68.Part 5 amends statutory provisions relating to certain duties and powers of local authorities in relation to bus services.
69.Section 34 amends section 66 of the 1985 Act to exclude local authorities in Wales from the restriction, imposed by that section, in respect of the provision of local bus services by a local authority. (This does not affect the fact that, in order to provide a local bus service that is subject to the restriction in section 23, a local authority will need to have been granted a local bus service contract or local bus service permit.)
70.Where local authorities wish to run bus services commercially, they will need to establish a company, and it is expected that they will rely on the general power of competence (“GPOC”) contained in section 24 of the Local Government and Elections (Wales) Act 2021 to do this.
71.The amendment made to section 66 of the 1985 Act does not affect the two local authority bus companies (”Cardiff Bus” and “Newport Bus”) operating in Wales (by virtue of certain exceptions to the section 66 restriction) prior to the amendment to section 66 coming into force. These companies were formed under section 67 of the 1985 Act, subject to requirements set out in sections 73 to 79 of the 1985 Act, and the Act does not make provision in relation to these requirements. However if a local authority providing local bus services through a bus company existing before the coming into force of the amendment to section 66 were to establish new companies to provide bus services, after the coming into force of that amendment, the requirements set out in sections 73 to 79 of the 1985 Act would not apply to those new companies.
72.Although this is not mentioned in the Act, sections 67 to 73 of the Local Government and Housing Act 1989 and the Local Authorities (Companies) Order 1995 will apply in relation to any companies established by local authorities under GPOC for the provision of bus services, once the section 66 restriction has been removed (including to any new companies formed by local authorities that were providing local bus services prior to the amendment to section 66 coming into force, as discussed above).
73.Section 35 amends section 63 of the 1985 Act. The effect of the amendment is that the requirement imposed by that section (for a county council to secure public passenger transport services that it considers are needed to meet transport needs within the county, where those needs would not otherwise be met, for instance where there is service failure or where services are not delivered to the appropriate standard) will not apply to a county council or county borough council in Wales so as to require it to secure a service that is a local bus service. It is envisaged that, under the system established by the Act, where local authorities in Wales wish to provide a local bus service, they will rely on GPOC to do so (and, unless the service in question is outside the restriction in section 23, a local bus service contract or local bus service permit will be required in respect of the service).
74.Section 36(1) provides local authorities with the power to give financial assistance in connection with the provision of a local bus service. The effect of section 36(2) is that the requirements in sections 89 to 92 of the 1985 Act do not apply to financial assistance given under subsection (1). This does not however exempt local authorities from existing statutory constraints regarding the provision of subsidies contained in the Subsidy Control Act 2022 or any applicable future statutory constraints regarding subsidies. Section 36(3) also amends section 63(9) of the 1985 Act. The effect of the amendment is that local authorities are not able to promote local bus services, using their power under section 63(6)(a), that have been subsidised under section 36(1) of the Act.
Commentary on Sections Part 5 - Local Authority Powers and Duties