"No fare hikes or route cuts" at Newport Bus despite falling passenger figures
1:37pm Tuesday 22nd April 2014 in News
Newport Transport travel passes. Newport Transport Managing Director Scott Pearson joins the team at Newport Market. (2258029)
THE boss of Newport's council-owned bus company has pledged not to put up fares or cut routes while his firm rides a storm of funding squeezes and falling passenger numbers.
Newport Transport has already been affected by Welsh Government funding cuts, but the closure of the city centre bus station last November saw passengers take 200,000 fewer journeys on its network
Both factors have conspired to hit the firm for at least £415,000 over the last 18 months.
Scott Pearson, Newport Transport managing director, spoke about the challenges facing the firm to a meeting of Newport council’s cabinet last Thursday – but said there was light at the end of the tunnel with the new bus station due as part of the Friars Walk development.
He told the Argus: “It would be wrong to put fares up with a bus station that is not built... We don’t intend to put up fares this year, we don’t intend to cut routes.”
“The issues are that the funding has been cut from central government over the past two years – it doesn’t help the bus industry but we understand that."
Mr Pearson said the firm, which operates the Newport Bus brand of services and is run commercially with Newport council being the only shareholder, is making a profit.
Newport Transport appears to have avoided the route cuts seen at Stagecoach or the fare hikes taken at Cardiff Bus - two firms also affected by a decline in public subsidy.
Sources told the Argus that cuts to the Welsh Government bus services’ operators grant saw the firm £275,000 worse off over the last 18 months - and it is likely that planned cuts to support for providing concessionary fares will hit the firm for £212,000 in 2014/15.
Since the main bus station closed the firm saw passenger journey figures fall by around 6.5 per cent – equivalent to 200,000 fewer journeys – bringing in £140,000 less in revenue for the firm.
Mr Pearson explained to cabinet how Welsh Government funding cuts have hit the industry over the last two years - including changes to the bus services’ operators grant.
All this meant Newport Transport had to make “significant cuts in our cost base” in the last year, he told cabinet.
However he said he had managed to get “some leeway” on £25 million cuts to support for concessionary fares across Wales following a ministerial meeting in his role as chairman of the Confederation of Passenger Transport Cymru.
Mr Pearson said there is “light at the end of the passenger tunnel" with the completion of the redevelopment of Newport city centre and the new bus station in 2015.
He suggested that the firm could look at fare increases to meet extra demand after the redevelopment is done.
The Argus revealed last week that Newport Transport had negotiated a deferment in the contributions to a local government pension scheme it had a £4.7 million deficit in.
Cabinet agreed to provide a guarantee over future contributions as required by the scheme, but decided that it should be part of any future negotiations between the two parties.
Newport Transport has around 400 vehicles and 450 drivers, and serves 8 million passengers a year.