THINGS YOU SHOULD KNOW ABOUT YOUR
PRIVATE BUS OPERATOR STAGECOACH!

"Ethics are not irrelevant but some are incompatible with
what we have to do because capitalism is based on greed."

Brian Souter - Co-founder of Stagecoach

The story of Brian Souter and Ann Gloag from Perthshire in Scotland, who founded and own transport multinational Stagecoach, is celebrated as one of rags-to-riches success.

The two siblings bought second-hand buses with their father's redundancy payment, and within twenty years established one of the major transportation companies in the world, taking advantage of the privatisation of the National Bus Company in 1985.

Stagecoach now has a 16% share of the UK bus market, turnover of £1.5 billion and a group operating profit of £129.8 million.

Souter and Gloag are now 11th on the Sunday Times' Rich List for Scotland, worth £327 million. They also ranked 132nd in the UK Rich List.

The transport services owned by the group include:

        * Stagecoach local bus services in 60 cities, towns and rural areas in Britain,
          running 7000 vehicles in 16 regional companies
          - see: www.stagecoachbus.com

        * Megabus intercity bus services

        * The Oxford Tube service connecting Oxford with London

        * Southwest Trains, train services in south west England
          - see: www.southwesttrains.co.uk

        * A 49% share in Virgin Trains - see: www.virgintrains.co.uk

        * Island Line, the Isle of Wight train service, and Sheffield Super Tram3
          coach services in the USA and Canada (though some services have been
          sold in 2003) - see: www.coachusa.com

        * Ferries and buses in New Zealand - see: www.stagecoach.co.nz

Stagecoach has also operated bus services in Malawi and Kenya, which it sold in 1997/8.

Ruthless Business Practices

Stagecoach's success has been achieved partly with the help of business practices that have come under substantial criticism from regulatory bodies.

When local transport was deregulated in the 1980s, Stagecoach used many tactics to defeat its rivals and gain franchises, including temporarily flooding the market, with services which were often cut-price, or even free.

In Darlington in 1994, Busways (a Stagecoach company) succeeded in taking over the local authority's bus operation by running free services so that the local authority's company went into administration and Stagecoach's competitors removed their bid. The Monopolies and Mergers Commission (MMC) referred to these actions as 'predatory, deplorable, and against the public interest'.

On other occasions Stagecoach has been investigated by the MMC, when its acquisitions put it in a powerful enough position in local transport to endanger public interest. In Scotland, these have included Strathclyde in 1994 and Ayrshire in 1986.

When Britain's rail infrastructure was privatised, Stagecoach put in bids for every one of the 25 franchises up for sale, and won two of them.

According to John Mair, who produced a Granada TV World in Action programme about Brian Souter, "When the Conservatives offered up the opportunities for arch-capitalism he took them seriously".

In September 2004, a Residents' Action Movement in Auckland, New Zealand, wrote an open letter to Auckland Regional Council complaining about Stagecoach's high fares, despite public subsidies for public transport.

Abuse of Workers' Rights

Stagecoach has come under much criticism from trade unions over levels of pay and job security, including several strikes in recent years.

Stagecoach has also been criticised for its dubious attitude towards labour rights. In the 1980s, during a strike by East Midlands Bus Company workers relating to overtime, Souter threatened to bring in non-unionised labour and the union backed down.

At a 2002 strike by South West Trains workers, managers were brought in to replace station security staff, causing a security risk to passengers according to the RMT union and Souter threatened to fire 2,500 members of staff to end the strike, advertising for non-unionised staff to replace them.

At the 2003 Trade Union Congress, Bob Crow of the RMT union led a call for the right to take secondary action and accused Stagecoach of using 'scabs' from around Britain during a recent pay dispute in Devon. In this incident, one striker got his ankle broken when a 'scab' driver drove at the picket line.

Stagecoach workers in different parts of the company receive varying rates of pay, sick pay and leave entitlements, making it harder to organise coordinated campaigns by trade unions on working conditions throughout the company.

Poor Quality of Services

Privatised transport facilities have come under much criticism for prioritising profit over public transport needs, convenience and safety. One rail service particularly criticised for poor quality is South West Trains (SWT), run by Stagecoach.

Stagecoach has been fined for poor performance, the Advertising Standards Authority (ASA) judged that their literature misinformed about their ability to provide their services. Complaints by passenger groups include the running of short trains; the omission of scheduled stops; poor maintenance on trains leading to passenger discomfort and safety risks, including train fires; and the company receiving disproportionate profits, boosted by public subsidy (In 2003, subsidies for SWT rose from £50m to £170m).

Passenger groups suggest that 'Stagecoach's 8-year history of failure on SWT, and the worsening experiences of passengers, present the risk of a crisis...related to poor reliability, hopelessly inadequate capacity and passenger dissatisfaction'.

There are serious concerns as to whether a privatised rail system can fulfil public needs, or be accountable. Stagecoach appears to be a company where these concerns are especially valid since it explicitly follows tactics oriented towards profit, not transport users' needs.

Support for Homophobia

"We are asking another question about whether homosexual relationships have the same moral values as marriage." said Brian Souter on BBC news in 2000.

Brian Souter, encouraged by his evangelical Christian beliefs (he is a member of the Church of the Nazarene), uses his wealth and influence in an attempt to exert a political influence.

In 2000, he funded and led a campaign against the government's plan to repeal Section 28, the prejudicial and discriminatory law banning local authorities from 'teaching...the acceptability of homosexuality as a pretended family relationship'. This law effectively disabled teachers from dealing with homosexuality or tackling homophobic bullying, experienced by 77% of openly gay and lesbian school students.

Souter gave £500,000 to a campaign against the repeal of the law, which included a privately-run referendum. Despite the well-funded and promoted campaign, the government succeeded in scrapping Section 28 in 2001.

UK based First is Little Better!

First is a UK-based transport company with 60,000 employees in the UK and the USA, and a turnover of nearly £2.25 billion. It runs one in five local bus services in the UK, catering for 2.8 million passengers a day.

Chief Executive Moir Lockhead first joined Grampian Regional Transport in Aberdeen in 1985, later leading a management buy-out in 1989. GRT merged with Badgerline Groups in 1995 to form First. Lockhead, a leading Aberdeen entrepreneur, was ranked 22nd in the Sunday Times' 2002 Richlist for Scotland, and came 75th in a Scotsman report on Scotland's most powerful people. He has been given an OBE.

In 2004, First was awarded the franchise for ScotRail, the major rail network in Scotland, despite a warning by the Competition Commission that this might give the company too great a grip over transport in Scotland. There were also suggestions by the Conservative Party that Transport Minister Stephen Nicol, who approved the award, had his own interests in First.

Some of First's operations include:

        * UK Intercity rail services, including First Great Western, TransPennine
          Express and Hull Trains

          * London commuter services including First Great Western Link

          * Regional services in England including First North Western

          * ScotRail in Scotland - see: www.firstscotrail.com

          * GB Rail freight freight services

          * Croydon tramlink in London

          * Many local bus services in the UK

          * Services in North America including school buses (First Student) and
            vehicle maintenance (First Services)

Poor Working Conditions and Services

First's website promises: "Our vision is to Transform Travel ­ providing public transport services that are safe, reliable, high quality, personal and accessible".

The company makes much of its practices of corporate social responsibility, talking about customer choice and safety, and minimising environmental damage. Even so, First has had to deal with accusations of poor service and working conditions.

In July 2004, workers at First Bus in South Yorkshire went on strike against low pay, long hours, and poor working conditions. The company rejected the workers' ballot decision, threatening to take legal action against them, before a new offer was accepted the following month.

Following the end of the strike, First Bus in South Yorkshire decided to stop collecting union subscriptions, to the anger of the Transport and General Workers' Union.

There have been other strikes against First over recent years, including one in York in August 2003 over low pay.

In December 2004, First Bus was accused of failing to maintain coaches operating in the Lothians, and inspectors discovered more 210 defects on vehicles including faulty break systems and doors. Sixteen notices demanding immediate action, and 51 notices demanding action, has been issued to the company.

Vehicle inspector Douglas Pew suggested that "the company has failed to adhere to the agreed statute of its licence".

In January 2005, Greater Manchester Passenger Transport Authority (GMPTA) agreed to work with First after the latter reviewed its service, following complaints from passengers and criticism from the GMPTA for poor service.

In 2001, First Great Western was investigated by the Western England Rail Passengers Committee following large numbers of complaints concerning poor service and punctuality.

In 1999, First defended its profits rise despite being the operator of one of the trains involved in the Paddington rail crash of that year, insisting that profits were not being prioritised above safety.

The Skye Bridge

The toll booth is in darkness, the central lanes with the toll barriers are closed off, and the outside lanes are now open to free flow of traffic. It's a sight that campaigners have been fighting for since the toll bridge from the Isle of Skye opened in 1995, the local ferry mysteriously closed down, and the islanders found themselves forced to pay the highest toll fees in Europe.

By the end of 2004, crossing the Skye bridge cost £5.70 for a one way ticket. For nine years the islanders had been financial prisoners of the Bank of America, which acquired ownership and control of the bridge after it had been built under the UK's first PFI initiative, costing around £78 million more than independent estimates suggest it needed to.

The people of Skye had to pay a fee to an American bank every time they wanted to go to or from their island, although the costs of the bridge had already been met by the taxpayer and the European Investment Bank. Far from Westminster and national newspapers, out of sight, out of mind, Skye was the ideal location for launching a corrupt, unpopular initiative, in which private companies were granted monopolistic control over public works.

In 1997, before the election, the Scottish Labour party had promised, in a full page ad, to scrap the tolls as soon as possible. These promises were reneged on as soon as the party got into power, ministers announcing that scrapping the tolls would be 'impossible'. But the main campaign group, SKAT, refused to buckle under.

Made up of islanders and mainland supporters, SKAT describes itself as a non-political organisation, with members active in all political parties, or in none. "We fought the Tory Government, and now we fight the Labour one" said a SKAT spokesperson.

The issue of the Skye Bridge and its effect on our fragile economy unites all locally based political activists, says the group's website. Non-violent protests, with people paying the toll in pennies or with unmanageable giant cardboard cheques, continued. On 21 December 2004, the Scottish Executive bought the bridge back for £27m and abolished the tolls.

Despite widespread celebration, SKAT continues to campaign to remove the criminal convictions that some supporters received. Other issues are how much the Bank of America has made out of the deal, whether the islanders can recoup the toll fees, and what lies in store for the rest of Scotland's toll paying bridges, which people are now also seeking to challenge.

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