Bus fares to soar

The price increases, which could spread to some private hire taxi firms, are also being blamed on too many bus companies chasing falling passenger numbers.

The fare rise was criticised by council bosses and MPs, who said companies already receive a fuel costs rebate from the government and the move would not encourage people onto public transport.

Some small bus companies have already increased their average fares by up to 10p, and Blackburn Transport today revealed it will be putting up its fares by around 4.5 per cent, almost double the inflation rate of 2.9 per cent.

The current price of oil stands at $34 (£21.18) a barrel, after a $6-8 rise due to the impending war with Iraq. Diesel has risen by 8p a litre since the beginning of the year and looks like it could increase further, if Iraq is invaded.

Although train companies cannot increase their fares because the government sets levels, many private taxi drivers have said they will have no choice but to increase fares if fuel costs rocket.

Michael Moreton, of Blackburn Transport, operates a fleet of 107 buses. He said his passenger numbers had grown by three per cent in two years due to easier access buses. He said they were due to increase fares on March 10, but they had put it back while they calculated a higher figure.

He said: "The rise will be phenomenal, well above the rate of inflation, something in the region of 4.5 per cent. Other companies have had an interim increase but we are waiting to give just one increase.

"In the last two years insurance has gone up by 120 per cent. This has had a profound effect on our running costs. When coupled with increased fuel costs and increased wages we have had to put up our fares. Claims have increased and so premiums have risen."

Robert Tuffnell, of Hyndburn's M&M buses, said: "Our insurance premiums have nearly doubled from around £40,000 to £75,000. There seems to be this litigation culture where people force up the cost of insurance. We nearly had to stop working because we couldn't get a company to insure us.

"We put 5p on the average fares last year, but if the cost of fuel goes up we can't afford not to increase our fares. Costs of also risen due to things like vandalism.

"There are too many buses chasing too few passengers. It is competition and there will be winners and losers I suppose."

Duncan Allan, Commercial Director for Lancashire United and Burnley and Pendle Transport, said: "We increased our fares in September by seven or eight per cent, so they went up by five or ten pence. We have no plans to increase our fares again, but if the cost of fuel increases we will have to pass the cost on to the consumer.

"We are here to make money and run a bus, we don't want to run at a loss."

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Pilkington's Coaches has a fleet of 30 buses with 20 running on services across Hyndburn from Accrington. Alan Pilkington, partner, said they have already increased fares by an average 10p on February 1 and will have to increase again if fuel rises continue. There was a change in legislation that meant we have to insure all of our fleet, instead of the 20 that are running. We can't afford to do that. We'll probably have to sell some of them."

Dave Law of Hyndburn Borough Council said: "If Pilkington's do this, and it is a matter for them, I can see that it could affect services."

Although hackney carriage taxi fares are set by borough councils, private hire companies can set their fares.

Duncan Alan, of Burnley and Pendle Private Hire Association, said: "We aren't looking to increase fares at the moment but if something happens in Iraq and the cost of fuel trebles we would have to look at it."

Abdul Shakoor, chairman of Burnley and Pendle, Hackney Carriage Association, said: "The price of diesel has been going up and that was why we got the council to increase fares from £1.60 minimum to £2. But a lot of the drivers are worried and we are thinking of going to the council again if it goes up further so we can get another increase." Mohammed Sarfraz, of Saf's Euro Taxis, in Clitheroe, said: "We are considering it if the price of fuel goes up any more, as we serve more of a rural community we arguably use more fuel."

Coun Andy Kay, executive member for regeneration, of Blackburn with Darwen Borough Council, said: "The people to suffer most will be the users. However, this is a highly competitive market and some may find it more difficult to compete than others.

"All registered local services are eligible to claim back from the government 36p for every litre of fuel they purchase".

Richard Frost, executive member for planning, environment and transport at Burnley Council said: "I would not support them putting up fares in a speculative manner, but if they did rise because of what's going on in Iraq that is different.

"We should be encouraging greater use of public Transport and making them more expensive isn't something we would support."Burnley MP Peter Pike said: "I think that we should keep fares as low as possible. The Chancellor is going to have to look at a number of issues in the next budget, including fuel duty. I will make representations to him on that.

"If we want people to move to public transport we must try to make sure it is as cheap as possible." Ribble Valley MP Nigel Evans said: "The Chancellor needs to think carefully and not raise duties on fuel. This has a cost to the travelling public and I have raised this issue with a Cabinet minister."

A spokesman for LCC said: "We would first have to consider the effect that any loss of services would have on the whole transport network before we would consider putting into place any alternative measures."