CC proposals for First bus price controls in Scotland

Competition Commission provisional decision (34 pages, PDF) to vary the terms of the price controls applied to some of FirstGroup's bus operations in Scotland following its acquisition of S B Holdings. The Competition Commission had refused in November 2007 to terminate these controls.

This does not affect the separate controls on First's Scottish bus operations put in place following First's acquisition of the Scotrail passenger rail franchise.

The Competition Commission summarises its proposals as follows:

allow fares to increase so that revenue rises by no more than whichever is the lower of the CPT (Scotland) index and the CPT (GB-wide) index;

allow a catch-up adjustment in revenue for each of First Glasgow and First Edinburgh that reflects the difference between revenue and cost (including weighted average cost of capital);

allow First to spread the catch-up adjustment across an indefinite period; and

rebase the mileage floor (which applies only to First Edinburgh) to 75 per cent of 2002 mileage.

Short consultation period: Responses by Friday 7 March 2008.

For further information or advice please contact Franck Latrémolière.

Filed under Competition Commission, Price controls, Public transport.

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