relations. We have never been more recognised or defined as an industry, first, for the quality and the services that are provided, and, secondly, for quantity, by defining the physical size of fleet and the socio-economic benefits to the Province.

Post-COVID, our sector has many challenges, and the opportunity now is to build on the new relationships. We cannot allow the subvention that has been invested in the industry so far to go to waste. It is abundantly clear that there is a huge disconnect between the governing guidelines for the industry and the aspirational vision of where we want to go. As a region, we have ambitious environmental targets for 2050 and a vision of a more carbon-neutral society. It is clear that Translink will not be able to do that on its own. The private sector will be required, but the legislation will prohibit that. That is the tragic irony of the current situation. The new guidelines have gone to great lengths and depths to ensure longer consultation periods and that there are additional stakeholders to authorise new permits, yet we were presented with a done deal. I am confident and hopeful, though, that we can revisit and shape more appropriate guidelines for future transport ambitions.

The Chairperson (Miss McIlveen): Eamonn has joined us. Eamonn, do you have anything to add?

Mr Eamonn Rooney (Rooney International Coach Hire): I will briefly give my perspective on how we are being treated. Like Owen and the other operators, we applied for permits. I have been operating a service between Belfast and Newry for over 20 years. There was a gap in the market, and we started our service back in 2000. We built it up to 700 passengers per day pre-COVID. Just pre- COVID, we applied to add more services because the numbers were increasing. It took over two years for us to add a service. For talk's sake, we had a 5.00 pm service and a 5.30 pm service, and we

4 wanted to put in a 5.15 pm service to cope with the numbers: it took two years. Again, we had to force the Department to a judicial review, and, at the dying hour, it sent me a letter to say that it would grant me the licence. Lo and behold, in the meantime, Translink had set services in on top of the service times that I had applied for. I did not think that was appropriate. I raised that at a meeting a couple of months ago and was told by the Department that it would not happen again and that it should not have happened, blah, blah. However, I discovered back in October that Translink has added the 238B service, and it is shadowing every one of my services between Belfast and Newry. That is predatory, and it has been facilitated by the Department. It is not appropriate to treat operators like that. That is my opinion. I am sure that Owen and the rest of the operators have gone through the same process as I have. It is like getting your teeth pulled.

The Chairperson (Miss McIlveen): Thank you. I thank all of you for your contributions this morning. As you are aware, we will return to the matter next week, when the departmental officials come to the Committee. Members felt it would be useful to hear from the operators in advance of that meeting. Certainly, what you said this morning is worrying, to say the least.

Karen, you mentioned that you had a meeting on 14 April with officials. Was that to discuss this issue? What advance knowledge did you have going into that meeting?

Mrs Magill: Before the meeting, we were sent a copy of the new draft guidance, and that was it. We had not met the Department for nearly two years prior to that. During the meeting referred to by Owen, we met the Competition and Markets Authority and the Department. We have had other meetings about Public Service Vehicle Accessibility Regulations (PSVAR) compliance but not about the new guidance or the change to the process.

The Chairperson (Miss McIlveen): So up until 14 April, you were not aware that any changes were being made to the guidelines.

Mrs Magill: No. During the meeting with the Competition and Markets Authority, the Department mentioned that it had thought about introducing two more steps to the application process. I raised concerns at the meeting and in writing afterwards and asked, "How can you do that? All the applications are in under the current guidance, and that is how they have to be considered. Why are you moving the decision to a panel? If the panel cannot make a decision, does that go to the Minister, as that extends the process? You are paid within your job description to do your job. You are now saying that you are not fit to do that. You are going to move it to a panel. What is the panel's experience? Who is on the panel who can make those decisions? You are telling me that, even at their pay grade, they may not be able to make a decision, so we will put that on to the Minister, and that is how we are going to develop the network. Where a Minister's portfolio is what it is, we are going to give her the decision to make". We could not understand that, and, as I said, we did not make any agreement. We opposed it greatly for obvious and sensible reasons.

I want to come back to the point that we did not know that the Minister had already been presented with a document to ask her to change the process. We asked for that document, and it has been submitted to me. I have gone through it and have already responded. The submission to the Minister was neither accurate, fair nor transparent about the process. It did not mention the opposition from the private sector. It did not mention the concerns we raised when we had the verbal conversation. The Minister was given a set of facts that were not all facts. I believe there was a certain amount of manipulation, and the Minister could not have made another decision based on what she was given, and that is where our concerns come from.

Why have the Department and the officials or whoever is working on this decided that the private sector should not be part of the network and that as many hurdles should be introduced as possible? This is about developing the network for the people of Northern Ireland and allowing businesses to do what they do best. Why is it being made so complicated? Why did a submission go to the Minister that did not give the facts or a representation of what the private sector felt? Why are we being hindered even more in the new document? We are not even allowed to be part of the journey planner even though we previously had a discussion on that with the Department for Infrastructure and I have submitted a document to the Department.

We have raised a lot of our concerns. In February 2019, before John McGrath, the then deputy permanent secretary, left, he said that he had brought the team in, discussed it with Translink and asked the team to ensure that the process of applying for access to the journey planner was made available. You would think that the Department that owns the public transport provider, the network

5 and everything surrounding them would want to develop a network of services for the passengers in Northern Ireland. You would also think that it would want information about the 65 permits it has to be part of a journey planner so that all the operators in the Province can link and integrate. We could start the proper process of creating a better network with more flexible services that will shorten journey times to get people out of their cars and onto public transport. That is where we do not understand where this is coming from.

The Chairperson (Miss McIlveen): These are being regarded as draft guidelines. Was any explanation given to you by officials about their status or whether there would be consultation? Was the meeting of 14 April part of a consultation process?

Mrs Magill: It was not described as being part of a consultation process; it was described as going through the new guidance. The official whom we had been dealing with presented that to us. Two weeks later, we raised concerns with his superior, Jackie Robinson, who was new to the Department, I think, last November. She said to us during that meeting, "Look, we will meet together, we will consult, and we'll look at the guidance". I said to her at the time, "We have already done all that. Stuart has already sent it out. We have already met him, and we've expressed our concerns". She agreed at that point that we would need to look at it, but we have not heard from them since. That was five weeks ago, and we have heard nothing since. Since that meeting, I have written to the Minister about the submission and the new determination that they have requested from the Departmental Solicitor's Office (DSO) about the 30-minute rule. I do not understand why they needed that, but we have not heard anything since.

Mr McLaughlin: The Department told us that the process had changed without consultation. The consultation is limited to the wording of the guidelines. That is what it told us.

The Chairperson (Miss McIlveen): OK. We will get clarity from officials about that next week.

One of the points that were clear in the rebuttals that you made was about getting a permit. Owen, you said that, in the process that you went through, you felt that officials frustrated and blocked the application. The new guidelines will not help any future application; they will perhaps frustrate it even further. One of the headlines is proof of demand and evidence of demand. Up to this point, what did you need to present in order to prove the viability of a route?

Mr McLaughlin: The legislation just says that we need to provide evidence of demand; it does not give any detail. The evidence of demand that we compiled was extensive. We did a full review of the legislation, the regulations and the guidelines, including the Programme for Government and the regional development strategy of 2035, etc. We also did a review of the existing service provision. It is important to highlight that, at that stage, Translink did no express routes anywhere in Northern Ireland; the only express route anywhere in Northern Ireland was the service operated by Eamonn.

We received advice from one of the UK's leading experts in the field: a chap called Professor Peter White of the University of Westminster. He helped us with our detailed elasticity-of-demand model. We also used Northern Ireland Statistics and Research Agency (NISRA) settlement data. We put that data in to a spatial model to model potential demand. We did a focus group on the Derry route that specifically looked at the tourist aspect and potential barriers to demand. The evidence that we produced was robust and was done, first of all, from a business-case point of view. It was a significant investment of £11 million over five years, so it was way in excess of the level that could reasonably be expected to apply to a small or medium-sized operator.

The important thing is that it is implicit in the guidelines that, where the service is vacant, it is normally awarded. It is only really when another service of the same type operates on the same route that the evidence of demand really comes in to play, as does the 30-minute rule. It is worth pointing out that, in an experience similar to Eamonn's, we were warned, going in to this, how obstructive the Department had been and could be and how obstructive it was likely to be.

Less than two weeks after the Department settled our judicial review on the Londonderry to Belfast route, it permitted Translink to operate its first ever express route in Northern Ireland — between Londonderry and Belfast. It was within two weeks of the settlement, at the start of the process that was supposed to be redetermining ours. We only found that out some time later. Translink has also put express or direct services on almost every route that we applied to do. Those were routes that we were told there was no demand for initially.

6 We [Inaudible owing to poor sound quality] all the express routes, and we were putting an express service into Scotland. I must say that the difference between Northern Ireland and Scotland is like chalk and cheese. We got on the Traveline Scotland website with no problem. All we had to do was supply a timetable, and, for access to the bus station — Glasgow — all we have to do is provide our timetable and pay our on-stance fees. They could not be more helpful.

The Chairperson (Miss McIlveen): OK. Thank you.

Mr Boylan: You are all welcome back. Karen and Owen, it is good to see you again. I want to clarify some points, and I have questions for Owen too. Karen, primarily to you, Niall and Eamonn first, your briefing mentioned the 30-minute rule and how the interpretation of it has changed under new guidance. Can you give us a better understanding of exactly what impact that has on regular stopping and express services on a shared route?

Mrs Magill: OK. I will lead on that, as I normally do. In the job that I do, when an operator comes to me and asks, "I was thinking about a service. Can I apply for it?", I should be able to look at the legislation, the suitability of the route, whether there are any incumbent operators, and how the needs of the people will be met. There are certain criteria that I should be able to look at in order to say, "Yes, that is fine".

The big thing that everybody knows — my three-and-a-half-year-old would know it if she were here — is the 30-minute rule. Where you have an existing two-stage carriage, or a regular stopping service as it is called now, and somebody else applies for another stage carriage service on the same route, they cannot have it unless there is a 30-minute time difference. OK? If an express application comes in for the same stage carriage route, because it is an express service offering the passenger a different service, no time buffer or 30-minute rule applies. I think that that is what Owen referred to. That is what you have to look at. Everybody knows the 30-minute rule.

Where you have two express services, you then have a 30-mile closed door element. In simple terms, it is a time buffer to provide protection for the incumbent against a new operator. Owen and Eamonn referred to new services coming on board. There is a 30-minute time buffer.

Mr Boylan: OK. I appreciate that. Now for the real question — I will let others who want to respond come in in a minute — as I take it that the changes were not wanted by the industry. That is one point. My real point is: what do you think the purpose of the change, or the change in interpretation, was?

Mrs Magill: I will be blunt and quick: it was to keep the industry out. There was no real need for the change. It was established — it was fair — and I do not understand why the departmental solicitors went for a redetermination. I personally think that it was to block. Whether that is right or wrong, I do not see any other reason for it.

Mr Boylan: To Niall and Eamonn I have another point for Owen but Niall and Eamonn for now.

Mr McKeever: I will explain, Cathal. I have been a permit holder for 25 years, and, as I explained, after countless miles and passengers, we are going into a brand-new world in which we do not know if we can look past three years. They have taken a defined guidelines document and created a spurious document that is difficult to follow and challenge. It is very difficult to live in such circumstances, never mind operate a business, employ people, and plan for the future. I struggle to see how the current guidelines would encourage a more interactive and iterative public transport system.

Mr Rooney: I operated a service between Newry and Belfast based on the 30-minute rule. When I looked at the set-up 20 years ago, Translink was running a service that consisted of a two-hour journey through Newry, Loughbrickland, Banbridge, Dromore, Hillsborough, Sprucefield and Belfast. It had no passengers getting on in Newry. I put a service on, and, within a couple of years, we were filling our buses. The reason was this: we were running directly from Newry, we closed our doors in Newry, and we were in the city 50 minutes later.

If the 30-minute rule is done away with, it will obliterate me. It is set up to do that; it is set up to take us off the road. Once the 30-minute rule is up, in three years' time when I reapply for my permit, they will say, "Sure, Translink is doing that. See you later". It is as simple as that. The dominoes have all been set up to fall in a couple of years' time when we reapply for our permits. That is my opinion.

7 Mr Boylan: That is fair enough. That is why I posed the question. Clearly, issues have been coming up. If we need any other information, we will definitely come back to you.

Owen, I want to pick up on your point, and maybe you can comment on the 30-minute rule as well. There is an issue in that the determination is supposed to take six weeks, but it took over two years. You have experience over a number of years. How did the Department explain that gross delay in making a determination? What did it say?

Mr McLaughlin: There was really no valid explanation given. As I explained, in those six weeks, when we had the terms of settlement from the judicial review, we agreed to an extension in order to allow Translink to present to Derry City and Strabane District Council. That has been the only one. There was an eight-month period in which the Department completely ignored us and did not do a thing. That seemed to coincide with the arrival of the new permanent secretary. It just waited for something to come along. It latched on to the Northern Ireland (Executive Formation and Exercise of Functions) Act 2018.

It is really difficult. In England, Scotland and Wales, and, I believe, in the Republic of Ireland, you do not even need a permit for an express service. In Great Britain, you do not even need to register it. It is laughable that we have those barriers here. Those barriers were all stamped out in the rest of the United Kingdom over 40 years ago.

Let me be clear on the 30-minute rule: in effect, the Department is saying that, if there is any bus at all operating along the route within 30 minutes either side, you cannot operate a different type of service, such as an express service. That gives you a one-hour window.

Again, Northern Ireland sits out like a saucepan handle. We are the only place in Europe that does not have express coach services between urban centres. It is not just about the fairness of the application process; it is hurting public transport in Northern Ireland. It is also stretching Translink services and diluting bus services in Northern Ireland. It is no wonder that Ulsterbus services are in chronic decline.

Mr Boylan: I gather, from what you are saying, that, in relation to the determination, there was no clarification, verification or validation of why the Department decided to delay and that it is moving the goalposts with the 30-minute rule. Is that how you feel?

Mr McLaughlin: Yes. The 30-minute rule is only one of many goalposts. I think that it was last February that the Department advised the Committee that awarding us this would have a significant impact on Translink. I believe that it quoted a figure of £2·2 million. That figure evaporated. It told us that we were denied it not because of any impact on Translink but because we did not show enough evidence of demand. I can provide the Committee with copies of the applications that we submitted, and I challenge anybody to come to the conclusion that the Department has subsequently come to: that there was insufficient evidence of demand.

We just get excuses trotted out at every stage. It is to prolong it, and it is to come to the same business decision that we have come to, which is that there is no point in trying to invest in public transport in Northern Ireland. All you will get is pain and a loss of time and resources over many, many years. If these people are prepared to waste millions in inefficiency left, right and centre, they are not going to care about paying £30,000 or £40,000 in costs for judicial review after judicial review after judicial review. We have been entirely blocked, and I am calling on the Committee to ask the Competition and Markets Authority to do a formal investigation into how the public transport sector is operated in Northern Ireland.

Mr Boylan: Owen, Karen, Niall and Eamonn, thank you very much. I wanted to pick up on those points because I know that other members have different points to make. You are right to say that it is about guidance and interpretation across the board. Other members will have different questions, and I wanted to concentrate on those two. Thank you very much for your responses. We will continue to work with you. Obviously, at the end of this meeting, we will have a discussion with the Committee and the Chair on how we go forward. Thank you for your answers.

Ms Anderson: Niall, as you said, Karen has definitely become a household name among many elected representatives. I did not know her at all, but I think that she now has me on speed dial. [Laughter.] I acknowledge the lobbying that she has done and the sterling work of the sector. I also acknowledge the importance, Niall, of Airporter for Derry and the north-west. Two days ago, a constituent had to get the Airporter to get to the airport for a quick turnaround because somebody was

8 very ill in hospital in England. It is a highly valued and much needed service, and I am gobsmacked that all of you have to live daily with the potential withdrawal of your permit. I do not know how the Department expects Airporter, or any other transport business, to operate effectively with such a cloud hanging over it. I want to put on record that, in listening to you today, I did not think that I would be any more shocked by how you have been treated by the Department through the COVID pandemic and the issues that you have had to deal with, particularly as you had been trying to get access to much needed grants. Hearing all this today is quite shocking.

Owen, you recounted your experience of the Department's settling the judicial review and then, in effect, ignoring you for years. Are you of the view that that was to buy time to put in place a block so that it did not have to address the issue? I cannot understand anyone being involved in a judicial review where the Department settled it having that experience. One would expect that the determination made would be to your satisfaction. I cannot understand how you have been treated and how the outcome came about the way that it did.

Mr McLaughlin: It is shocking. Effectively, we have a Department that, I argue, is in contempt of a High Court settlement. Breaking it into the different periods, initially it asked us for more information and for advice. Believe it or not, it said that there is no process for determining what services should be given priority at publicly funded bus stations. It was asking us for advice on it, yet we are supposed to be just an operator and not doing that. We happily did so and told the Department about how we were getting into Google Transit and those sorts of things. We passed over an immense amount of information. Karen will have seen much of what we did. That brought us up to the period where they said, "Look, will you allow Translink to present to Derry city council?". We were in this for 10 years, and I can be frank now about our business plan. We did not expect even to break even for the first two and a half years and only pay the debt off after four years. We were in this for 10 to 15 years and wanted a good relationship with Translink and the Department. We should be able to plug into the network, and people should be able to use Translink services for the first and last mile. What I mean by that is get a bus into Derry's Foyle Street station, get our express down, and maybe use the Glider if they are going to Andersonstown, east Belfast, the Titanic Quarter, etc.

We acceded to that and agreed because we wanted to show good will and give them the benefit of the doubt. However, we were then ignored for a period of eight months. We had MLAs and our MP writing to the permanent secretary, but they were just ignored. It then became clear that they were not interested; there had been a distinct change of tone. We had this thing about the Minister and tried to argue rationally and reasonably. We should have been one of the best pieces of news for Translink, which was going into its new service agreement. The legislation says that it is to be awarded "most", which means over half, but it is effectively awarded 100%. There is a reason why it does not do express services: they do not qualify for all the subsidies that Translink bus services do, such as revenue support and capital support.

We tried to be rational with the Department and argue with it, saying, "Look, you don't want to go into a second judicial review". However, the fact that the Department was not making a decision made it difficult for us to trigger a judicial review. That was the advice that we were getting from solicitors. So, our being accommodating to Translink became a problem for us from a legal trigger point of view. You go to the Minister, you put in so much effort, and you just have to keep going. So, we just had to wait until a decision was made.

That decision was communicated to us in March, just before Easter, and, honestly, I would like to submit the paper that we received because the quality of it is incredibly poor and the statement on fair access to public transport is absolutely contorted. I described it in the meeting — Karen was there — as asymmetric to the level of information, quality of data and evidence of demand that we were putting in. It was a simple message that we got back from the Department. In a way, Martina, part of that message was, "No matter how much effort you put in, we have only to put in a minimal amount of effort to block you". That is the message that we got.

Ms Anderson: Are you considering opening up another legal avenue, because it seems, from what you have recounted, that the Department is in breach of a High Court ruling. Is that something that you are exploring?

Mr McLaughlin: I think that it is in breach of the ruling, and we have talked to our solicitors. As I said, we are a transport company, and we decided to diversify in Northern Ireland, which was a riskier strategy with £11 million of investment and 75 jobs. We could mount a legal challenge, but the outcome would probably be to force the Department to make another redetermination. When we went

9 into this, we were prepared for two judicial reviews — that is what we expected — but we expected them to be within two years.

It is not reasonable for us to go forward; we are finished with the process. It is clear that we have been unfairly blocked, and what happened was a message to the wider industry to say, "If Hannon's can't get it with all the resources that they've put in, do not even bother asking". It is just incredible that they have changed the 30-minute rule that they have changed. The audacity of doing that: a bus could go down one route, yet an express on the same route could be blocked. Express services work everywhere else in Europe, and rapid intra-urban connectivity is in the Programme for Government. Transport economics of demand show it. I probably should have said at the outset that in a former role I worked for Translink. One of the areas that I worked on was the elasticity of demand, stimulating demand, and barriers to travel. Translink knows that, but it does not do it because that is not what it is contracted to do. There are no express services in its service agreement. As I say, it really came as a shock to us, and to Karen as well — although Translink did it to Eamonn — that, for each and every one of the routes that we applied for, it had put in, in effect, express services on those routes, even though it had no contract to do so.

Ms Anderson: Having listened to you today, I understand why you want this to be probed into, and that could be by an inquiry, because there are obvious problems there.

Karen, you have talked a lot about the changes to the permit application process. During the meeting in April, it was confirmed by the DFI officials that the changes had been made and agreed by the Minister. Was the sector given no notification whatsoever about the changes to the guidance? Is that how the Department has done things with you in the past? Is that how it has communicated with you, or did something different happen here for that to be landed on you without any prior notification?

Mrs Magill: During the meeting that we had in May 2019, I think, officials suggested changing the process, but, as I said earlier, we objected to that and opposed it for very obvious reasons. We were never formally advised that it would be formally changed or that they were going to the Minister to actually change the process. We did not know that the process was actually changed until the meeting that we had a number of weeks ago. Therefore, there was no formal communication, either verbal or written, to say that they had changed it, had included the new steps, were going to the Minister to get her to agree the new determination process, and would get us guidance to reflect all that. There was never anything formal at all.

I have worked for 20 years with the Department for Regional Development, as it was previously, now DFI. I have been involved in every decision or application that we had for either stage carriage or express, in the early days and across the years, from Niall and Eamonn. I have been involved at every stage. We always had a battle, whether it was through lack of experience with officials, ignorance or just fear, but we always got there. However, recently, it is a totally different ball game: we do not get there. We need certainty for our people with regard to their businesses. Officials do not seem to believe that they are accountable any more. Even with regard to the minutes and responses that we get, they can prevaricate; they do not always answer or are not always direct with us. I just do not understand it. Perhaps it is because they are different officials. There is an intransigence that I have never seen.

I was involved with that application, for part of the way, in the past couple of years, and I never witnessed anything like it. The information and proof of demand that Owen's company put in was way above anything that I have ever seen, even being produced by the Department, yet the Department still dealt with the matter in the way that it did. It is giving Translink, and our industry, a bad name.

As I said last week, I do not understand why we do not have communication with the Department. There is no formal channel. We can request a meeting with the permanent secretary or deputy permanent secretary but there is no level there. We deal with the official at the grade that is dealing with our issue. That is it. It does not talk to us about carbon-neutral transport or anything. We are not seen as an industry. As I said last week, we are 80% of the size of Translink. There are over 1,100 vehicles in the fleet. As I told my people, they obviously do not have to worry about good carbonisation with us, because we can just tootle up the road as we like: nobody takes anything to do with us.

We are not part of the transport statistics even though we are licensed and regulated by the Department, and even though, just from vehicle and driver licensing, we pay the Department £0·5 million a year for that privilege. It does not talk to us or see us as an industry. That is part of the problem. It does not see the role that we can and need to play in the development of the network. Between us and Translink, we can go forward. It is the Department that owns Translink, owns the

10 network and actually owns us as well. The Department needs the wherewithal, the experience and the knowledge to try to look at this sensibly, look at what the Programme for Government did, look at what the priorities and responsibilities are and say, "You know what? We have an asset here. We can work together, and we can do this". There is no fear of anything happening to Translink, because Translink has to be there to provide the level of service that the private sector either cannot or will not provide.

Ms Anderson: May I ask you a question about the journey planner? I am thinking of the Airporter in Derry, and others: all of you. You said that services that were previously included on the journey planner were removed without any reason. I am trying to probe. Why you think that there is a reluctance to include services not offered by Translink on the journey planner? I ask that because we in Derry value Airporter. Surely it is not helpful for businesses, or for public awareness of the extent of the services available, if those services are not reflected on journey planners.

Mr McKeever: Martina, I can tell you about my experience. I have been trying for several years to get the Airporter on the journey planner. At contact level and managerial level, I am having great, warm and welcoming consultation. There is a willingness to say, "Look, we really should get it on board", but, as soon as you get into the intricacies of whatever the system is, there seems to be a blockage along the way, so getting it on the journey planner never seems to come about: the system is too complicated or whatever. I go back twice a year to check whether there have been any developments. If you think about how we search for transport now, you realise that everything is done online, so there should be an easier and freer way to make that occur and more opportunity for the public to access it.

If we cannot integrate with the journey planner, a very easy give in the meantime would be to have a link that says, "There are services going to here. We have a licence to do this. We are working within the network. We layer on top of what Translink provides, and we contribute to the public transport network". It is only right that the journey planner, which is a central point for Northern Ireland transport, should offer the opportunity, even if it is just signage or something that states, "Click here, and if you book online, we can look after that". The issue is concerns providing exposure for services that are not being seen, never mind the licensing and other issues. Once you are operational, trying to maintain and gain traction and grow are equally challenging. At personnel level and director level, the communication is great between the Airporter and Translink. The challenging part is trying to get into the infrastructure.

Mrs Magill: Prior to the new guidance, the application stated that, once your permit was approved, you would automatically be part of the journey planner. That has not happened. I know that Eamonn was on it for a couple of months and then mysteriously taken off it. I know that one company from outside, Scottish Citylink, is on it, so I do not understand what the barriers are, nor do I understand why any reference to the journey planner has been completely taken out of the new guidance. The officials need to tell us why.

Ms Anderson: We do not understand it either, and Committee members will pick up on that. I have lots of other questions, but other members will want to come in. Given what you collectively have imparted to us today, I find it shocking that businesses have to operate in that way, particularly given the operational excellence that all of you provide across the North. Niall, I have to say that Airporter in Derry really is a valued service for the city and beyond. Thanks for that.

Mr McKeever: Thank you, Martina.

Ms Kimmins: Thank you, all. As I said at last week's meeting, although I appreciate the opportunity to engage with you all, it is unfortunate that we have to have the number of meetings that we have, Karen. There is a range of issues and various aspects to this. I will go over some of what has been said. I share Martina's sentiment that you, and particularly Karen, have done sterling work on behalf of the sector, and that has definitely been very beneficial to us for drilling down into what the issues are. I do not think that what we are talking about is a big ask. Martina finished by mentioning the conditions in which operators are now having to work. As a past student in Belfast, I know how valuable a service Eamonn's company provides from Newry to Belfast, and it is quite shocking that the company is being treated in the way in which it is. The service that the private operators can provide should complement what Translink and others are providing, so there is a range of issues there.

Permit renewals are now being treated as new applications, and I want to get a bit more detail on how that will affect business. Given that it will be lengthier process, will that mean that you could be out of permit between renewals? If so, how would that affect you?

11 Mrs Magill: I will come in and then let the others speak. When we had the meeting with the Department and went through the new guidance, Eamonn said, "If I were to apply for my services again now, I would not get them". The difficulty is that Owen's application and other applications in the process are now being dealt with under the new guidance, and that is where there are additional barriers, and they are not just related to the length of time. The 30-minute rule will seriously affect applications. It is just more barriers. The other guys may want to come in. Eamonn, do you want to go first?

Mr Rooney: As I said, the 30-minute rule was introduced only recently. Before it, that was the only reason that I was only able to operate my service between Belfast and Newry. Translink has now set up numerous services that run at identical times to mine. When it comes to the renewal of my permits, the Department can say, and my gut feeling is that I expect it to say, "Hang on a second. Translink is operating those services. We do not need you, Eamonn. Thanks very much. Cheerio". End of story.

Ms Kimmins: Yes, I know. That is certainly very concerning, particularly, Eamonn, when you look at the length of time you have been delivering that service. As I said, although Translink can do some of it, it cannot provide the same level of service that you have been able to, with drop-off and pickup points and all of that. Moving forward, we need to address that so that you do not find yourself in that position.

The determination of applications has also changed considerably with the introduction of a panel, as well as a provision to choose to refer the application to the Minister to make a decision. How does that stack up with the previous process? Do we know who that panel will be made up of? When the Department was dealing with Hannon, it did eventually refer the decision to the Minister. Was any reason given as to why the Department referred it to the Minister?

Mr McLaughlin: Again, it goes back to the Northern Ireland (Executive Formation and Exercise of Functions) Act. In order for it to be referred to a Minister, it has to be a major decision beyond the responsibility of the senior officers. That clearly was not a major decision. It was a day-to-day operational decision for officers of the Department. It did not cut across Departments, and there were no policy implications: nothing. That was the pretext for leading on to saying that this is why the Department might introduce this. As far as we can tell, the Committee was informed that that may have a significant impact on Translink's ability to provide its services. Again, I would challenge that. The £2·2 million figure quoted was less than 1% of turnover. The eventual figure that was quoted to us was, I think, £895,000, which is less than 0·5% of Translink's turnover.

For me, the real barrier is not the panel, because the panel can be just the same as an individual. The real barrier is the bit about referring the decision to a Minister. It is absurd that a decision on a permit for a vacant service for which there are no express services has to be referred to a Minister. Think about how valuable Eamonn's service was if you were trying to get back to Coleraine, Newcastle, Enniskillen, Dungannon, Omagh or Cookstown. Again, all those places do not even have a direct rail service to them. We were going to offer a non-stop service or a service with a very limited number of stops, with a toilet on board and pre-booking. We were attacking all the barriers. It was effectively the same service that we operate between Belfast and Scotland, and that has increased demand on that route by 19%. We know that from the figures from Stena.

The reason that we were given for a referral to a Minister was that it was a major decision, yet what came back was that we were denied our permits not because of any potential impact on Translink and not because of any policy decisions, but simply because we did not provide any information. Why therefore was it ever passed to the Minister? If that is what the Department is saying, how could it ever have been passed to the Minister?

Mrs Magill: The determination process is obviously controversial. The Department is unnecessarily making the decision controversial, because it is taking a protective stance instead of looking at it as development of the network. That is where this is wrong.

If there is to be a panel, and if there is anything controversial, the panel has to be made up of people who know and understand what they are doing. As I understand it, it was one of the directors and the head of testing at the Driver and Vehicle Agency (DVA). I did question what they would know about making that decision. Giving it then to the Minister seemed to be part of the delay in a long process.

There is something that we need to highlight. The Transport Act 2011 was born of the need to change the system, ensure fair competition and allow the private sector to be part of a process, not to do any

12 damage to Translink but to complement it in every way. That is what it was about. Some of the services were to be subcontracted to the private sector. We were also to have a stand-alone department that made the decisions on the bus permit applications. For some reason, those provisions in the Act were never enacted, neither was that which would allow grants to be paid to the private sector. That was not done for some unknown reason, so one has to ask why those provisions were not enacted.

In the meantime, you have a Department that owns a network and that owns and has an agreement with Translink, and it is making the decisions on other services coming in. It is not treating them as being complementary to its service. Rather, it is frightened of them and treating them as if they are the enemy coming in. That whole protection attitude has to stop. We need to know why we do not have the proper stand-alone department and why things are not done with the vision of and absolute concentration and focus on developing the network for the people of Northern Ireland.

There is a whole lot more that the Department needs to answer about determinations, about where the stand-alone decision-making department is and about why it looks fearfully at any applications for permits.

Ms Kimmins: That is certainly the sense that I am getting, Karen, from listening to you [Inaudible owing to poor sound quality.] It makes no sense when something has worked so well for so long. The barriers that are being put up are beyond belief.

What really screams out at me as well is that rural connectivity is massive in all of this. I know that Translink probably does not have the resource to deliver the service that the private operators can deliver. Owen mentioned some of the areas where they are trying to replicate the type of service that Eamonn is able to provide at this end of the Six Counties. It is about all of that. It does not make sense to me as why the situation is being made so difficult for you.

My final question goes back to the situation that Hannon's experienced. Your submission, Owen, stated that it was not clear whether the decision to refuse was made by the Minister or officials. Since then, you have met the Department. Has that been clarified, or are you still not sure from where the decision came?

Mr McLaughlin: Yes, it was clarified. It was the Minister who made the decision. That is what the Department told us at the meeting that we had some time in April.

Mrs Magill: Yes, just before then.

Mr McLaughlin: It put words into the Minister's mouth, to the effect that she considers empty seats on a bus service that stops 15 times between Enniskillen and Belfast, that comes off the main route twice, that has no toilet on board and that does not want pre-booking as evidence that there is no demand for an express service that would provide those things. I do not know how the Department has got away with doing this, but, yes, it confirmed that the Minister made the decision.

Ms Kimmins: Has that assessment been made in the context of COVID, or is it looking at pre-COVID figures?

Mr McLaughlin: In what context, Liz?

Ms Kimmins: The empty seats.

Mr McLaughlin: It had nothing to do with COVID. There was no implication of that.

As part of our evidence of demand, we put in an analysis of Translink's Goldline timetables. We compared them, from 15 years previous to the time that we were doing the analysis. It showed that, where there was no degree of contention — no private operator — Translink had not changed the timetables one bit, whereas, on the Derry route, because Chambers operated on that, it had increased the service by 66%. It also slashed its fare by about 50% for the 40-journeys ticket. On Eamonn's route, it improved its offering by about 66%. For the Dublin offering, when two or perhaps three other minor operators came in, it more than trebled its service offering.

13 That therefore is the revealed response to a bit of contention. The Office of Fair Trading appeared before this Committee's predecessor to say that what you have in Translink is an operator that has been able to "slump into a comfortable inertia".

The customers whom we attract have no choice. They either have to drive, not travel or go on a bus that stops multiple times along a long journey with no toilet on board. We realise that people travel for many reasons. People who travel for medical treatment or who have a chronic disease need access to a toilet. It is one of the top questions that we are asked about our Glasgow service. The longest stretch on that is 80 miles. They ask, "Do you have a toilet on board?". That is so important for people on longer journeys.

Ms Kimmins: Thank you, all, for your feedback. It has been very helpful.

Mr K Buchanan: Thank you, Karen and gentlemen, for attending, albeit remotely. I have a couple of quick questions. Karen, you referred in your letter of 29 April to the draft guidance. Is it your understanding that the draft guidance is now the new guidance? Does the Department use the draft guidance as its new guidance?

Mrs Magill: Yes. That is what it is doing, and that is what it has used to determine the Hannon application.

Mr K Buchanan: I have a couple of other questions. For what period does an operator's licence run? If I were to apply tomorrow for an operator's licence, when would I have to reapply?

Mrs Magill: You reapply every year. Technically, the law states that it is a three-year thing, but, because of security and different things over the years, that has never been allowed. You therefore have to reapply every year for your operator's licence.

Mr K Buchanan: What about the permits? Owen ran the route from Londonderry to Belfast. You need a permit for that route. Say that it was a 5.00 pm service, and you wanted to run another service at 6.00 pm, does that require another permit?

Mrs Magill: That requires a whole consultation process on your permit.

Mr K Buchanan: If I have a permit for a Belfast to Londonderry route, and I want to run a service in another time slot, does that take another permit or a separate consultation on the same permit?

Mr McLaughlin: As part of the application process, you submit one timetable. You tell the Department what services you intend to provide. If you want to put on an additional service, you have to consult and ask it. We have one timetable. I cannot remember how many services a day there are, but there is an extensive timetable, seven days a week. It is not on a service-run by service-run basis.

Mrs Magill: Niall and Eamonn, how do you deal with your different times?

Mr McKeever: Our specific service is for Derry/Londonderry to the two Belfast airports. We have to reflect the activities at the airports, so we have a summer timetable and a winter one. Even the change of times between summer and winter, putting on and taking off services, requires a period of reflection. It does not require a new permit application, but there is an interrogation to determine the reasons that we need the change.

The frustrating element is that the pedigree of the service and the history of running it seems to be set aside. We have expertise in running the service, but we are being challenged by the new, complicated system being put forward under the new guidelines.

Mr Rooney: My experience, as has been mentioned before, was that we wanted to put on a 5.15 pm service from the Europa to Newry. We already had a 5.00 pm and a 5.30 pm service, and the vehicles were overloaded. It took me two years to get a permit for a 5.15 pm slot, and that was granted only because we had a judicial review set up for the following week. The Department issued a letter to say that it was going to grant a permit to me for a 5.15 pm service. The Department was happy for me to put on two buses at 5.00 pm and a further two at 5.30 pm, but it did not want me running a 5.15 pm service.

14 Mr K Buchanan: Is that all under the one permit?

Mr Rooney: Yes. That service was to be added to my permit.

Mr K Buchanan: I have one final point. For example, if you want to take the 5.00 pm service away, do you need to advise or consult Translink about doing so or do you just stop it?

Mr Rooney: You cannot just stop the service. You have to give two months' notice, but we have not ever had to do that.

Mr K Buchanan: Thank you, gentlemen and Karen.

Mr Muir: I thank everyone for taking the time to talk to us virtually. A lot of my questions have been answered. There will be significant questions for officials next week. I have one question for Karen. The view is that this was a policy change and that there was no significant consultation on it. Can you confirm that that is the case? Changes are one thing, but not having a full, proper consultation, with the ability to engage, is another thing entirely. There are particular responsibilities under section 75 and all the rest of it to do that engagement. Can you tell us a bit more about that?

Mrs Magill: The first time that we knew was in a meeting with the Competition and Markets Authority, Owen and what have you? At that meeting, one of the officials suggested two new parts to the determination process, which were the panel and the Minister. We said not to do that under any circumstances, as it did not make sense and was not needed. We then had a review meeting. All permit holders meet with Stuart Gilmore every so often. At another one of our meetings, the Department made a presentation advising on the process. I said, "Yes, but we have already objected. There is absolutely no need for that process. Why would you do that? Why would you [Inaudible owing to poor sound quality]?". That was purely a presentation. The next thing that we were presented with was the guidance. In between the presentation and the guidance coming along, the Minister had already been involved and had made a decision based on a submission in which she was not told that the industry had objected. That was submission 10/78/2020.

We were presented with the guidance just recently, in March. In between, there was no formal communication. There was no formal consultation. There was merely a presentation, and then the guidance was presented to us. In between that time, we were told, "The Minister has changed the process, and here is the guidance to reflect that". That was it. There was nothing formal at all.

Mr Muir: OK. A lot of other issues have been teased out and fully explained, but the consultation process is a key issue. If there had been a full consultation process, Karen, the Committee and others would have had sight of that and been able to make a response. The fact that it was delivered in a presentation, after which the guidance came out, is, for me, the key issue. Separate from the actual decision is the ability to have a consultation.

Mrs Magill: It is concerning for the Committee, but not to be formally consulted and presented with a done deal, however, while knowing that the Minister has not been presented with all the facts seems to be how things are being done now. It is very disappointing. Translink's name comes up all the time, because the Department is the Translink provider, but it is what the Department is doing. The Department has decided that this is how it is going to work, and we have had to live with that. It does not make sense. We need an opportunity for us and Translink to work together to look at the rural areas, to look at services that have been taken off and to look at where we can come in with smaller vehicles and, as Owen said, do the first mile, the last mile and try to marry in. We have asked the Department for that opportunity. There is a lot of potential there for integration, but not unless the Department's attitude changes and its vision is for that type of service. We therefore need that in the Department, and we need to be properly consulted. We need to be involved, and we need to be seen as the proper stakeholders that we are.

Mr Muir: I am on the record as saying that it is best if politicians are kept out of planning and licensing decisions, particularly regulatory decisions. [Inaudible owing to poor sound quality] the Minister is something that I am slightly uncomfortable with. It is best left as an independent process. We have seen what happens when it goes the other way.

We have got a lot from you today. That is important. It has been an extensive session, and I am grateful for that. Next week, we can ask the officials about the issue. Thank you.

15 Mr Beggs: Thanks, everyone, for your evidence. It is clear that the independent coach sector has spotted gaps in provision and developed public transport services to meet that gap. You have been innovative and, ultimately, you have expanded services through the direct routes that you have introduced. I share your concern about the new guidance. I can see how it will create uncertainty in the industry and potentially difficulties for getting future investment.

Owen, I picked up from your comments that you think that Translink does not provide direct services because of subsidies. Will you expand on that? I am trying to understand why it has not been meeting the demand that private operators have provided in its place. What are the subsidies?

Mr McLaughlin: The sound is breaking up a bit, but I picked up that you asked me to expand on bus service subsidies surrounding. There is a legal definition in Northern Ireland of what a bus service is. It goes back to the Finance Act 1966. It determines what subsidies can be awarded and legislates for concessionary fares, accessibility etc. Through the Transport Act 1967 Act and, later, the rural services agreement, Translink was awarded all bus and rail services in Northern Ireland. There are no express services in the service contract. That is likely to have been for the reason that Translink did not want to operate any because express services did not qualify for subsidy. For instance, up until March 2015, Translink could claim tens of millions of pounds in fuel duty rebate but only if it could prove that the services were bus services and not express services. That is why Translink's network is without express services. It is not contracted to do them, and there is not the gamut of subsidies available for them, so Translink has chosen not to do them. It has only one express service anywhere [Inaudible owing to poor sound quality] and that is in Scotland, operating between Stranraer and Edinburgh, on behalf of Scottish Citylink.

Mr Beggs: It is clear that you and your colleagues have spotted that demand from the public and provided that public transport service. Thank you for that. What effect will the new guidance have on fresh applicants who are considering introducing new services? Will it be an even higher hill to climb that may, in fact, put others off?

Mr McLaughlin: It is not a hill but a complete shutter for our services, because of the interpretation of the 30-minute rule that is now applied across service types. Incidentally, the Department's solicitors wrote to our solicitors and informed them that the Consumer Council for Northern Ireland (CCNI) had put forward the new interpretation. The CCNI has disputed that. In effect, that meant that we could not operate. We could not apply for the express service, even if there was no express service operating along that route, but there was a bus service — well, you could apply, but you would automatically be turned down. There is nowhere in Northern Ireland where you would put an express service that does not have a bus somewhere along the route. In effect, for us or any other operator, there is no chance of applying to operate the network of express services that we applied to operate.

Mr Beggs: What protection is there for the public? Do the Consumer Council and, potentially, the Competition Commission have a role?

Mr McLaughlin: They do have a role. I met and briefed the Consumer Council but, to be honest, I have found it to be a bit passive. We pointed out that, as a Consumer Council, it should be looking out [Inaudible owing to poor sound quality] that people who would potentially use public transport are not even given the choice. There is not even the option to use an express service, never mind having competition. It wanted to stay neutral, but my view is that, by staying neutral, it fails potential users of public transport in Northern Ireland, the wider public transport network and consumers.

Mrs Magill: I will come in here, too, Mr Beggs. The Consumer Council is a consultee, and I highlight the fact that it was not consulted in relation to the new draft guidance at all. It did not even receive the guidance that we received; I shared that with it and invited it to come along to the meeting to discuss it. It is allowed to make recommendations in relation to the permit applications, but it was not consulted at that stage. Even apart from Owen's experience, the Consumer Council's role is more passive than it used to be. It used to have proper hearings whenever there was an impasse. Whenever there were difficult decisions to be made, it held hearings and stuff, but that activity does not seem to happen any more.

Mr Beggs: You mentioned, Owen, that Hannon Transport went through a successful judicial review and was awarded costs. You then said that the Department simply ignored the settlement of that judicial review. What aspects did it ignore? It is quite serious for a public body to ignore a judicial review.

16 Mr McLaughlin: There were a couple of different aspects. Going into the review, the Department knew that there was no Minister in place. It made no mention of whether the fact that no Minister was in place affected its ability to make a decision. It committed to giving a fresh redetermination within six weeks of 15 February. As I said earlier, we agreed an extension to that and we went through a couple of variations, which brought us to the end of June. That was the last part.

Funnily enough, the Department repeated every single mistake that we pointed out through the judicial review, such as not taking account of our scientific evidence of demand, not having expertise on the panel and giving undue weight to Translink's evidence. Ironically, the only thing that it got right in relation to what we pointed out in the judicial review was the application of the 30-minute rule. In that original determination, it confirmed, in writing, that the 30-minute rule did not apply. Through freedom of information, we had sight of similar advice that it had given to another operator. We provided that written evidence to the Department as soon as it mooted that new interpretation, shall we say, of the 30-minute rule.

As the Department was simply not making a decision and extending it out, we were left at the point where it was difficult for us to get the trigger. Having allowed the six-week period to be extended, there was no trigger whereby we could press the button on another judicial review. We came close a couple of times, but then there was a slight change, and we had to rethink. As I said at the start, the goalposts have been shifting all along, and it has been difficult to pursue that. The other aspect is that, even though we recouped costs as a business, we did not recoup my costs and we did not recoup the full costs of the company. It is expensive and, frankly, we do not need that. We do not need to invest £11 million in Northern Ireland. We are better off opening up in Paris, as we did, or further extending across Europe. That is what we intend to do. Honestly, we are fed up with the Department's behaviour and we are finished, unless something significant changes. The only thing that will change it will be no more judicial reviews. They are happy to go through a series of those and pay costs. It will only change if the Competition and Markets Authority comes in and does a thorough review.

Mr Beggs: You are all painting a picture of a monopoly situation, even in terms of gaining access to the journey planner and to bus stations, which occurs in all other locations. My understanding is that new bus stations are being developed in Belfast and that there is a new transport hub in Londonderry. Have you been consulted on the designs for those new stations so that they will be able to facilitate independent users?

Mr McLaughlin: No, we have not been consulted but, in fairness, there was some consultation; I do not know all the details of that. When we applied to get our Glasgow service in, we asked for slots at 6:30 am and 10:30 am, but they told us that there was no room. That was just not true. The other thing that I would say is this: how come Laganside bus station is just out there doing nothing? Any local authority in England would tear off your right arm to have a facility like that. In Northern Ireland, it is just left there to go to waste. It seems more that they added services into Europa to prove that they needed redevelopment. The Northern Ireland Transport Holding Company is more interested in getting subsidised property development than network changes.

To say that there is no system to prioritise services in there is crazy. That is what the Department is saying: that there is no way of prioritising, or they have no criteria to prioritise. The most glaring example of that is the services to Dublin that operate kerbside and our Glasgow service, which operates kerbside. Those passengers do not even have a shelter. Meanwhile, Crumlin snooker hall to Belfast gets into the station, as do the services from Drumbo, Newtownards and Portaferry, all of which are minor services which would be better off operating kerbside because they would probably be closer to where the passengers want to go. They are probably in for operational reasons to allow drivers to change or something like that. It is mismanaged, and there is no control over it. There are no criteria and there is no accountability.

Mrs Magill: May I come in there, Mr Beggs? From the federation's perspective, there was an initial consultation with set questions, which we responded to. We raised the whole area of additional space and stands for new services and even for some facilities for coach parking. I know that a lot of the development of the Belfast hub had been assigned to a commercial-type bias, but we and others had also asked about additional stands to allow us in, and also for some parking spaces. However, I do not think that anything ever changed on that.

Mr Beggs: I understand that the journey planner was developed with a public subsidy. I am trying to understand the logic for not including public transport services in it, other than to maintain a monopoly. Is that your understanding as to why you are not being included?

17 Mr McLaughlin: It is indeed. I contrast that with our experience in Scotland. I will give you some figures on the journey planner. The Translink website cost £1 million, but that did not include the journey planner, which cost a further £870,000. It was directly awarded to the incumbent supplier, whose website boasts how it is ideal for use by a local public transport authority, that it can handle up to 4,000 operators and that adding timetables is as simple as a few clicks. There is no reason whatsoever why a highly significant public spend does not include our service to Scotland, the Airporter services or, indeed, Eamonn Rooney's, which were in but were removed.

Mr Beggs: Chairperson, we have to pursue these issues. We are not providing the best public transport service to the people of Northern Ireland.

The Chairperson (Miss McIlveen): OK, thank you. Karen, Niall, Eamonn and Owen, thank you all for your contributions this morning. As you know, officials are coming to brief the Committee next week. You have given us plenty of information for questions. I appreciate your time today. Thank you.

Mrs Magill: Once again, thank you for the hearing and your support.

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