A troubled scheme to introduce London-style pay-as-you-go smart travel across the North of England looks likely to proceed without the region's major bus operators after they refused to support the project, The Yorkshire Post has learned.
Transport for the North is understood to be struggling to find a way forward for its project allowing passengers to use contactless bank cards to travel on buses, trams, trains and ferries on the same journey with a fixed maximum price.
Larger bus companies such as First and Arriva have refused to sign up because they are already working on their own contactless ticketing schemes and believe TfN's back office office processing system, known as ABBOT, will cost more.
At a meeting in Leeds, members of TfN's board agreed to investigate two options which would create a modern contactless system for heavy rail, light rail and some smaller bus firms but without the initial involvement of the larger bus companies.
But the strategic authority has also considered scrapping this element of its smart transport strategy and returning the money to the Government so it can be spent on other improvements in the North.
The stand-off has prompted the director of the influential Northern Powerhouse Partnership to call for the introduction of bus franchising - where routes and fares are decided by local authorities - "if the unregulated bus companies won’t play ball with pay-as-you-go".
TfN says finding a solution is "extremely complex" but it wanted to see real changes in the experience for passengers on public transport across the North".
The discussion of the best way forward took place in a behind-closed-doors section of a meeting of Transport for the North's board in Leeds, with most of the meeting held in public.
The Post understands that TfN officials were quizzed by political leaders about why the agreement of the bus companies was not secured at an earlier stage. Transport bosses will do more work on the different options and meet with the bus operators again before the next TfN board meeting in September.
Of the six possibilities considered, two 'lead options' are now being explored where ABBOT would be rolled out but with the major bus companies not involved.
In one version a back office system would be set up in the hope that bus firms would join it later, in the other a 'broker' system would be created to integrate TfN's approach with that of the bus companies.
It is hoped that the bus companies might eventually sign up, either because they choose to or because they are forced to if franchising is introduced. Unlike in London, which is a regulated market, bus companies cannot currently be compelled to take part.
According to a TfN report seen by The Yorkshire Post, its programme board also considered "the fall-back option of stopping [the project] altogether and seeking to persuade HM Treasury to redeploy the allocated funding to other transport needs in the North".
Bus operators Arriva, First Go-Ahead, Stagecoach and Transdev see little commercial benefit in ABBOT because they are already developing their own rival systems. A TfN report says: "They have asserted that ABBOT costs are higher than their current systems. We believe that this will be incorrect."
Matters have been complicated further by the fact that TfN's programme director responsible for smart travel left earlier this year, with a replacement due to start in early August. TfN is getting up to £150m in funding to introduce 'integrated and smart travel' across the North.
Though the stalled third phase of the integrated and smart travel project is the highest-profile and most ambitious, phase one has seen the deployment of smartcards designed to make rail travel easier and more convenient than with paper tickets.
TfN says 3.9 million journeys have been loaded onto smartcards so far and the next step is for train operating companies to retail the product through their websites and ticket vending machines.
The second phase is making the same kind of information currently used by most rail passengers available to bus and light rail passengers. This element will soon become reality and officials say it means passengers will be able to plan journeys, obtain fares information, travel and avoid disruption much more conveniently, quickly and simply.
The vision for phase three of the scheme is that rather than buying multiple separate tickets to travel on different modes of transport - each with its own cost - on a journey to work across the North, commuters from Liverpool, Sheffield or Newcastle can pay for it all using a contactless bank card with a capped daily or weekly fare at the end.
According to TfN, "this means they will never pay more for a pay-as-you-go collection of daily or weekly journeys than they would if they had bought the best value day saver ticket".
A spokesman for Transport for the North said: “We want to see real changes in the experience for passengers on public transport across the North, that includes how they access information about and pay for their travel.
“Delivering a smart ticketing solution across different modes of transport and many operators in the North is extremely complex, with several different options. Our members have asked for additional work to be undertaken in order to consider the best way forward.
“We’re working closely with the Department for Transport and operators to agree the next steps and will reconvene in September.”