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This Memorandum refers to the Transport Bill as amended at consideration stage in the Northern Ireland Assembly on 24 January 2011 (Bill 29/09)

TRANSPORT BILL

EXPLANATORY AND FINANCIAL MEMORANDUM

INTRODUCTION

1. This Explanatory and Financial Memorandum has been prepared by the Department for Regional Development in order to assist the reader of the Bill and to help inform debate on it. It does not form part of the Bill and has not been endorsed by the Assembly.

2. The Memorandum needs to be read in conjunction with the Bill. It is not, and is not meant to be, a comprehensive description of the Bill. So where a clause or part of a clause or schedule does not seem to require an explanation or comment, none is given.

BACKGROUND AND POLICY OBJECTIVES

3. The main purpose of the proposed Bill is to create an effective, efficient and sustainable public transport system that contributes to the Executive’s transportation, environmental, social inclusion and equality objectives.

4. This will be achieved through the introduction of new service delivery arrangements that will enable the Department to contract with public transport operators while ensuring compliance with EC Regulation 1370/2007. This will include powers to award contracts for Bus Rapid Transit.

5. Under the Transport Act (Northern Ireland) 1967, the Department of the Environment is responsible for granting Road Service Licences for the carriage of passengers and their luggage by road. This licence includes both an operator element and a route/service element. This Bill amends the definition and function of the Road Service Licence to a Bus Operator’s Licence which will remain the responsibility of the Department of the Environment. The Department for Regional Development will become responsible for public transport service delivery through the contracting and service permit systems which will be introduced in this Bill.

CONSULTATION

6. The Department held a public consultation on its public transport reform policy proposals between 9 November 2009 and 5 February 2010. There were 103 written replies received. Eleven public meetings were held during the public consultation period, with a total of 194 attendees.

7. The Department carried out a public consultation on the Bus Rapid Transit policy proposals between 23 November 2009 and 19 February 2010. There were 36 written replies received.

OPTIONS CONSIDERED

8. An Outline Business Case was produced which evaluated three options for the revised organisational arrangements that will deliver and sustain the reforms. The three options were:-

9. The three options were evaluated against monetary and non-monetary criteria. It was concluded that the agency option offered the best overall value for money because:-

10. A review of the Outline Business Case was then completed which updated the proposed Agency costs and benefits, reviewed the efficiencies achieved by Translink and provided an updated comparative efficiency of the Translink companies benchmarked against other operators.

11. In respect of Bus Rapid Transit a strategic outline case (SOC) was completed in February 2008. The SOC demonstrated the feasibility for the proposed pilot Rapid Transit network in the Belfast Metropolitan Area and was endorsed by the Executive in November 2008.

OVERVIEW

12. The Bill will contain the necessary powers relating to the regulation of public transport service delivery in Northern Ireland. It covers the duty of the Department to secure the provision of public passenger transport services, the power to enter into agreements and to award service permits for that purpose, the ability to attach conditions to and vary a service permit along with powers for the revocation, suspension and curtailment of service permits. It creates offences and provides enforcement powers in respect of the contracting/service permit regime. The Bill provides power for the Department to regulate fares, designate bus stations/premises as shared facilities, regulate passenger conduct in bus premises, provide integrated and on-street ticketing systems, make grants for the provision of bus services of benefit to certain sections of the public, acquire and dispose of land, provide vehicles and facilities for public transport purposes, and exploit commercial opportunities arising from its public transport functions.

13. The Bill has 49 clauses and 2 Schedules. A commentary on the provisions follows below. Comments are not given where the wording is self-explanatory.

COMMENTARY ON CLAUSES

Clause 1 imposes a duty on the Department to secure the provision of public transport services in Northern Ireland and provides mechanisms for the Department to do so through service agreements and service permits for public transport services, and agreements for services ancillary to the provision of public transport services. It also allows the Department to determine the general level and structure of fares for these services, to provide vehicles, ticketing machines and systems, and to exploit any commercial opportunities which the Department considers appropriate. Most public passenger transport services will be awarded directly to the Northern Ireland Transport Holding Company and its subsidiaries, as the publicly-owned internal operator, under a service agreement in compliance with EC Regulation 1370/2007. This clause also creates an offence to operate unregulated services.

Clause 2 deals with service agreements in more detail. It provides the Department with the power to make regulations as to the content of service agreements. It also provides that service agreements can include the award of “public service contracts” in accordance with EC Regulation 1370/2007 and allows the Department to make provision for the review of decisions made in respect of the award of service agreements, as required by the Regulation.

Clauses 3 to 12 deal with the process for granting service permits. These clauses provide for the information that an applicant will have to furnish in the application, the matters to be taken into account by the Department when considering an application, the attachment of conditions to a permit, disqualification of operators from being able to hold a permit, and the revocation, suspension and curtailment of permits for any reasonable cause and other specified grounds as outlined.

Clauses 13 deals with the payment of fees for permit applications and issuing of permits.

Clause 14 provides that permits are neither transferable nor assignable. It also allows the Department to make directions for the treatment of permit in circumstances where the permit-holder dies or becomes a patient under the Mental Health (Northern Ireland) Order 1986.

Clause 15 allows the Department to make regulations to provide that service agreements with and service permits held by a company or other body corporate also applies to services provided by any of its subsidiaries.

Under clause 16, it will be an offence to forge, alter or use a permit with intent to deceive. It will also be an offence under clause 17 to knowingly make a false statement or produce false or misleading material in relation to an application for a service permit.

Clauses 18 to 21 deal with the separation of bus operator and bus service licensing. Clauses 18, 19 and 20 amend the function and name of the “Road Service Licence” in the Transport Act (Northern Ireland) 1967. Clause 21 deals with amendments to the Taxis Act (Northern Ireland) 2008 as a result of the changes to the current “Road Service Licence”.

Clause 22 amends the duty of Northern Ireland Railways under section 55 of the Transport Act (Northern Ireland) 1967 to reflect that this duty will be exercised in accordance with any agreement entered into under this Act.

Clauses 23 and 24 provide arrangements for the production by the Consumer Council of a forward work programme in relation to its transport functions and for the production of a memorandum by the Department and the Consumer Council detailing arrangements for co-operation and consistent treatment of matters in relation to the Consumer Council’s transport functions.

Clauses 25 to 31 set out the provisions on the enforcement of the provision of public transport services. The Department will have the power to enter into and inspect certain premises that are being used in connection with the carriage of passengers and their luggage by road and to seize certain documents and to obtain certain information. It will be an offence to obstruct an authorised officer in the exercise of functions under the Act. Clause 31 provides for prosecutions for offences under this Act.

Clauses 32 to 37 deal with the payment of grants by the Department in relation to the provision of public transport services, provision of advice, information or training relating to public transport services and capital expenditure for the purchase of vehicles.

Clauses 38 to 40 provide for the acquisition and disposal of land, including powers for the Department to obtain information as to ownership of land and to enter onto land.

Clause 41 applies section 18(2) of the Interpretation Act (Northern Ireland) 1954 to appointments to the Northern Ireland Transport Holding Company made under section 47 of the Transport Act (Northern Ireland) 1967 to include power to remove or suspend persons from appointments under this section.

Clause 42 provides the Department with the power to make regulations in respect of the conduct of persons at bus stations.

Clause 43 gives the Department the power to issue directions in respect of the shared use of facilities used for the provision of services under a service agreement.

Clauses 45 to 49 contain a number of miscellaneous and supplementary provisions, including powers to make regulations.

FINANCIAL EFFECTS OF THE BILL

14. The staffing costs of the new public transport agency are expected to be around £3.6m, of which more than £2.3m would be covered by the transfer of existing resources within DRD. The additional £1.3m is in relation to new functions, mainly in relation to local public transport planning and the EC Regulation 1370/2007 requirement for contracts. This additional expenditure is necessary to create the structures through which longer term efficiencies and improved services will be achieved and sustained.

15. The Strategic Outline Case for Bus Rapid Transit identified three pilot routes for the Bus Rapid Transit system in Belfast, at an estimated cost of £147m.

HUMAN RIGHTS ISSUES

16. The provisions of this Bill are compatible with the Convention on Human Rights.

EQULAITY IMPACT ASSESSMENT

17. An Equality Impact Assessment (EQIA) was completed in respect of the Department’s proposals and included in the policy consultation pack. The Equality Impact Assessment concluded that there was no need for any mitigation or adjustments for section 75 groups in the general population as any potential impacts identified were positive. A further analysis of the staffing profile for NITHC/Translink compared to the NICS, carried out to consider any potential equality implications in the event of a need to transfer staff into the new Agency concluded that, although there was the potential for differential impact in terms of gender, there were no significant impacts on any section 75 groups.

18. The proposals for Bus Rapid Transit were included in both the Regional Transportation Strategy and the Belfast Metropolitan Transport Plan, both of which were the subject of Equality Impact Assessments. Following an Equality Screening of the policy proposals for Bus Rapid Transit, the Department concluded that an Equality Impact Assessment of the proposals to introduce enabling powers was not required. The Department proposes to carry out a full Equality Impact Assessment prior to the implementation phase of the project.

SUMMARY OF THE REGULATORY IMPACT ASSESSMENT

19. A Partial Regulatory Impact Assessment was completed in respect of the Department’s public transport reform proposals and included in the policy consultation pack. The Partial Regulatory Impact Assessment concluded that the reforms should generally have a positive impact on bus operators through the potential to participate in the development of local public transport plans and by enabling licensed private operators to get access to bus stations. Similarly bus passengers will benefit in the longer term from improved accessibility to customer information on all services and through access to shared facilities. A full Regulatory Impact Assessment will accompany the Bill at Introduction.

20. No immediate impacts have been identified in respect of the Bus Rapid Transit proposals. It is, however, proposed that a further regulatory screening exercise will be undertaken prior to the implementation phase of the project.

LEGISLATIVE COMPETENCE

The Minister for Regional Development had made the following statement under section 9 of the Northern Ireland Act 1998:

“In my view the Transport Bill would be within the legislative competence of the Northern Ireland Assembly.”