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4.0 DRT Market Opportunities

4.1 DRT should form part of an overall transport and accessibility plan and the development of particular market niches should be defined clearly in transport planning e.g. the strategy for dial-a-ride services for persons with mobility impairments and conventional taxis for people who need a premium service.

4.2 DRT markets overlap so the development of one market may transfer trips away from others. This process needs to be managed explicitly to ensure that costs and benefits are allocated correctly to public agencies.

4.3 This chapter therefore looks at the future markets for:

• Premium services in Scotland - This includes conventional taxis, and premium taxi-bus style services, funded by users through premium cost fares.
• Best value public transport - This includes supported services funded through user fares and transport funding, and providing alternatives to conventional bus routes for different users and / or locations ( e.g. dial-a-ride services)
• High value to agency services - This includes services purchased largely to meet some specific non transport aims.
• High care needs services - Particularly the relationship between patient transport, social services transport and other high care needs.

Premium Services

4.4 DRT is long established as a service through which users pay a premium for personal door-to-door travel through the conventional taxi and private hire market. There has been little diversification away from this core role yet there appears to be potential for the market to develop.

4.5 One successful area of growth has been for airport transfer services which appear to combine enough attributes to grow their market as a result of high quality door-to-door operation for people with luggage to carry. Further growth of this market can be expected.

4.6 Similarly, although to a lesser extent, their may be local markets for rail feeder services and even coach feeder services.

4.7 Commercial taxibus DRT has not been proven successful in any area where it has been tried in the UK and has only been profitable elsewhere when other forms of transport have been of limited availability e.g. where conventional taxi availability cannot cater for all of the demand. The lessons from the Stagecoach pilot in east central Scotland are that similar markets exist in Scotland, particularly late at night when taxi supply is limited.

4.8 To build on the Stagecoach trial there may be opportunities for commercial DRT development to be explored further through Bus Route Development Funding applications.

Stimulating the Taxi Market to innovate

4.9 It is surprising that despite having the option to deliver DRT services to offer competition to public transport this has not happened. It may be that there is no market but there are several factors which could have been restraining growth of this market:

• Local registrations for taxis within small local authority boundaries, combined with concern about cross-boundary operation
• Associated limitations placed on the number of licences issued
• Lack of co-ordination within the sector

4.10 One option to overcome these problems might be for taxi licensing to be transferred to regional authorities in the future. The benefits of restricting numbers of taxi licences continue to be reviewed. These issues would require a more detailed analysis of taxi provision and policy than has been undertaken for this study.

Best Value Public Transport

4.11 The option of developing rural DRT solutions as alternatives to increasingly unsustainable subsidies on poorly used rural services is appealing. The ability to compare costs of fixed and flexible services in rural locations as part of this review has been constrained by lack of data. However the pilots could not have been expected to provide much detail on the types of area where best value can be obtained and in principle there are major benefits to be secured with wider network coverage for lower funding.

4.12 The role of DRT in delivering a best value solution for local authority supported transport can only be fully understood and explored through a review of the local subsidised network and this should be an essential function within local transport strategies and best value reviews.

4.13 Local authorities often set limits, beyond which they will not fund, on the level of subsidy per passenger trip. However, it is important when supporting services to define 'socially necessary' in terms of social need as well as financial cost.

4.14 Public services operate on the basis of charging bus equivalent fares and concessionary fares. However an authority replacing many fixed services with DRT could face funding problems since re-imbursement for concessionary fares for DRT will generally involve additional costs for the operators associated with the demand responsive mileage.

4.15 There is the related issue that free concessionary travel is being made available for fixed public transport and it would not be equitable if this were not to be available for those who cannot use fixed services and who use existing DRT services. There are therefore very substantial costs for funding DRT in Scotland associated with the roll out of the free concessionary travel scheme. In addition, it should be recognised that a large increase in funding for community transport operators will be needed to ensure that this sector can continue to thrive as the largest provider of Scottish DRT services.

4.16 Perhaps more serious is the issue of how much service provision should be provided to cope with the generated demand from free travel e.g. dial-a-ride for disabled people. The current proposals for the free concessionary travel scheme in Scotland identify that scheduled services will be eligible, but how the scheduling will be specified in relation to DRT network coverage by time of day and area is not yet clear. Specifically, if concessionary fare reimbursement covers the market cost, then there would be nothing to stop a DRT operator continuing to expand provision and sending the bill to the concessionary fares budget.

4.17 However to exclude DRT from free concessionary fares would not be equitable since fixed services neither have comprehensive coverage of geographical areas nor provision for all levels of disability. Perhaps a taxicard type payment mechanism could be developed so that users can choose how they ration their DRT trips over the year. To ensure equity, the trip allowance would need to be shown to compare with the benefits being experienced by equivalent fixed service users.

High Value to Agency Services

4.18 Local authority provision of specialist DRT for the Education and Social Services markets is well established and currently utilises a wide range of providers including; internal provision; taxi sector; commercial bus operators; and the community transport sector.

4.19 Although it is established best practice ( e.g. Audit Commission 2001) to promote co-ordination between the different provision, progress has been slow. Overcoming cultural and employment related barriers is a formidable challenge but one that needs to be tackled. It is clear that incentives are needed for staff to take on the difficulties associated with joint working. These could be both positive funding opportunities for best practice and a more cross sectoral approach in best value reviews.

4.20 It should rarely be necessary for non transport agencies to fund services in their entirety, as has happened in Lanarkshire, but funding contributions to recognise the value to other agencies of transport investment has the potential to significantly enhance the funds available for DRT development. There should be a general expectation that transport planners will be looking beyond transport funding to deliver DRT services.

High Care Needs Services

4.21 General public transport provision, to health and other services, is the statutory responsibility of local transport authorities. It covers fixed public transport and some DRT services. Authorities are required to have regard to the transport needs of members of the public who are elderly or disabled. Most of these services are working well but the choice of service provider is not necessarily optimising value for money. The total absence or presence of taxicard and dial-a-ride provision by local authority, rather than a social or geographical basis, indicates that procurement route depends more on the policy of the local authority than any more systematic analysis of best value.

4.22 In the future, local authorities should be much clearer how they are meeting the needs of all residents. The needs of some will best be met by dial-a-ride and for others by taxicards, but CT is the largest provider of high care needs DRT, and there is substantial scope for developing this sector through appropriate service procurement across more of the country. This review has indicated that CT providers will often be best value providers:

• Where there is a track record of high quality delivery - Note that areas with a weak community capacity will often be areas with the greatest social exclusion, and particular benefits can be gained from strengthening the CT sector in these areas. However it is important to ensure that the sector can develop steadily over a large number of years since taking on too much too early can be destabilising, not just for the CT sector, but also for commercial operators.
• Where contracts reflect community boundaries rather than administrative areas.
• Where there is strong management at the heart of the organisation including sufficient management capacity to avoid over reliance on any one individual.

Patient transport challenges

4.23 The current move towards fully accessible, door-to-door, demand-responsive, user-friendly service provision within public passenger transport, and the alignment of community transport within the public transport sector, has blurred the boundaries between patient transport and public transport. Within this context the PTS has been subject to review.

4.24 These transport issues are compounded by other changes within the NHS including:

• Restructuring - Centralisation of specialist services and decentralisation of less specialised care resulting in new travel patterns and needs and types of patient transport.
• Joint working - Health and social care partnerships increasing opportunities for better sharing of vehicle and staff resources including social services vehicles.
• Procurement - GP contracts mean that more out of hours care is being provided from centralised locations requiring transport provision at unsociable hours.
• Social inclusion - Policies to tackle health inequalities which are often access related.
• Efficiency - Increasing opportunities for booked appointments to ensure that patients can travel when it is most convenient.

4.25 Future DRT, including patient transport, needs to reflect this changing context. The strategy for the development of the non emergency patient transport service in Scotland ( SAS 2001) identifies that the eligibility for patient transport is determined by medical, social and geographical criteria. With rising demand, the strategy identifies that "the Scottish Ambulance Service would specialise in medical need but would co-ordinate other agencies to provide local transport solutions."

4.26 Work is underway to define medical need more clearly in relation to funding responsibilities, and determine how the joint working between the SAS and partner agencies might operate in practice. In particular, there is a need for clarity on how definitions of need (including social need) relate to funding responsibilities for the NHS.

4.27 Current NHS funding for DRT consists of:

• The budgets allocated to the SAS as a Special Health Board within NHS Scotland.
• The hospital travel costs scheme.
• Ad hoc taxi purchase from other hospital and GP budgets
• NHS funding for community transport
• Investment through hospital/site travel plans including planning gain associated with new build.

4.28 In practice these budgets are insufficient to fund all patient transport needs or provide services which meet patient wishes, such as to be accompanied. As a result there are many other approaches to funding patient DRT services such as local authority supported services, community transport funding, (informal use of) Dial-a-Bus, Taxicard, lottery, charities, etc.

4.29 There is little consistency across the country on which of these budgets funds which types of trip, and from which operator. Without clear eligibility criteria linked to available funding it is therefore difficult to introduce efficient, sustainable and complementary DRT provision.

4.30 It should also be noted that displaced trips from more tightly focused patient transport may well be made by car. However parking at many urban hospitals is a growing problem and in some cases parking charges are being used to manage demand. The revenue from this parking income should therefore be used to fund appropriate transport provision to help manage demand including for the various DRT solutions.

Ways forward for patient transport

4.31 There are several possible ways to structure patient transport in the future to ensure that people are not excluded from health care due to poor accessibility. Some issues need to be addressed nationally. Funding allocations for local authorities and the NHS need to reflect need and the funding formulae and grant funding should take account of demographic change and hospital and health centre configuration.

4.32 To create a clear structure for DRT delivery by PTS, CT, and commercial services including taxis, consideration should be given by transport authorities and their partner agencies to improving:

• Procurement - Decisions should deliver best value for each care level required, maximising use of resources and tailoring provision to care needs. To achieve this in England, commissioning of patient transport has recently been transferred to Primary Care Trusts encouraging integration of decision making on patient transport with partners and with other health transport funding at a local level. In Scotland the different Health Board structure requires a different approach, but the same principles of best value, integration and patient focus should be central to procurement approaches.
• Classifications of Need - Health needs are wider than just getting to the destination. People should feel happy about the whole care package including transport. The progress made defining medical need within the SAS needs to be discussed more widely with other partners in the NHS and expanded to include more transport service operations than those that the PTS manage.
• Funding - The many funding sources need to be co-ordinated more effectively and linked to the trips that are being funded. In particular community transport is currently picking up more of the gaps without the funding and support mechanisms needed.
• Integration between patient and other transport needs - Where vehicle capacity is not being fully used there will be benefits from more joint working.
• Charging - There are different markets for patient transport and some users may be willing to pay for transport within the patient transport service to avoid having to drive.
• Considering the potential for DRT as part of a programme to reduce parking and congestion on hospital sites, particularly by offering this service to staff when parking restrictions are introduced at hospitals.

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