STAGECOACH and Go-Ahead Group, the independent bus operators that have grown rapidly by acquisition, were yesterday rapped over the knuckles by the Monopolies & Mergers Commission for predatory behaviour and acting against the public interest in the North East of England.
Both companies were unrepentant and said they intended to lobby the office of fair trading to ease the conditions imposed on them to stop unfair competition in the future.
The commission's report, which found a scale monopoly existed in favour of Stagecoach and Go-Ahead in the reference area, branded Stagecoach's actions in Darlington "deplorable".
Stagecoach Busways recruited most of the drivers of the ailing Darlington Transport Company, registered services on all its routes and then ran free services causing the sale of the municipal bus company to fall through and the company to collapse, the commission said.
Stagecoach Busways managing director John Conroy hit back saying the company's actions were "legitimate and proper" and reflected a genuine desire of the former DTC employees to work for Stagecoach.
Jonathan Evans, competition and consumer affairs minister, accepted the commission's findings and asked the office of fair trading to seek undertakings from Stagecoach and Go-Ahead that they would maintain fares and frequencies for three years after a competitor withdrew from a route, if their lower fares or increased frequency had forced the competitor off.
Martin Ballinger, managing director of Go-Ahead, said the commission had totally disregarded the views of established operators. It encouraged companies with aged vehicles and badly paid employees to compete against Go-Ahead which has invested heavily in the industry, he said. "The government has got to make up its mind what it wants."
The minister strengthened the commission's recommendations, when he imposed the three-year rule on Go-Ahead as well as Stagecoach. The commission came down in favour of a 12 month fares and frequencies freeze for Go-Ahead.
The commission, which has conducted many bus inquiries since the industry was deregulated in 1986, said the existing machinery was too cumbersome and there needed to be a more responsive regulatory authority.
Mr Ballinger agreed, saying traffic commissioners on the ground should deal with localised issues.
