Information: Franchising

How are our local bus services run at the moment?

Bus services in our area, as in much of England, operate in a free market, deregulated by the Transport Act 1985, meaning that anyone (subject to statutory safety and operating standards) can operate bus services. Bus operators are free to run whatever services they like, on a commercial basis (although there are a number of hidden subsidies in place) deciding the fares they will charge and the vehicles they will use. This results in an uncoordinated network with a confusing array of ticketing options.

These ‘commercial’ routes are run by a variety of operators, who may choose (if they wish) to try to compete with each other on the same route – although there’s little of that happening in this area or, indeed across much of England. There’s little coordination, even less joint ticketing, and it leaves the less-profitable (mostly, but not exclusively, rural) routes poorly served – because it’s more difficult to make a profit on them – and at constant threat of withdrawal, with local transport authorities having to pay operators to run journeys on some routes that are socially necessary.

One example (of many) was Stagecoach’s October 2022 withdrawal of a whole swathe of services on which they were unable to make a profit, leaving the Cambridgeshire and Peterborough Combined Authority (our Transport Authority) to find operators to take on the routes, under contract, supported by public money.

Crucially, supported services are not allowed to operate on routes already covered by commercial services (except for short sections where there’s little or no alternative). Which explains, at least in part, why some routes might seem to take unusual routes or to begin and end in less obvious locations.

How will franchising change things?

The Cambridgeshire and Peterborough Combined Authority (CPCA) is our local transport authority, and has the ultimate responsibility for transport matters, including bus services, across the county. Franchising falls within its remit.

Bus franchising isn’t really franchising, as generally understood in the business world, it’s contracting. Crucially, though, it brings buses under local control. Keep those two ideas in mind and the concept immediately becomes much more approachable.

Under franchising, the CPCA will determine routes, frequencies and fares, then invite bus operators to bid for contracts to run those services. It is the chosen system for channelling increased funding into bus services, however, service improvements will depend upon funding levels, competent route design and oversight of service provision. If done well, it has the potential to improve reliability, bring greater coverage for rural communities, and deliver more consistent standards of service. Moreover, with all routes operating under contract the distinction between ‘commercial’ and ‘supported’services is swept away, so that routes can, over time, be reorganised to better serve the needs of local communities.

Private bus operators will no longer be able to decide when and where to run services, what fares to charge, nor, crucially, will they have the right to withdraw your local bus route.

Will this mean that we get services like London and Manchester?

No. Not only do Greater London and Greater Manchester have much larger populations – and, crucially, greater population density – than Cambridgeshire and Peterborough, but they use different franchising models, neither of which would be the most appropriate for our area. In a 2024 consultation, the CPCA proposed adopting the franchising model used in the Channel Island of Jersey, where…

Risk is shared through a minimum subsidy contract (managing down-side risk to the States) with the operator keeping fare revenue (providing up-side incentive to the operator). The up-side is also shared after a certain point with a profit-share arrangement, incentivising the States to take positive, pro-bus steps.

There are also financial penalties should the core service not be delivered to the agreed standard.

[Practical bus franchising – the Jersey model HCT Group, 2016, PDF, p13]

More detail for people who are interested

Is this a party-political issue?

Not really. All three Combined Authority mayors, to date, have shown support for franchising.

Post-deregulation, our bus network has shrunk drastically, leaving many of our rural communities with few public transport options; a decline which they all wish to see reversed.

The first mayor, James Palmer (Conservative) started the process to bring buses under local control, through franchising, building a ‘business case’ as required under the Bus Services Act 2017. Covid intervened, wrecking Palmer’s business case.

The second mayor, Dr Nik Johnson (Labour) resurrected and advanced this work. In February 2025, he exercised his powers to choose franchising as the best way to reform buses.

The current Mayor, Paul Bristow (Conservative, elected May 2025) said: “Franchising gives us the power to transform buses so they truly work for passengers and communities.”

When will we see franchising introduced in Cambridgeshire and Peterborough?

Mayor Bristow has established an independent review, chaired by Leon Daniels OBE to “… test how that [franchising] can happen, putting service improvements at its heart, while ensuring that it will be financially sustainable for the long term.”

Leon Daniels said: “The Combined Authority has a bold vision for the future of bus transport. If done right, bus franchising will support local growth and deliver sustained prosperity for the region. Collaborating with those operating in the bus sector will ensure we can identify a way forward that works for everyone.”

But isn’t there a new plan for trams or light rail?

The Cambridge Growth Company and Cambridgeshire and Peterborough Combined Authority have “launched the preparation of a Project level Strategic Outline Business Case for a potential Mass Rapid Transit (MRT) system for Greater Cambridge.”

This is the first stage of a process which involves:

  • a Strategic Outline Business Case
  • consultation
  • a Full Business Case
  • a Transport and Works Order
  • tendering for construction contracts
  • construction
  • procuring MRT vehicles
  • tendering for operators
  • testing and evaluation
  • launch of first route

In short: that’s a long time away. Moreover:

  • Many routes/areas are unsuitable for tramway/MRT lines.
  • Those routes/areas will need their bus services protecting and improving.
  • At many transport hubs bus and cycle interchange facilities will be required.
  • Bus franchising is essential for planning bus/MRT co-ordination.

Links to further reading and reference material.

Bus Franchising, Quality Partnerships, and other ways of improving bus services
[Cambridge Area Bus Users archived explanation dating from 2018-2019]