Souter has got to give way in battle for bus control

Published on Sunday 1 October 2006 00:46

BRIAN Souter, the Stagecoach chief executive, has fought many battles with bureaucracy but he risks biting off more than he can chew with his latest threats.

He objects to town hall bosses telling him how to run his business and says he will withdraw his bus operations if the government gives them new powers over services.

Souter is not somebody to cross without first dressing in body armour and the government will know it has been in a scrap if it takes him on. But ministers - at Westminster and Holyrood - should call his bluff on this one.

Anyone who stands long enough in Princes Street, Edinburgh, or in Glasgow's Renfield Street will be familiar with the problem. Queues of buses as far as the eye can see and many of them carrying not a single passenger. There's no wonder our cities are so congested: they're full of buses holding up the flow of traffic.

Douglas Alexander, the transport secretary, now wants to end the free-for-all and introduce "quality contracts" that will lay down certain conditions. These contracts would bring some order to the chaos by restoring some control over the freedoms introduced in the 1985 Transport Act that helped Souter and his sister Ann Gloag become millionaires.

The act was supposed to tackle inefficiencies but its focus was on competition rather than integration and, 21 years on, tackling congestion is now of greater importance than lining the pockets of bus company executives.

Leaving the buses to operate more or less as they please - within the limitations laid down by the traffic commissioners - has made it more difficult to plan a proper public transport system and was a fundamental flaw in the original legislation. Fragmenting the bus network, and subsequently the railways, meant Britain would not get the integrated system that it obviously needed. We are still waiting.

It would be no surprise if Alexander's proposals emanated from Alistair Watson, the veteran Strathclyde transport boss, who told me earlier this year that the nose-to-tail line of buses around our cities is unsustainable.

He was in no doubt that buses contribute to congestion and that only by regulating them can there be a better flow of traffic and services. "At times we have over-provision in Glasgow and Edinburgh. The status quo has to change. We need to limit the provision," he said.

That's straight talking from somebody who's been involved in public transport all his working life and wants it to succeed. The proposed solution involves quality contracts, specifying certain levels of service and frequency, although Watson would go further and introduce franchising, as exists in London, to bring an end to bad practices such as cancelling services at short notice or two firms charging different fares for the same journey.

Of course, the bus operators are not keen on franchising and it is easy to see why: under a franchised system the returns average 9%, whereas they currently manage 14%. Money talks and until now the bus companies have persuaded the authorities to retain the status quo.

However, things may be about to change and that will put pressure on Souter to show he's not making idle threats.

He is feeling bullish after just winning the South West Trains franchise, but could he really sever his links with the bus industry that got him started? That really would signal a shake-up.

Red face for Green

SIR Philip Green, knighted for his services to retail, has been forced to eat some humble pie after seeing profits and sales tumble at his Bhs empire. The man who boasted he would "trade the socks off" Marks & Spencer was forced to admit he got it wrong at Bhs: wrong fashions, wrong shapes, even wrong sizes.

Green will get little sympathy from those in the City who never liked him. His refusal to toe the line or court popularity in the Square Mile was his undoing in the years following his 47m acquisition of Scottish value chain What Everyone Wants from Vera and Gerald Weisfeld.

Green made Glasgow-based WEW the core of his Amber Day company but he was accused of not following the City rule book. He was also associating with other high-flyers who later would be discredited for their links to financial scandals. Following a shortfall on WEW profits that he had led investors to expect, he was forced to quit, sparking a long period of mutual mistrust between Green and the City that still lingers.

It's why Green keeps Bhs and other chains, including Top Shop and Miss Selfridge, under family control. But he chose to release the Bhs figures last week probably because he knew the accounts would eventually be made public anyway.

It gives his critics more mud to throw at him, and whether or not he deserves it, he has been shown to be fallible. As for his chums, it will probably mean fewer exotic parties in the months ahead.