AGENDA ITEM NO. 5(3) REGENERATION SCRUTINY COMMITTEE – 7TH JULY 2009 SUBJECT: WITHDRAWAL OF X38 THROUGH BUS SERVICE TO CARDIFF REPORT BY: DIRECTOR OF THE ENVIRONMENT 1. PURPOSE OF REPORT 1.1 To advise Members of the background to the changes made to the X38 bus service and to outline the current position. 2. SUMMARY 2.1 The report looks at the reasons for the changes made by Stagecoach to the X38 bus service between Bargoed and Cardiff. The report examines the Council’s position, particularly with regard to funding. 3. LINKS TO STRATEGY 3.1 Caerphilly Local Authority Bus Strategy (LABS) first published in June 2003 as part of the Local Transport Plan (LTP). 3.2 Regional Bus and Public Transport Strategies being developed by Sewta (South East Wales Transport Alliance). 4. THE REPORT 4.1 The X38 route to Cardiff was a wholly commercial service provided by Stagecoach that operated from Bargoed via Pengam, Penpedairheol, Gelligaer and Nelson with most journeys operating via Pontypridd. The service operated mostly every hour and required 3 buses to maintain the timetable and had been losing money for some time. 4.2 The X38 service had been affected by the improved train service from Bargoed, Pengam and Ystrad Mynach Stations - the standard pattern timetable introduced 4 trains per hour from March 2006 providing a shorter and more consistent journey time and with competitive fares meant the bus service lost a significant amount of fare paying passengers. The service also paralleled a number of other services on sections of its route and suffered reliability problems because of traffic congestion at Pontypridd and Cardiff. 4.3 Following service changes in the Merthyr area, Stagecoach registered a revised X38 service from 6 October 2008 that offered an improved timetable between Bargoed and Pontypridd – there is now a consistent hourly timetable throughout the day, whereas previously there were some gaps in the timetable particularly in the afternoon. The service now operates with low floor buses, which was not the case previously. Connections to Cardiff are possible by changing on to services X4 or X32, also provided by Stagecoach, with through tickets no more expensive than the previous single X38 fare on journeys to Cardiff. 4.4 Stagecoach has confirmed it would cost more than £100k per annum to reinstate the previous level of service, or around £70k per annum to reinstate peak journeys to Cardiff. To meet these costs, the Council would have to make significant cuts to other established subsidised bus services. 4.5 The Council has received a number of representations following the curtailment of the X38 service, mainly from passengers and local councillors living in the Nelson area. A petition was also submitted to the Petitions Committee of the National Assembly for Wales calling for the restoration of a direct bus service between the Rhymney Valley and Cardiff. The Petitions Committee undertook consultation with Stagecoach and the Welsh Assembly Government. Stagecoach confirmed that a substantial annual subsidy would be required for this route to be financially viable. The Deputy First Minister and Minister for Economy and Transport stated that the decision to subsidise a route rests with the relevant local authority, reaffirming the position outlined in this report. 4.6 Unfortunately the response from the Minister does not recognise or address the significant gap in funding required to reinstate the X38, particularly when the Council is dependent on the LTSG to fund around 40% of contracted services (the other 60% is funded from the Council’s own revenue budget). Whilst confirmation of the allocation of LTSG for local authorities in Wales for the 2009/10 financial year is still awaited at the time of writing this report, informal indications are that it will not increase form 2008/09, despite increasing operational costs on existing contracts. 4.7 The curtailed X38 route, currently provided by Stagecoach on a fully commercial basis, has maintained many of the passenger movements made on the previous service. The existence of this service means the Council cannot seek tenders for another operator to provide an alternative service to Cardiff that incorporated the X38 route as it would duplicate a substantial part of the Stagecoach service and abstract revenue from it. Conversely, the existence of the current X38 also dilutes the passengers available for an alternative service and therefore increases the subsidy required. 4.8 However, it is also clear from discussions with Stagecoach that in the first six months of operation of the revised X38, the service is not generating sufficient revenue to sustain the curtailed route on a commercial basis. It is unclear at present how long Stagecoach will maintain the current operation, as it is linked to a network of other routes operating in the Merthyr / Treharris and Nelson areas, but if Stagecoach were to withdraw the service completely, it may provide an opportunity to consider a revised X38 service that could reinstate through journeys to Cardiff at peak and possibly other times during the day, albeit at a much lower frequency than the previous service (or the current Pontypridd service). 4.9 Finally, it is worth noting that the majority of communities in the County Borough do not have a direct hourly bus service to Cardiff – there are now only three routes – service 26 from Blackwood via Ystrad Mynach, Caerphilly and Nantgarw; Service A from Graig y Rhacca via Caerphilly and Thornhill and service B from Senghenydd via Caerphilly and Thornhill. Whilst some areas benefit from direct train services, many communities do not and the only alternative is to change services to make the through journey. 5. FINANCIAL IMPLICATIONS 5.1 No additional cost at present, as the significant funding to reinstate the previous level of service on the X38 is not affordable. Members are asked to note that the current X38 service may not be sustainable as a commercially provided bus service in future and it may be necessary to consider financial support for the reinstatement of a service. 6. PERSONNEL IMPLICATIONS 6.1 None. 7. CONSULTATIONS 7.1 Consultations have taken place and are reflected in this report. 8. RECOMMENDATIONS 8.1 For Information only. It is recommended that Members note the content of this report. 9. REASONS FOR THE RECOMMENDATIONS 9.1 To be advised of the concerns of passengers following changes to the X38 bus service and the financial pressures that preclude the reinstatement of the previous level of service on the route. 10. STATUTORY POWER 10.1 Transport act 1985. 10.2 Transport Act 2000. Author: Huw Morgan, Principal Passenger Transport Officer Tel: ext 5089, Email: mailto:[email protected] Consultees: Cllr R Gough, Cabinet Member for Transportation and Planning Cllr V Jenkins, Chair of Regeneration Scrutiny Committee Cllr D Bolter, Vice Chair of Regeneration Scrutiny Committee Cllr A Blackman, Local Member for Nelson Ward Stuart Rosser, Chief Executive Anthony O’Sullivan, Director of the Environment Terry Shaw, Head of Engineering Services Clive Campbell, Transportation Engineering Manager .