First Group and Go-Ahead welcome government's extension to Covid-19 bus bailout from Grant Shapps

·2 min read
FirstGroup
FirstGroup

Public transport giants FirstGroup and Go-Ahead today welcomed the government's extra bailout of the UK bus network today after months of reduced passenger numbers due to Covid-19.

However, the two companies said their passenger numbers were still running below 50% of pre-covid levels, with FirstGroup only operating at about 40%. Both their share prices have fallen dramatically since the pandemic struck.

The Department of Transport has pledged a further £218 million for bus companies and light rail systems in England to keep them afloat ahead of what is expected to be a many months to come of low usage as passengers stay at home where possible.

On top of the eight week funding package, a weekly pot of £27.3 million is to be made available for as long as it is required.

The deal does not include London, where Transport for London is attempting to secure its own bailout.

Alongside the funding announcement, Transport secretary Grant Shapps announced plans to publish a National Bus Strategy, to set out ways to make the system economically viable going forward.

While there has been a pick up in travellers in recent weeks, the going remains slow for bus operators.

Go-Ahead chief executive, David Brown, said passenger numbers were still running below 50% of pre-covid levels across its networks despite communities returning to work and services reopening.

FirstGroup also welcomed the funding extension under the Covid-19 Bus Service Support Grant Restart programme, which was first launched in May, plus the continuing pledge for funding where needed.

"This commitment, on substantially the same terms as previously announced, demonstrates the value placed on bus services to support the restart of local economies, get people back to work and children back to school from September," the company said.

First said the first tranche of the programme had allowed the industry to increase its capacity levels while maintaining social distancing on board. First Bus's mileage has risen from 40% to nearly 90% of pre-Covid levels but passenger volumes were still only around 40%, compared wtih 10% at the low point.

First also welcomed the Scottish government’s announcement of an additional £68m to extend to 8 November its equivalent to the English bailout.

Commenting on the announcements, FirstGroup Chief Executive Matthew Gregory said:

"The further funding packages confirmed by the UK and Scottish Governments enable us to keep people travelling safely on our essential services, allowing social distancing to be maintained on our vehicles. Bus networks are vitally important to local economies, both now as people return to education and workplaces, and in the future as they offer a sustainable transport alternative to the car."

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