Municipal buses in Swindon, 1927-2017, RIP

A Thamesdown Transport bus in central Swindon
A Thamesdown bus passing through Emlyn Square
Swindon Borough Council has provided public transport services in Swindon since 22 September 1904. Initially these were tramways, but starting from 1927 bus services were introduced, replacing the trams between 6 May and 11 July 1929. Legislation to deregulate bus services in 1986 brought significant changes, with Thamesdown Transport incorporated as a limited company at “arm’s length” from Swindon Borough Council — though at times that arm was rather short. But Swindon was unusual, in that its municipal bus operator remained in public ownership. That has ended in 2017. Thamesdown Transport has been sold to Go South Coast — part of the Go Ahead Group which also owns Salisbury Reds and Oxford Bus Company, and part owns the infamous Govia Thameslink Railway.

Thamesdown Transport profit and cash flow
Profit and cash flow of Thamesdown Transport, 1994 to 2016, adjusted for inflation. Underlying figures exclude one-off payments for pension liabilities and depot sale and purchase.
Swindon council claims to have sold its bus company because the company is making unsustainable losses in “difficult trading conditions”. Thamesdown Transport has been unprofitable — losing almost £1.5M in the last five years — and has been propped up twice by the council in that period. In 2012 the council took on the company’s pension liabilities to the local council pension scheme, the bus company receiving £1.5M in return for paying an ongoing fee to the council. In 2014 the council bought and leased back the company’s Barnfield depot in 2014, injecting £2M into the company. But a review of the company’s published accounts suggests that it is cash flow rather than profitability that’s the problem. The sale and lease back of the Barnfield depot appears to have been in response to a lack of cash, rather than unprofitability, with the accounts showing the company had less than £10,000 in the bank at the end of March 2014. And expected results for this year — reportedly a loss £149,000 — show smaller losses than in some recent years.

Thamesdown Transport revenue
Revenue for Thamesdown Transport, 1994 to 2016, adjusted for inflation.
So what brought Swindon’s municipal bus company down? An ongoing theme in the chairman’s report to the annual accounts is the cost of servicing liabilities to the Local Government Pension Scheme, and this has remained even after the re-arrangement of the liability in 2012. Another theme in recent years has been a downturn in bus travel to-and-from Swindon town centre — always the most profitable part of the company’s bus services. The annual reports do not give reasons, but the stalled regeneration of the town centre and congestion in central Swindon caused by major roadworks are both well known to local residents for many of whom the town centre is now only a destination of necessity rather than one of choice. Not surprisingly the chairman — in recent years always a councillor or ex-councillor from the controlling group on the council — makes no mention of the impact that a reduction in car parking charges by the council may have had. The bus fleet has aged too: in 1996 the company chairman reported that ⅓ would be less than three years old; by 2017 only 4 out of 88 serviceable buses were less than three years old. Recent annual reports comment on the increased costs of maintaining that ageing fleet. Competition from Stagecoach is rarely mentioned, but cannot have helped, as that company has consistently held its suburban return fares at a lower level than Thamesdown and has actively competed on routes to west and south Swindon. Another contributing factor may have been the loss of developer contributions to buses serving new housing developments — hit by the severe downturn in house building since the 2008 credit crunch.

Thamesdown Transport and its depot have reportedly been sold to Go South Coast for close to their book value — almost £7M for the company and £4M for the depot. What we don’t know is whether the deal also frees the company of its remaining pension liabilities to Swindon Borough council for the Local Government Pension Scheme, or whether that will now be picked up by Swindon tax payers.

Full disclosure: the publisher of komadori’s green corner is a minor shareholder of both Go Ahead Group and Stagecoach Group.

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