‘Bus privatisation grab’

Bus companies say the government needs to make public routes more relevant to needs. 180585_01.

By Kath Gannaway

McKenzies and Martyrs bus services are among a number of locally owned bus companies fighting to retain their assets, and potentially ownership of their companies, under a proposal put by the State Government as part of negotiations of public bus route contracts.

The Bus Association Victoria (BAV) and local operators have accused the State Government of “acquisition by stealth”, claiming all three options offered to them as their contracts come up for renewal involve selling off their assets including buses, staff and intellectual property.

Chris Lowe, Executive Director of the BAV, said the government has told nine small to medium family business bus owners out of the 13 that operate in Melbourne that new five, seven or 10 year contracts on offer are contingent upon the companies agreeing to transfer assets on a varying scale.

Brad Sanders, General Manager of McKenzies Bus Services, has been representing McKenzies, Martyrs and Panorama Coaches that operate out of Diamond Creek, in the negotiations.

“Depending on the contract period the government wants access to new buses and staff and to intellectual property – that is the know-how of how we run our businesses,” he said.

Minister for Transport, Jacinta Allan, has rejected the claims saying the changes are about putting passengers first and providing buses where people want to go.

She said the government had successfully negotiated with two thirds of the industry and would continue to negotiate with other providers to ensure they get a fair deal.

She denied there is a compulsory acquisition of assets saying operators can choose 10 year contracts that include the government purchasing at market value strategic assets, buses and depots, or they can choose five or seven year options where they keep their existing assets.

She said the purchase of assets was so contracts could be put to market at the end of the 10 year contracts and the assets could be used by future operators.

BAV Executive Director, Dr Chris Lowe, said while that explanation was partly true, it was also partly irrelevant with the five and seven year options enabling operators to keep the depots and buses they own at the commencement of the contracts but with staff subject to offers from the government or its nominee at the end of the contracts.

“The operators will procure their own buses during the contract with their own money but will be contractually obliged to transfer them to the government at the end of the contracts.

“For smaller operators these replacement buses could be a quarter, third of half of their fleet, meaning good-bye business,’ he said.

Mr Sanders told the Mail the government wants contract signed by 29 June.

“If we sign the contract, we have to sell,” he said.

“In 10 years’ time I would like to think that we can keep going, and not be taken over.”

In answer to Ms Allan’s statement that passengers deserve a better service, Mr Sanders said the government holds the reins in terms of where public services run.

“We can do it better if they give us the ability to do it,” he said.

Dr Lowe concurred saying operators are contracted to do what the government directs them to do.

“What the government needs to do is change the bus routes so they are more responsive to the community needs.

Eildon MP Cindy McLeish said she is outraged at the proposal saying local bus companies had invested heavily in their businesses.

“When you look at the bus lines we have here and what they have put into making them successful businesses, and establish good will.

“They are not investing to the government can take over and sell them off,” she said.

Labor candidate for Eildon, Sally Brennan, said Eildon communities relied heavily on buses for public transport.

“It is vital that our bus services meet the emerging and changing needs of travellers and commuters,” she said.

Ms Brennan said she was pleased that the government was looking at modernising contracts with bus operators to sort out the declining bus use in the city but said it was important, with services in the Yarra Valley regarded as metropolitan, that the unique transport needs are recognised.

“I will work with the government and bus operators to ensure that the public transport needs are met, and that the values and services that underpin our locally owned and managed bus services are maintained,” she said.