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Studying London's bus system model

Transport for London says there has to be a balance in managing rewards and penalties especially when transport subsidies are tightened.

LONDON: This month, Singapore introduced incentives and penalties for bus operators who achieve standards set or fall short under the Bus Service Reliability Framework (BSRF). These are worked out every six months.

London has a similar system since 2001, and authorities say there needs to be a balance between giving rewards and enforcing penalties.

In London, priority lanes for public buses ensure better journey time reliability but even with such lanes, buses can still get caught in a jam.

These may be beyond the control of operators and they are spared the blame under the bonus-penalty scheme.

In addition, frequently congested roads have a higher excess waiting time which is the difference between the actual and scheduled wait times for buses.

Alex Moffat, manager (performance development) at Transport for London, said: "We are constantly reviewing the standards, we toughen the standards, and operators have to respond, and improve their performance, and get better and better."

Transport for London determines how difficult a route is when setting the standards.

Routes in central London are usually more difficult to operate than in outer suburbs.

Longer routes are also more challenging.

Higher excess waiting time (EWT) is assigned at major centres where there are many commercial activities like shopping malls.

And analysing the route is an important exercise for operators when tendering a bid.

Jaspal Singh, CEO of ComfortDelgro (UK and Ireland), said: "You have to know the geography of your route. You also take into account the competition in the area, who are the other operators, how hungry they are."

John Trayner, managing director of Go-Ahead London, said: "65 per cent of our tender bid is wage-related staff costs so we have to be competitive on wages, but that goes to all operators. You don't want to be the most expensive payer in town. Your drivers are paid the best but you don't want the worst."

Trayner added that the transfer of higher salaried bus driver to operators who puts up a lower bid for contracts have levelled the playing field.

He explained this is because the operator has to absorb these drivers from the company that lost the contract.

This increases their cost because they have to take in the drivers under the same employment terms.

Operators who win the contract and meet the standards are given financial bonus.

These can be as high as 15 per cent of the contract value - worth between three and four million pounds.

However, if operators don't perform, they can incur penalties of up to 10 per cent of the contract value.

In the past, bus operators have enjoyed good incentives, but over the years, bonuses have gone down as standards are set higher.

Bus drivers say they do not feel pressured to meet these higher standards.

Althea Amos, a bus driver with Go-Ahead London, said: "I don't find it that it gets to me, because when you start getting stressed that's when mistakes start happening. That is when accidents happen. So, for me I always try to stay focused, remember what you're dealing with, a bus-load of people. That is your responsibility."

A total of 1.7 billion pounds a year is spent on managing the bus network, and Transport for London says there has to be a balance in managing rewards and penalties, especially when transport subsidies are tightened.

Even though bonuses may be lower now, there is still good interest from bus operators to bid for routes.

On average, Transport for London receives three bids for every route tendered.

The competition is intense, but there is a bigger challenge.

Trayner said: "Our biggest competitor is the car. We are trying to get people out of cars into the public transport, onto the buses, and we can only do that if we can provide a reliable quick service, getting them from A to B quicker than they can in a car, which only sit in traffic. Now, we need help to do that with bus priority, traffic signalling, stopping people digging up the roads when they don't need to."

It has been a long journey for the bus contracting model in London. After nearly 30 years, it has seen results in improving reliability. However, one challenge ahead is maintaining this level of service in the face of a growing population in London.

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