Nippy Bus (Somerset) folds?

[whole diary]

[stuving]

In principle, if you specify what you need exactly, and reject any bids that don't comply, you could reasonably take the lowest price bid and ignore any extras that were offered in it. Life isn't often like that, but it can come close, and of course comparing two numbers is relatively easy. However, I would hope that local authorities, who do a lot of contracting, can cope with assessing a range of other factors.

What is genuinely difficult is judging the credibility of a bidder, and justifying not believing their offer. I suppose that in theory it's their own loss if they get it wrong, and that should hold for big bidders. However, the existence of limited liability means it's not just their loss in the case of a small company'. And it's not unheard of for the boss of a small company to take a desperate lunge at landing a job as the last chance of avoiding failure.

[LiskeardRich]

For the financial repute element of holding an o licence for buses the operator is supposed to have an amount per vehicle in reserve funds. £4000 or £5000 I believe it is per vehicle. A council should be able to assume this is the case.

[JayMac]

The requirement of a bond from the operator could be written into the tender contract.

Won't prevent insolvency on the part of the operator, but could shield the LA from having to dip into their emergency contingency funding to organise short notice cover. 

[ChrisB]

Presumably in that case, operators go bust sooner, if they can't fall back on their bond?

By the time the council use this bond for relief buses, you're presumably at the same date as if the operator had spent their bond before going bust?

[JayMac]

Huh? I'm suggesting the contractor has to give the LA a bond. It won't be the contractors to use to stave off insolvency. These could be bonds similar to those required by the ATOL scheme.

The bond is there to protect the public purse from further unreclaimable expense.

[LiskeardRich]

the NippyBus N9 between Martock and Yeovil replaced First S&A (as then was) Service 52 over that route so it seems that things will go back to how they were but will incorporate the route of Service N8.

SWC had the 667 previously before loosing it to NippyBus on tender.

As for the 669 Frome Minibuses had it previously but haven't operated it since 12th June 2016 after which NippyBus took it over under tender from SCC^‡(resolve).

[ChrisB]

Huh? I'm suggesting the contractor has to give the LA a bond. It won't be the contractors to use to stave off insolvency. These could be bonds similar to those required by the ATOL scheme.

And I'm not querying that either.
Where do they get the funding from gfor this bond? Yup, their cash reserves, which are then depleted by the amount of the bond, and thus they have less cash to run their buses. Thus they go bust sooner.

The bond then covers replacement buses, and would probably expire (used p) by the time the company would have gone bust if there was no bond & they spent the same cash keeping their operation going that much longer. Swings & roundabouts.




Edit note: Quote marks fixed, purely in the interests of clarity. CfN.

[Bmblbzzz]

And if the operators were making a profit it wouldn't matter. That they don't is a symptom of wider problems in transport, public and private.

[ChrisB]

yup - we should pay more council tax so that these companies can make a profit.

[ellendune]

Huh? I'm suggesting the contractor has to give the LA a bond. It won't be the contractors to use to stave off insolvency. These could be bonds similar to those required by the ATOL scheme.

And I'm not querying that either.
Where do they get the funding from gfor this bond? Yup, their cash reserves, which are then depleted by the amount of the bond, and thus they have less cash to run their buses. Thus they go bust sooner.

The bond then covers replacement buses, and would probably expire (used p) by the time the company would have gone bust if there was no bond & they spent the same cash keeping their operation going that much longer. Swings & roundabouts.

The company might not need to put down the capital. Bonds can be bought a bit like an insurance policy. That would mean some companies would have to pay higher premiums than others - and some companies would be considered uninsurable. That would obviously then be factored into the tender, but then the tenders would all be on the basis of equal risk to the local authority and to the travelling public.  

I hope I corrected the quotes in my quote correctly



Edit note: Yes, you did. I've now corrected the quote marks in the previous post, too, in the interests of clarity. CfN. 

[ellendune]

yup - we should pay more council tax so that these companies can make a profit.

The problem seems to be that they do not make a profit at all - that is why so many of them are going bust!  And leaving the local authority to pick up the bill. 

[ChrisB]

hence my suggestion. the taxpayer shoulders the council's expenditure, whether through the initial contract or after they go bust.

[grahame]

From the Daily Mail - their angle:

Drivers hit out at 'disgusting' bus company boss 'who spent all his time in Thailand' after he sacked entire staff by telling them: 'I can't work with you a moment longer'

[chrisr_75]

Remarkably restrained and un-Daily Mail like comments section on that article so far! 

[Bmblbzzz]

yup - we should pay more council tax so that these companies can make a profit.

That might help Nippy Bus and other local bus operators, but what about ToCs? And although airlines don't get subsidies (at least in the conventional sense), the overall airline industry rarely if ever makes a profit.