Seòmar agus comataidhean

Scottish Budget 2022-23 – Impact on the West of Scotland Transport Network

Letter from Strathclyde Partnership for Transport to the Convener, 19 January 2022

Dear Mr Lockhart

Scottish Budget 2022-23 – Impact on the West of Scotland Transport Network

I am writing to you on behalf of the West of Scotland Regional Transport Partnership (SPT) regarding the recent Scottish Budget announcement to highlight some key points which we believe must be considered as part of your deliberations on its implications and ability to catalyse a green pandemic recovery.

While SPT remain supportive in principle of action to tackle transport affordability, such as ‘free’ bus travel for Under-22’s, we have previously highlighted to Transport Scotland the potentially negative unintended consequences of this policy on patronage on the Glasgow Subway. People under the age of 22 currently account for around 17% of our customer base, making around 2 million trips per year. SPT anticipate that the U22 bus scheme will attract passengers away from the Subway to bus, potentially leading to a revenue loss of up to £3 million per annum. Coming at a time when the Subway is only at around 60% of pre-Covid passenger levels due to impacts of the pandemic, and when we are at a crucial stage in the delivery of the £288 million Subway Modernisation programme, the prospect of such a large loss naturally gives us significant concern.

We are further concerned that no provision has been made in the Budget for ongoing financial support for public sector-operated ’light-rail’ systems such as the Subway and Edinburgh Trams – despite provision being made for ‘heavy’ rail and bus. As you will be aware, the pandemic has had devastating impacts on public transport patronage, and it is only thanks to additional financial support from Transport Scotland during the pandemic that the Subway continues to operate. We have been told that the Covid Support Grant we currently receive will continue until the end of March 2022, but no support guarantees have been made beyond that point, and so the Subway faces a ‘cliff-edge’ drop in financial support which would have significant implications for the service.

On a wider point, SPT has gone to great lengths over recent years to reduce our cost base[1] in line with available revenue funding from our member councils, but if we are to continue to support the Scottish Government in achieving national targets and aspirations, we must have the necessary revenue funding available to enable the change required. Given additional funding is not realistic from local authorities, if provision is not made nationally then, without developing new revenue funding streams, public transport network post-Covid remains precarious.

Based on the above, please consider the following three “asks” in your budget deliberations:

To prevent the undermining of public transport funding

1) Provision must be made within the Budget to counter any negative impacts of the U22 ‘free’ bus scheme on the Subway in Glasgow (and similarly Trams in Edinburgh),
2) Provision must be made to continue the Covid Support Grant for the Glasgow Subway (and similarly Trams in Edinburgh) beyond March 2022.

Given the important role public transport must play in achieving many national targets:

3) Scottish Government, and parliament more broadly, should engage in a fundamental review of how local and regional transport services are funded.

SPT funded and supported services such as the Subway and supported socially necessary bus services formed an essential part of our collective response to the pandemic – we transported key workers to and from their workplaces when the commercial market retracted from delivery. As a transport authority focussed on partnership, we are keen to be at the core of future aspirations to deliver a green economic recovery from Covid and achieve national climate change targets.

The potential impact of the issues I raise in this letter are significant, and place the future of our region’s transport network in a very precarious position. Without action, the continued operation of the Subway in Glasgow - which in 2021 celebrated 125 years of operation - and other SPT services including support to uncommercial bus routes linking communities, may need to be reduced.

I am copying this letter for information to the Cabinet Secretary for Net Zero, Energy and Transport, the Transport Minister, and members of SPT’s Partnership Board. We would, of course, be happy to meet with you to elaborate further. I look forward to your response.

Yours sincerely

Councillor Dr Martin Bartos
Chair, SPT

---

[1] SPT is a lean, efficient public sector organisation. Over the last decade it has reduced costs and increased commercial income in order to divert more money to public transport subsidy while receiving less revenue funding from our member local authorities.

• SPT has reduced staff headcount substantially - further reductions would impact service delivery.
• SPT has increased commercial revenue streams, such as advertising and property rental, (many of which were impacted during the pandemic without any access to compensation or mitigation schemes).

SPT has entirely absorbed the 3 month period during which government didn’t then, or subsequently, provide any pandemic financial support to Subway (but did to private transport operators). This was achieved through challenging re-profiling of expenditure and further belt-tightening – all while adapting to pandemic working circumstances and maintaining service.

The room for manoeuvre financially is now very limited. The only other currently available and financially meaningful mechanism in SPT’s power to increase revenue funding is ticket price increases - but those would fall on reduced numbers of travelling public (requiring higher fare increases). Fare increases however would be counterproductive to patronage (putting into question any actual income gain - as well as being directly contrary the mission of the transport authority for more affordable public transport).

If revenue income cannot be increased then revenue spending must be reduced – and to balance budget deficits of the levels faced in the future is likely to fall on our bus service subsidy (which forms around a third of our revenue spending). Practically this means, as different bus support contracts expire, future cuts to socially necessary bus services in areas where public transport is already not commercially sustainable.