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The QCS Board has issued (3 November 2015) the first ever decision on a proposal for bus franchising through a Quality Contract Scheme as envisaged by the Transport Act 2000.  The QCS Board was asked to review a proposal for a 10 year QCS for Tyne and Wear for compliance with the statutory criteria on consultation and the public interest which are set out in the Act.  The proposed QCS would have seen buses in Tyne and Wear franchised at an operating cost of £1.6 billion.  The QCS Board found that Nexus had failed to comply with the statutory consultation requirements such that consultees were potentially misled by errors in the material which portrayed the value for money of the proposed franchising scheme as superior to the operators’ alternative partnership proposals - and there was evidence that consultees were so misled.  The QCS Board was not satisfied that the proposed QCS was affordable or indeed  economic, efficient and effective as required by the Act.  Finally, the QCS Board had no hesitation in concluding that the negative impacts on bus operators were wholly disproportionate to the benefits to bus passengers and citizens of Tyne and Wear.  The decision will have important implications for the future of bus regulation in the UK.

The bus operators in Tyne and Wear potentially most affected by the proposed scheme were Go North East Ltd and Stagecoach Group plc.

Alan Maclean QC was Counsel for Go North East Ltd.

Naina Patel was Junior Counsel for Stagecoach Group plc.