REF0087 Written evidence submitted by the Go-Ahead Group

Background

Go-Ahead is a leading UK public transport operator, providing high quality services in the bus and rail sectors. We run bus companies across the country, from to Newcastle, with a quarter of London’s buses for Transport for London (TfL).

Internationally, we provide bus services in Singapore and Ireland, and rail services in Germany and Norway. Go-Ahead is responsible for nearly 30 per cent of all UK rail journeys through its Thameslink Railway and Southeastern franchises. We employ around 30,000 people globally.

Summary

The pandemic, and the strength and duration of the UK’s Government ‘avoid public transport’ message has had a devastating impact on bus and train use and led to a highly undesirable shift to car travel. Analysis has shown public transport to be safer than many other activities in respect of Covid, and at the right time we need publicly funded campaigns to get people back on buses and trains. Getting passengers back is necessary to increase the contribution of buses and trains to decarbonisation, along with more zero emission buses (requiring a leasing model). Flexible ticketing on rail is needed to help bring passengers back. The CBSSG funding for bus has enabled services to continue on an efficient basis during uncertainty but it is break even so we have no ability to invest. When it comes to an end there will be a need to avoid a ‘cliff edge’ with a tapering off of support to enable a service level that meets new and settled patterns of customer demand. We support the principle of ‘recovery partnerships’ involving local authorities and operators to agree new networks and foster growth, including through bus priority measures. For rail, ERMAs provide stability and continuity of service, the role of train operators remains critical to responding to customer needs, and to restoring and growing passenger numbers.

1. Use of public transport and the way people choose to travel

Impacts of lower use of public transport

1.1. Public transport use remains considerably lower than it was before the Covid 19 pandemic. On Monday 21 September, bus use outside London was at 59% of pre-Covid levels, and national rail was only 35%1. With the further restrictions announced by the Prime Minister on Tuesday 22 September it is now expected these figures will fall further. 1.2. Inevitably there are some longer term trends, accelerated by Covid-19, that will continue to have an impact on the demand for buses and trains for some time. The rise in on-line shopping had already led to a 30% decrease in physical shopping trips taken, alongside increased rates of working from home (even before Covid, 31% of British workers were working from home at least one day per week2). 1.3. Go-Ahead continues to adapt to these trends; we are already undergoing a relative shift in service patterns away from emphasis on the morning/evening peak to looking at how we better serve the middle of the day and evenings. We also expect to provide more services to locations like online delivery warehouses and less to business districts. Our Plymouth Citybus service is now providing a route for a community to the north of Plymouth following the recent opening of a large Amazon warehouse. However, one trend that we do not regard as either inevitable or desirable is the recent one away from public transport to car use. 1.4. The sustained use of a negative ‘avoid’ message on public transport by the UK Government (in contrast with the approach taken in other countries) has led to a clear shift away from buses and trains towards increased car use. Despite a recession and increased working from home, car use had reached 92% of pre-Covid levels by Monday 21 September3. 1.5. More car use leads to more congestion and air pollution, with consequent health impacts, and to increased risk of road accidents. It will also constrain our ability to recover the economy. A recent report from CBI/KPMG highlighted that ‘without a wide scale return to public transport, congestion

1 https://www.gov.uk/government/statistics/transport-use-during-the-coronavirus-covid-19-pandemic 2 Virgin Media, Survey, 2017. URL: https://www.ispreview.co.uk/index.php/2017/06/virgin-media-asa-consider-homeworkers-ads- broadband-speed.html 3 https://www.gov.uk/government/statistics/transport-use-during-the-coronavirus-covid-19-pandemic REF0087 will increase, driving down productivity and increasing emissions as a result’4. The Governor of the Bank of highlighted that ‘restoring confidence in using public transport’ is needed to avoid the country ‘being in recession for a very long time’5. In the pre-Covid economy, 3.5m people in the UK were travelling to work by bus, and buses supported 1.4 billion shopping trips per year, accounting for annual spending of £27bn6. 1.6. With emissions higher when urban traffic is slower7 this will increase air pollution. Air pollution has been described by Public Health England as the biggest environmental threat to public health, with between 28,000 and 36,000 deaths a year attributed to long-term exposure8. Analysis from both Harvard University9 and the University of Birmingham10 has found that high levels of air pollution increase the risk of death from Covid 19. 1.7. We very much welcome the positive emphasis placed on active travel in recent months. However, for many journeys, particularly over longer distances, walking and cycling is complementary to public transport. Research undertaken by Go-Ahead with the University of Leeds and RunFriendly in 2018-19 showed that bus and rail commuters typically accumulate about 24 minutes of exercise per day, providing a range of health benefits11. Increased use of car for end to end journeys increases the risk of obesity, heart disease and strokes.

Safety of public transport

1.8. Analysis is showing the safety of buses and trains, particularly for relatively short distances. A study by the French Institute of Public Health found that only 1% of Covid19 clusters are linked to transport (land, air and sea). They mainly come from workplaces (24%), health care venues (16%), family gatherings (14%), public events (9%), social accommodations (8%)12. A study for Deutsche Bahn showed no cases contracted on board ICE intercity trains based on German track and trace data and the infection rate for train staff was significantly below the national average. This was, in part, attributed to the high air-exchange rate on board trains compared to many other indoor environments.13 1.9. The average length of a journey on one of our UK buses outside London is around 15 minutes. People tend to spend shorter periods of time on buses and trains compared with bars/restaurants, they’re not generally talking and they’re wearing face coverings. Modelling by University of Colorado showed that aerosol infection risk is considerably higher at an indoor gathering (with movement, pervasive talking and minimal ventilation) than on a public bus ride (well ventilated, minimal talking and movement)14. 1.10. A report by Rail Safety and Standards Board indicated that the risk of contracting Covid-19 while travelling by train is about 1 in 11,000 journeys15. This is equivalent to a chance of less than 0.01%, based on an hour-long train journey in a carriage with no social distancing or face coverings. Wearing a face covering (now mandatory unless exempt) more than halves the risk. Given the higher risk of an accident associated with car journeys, for an individual traveller per kilometre travelled, the car is 25 times less safe than rail. 1.11. Our companies have taken various measures to ensure the safety of our customers. Cleaning regimes have been enhanced on our services, customers advised to wash or sanitise their hands and to use contactless payment. Customers are reminded that face coverings are mandatory. Our apps and websites now give detailed information on how busy services are likely to be (our ‘When2Travel’ feature was introduced in June for bus and Southeastern launched a new ‘Seat Finder’ service in August), helping people plan their journeys.

4. https://www.cbi.org.uk/articles/commuting-beyond-coronavirus-how-public-transport-can-build-back-better/ 5 https://www.telegraph.co.uk/news/2020/07/15/boris-johnson-urge-country-return-work-bank-governor-warns-long/ 6 The Value of the Bus to Society, Greener Journeys, 2016 https://greenerjourneys.com/wp-content/uploads/2016/10/The-Value-of-the- Bus-to-Society-FINAL.pdf 7 Begg, David and Haigh, Claire ‘Tackling Pollution and Congestion: Why congestion must be reduced if air quality is to improve’ Greener Journeys https://greenerjourneys.com/wp-content/uploads/2017/06/TACKLING-POLLUTION-AND-CONGESTION-15-JUNE-2017- FINAL.pdf 8 Public Health England air pollution review March 2019 https://www.gov.uk/government/news/public-health-england-publishes-air- pollution-evidence-review#:~:text=Air%20pollution%20is%20the%20biggest,lung%20cancer%2C%20and%20exacerbates%20asthma. 9 https://www.medrxiv.org/content/10.1101/2020.04.05.20054502v2 10 https://www.thetimes.co.uk/edition/news/air-pollution-found-to-raise-covid-death-risk-czm0jqfm6 11 https://www.go-ahead.com/media/press-releases/go-ahead-urges-passengers-make-better-use-first-and-last-mile-their-journeys 12 Santé Publique France (French Public Institute on Health Information). Data collected between 9 May and 11 August 2020 13 https://www.researchgate.net/publication/342353367_Preliminary_Implications_of_COVID-19_on_Long- _Distance_Traffic_of_Deutsche_Bahn 14 https://www.nationalgeographic.com/science/2020/08/how-to-measure-risk-airborne-coronavirus-your-office-classroom-bus-ride-cvd/ 15 https://www.rssb.co.uk/what-we-do/insights-and-news/News/Rail-still-safer-than-road-during-Covid-19 REF0087 What needs to happen

1.12. With face coverings now mandatory, enhanced cleaning in place and extensive communication around hygiene and social distancing, we would like Government to take a more holistic view that appreciates the health benefits of public transport and incorporates this into its messaging. 1.13. At the right point in time, we would like consideration to be given to changing the guidance to enable all seats on buses and trains to be used, with the exception of those in a ‘face to face’ configuration. This would bring the UK more into in line with practice in other European countries (e.g. France, Italy, Netherlands, Spain), and to that of the airlines, where journeys are considerably longer on average. The average local bus journey in the UK lasts only about 15 minutes. By way of comparison, a medium length European flight such as London to Madrid has a duration of 2hrs 30 minutes. 1.14. At the right point in time, we would like to see public money, similar to that spent on the hard hitting ‘avoid’ message, to be spent on a national campaign to encourage a return to the use of buses and trains. This could be accompanied by incentives such as two weeks half price travel after 1000. 1.15. Government needs to also reiterate the ‘hierarchy of sustainable travel’. In the ‘Decarbonising Transport’ document published in March, the Secretary of State said ‘Public transport and active travel will be the natural first choice for our daily activities’16. It is vital that this approach directs policy across Government if we are to avoid a severely damaging long term shift towards increased private car use. 1.16. We anticipate the publication of a National Bus Strategy later this year. When Transport Secretary Grant Shapps appeared before the TSC on 24 July, he reiterated the Government’s pledge of £3billion for buses, and stated ‘We think we will be able to buy something like 4,000 new buses as part of that investment and do many other things’. We anticipate this including funding for Superbus networks featuring bus priority as outlined in the original PM announcement. This underlines the urgency of being able to restore passenger numbers as soon as is possible, so we can further develop networks and expand bus as a mode of choice.

Decarbonising transport to meet net zero

2.1 With customer demand patterns changing, and a significant fall in customer revenue, there is a need to reassess how best to achieve the decarbonisation of transport. Zero emission technology for buses and trains needs to move faster than that for cars, because ultimately, we need to have less vehicles on the road. A report from the House of Commons Technology Committee in 2019 stated that in the long term personal vehicle ownership is not compatible with achieving the Government’s decarbonisation targets17. In tandem with reaffirming the ‘hierarchy of sustainable travel’, the Government needs to work with bus and rail industries to accelerate their decarbonisation. Decarbonising through bus travel 2.2 The fall in the number of bus customers has left bus companies dependent upon the support received through the Covid-19 Bus Services Support Group (CBSSG). Whilst this has enabled service levels to be restored to levels close to that provided pre-crisis, the terms do not allow operators to make any profit. Operating buses (unlike trains) is quite asset heavy (we own buses and depots) and the inability to earn profit will prevent investment in these assets. A small margin should be provided to cover risk and encourage investment; we also need the Government to adopt a new leasing model to enable follow through on the Prime Minister’s pledge in February 2020 of 4,000 new zero emission buses18. 2.3 Our industry body the Confederation of Passenger Transport (CPT) is proposing a leasing model where operators pay a fee in exchange for long term usage. The purchase of these buses, which would all be zero emission, would be financed through a combination of £2bn of government and private investment. 2.4 We would like to see progress on a leasing model for zero emission buses, as part of a green recovery that reduces carbon emissions and protects highly skilled UK manufacturing jobs. 2.5 Given the increased capital costs involved with zero emission buses versus diesel equivalents, the transition to zero emission depots and towns should be accompanied by bus priority and demand management to drive that passenger growth. Our proposal submitted to DfT for an ‘electric bus city’

16 https://www.gov.uk/government/publications/creating-the-transport-decarbonisation-plan 17 https://committees.parliament.uk/committee/135/science-and-technology-committee-commons/news/142808/governments-target-for- netzero-by-2050-undeliverable-unless-clean-growth-policies-introduced/ 18 https://www.gov.uk/government/news/major-boost-for-bus-services-as-pm-outlines-new-vision-for-local-transport REF0087 in Oxford was based on a business case where bus priority enabled a 10% improvement in bus speeds that would generate an equivalent 10% improvement in passenger numbers. Decarbonising through rail travel

2.6 Nearly all of our rail services across GTR and Southeastern are electrified. However, rail as a whole needs to make further progress on decarbonisation with support from Government. As well as further investment in electrification, the Government needs to provide incentives within the franchising system towards innovation (eg for trials of battery powered trains and hydrogen trains). GTR has innovated through its Class 700 fleet which is recycling 15.8GWh of energy, being returned into the network, equating to a decreased energy demand of over 50% on the rolling stock it replaces. 2.7 Rail is a green mode of transport, but its ability to contribute to the decarbonisation of transport is being hindered by the low levels of rail use. In addition to more positive messaging (as covered earlier), there is also a need for effective reform of rail fares and ticketing. 2.8 Go-Ahead has been at the forefront of the development of smart ticketing on rail through our Key smartcard product, and successful extensions of contactless ‘pay as you go’ beyond London. In May 2021, 65% of Southeastern’s passenger journeys used some form of smart ticketing. 2.9 Smart ticketing enables more flexible tickets (e.g. carnet type products, part time seasons) but the current fares structure is inflexible due to regulation that has made it complex and restrictive. With the trend towards increased working from home accelerated by Covid 19, it is vital that suitable rail ticketing products are available for part time commuting to avoid an unnecessary shift to car travel. No matter how frequently people choose to travel, we need fares reform to establish a system which encourages customers to choose rail when they do.

3 Transport Funding and Devolution CBSSG and beyond 3.1 The CBSSG arrangements ensure that local authority contract and concessionary income continues to be paid, with additional money provided directly to bus operators aimed at enabling them to cover their costs for the services. This mechanism has enabled us to respond with agility; we successfully scaled up our timetable in early June in line with lockdown easing. 3.2 With continued uncertainty over demand levels following the PM’s announcement on September 22 and the potential for further ‘lockdown’ measures at local or national level, it is important that the current mechanism remains in place for as long as necessary to enable us to continue to respond with agility. 3.3 Throughout the crisis we have liaised closely with relevant local authorities in planning service changes, adapting service levels in line with the national situation and tailoring service to meet local needs (eg retiming and additional services to meet hospital shifts). In the midst of a crisis, the consideration of changing to a specification/regulatory role for combined/local authorities risks additional bureaucracy, complexity and cost when resources need to be prioritised on keeping services running. 3.4 The principle outlined by the DfT is that CBSSG funding will remain in place for as long as it is needed, and we support that. However following an end to Covid related restrictions we would anticipate it still taking time for customer demand levels to settle at a level that we could remain confident in for the medium term. Consequently it is important that this funding does not end with a ‘cliff edge’ but that support is tapered away as service patterns are reviewed and established to meet new customer trends. 3.5 We support the principle, outlined in the CPT’s response to this inquiry, of putting Recovery Partnerships in place between local authorities and bus operators to provide local frameworks for agreeing the new network, the distribution of funding to support it in the short term and the rapid mobilisation of bus priority measures to sustain it for the long term. These partnerships need to be supported with short-term funding to prevent excessive reductions in local services and foster the growth of new services. 3.6 The agile partnerships being proposed would be tailored to the specific needs of recovery after Covid- 19. They can be established with minimum process and get to work quickly. Bus Services Operators Grant (BSOG) 3.7 BSOG is another funding mechanism that helps keep bus services viable. Its provision is a key factor in delivering a wide range of bus services to communities in England. 3.8 BSOG is a grant paid to bus operators to help them recover some of their fuel costs. It provides a direct benefit to passengers by helping operators keep fares lower and service levels higher than would otherwise would be possible. REF0087 3.9 Given its critical importance to continued bus service provision, we do not think there should be any immediate changes to its provision. We recommend that over time measures be taken to reform BSOG so that it is more supportive of zero emission bus investment. This should be done in a manner that avoids any ‘cliff edge’ and upholds the principle that overall levels of funding support are at least maintained. ERMAs and Rail Reform 3.10 Go-Ahead welcomes the Emergency Recovery Measures Agreements (ERMAs) now in place on rail franchise contracts, for providing stability and continuity of services amidst continued uncertainty. In the medium term there will be a pressing need to get passengers back on trains, to ensure that comprehensive network provides value for money; passenger numbers at 30-40% of pre-Covid levels inevitably leads to high a subsidy requirement. 3.11 Private operators have the expertise and customer innovation to drive up customer numbers. At the right time this will need to be recognised in contracts that reward behaviours, provide incentive and ensure that private companies have 'skin in the game' to increase customer numbers. Increasing customer numbers is necessarily linked to fares and ticketing reform. 3.12 Go-Ahead operates through concession type contracts in various settings and is entirely comfortable with that model. However, within any future structure of the rail industry it is important to recognise the vital role that train operators have through being closest to the customer, and ensure they have the levers to respond to customer needs as they arise and change. September 2020