August 25th, 2009
Bus operators to be probed over high fares – The Office of Fair Trading (OFT) today announced that it is referring the local bus industry to the Competition Commission over concerns that passengers are being charged unfair, high prices. A five-month investigation into the £3.6 billion bus sector by the OFT found evidence of limited competition that may have led to "higher prices for bus users", prompting the referral to the Competition Commission for a more detailed investigation.
The bus industry is dominated by a small number of companies with a monopoly over local routes. A series of takeovers has led to increasing concentration in the sector, with almost two thirds of bus services controlled by only five large operators: Arriva, Stagecoach, Go-Ahead, First Group and National Express. The OFT said it had received a “substantial volume” of about 30 complaints of “predatory” behaviour by existing operators “designed to eliminate competition” from new entrants to the market.