The bus is the most used form of public transport across Britain, and this is no different in the North. They are an essential component of an integrated transport network, accounting for 77% of public transport journeys. Affordable, reliable, and accessible buses provide people of all ages and backgrounds with access to activities such as education, socialising/leisure, and work. Access to these activities is fundamental to our quality of life but they have a secondary benefit of boosting the economy of our region. For instance, did you know that people who travel by bus spend more money in their local economy than those who travel by car?
The provision of bus services themselves also benefits the economy, as there is economic value created in providing the services. For example, people working in the sector receive a wage, which is spent and taxed, but also the bus sector supports a supply chain that benefit from orders they receive, such as the manufacture of new buses. Bus Operators in England directly employ 105,000 people and support employment of a further 53,000 in the sector’s supply chain.
In September 2024, the Confederation of Passenger Transport (CPT) launched a report, prepared by KPMG, that delves into the figures and highlights the economic value of bus services to Britain and the regions that make it up.
The report sets out the economic value of local buses through three different lenses:
The table below shows the figures from CPT’s report on the economic value of buses in £ million. It covers the value created by factors that make up the three identified lenses in the North East, North West, Yorkshire and the Humber. A combined figure for the North is also shown.
(Data from CPT and KPMGs report: The economic impact of local bus services 2024 (Full reference see end). The figure for the North was created by combining the data for the three sub-regions. Figures have been rounded to the nearest £5m.)
The economic value of buses as shown in the table is clearly substantial, which is something that should be considered when looking at the decisions to invest in these services. The contribution to GVA from bus commuter wages in the North is estimated at £14.5bn, which is roughly £870 per person. In the report, CPT also considered investment and the economic value created when investing in buses. They found that in Britain “every £1 of public funding spent on a package of measures could generate £4.55 in economic benefits”. This statistic demonstrates that investment in bus services can provide excellent value for money due to the benefits likely to be returned.
There have been several successful examples of bus investment in the North in recent years. One such example can be seen in the North East, where Transport North East (now part of the North East Mayoral Combined Authority) provided discounted multimodal tickets to passengers aged 21 or younger. The investment in discounting fares for young people has proved highly successful. Within 10 months, the scheme funded over 12 million journeys, helping young people access work, education, and social opportunities. After 10 months the scheme had generated £21.6m of social and economic benefits despite costing just £9.75m.
A further example can be seen in the economic benefit of the £2 fare cap which the Government launched in 2023. This has had positive impacts across the North not least in the East Riding of Yorkshire where the fare cap has led to an increase of the leisure market by 11%, particularly between Hull, Beverley, and York (X46/7) and Hull, Beverley, and Bridlington (121). This case again demonstrates that well designed investment packages in bus services can deliver significant positive result for communities including those in the North.
Transport for the North research has shown that over 3 million citizens in the North (~20% of the population) are at high risk of transport-related social exclusion. Furthermore, the North has seen 36% less bus mileage than in 2005, a steeper reduction than the national average of 28%.
CPT’s research and the examples referenced underscore the transformative power of investing in bus services. Not only do they foster social inclusion and have environmental benefits, but they also provide essential connectivity to support economic activities. Continued investment in buses is crucial to economic growth and ensuring that everyone, regardless of age or income, has access to what they need.
If you are interested in finding out more about the economic benefits of buses, be sure to check out CPT and KPMG’s report ‘The Economic Impact of Local Bus Services’ .
Reference
Confederation of Passenger Transport, and KPMG. 2024. Report. The Economic Impact of Local Bus Services. UK.