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Bath & North East Somerset Council | |||||
DECISION MAKER: |
Cllr Sir Elgar Jenkins OBE, Executive Member for Transport and Highways | ||||
DECISION DATE: |
On or after 19th August 2006 |
PAPER NUMBER |
3 | ||
TITLE: |
Park & Ride Service |
EXECUTIVE FORWARD PLAN REFERENCE: | |||
E |
1404 |
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WARD: |
All | ||||
List of attachments to this report: None | |||||
1 THE ISSUE
1.1 This report sets out financial implications concerning the Councils Park & Ride budget together with actions needed to address the situation. A new contract has been awarded to First Somerset & Avon ltd, which includes a requirement to introduce 8 brand new low emission double deck buses. The cost of this new contract is significantly higher than the previous contract. There has been a delay with the delivery of the new buses and the buses will now be arriving in early September.
2 RECOMMENDATION
The Executive member is asked to agree that:
2.1 The Park and Ride fares be increased as follows. That the ten-journey ticket be increased by £2.00 to £10.00 and that a special Saturday return fare of £2.00 be introduced from 1st September 2006 (or from the date that the new vehicles enter service, if later);
3 FINANCIAL IMPLICATIONS
3.1 The Park & Ride contract was re-tendered last winter. The full details of the competitive tender were set out in an earlier report of 1st February 2006. A new contract was awarded to First Somerset & Avon ltd, which includes a requirement to introduce 8 brand new low emission double deck buses. The cost of this new contract is £248,000 per annum higher than the previous contract. There has been a delay with the delivery of the new buses and the buses will now be arriving in early September. A new double-deck bus costs in the region of £150,000 so this represents a total investment of £1.2 million by the contractor.
3.2 In order to balance the Park & Ride budget incorporating the £248,000 per annum contract cost increase, it was agreed in February to increase the Park & Ride fares. It was also agreed that the fare increase would be implemented together with the introduction of the new buses. It was originally anticipated that the new buses would be deliver by late May, however the date is not early September. Consequently the increase to the Park & Ride fares has not been implemented.
3.3 The delay in increasing the fares together with a much higher usage of the Park & Ride by free bus travel pass holders, means that it will now be necessary to increase some of the Park & Ride fares higher than originally planned (as set out in the February 06 report). Fares were last increased in June 2005 after a three-year price freeze. It is recommended that the ten-journey ticket be increased by £2.00 to £10.00. This means that regular users of the service buying the ten-journey ticket will pay the equivalent of £2.00 per day, compared with the £2.20 standard return fare already agreed. It is also recommended that to retain the attractiveness of the service on Saturdays a special Saturday return fare of £2.00 be introduced at the same time.
4 THE REPORT
4.1 The fleet of 8 brand new double deck buses are due to introduced on the Park & Ride service, in early September. Originally it was expected that the new buses would arrive in June, however the earliest the contractor (First Somerset & Avon ltd) will receive delivery of the new buses is now early September.
4.2 The contract price will be increasing to £882,748 gross per annum, when the new buses enter service. This is an increase of £248,000 per annum compared with the previous contract. The new contract price was determined through a competitive tender and was significantly lower than all other prices received. The full details of the competitive tender were set out in an earlier report of 1st February 2006.
4.3 In addition to the increase in the contract cost, the income from fares is under greater pressure as a result of the introduction of free bus travel for residents over 60, from this April. Prior to 1st April 06 the Park & Ride fare income included the receipt of half fares from residents that held a half fare bus pass. On 1st April a free bus travel scheme was introduced for the over 60's and people with disabilities. Consequently no fares are now received on the Park & Ride service from bus pass holders. During the 2005/06 financial year there were a total of 35,635 passenger trips on the Park & Ride by half fare bus pass holders. In the first two months of the current financial year the number of passenger trips made by holders of a free travel bus pass (known as the Diamond Travelcard), was 18,319. Assuming that this trend continues, the total projected number of trips by the end of the financial year, will be in the region of 109,914. This represents a 308% increase. While an increase in usage by bus pass holders was expected with the move from a half fare scheme to a free travel scheme, there was no way of know in advance (i.e. in February) that the increase in usage would be in excess of 300%.
4.4 At the end of the 2005/06 financial year, the Council had issued just over 13,500 half fare bus passes to eligible residents. So far this financial year, the Council have issued over 27,500 free travel bus passes. This affects the Park & Ride fare income because the 14,000 residents who now have a free travel bus pass and previously didn't have a half fare bus pass, would have paid full fare whenever they used the Park & Ride service, before 1st April 2006.
4.5 This now means that the in order to meet the additional contract costs and deal with the projected fare income shortfall in relation to bus pass holders it will be necessary to increase the Park & Ride fares.
5 RISK MANAGEMENT
5.1 The report author and Executive member have fully reviewed the risk assessment related to the issue and recommendations, in compliance with the Council's decision making risk management guidance.
5.2 The risk assessment relating to the Council's procurement of the Park & Ride bus services was reviewed prior to the previous invitation to tender in 2005. The only change proposed at this time is to increase the period of notice for termination of the contract from three months to six months.
6 RATIONALE
6.1 An increase in Park & Ride fares is necessary to cover the higher cost of the new contract and deal with the projected farebox income shortfall in relation to bus pass holders. The previously agreed standard return fare of £2.20 is comparable to Park & Ride fares in other cities (e.g. £3 peak and £2.50 off-peak in Bristol). The ten-journey ticket will be increased at a lower rate to encourage passengers to switch to it (thereby giving savings in boarding times and cash handling) and a cheaper return fare is proposed on Saturdays to mitigate the impact of a fares increase on shoppers.
7 OTHER OPTIONS CONSIDERED
7.1 There are no options available to absorb the higher cost of the new contract and deal with the projected fare income shortfall in relation to bus pass holders, into the Transportation & Planning Department budget, because the whole budget is fully committed.
8 CONSULTATION
8.1 Consultation was carried out in 2005 at the time of the last review of the contract and the issues raised were considered at that time. Changes were made to the Park & Ride services as a result. In view of the timescales involved in re-tendering the contract, it has not been possible to carry out further consultation. However, no changes to the timetable or hours of operation are proposed.
Contact person |
James Willcock - 01225 477604 |
Background papers |
Report Entitled `Supported Bus Services & Community Transport' 1st February 2006 |