by Peter Hardy, ITP – Haskoning.
We were pleased to welcome Peter Hardy to the Quality Bus Conference in Portsmouth (23–24 September 2025), where he contributed to a thought-provoking session on bus reform models. In this guest blog post, Peter expands on his presentation, exploring where bus franchising might be the right approach.
Introduction
40 years ago, starting out in my transport career with Nottinghamshire County Council, Bus Deregulation was approaching. We were sat in the Board Room of Barton Transport in Chilwell, Nottingham. In walked one of the Barton family members, who said “we’ve been through two World Wars and a depression, so I’m sure we will be alright!” Little did he know!
We were meeting to discuss revenue support payments for the network. Patronage and revenue were falling on both the profitable and unprofitable parts of the network, and there was a call for more revenue support to keep the network going overall. It felt like things were chugging along in survival mode.
It feels like we are in a similar place now – on the verge of a new era. Bus networks are facing many challenges – in many areas, patronage remains lower than pre-Covid levels; there are rising costs; more services are being propped up with public funding; and around the country are changes in political headwinds.
In recent years we’ve seen the formation of Enhanced Partnerships (EP) – some have seen significant success, while others have struggled to achieve much at all. So, is it time for the public sector to take more control of local networks through franchising? This is something I’ve pondered a lot, working with a number of local authorities to consider the feasibility of franchising (or otherwise) in their areas.
My thoughts are drawn from experience of undertaking the franchising assessment for Cambridgeshire and Peterborough Combined Authority, our assistance provided to Jersey in its most recent contract procurement, and a study tour to the Netherlands to see different approaches to franchising there. Furthermore, I’ve met with all the authorities that have either introduced, or are on the journey towards, franchising (and reviewed all the publicly available documents - reviews; assessments; consultations; reports) to learn from their experiences.
Influential factors
There is a danger of getting too bogged down in deliberations around delivery models, rather than focusing on delivering improved and attractive bus services that people want to use.
Key to success is strong leadership and clarity about what we want to achieve. Important considerations in any delivery model are the quality of partnership working and collaboration. Furthermore, all parties need to have an overriding desire to generate a cycle of continuous improvement, whereby patronage and revenue are growing. With this, we can start to see a future where bus networks become more stable and sustainable.
EPs and Franchising are often viewed as being at two extremes. This may be true if we look at the ‘total control’ model of franchising in Greater Manchester. However, with other forms of franchising, there might be little separation from a very strong functioning EP. The gap will be influenced by the nature of relationships and collaboration in delivering a bus network and the how responsibilities and accountabilities are shared.
The EP+ concept has been put forward as representing a model whereby many of the elements of franchising are provided within an EP. I would argue that an EP+ is actually a hypothetical concept. It just represents a very good EP, which should be what we see in all areas as standard. Instead, most EPs fall short and represent a compromise position that was the best that could be negotiated by the parties at the time.
Many factors will influence where on the spectrum an area might want to be. These include the level of vision and ambition that exists, the current state of the operating market and the quality of the current service offer. Equally, consideration needs to be given to how the current network is funded – the balance of farebox revenue and public funding sources.
Think before acting
Before considering delivery model, it is crucial to do a lot of thinking about the future and where we want the bus network to be. This needs to be undertaken from different perspectives – local authority officers and elected members; bus operators; bus users and non-users; and other interested parties.
Firstly, it’s useful to identify the outcomes we want to achieve, then consider the gap between the future and current positions, identifying what needs to happen to bridge the gap.
Where might franchising be appropriate?
Certainly, there needs to be a strong case for change, otherwise why bother! It may be that there has been some form of market failure, a mismatch of ambitions or inaction on the part of commercial bus operators. Perhaps it feels as if things are just ambling along in survival mode. There may be frustrations of poor relationships or lack of progress through an EP, or even worries about some back-sliding away from commitments in an EP. More positively, it may that there is scope to do more with opportunities that exist or are on the horizon.
Whilst there may be a strong case for change, it’s also important to recognise the risks of change too, particularly in respect of eroding political support or funding.
It's important that the right conditions exist for franchising, such as some surety of sufficient competition in the market and the nature and definition of the network makes sense and is of suitable shape and scale to function efficiently and effectively. It may that it’s necessary to involve neighbouring authorities to achieve this.
Good data (patronage, revenue, costs) will be central to deciding how to go forward and the type of franchising to pursue. Not only will it help in service planning, but it will also help in deciding who should take revenue risk. Whilst Jersey is held up as a good example of ‘partnership franchising’, where the operator is required to take revenue risk, it has taken years to get to this point. When the States of Jersey first took control, there was little data available. Therefore, it took the revenue risk, so that prospective operators were not deterred from bidding. This contract period provided the opportunity to gather the necessary data, so that subsequent contracts could be based on minimum subsidy, with an operator able to take the revenue risk in the fullness of knowledge of the revenue situation.
Many different franchising models and variations exist – it doesn’t have to be like in Greater Manchester or London, where the authorities have total control. It’s important that any authority considering franchising, decides an approach that is best for its areas and circumstances. This might include sharing responsibilities and risks and incentivising operators to grow patronage and revenue. It may also be influenced by the nature of the relationship an authority wants with its operators. Things to consider will include:
Area to be covered and the services to be included or excluded
Service planning, design and development
Fares setting and revenue risk
Depot, fleet and equipment provision and management
Network and service branding
Marketing and information provision
Possible local authority owned bus operation
Nature of procurement approach (service packaging and contract phasing)
There’s a tremendous amount of upfront thinking to be done. However, the more these things can be sorted out early on, the easier it will be to carry out the franchising assessment, if that becomes the chosen route.
A franchising assessment can take on a life of its own. But it’s important not to get lost in the process, but to keep focused on what you want to achieve. Therefore, be clear on what your proposed franchising model looks like, as this will help in carrying out the business case assessment.
The business case is likely to be made on the strategic and commercial elements, along with the affordability of the proposals. There is a danger of a lot of energy going into the economic case. In practice, both Franchising and EP will provide positive Benefit:Cost Ratios (BCR). Whist the costs of franchising may be higher than an EP, these may be outweighed by the additional benefits secured through franchising in network efficiencies, service coordination and fares integration.
Regardless of how an assessment is taken forward, I would recommend keeping things as simple and straightforward as possible, continually engaging with all interested parties to keep them involved along the way. There is no magic formula to carrying out this work – to me, franchising is an art and not a science. It also needs to be the right fit for the area.
Many view franchising as something that takes a long time, and is costly, to introduce. Again, this depends on the type and nature of franchising envisaged. The process may not prove to be overly costly if done sensibly and proportionately. Furthermore, if the proposals in the Buses Bill for direct award of contracts to incumbent operators are taken forward, then implementation may be significantly faster through quicker procurement and less time needed for mobilisation.
Conclusion
In the coming years, more areas will inevitably consider options such as franchising. It will be important to remember that there is no single formula - everywhere is different and has different circumstances. Therefore, solutions must be tailored to local needs and ambitions. Key points are:
Focus on where you want to be rather than the delivery model
Build on what you already have
Certainty, stability and consistency (including political climate) build confidence
Early upfront thinking and planning is vital
Good data will help a lot
Keep all parties engaged
Maintain a log of steps taken along the journey and decisions made
Learn from others
As we move towards a time where the public sector plays a greater role in bus network delivery, there will be implications for local authorities to grow their staff resources and skills.
Hopefully, the five DfT-funded franchising pilots that are about to get up and running will help our overall understanding of what franchising might entail in shire or unitary authority areas. They will shed light on whether there are benefits over and above what is currently being achieved by EPs.
So, where is right for franchising? My view is that anywhere might be right, if the conditions and intentions are right. However, it’s unlikely to be right everywhere and so EPs will remain important and will continue to deliver progressive and growing networks in some areas.
Just like 40 years ago, we are on the brink of a new era for bus. Let’s not fall into the trap of ambling along in survival mode. Instead, let’s be intentional in whatever we do and whichever delivery model we adopt.
Peter Hardy is Technical Director at ITP – Haskoning, providing strategic advice and assistance on all aspects of public transport policy, planning and provision. He can be contacted at peter.hardy@haskoning.com