That this House has considered UK bus manufacturing.
It is a pleasure to serve under your chairship, Dr Murrison. I draw attention to my entry in the Register of Members’ Financial Interests and my role as co-chair of the all-party parliamentary group for British buses, alongside the hon. and learned Member for North Antrim (Jim Allister).
There were 694 more zero emission buses registered in Britain in 2025 compared with 2024, a 38% rise in the number on the road in one year. There were 167 fewer built in the United Kingdom in 2025 compared with 2024. When we need more zero emission buses, when operators and local authorities are buying more buses but there are fewer orders going to factories in Falkirk, Ballymena, Scarborough, Aldershot and across the country, we know there is a problem, and it did not start yesterday.
I applied for this debate, first and foremost, having been born and raised in a community that has seen immense benefit from the UK bus manufacturing industry. The goliath industrial site, which stretches across a large section of Glasgow Road in Camelon, has been the origin of Scottish-built buses for decades. A stone’s throw away is the sleek, relatively new modern site at Larbert, which hosts the global headquarters of Alexander Dennis. I had a welcome visit to Alexander Dennis’s “meet the fleet” exhibition last week for prospective bidders to Transport Scotland’s ScotZEB3 scheme. I tentatively await the outcome of that exercise and welcome Fiona Hyslop MSP, Cabinet Secretary for Transport, writing to me earlier this month to confirm when the announcement of successful bids is to be made. I hope for an objective outcome that supports Scottish manufacturing.
Members of Parliament will recognise the inherent pride when they spot something built in their community when out and about elsewhere in the country. When the Mayor of Greater Manchester’s fantastic Bee Network was launched, I was proud to note that there were more buses built by workers in Falkirk than from any other place in the world.
My hon. Friend is making a powerful case. Mellor, a bus manufacturer in Rochdale, does a superb job of producing the buses that Greater Manchester needs. Andy Burnham was the first in more than 40 years to retake control of our bus network in Greater Manchester, showing that with a publicly controlled local bus network, we cannot only improve facilities for passengers but secure contracts for local workers and British-built buses. Does my hon. Friend agree that is the way forward, particularly when we are considering Chinese-built buses?
Franchising is certainly an opportunity for our British bus manufacturing sector. I will speak later about procurement and the opportunities it presents for us to go even further, and potentially correct some of the examples that are not as great as the fantastic work done by the Mayor of Greater Manchester in that regard.
This debate is unlike the last one held in Westminster Hall prior to the election in 2024. This is not a debate about the virtues of the current push to decarbonise transport. It is an immutable fact that the shift in demand from both operators and public subsidy is towards cleaner and quieter transport. For the UK manufacturing sector, we need to recognise that the transition to zero emission buses and away from diesel is happening. A business selling horses and carts at the beginning of the 20th century could have continued to sell the carts and might have done well in the short term, but eventually, if it did not transition to automobiles, it would have gone out of business.
I thank my hon. Friend for his powerful speech on a topic about which I know he is particularly passionate. He will be aware that Alexander Dennis has a base in my constituency of Harlow. Would he agree that the move towards zero emission buses is a massive opportunity to increase the skills base of our communities? We should welcome the opportunity that young people have in our constituencies to work on these revolutionary new vehicles.
My hon. Friend goes to the heart of the issue we are debating today. This is an opportunity for our country to enable our manufacturers to compete within the market.
What British industry needs is not to see its renowned prowess for making diesel buses become a sentimental memory in communities such as Falkirk, but policy certainty and support to scale up and properly compete in the zero emissions market as we move towards the implementation of the ZEB mandate. International competitors have been able to scale up to meet the global market through state subsidy and clear procurement ambition. It is up to us to gather the political will to do the same, which I am sure we will hear articulated today.
Through both the mandate and voluntary targets for new registrations, operators are moving to prepare for new additions to their fleet to be fully zero emission by 2030, at the earliest. As that date approaches and diesel buses concurrently become a diminishing part of manufacturers’ order books, we must acknowledge that there is a short window before every new bus in the UK market will be zero emission. The year 2027, proposed by some during the passage of the Bus Services Act 2025 as the date for the ZEB mandate to come into operation, would, without thought, drastically narrow that window, and I was glad to see those amendments defeated.
However, the message we are hearing from our manufacturers is clear. If we now fail to get this right, we will not be talking about a British-led transition and we will not be talking just about a 35%, and rising, Chinese market share. We will be talking about transitioning to reliance on other places in the world to build the vehicles we need on our roads. We will be facing the reality of the long-term consequences of the price and security of supply being increasingly elsewhere and not here. We will have lost control.
That is why this debate is urgent. The Government, in my view, have the political temperament to deliver a new generation of British-built buses, and they have the proven ability to be bold on industrial policy, but too many missed chances by previous Governments and increasingly imminent deadlines for our industry mean that we need to be bolder. Sadly, taxpayer-funded schemes have contributed, rather than aiding a solution, to the problem of diminishing market share for UK manufacturers.
In the Doncaster East part of my constituency, franchising kicks in next year. At the moment, routes are about profits, not the people who use them. With this being about buying British buses, I think we have an amazing opportunity also to think about accessibility on our buses and to make sure we are also thinking about people who have disabilities or need extra help when we build our British buses.
For Members of Parliament, accessibility on our public transport network is always a key factor. At the “meet the fleet” exhibition, I was glad to see some of the new models coming out from Alexander Dennis—hopefully to be built at the Larbert and Camelon sites—which will provide greater accessibility for customers. It is important for all bus manufacturers to make that feature a key selling point when they are going out to the country.
Other countries have been able to do this and follow WTO or even EU free trade obligations. The German Government have recently started enforcing a 50% rule for contract value in procurement from the EU or countries with a free trade agreement, putting a cap on market growth of foreign competitors and, in practice, protecting jobs in the German automotive industry. The US’s Build America, Buy America scheme, introduced by the Biden Administration, mandates 70% local content for all rolling stock, and final assembly in the USA. Canada, while engaged in several free trade agreements, has introduced a Buy Canadian procurement policy framework that prioritises domestic industries.
If other countries can do it, so can we. When I have put to the Government the case for greater policy support for UK manufacturers, the very welcome forum of the UK Bus Manufacturing Expert Panel and the 10-year bus pipeline are often cited as the answer. The panel and the imminent 10-year pipeline will offer welcome certainty about the volume and source of upcoming demand, but we need alignment of policy to support our industry or we are in danger of providing just as much certainty to foreign competitors as to our own manufacturers.
The Government’s recent consultation on procurement reform is very welcome. I hope it did not escape the notice of my hon. Friends on the Front Bench and in the Cabinet Office that substantial submissions were made by Alexander Dennis, Wrightbus and supply chain businesses that rely on the primary UK manufacturing sector. The UK manufacturing sector is clear on a way forward that supports it without significant structural legislative change. We need a stronger emphasis on social value, and I believe Ministers must now consider a 30% social value weighting and clearer local economic benefit expectations.
I will call the Front Benchers at 10.28 am. There are about half a dozen Members seeking to catch my eye, so they will have five or six minutes each. Colleagues should reflect on keeping their remarks brief—a copybook example of which will be provided by Graham Leadbitter.
It is a pleasure to serve under your chairship, Dr Murrison. I congratulate the co-chairs of the APPG, the hon. Member for Falkirk (Euan Stainbank) and the hon. and learned Member for North Antrim (Jim Allister), on securing the debate.
I like to think I have a bit of an affinity with buses. For my entire time at high school—three years at Oban high school and three years at Biggar high school—every school day started and ended on a bus, as it does for many living in rural communities. At the age of 15, I volunteered at Biggar’s Albion works as part of a Duke of Edinburgh’s award, and helped to restore an Albion lorry. Albion was, of course, one of Scotland’s first vehicle manufacturers, and that included the manufacture of many buses. I do not know whether anybody here is old enough to remember that.
Although Albion is sadly no more, Alexander Dennis has been manufacturing buses in Scotland for more than 100 years and provides significant skilled employment. In Scotland, we recognise the importance of bus travel. The SNP has put in place a number of measures to boost bus use, including an extensive bus pass system, which includes free bus travel for under-23s. It has had positive social impacts and gives young and old people access to vital services and to education, employment and social opportunities. Increased bus use means steady demand for new buses to replace or expand existing fleets, and higher demand means greater opportunity for manufacturers.
In my former role as council leader in Moray, I had the pleasure of being a signatory of the Moray growth deal, which included the m.connect scheme—a combination of massively expanded on-demand bus services and expanded scheduled services over a large geography. It is well supported and well liked by the public and, again, more services mean more buses.
It is a pleasure to serve under you, Dr Murrison. I declare an interest as the co-chair of the APPG for British buses.
As the representative for North Antrim, I have the privilege of having Wrightbus as the key manufacturing company in my constituency. It is remarkable that, having started in a domestic garage just after the second world war, Wrightbus is now one of the world leaders in technology, skills and innovation. Ballymena in my constituency will forever be grateful to Sir William Wright for his innovative foresight, which led to where we are today.
It was not always an easy road. Just a few years ago, after substantial problems, Wrightbus rose like a phoenix from the ashes under new ownership, generating 2,300 jobs and producing many, many hundreds of buses, with the ambition to produce more than 3,000. I recently visited the site again, and saw the most modern of the company’s buses, which thankfully take care of all the accessibility needs one could think of. I was encouraged by the enthusiasm of the new chief executive, who certainly has ambitious plans for the site.
It is important that we as a nation grab hold of the opportunity here. The industrial strategy talks about advanced manufacturing as a strategic growth sector. If we mean that—I certainly believe that the sector has that potential—we must twin it with the approach we take on procurement. There is no point saying that advanced manufacturing is a strategic growth sector if our procurement policy is letting it down.
Given that we have a growth policy that aims to support UK bus manufacturing, does the hon. and learned Member agree that it seems totally counterproductive that we subsidise overseas bus manufacturers to bring buses into the United Kingdom? We have such magnificent manufacturing bases in Northern Ireland, Scotland and England.
Indeed, and the Chancellor is on record as saying that
“where things are made, and who makes them, matters.”—[Official Report, 11 June 2025; Vol. 768, c. 979.]
That is correct, and the Government need to get that message embedded in their soul.
I want to speak directly to the mayor of this great city—our capital city. In recent times, 479 Chinese buses have been put on our streets, with another 160 to follow—that is China, with the kill switches. I ask the mayor and TfL: where is the national pride in our capital city if we arrive and discover that the bus we are likely to get on was made in China rather than the United Kingdom? Other mayors seem to have had the vision and the desire to promote British-made products. That desire needs to catch flame here in the capital city, and I trust that it will.
Our procurement must be assertive and bold. There are the social value tools to make our procurement effective in assisting the production of home-made buses. We should be unashamed to do as other countries do when it comes to productivity. I hope that one outcome of this debate will be that those in a position to order buses reflect on where they order them from, and that we will see an interest in and accentuation of orders from within our United Kingdom. We have the means. We have the product. Let us build on it and make it even greater.
Finally, I want to raise a particular problem with production and exports in Northern Ireland. Sadly, under the Brexit arrangement, we are still under EU state aid rules. We see that in clauses 13 to 15 of the Finance (No. 2) Bill, which increase the level available for enterprise management incentives, enterprise investment schemes and venture capital trusts in Great Britain, but hold it down for companies in Northern Ireland. Why? Because of EU state aid rules. We also see it in the Industry and Exports (Financial Assistance) Bill, which again caps us under the EU state aid limits. How can we have a level playing field for UK production if, quite outrageously, one part of the United Kingdom is subject to a cap under EU state aid rules, which would not be there at all, of course, if we were properly part of the United Kingdom and had properly achieved Brexit? For Wrightbus, the workers in my constituency and the commonality of this United Kingdom, we must have that level playing field. That will then unleash opportunities for this great industry. It is time for the Government to liberate the bus building industry so that it can grow, including in Northern Ireland.
Good morning, Dr Murrison; I am delighted to serve under your chairship. I bring attention to my membership of Unite, and I record my appreciation for the hon. and learned Member for North Antrim (Jim Allister) and for my constituency neighbour, my hon. Friend the Member for Falkirk (Euan Stainbank), for securing this vital debate.
My hon. Friend and I both have Alexander Dennis sites in our constituencies, and we have campaigned together, representing the interests of the AD workers from Larbert in my constituency and Falkirk in his. Of course, being MPs from central Scotland, we are sadly no strangers to big industrial issues. Scotland’s only oil refinery operated in Grangemouth for a century until last year, when it was closed by its owners—a combination of a multinational company owned by a billionaire and a company controlled by the Chinese Government.
Eight miles along the M9 from Grangemouth is Larbert, which is my Alexander Dennis site. It is a huge local employer, and it is feeling the adverse effects of Chinese influence.
It is a well-known fact that Chinese buses and batteries currently have a substantial share of the market. Alexander Dennis workers and trade unionists have laid out the realities and issues that British bus manufacturers are facing. As is the case in many different industries, China is now able to overpower more established economies, and the position of European nations in a global trade context has dramatically changed.
Let us be clear: as a Government, we are not without power. Things can be done to help British business. The Government must be willing to intervene, impact and change the circumstances for British industry. It can be done. It was done, in December last year, when the Labour Government stepped in and saved the British chemical industry at Grangemouth. Our intervention saved 500 skilled and well-paid jobs on site, reversed the town’s industrial decline and boosted the local and national economy. That is the good that Government intervention does for British industry, British workers and British working-class communities.
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The initial ZEBRA—zero emission bus regional areas—scheme, touted proudly by Prime Minister Johnson’s Government, committed to 4,000 British-built buses by the end of the last Parliament. The scheme delivered just 2,270 buses, of which about 46% were built abroad. There was a material and harmful chasm between political rhetoric and delivery for UK manufacturers.
Scottish manufacturing fared worse recently in phase 2 of the Scottish Government’s zero emission bus challenge fund, the outcome of which was sending two thirds of ScotZEB2 orders to Yutong in China, while less than 20% went to Scottish manufacturers. That created an existential threat to 400 jobs and the Scottish bus manufacturing sector last year, with the First Minister being informed by the company in August 2024 that the outcome of the scheme appeared to show little regard for Scottish manufacturing, with unprecedented action being required in September to prevent the two factories from closing for good.
In addition, 130 jobs were lost in 2024, in part because of the aggravated issue of conditions being placed on Scottish Government funding, compelling adherence to advanced Fair Work First standards for employee remuneration, welfare and safety, while no such requirement was made of foreign manufacturers. I am all in favour of fair work standards being applied. The problem here is that they were not weighted in the procurement exercises, despite their being required only of British manufacturers. That created an unlevel playing field, tilted in the wrong direction.
We have heard testimonials to the origin of London’s public transport system in the labour of Scottish, English and Northern Irish workers, who now contend with, and are contradicted by, the rapidly increasing portions of Transport for London infrastructure coming from elsewhere in the world.
It does not have to be this way. For example, as my hon. Friend the Member for Rochdale (Paul Waugh) alluded to, the Greater Manchester and Liverpool City Region combined authorities, when franchising their bus networks, bought nationally. They chose to weight properly when buying buses, with procurement teams looking at what could be achieved when social value is appropriately weighted.
These successes and failures are largely down to how the schemes are set up. It seems entirely right to me that, because many are funded wholly with our constituents’ tax money, we should maximise the muscle of the state to make sure that as much of it as possible ends up benefiting our constituents, within the limits of our World Trade Organisation obligations.
Social value criteria should be directly linked to key performance indicators that provide evidence of growing industry; job creation and retention; skills and metrics, including economic impact; taxes paid in the UK; supply chain spend; and UK gross value added to UK plc. Simply setting social value at 10% would continue to risk it being immaterial to scheme outcomes, as we saw in Scotland, and would be an inadequate tool to deal with rapidly diminishing British market share.
Will the Minister confirm in his summing-up what further action is being considered to encourage contracting authorities to maximise their portion of the 10-year bus pipeline through domestic content when it is published? In addition, what conversations has he sought with Cabinet Office colleagues on procurement reform to amplify the views of the manufacturing sector and supply chain businesses when the time comes to legislate?
The necessity to retain and grow our domestic capacity is increasingly essential when serious concerns are being raised across Europe about the security of some Chinese-built buses. Following concerns raised by myself and the hon. and learned Member for North Antrim, there is currently a National Cyber Security Centre and Department for Transport investigation into the risk of remote deactivation in some Chinese-built buses. I understand, through subsequent reports in the media, that the possibility of remote deactivation exists for 700-plus buses currently active on British roads.
Although the risk may appear abstract to some, this issue raises important long-term security, autonomy and dependability concerns for my constituents, operators and passengers. Our manufacturers currently comply with security regulations 155 and 156, verified by the Vehicle Certification Agency, which ensures that vehicle manufacturers implement comprehensive cyber-security measures throughout a vehicle’s life cycle and ensures that software updates happen safely and securely. Approval certificates, however, can be sought from other countries’ approval authorities through mutual recognition arrangements for non-UK verification.
I raised written questions prior to the interim reports of the investigation being reported in the media. I will repeat them here, considering the new information. Have the Government considered requiring UK VCA verification for any non-domestic manufacturers in the UK following those concerns? Following that, will the Government accept that national industrial security could and should be factored into any subsequent taxpayer-funded procurement exercises? If there is any degree of fallibility in security that cannot be adequately mitigated, the Procurement Act 2023 surely provides the powers for contracting authorities to disregard bids from non-treaty state suppliers.
Is that a power the Government would consider encouraging or mandating contracting authorities to use, if they are not satisfied with the security of buses coming from abroad? Although that would certainly be significant action, buses are the most used form of public transport in the country and are essential national infrastructure. We know that there are sufficiently credible risks to warrant Chinese-built buses being investigated. Without prejudicing the outcome of the investigation, which I understand is still on track, will the Minister provide us with as much of an update as possible on when we should expect the investigation to be concluded? This concern reinforces the need to move urgently to tilt the market away from increased reliance on Chinese manufacturers and towards self-sufficiency.
With 400 jobs and the very existence of a century-old bus manufacturing sector put in jeopardy in my community in Falkirk last year, the state of the UK bus manufacturing sector is a real and present issue, not only for my community but for our national industrial security and how we effectively execute a just transition, as we move towards the zero emission bus mandate for 2030 at the earliest. The transition towards clean transport has been, and will be, backed by billions in additional funding from this Government, who have shown the ability to be bold on industrial policy. We have a valued, well-paid and skilled workforce. At the same time, we have an existential challenge from foreign competitors. Too much taxpayers’ money goes abroad, and too many self-imposed targets were missed by previous Governments.
If we do not adopt creative policies from elsewhere to support our British industry, we risk losing those jobs permanently to Chinese manufacturing, and if that is done, it cannot be undone. If UK bus manufacturing fails, for as long as this country is subsidising buses we will be sending taxpayers’ money abroad, so we cannot afford the cost of doing nothing.
Deindustrialisation is not an inevitable process—a reaction to the UK sector losing market share. We have policy levers. We can increase social value weighting expectations nationally and locally to 30%; we can give clear guidance to contracting authorities on how the muscle in the Procurement Act can best be strategically deployed; we can clearly state the risks that kill switches could present; and we can back British buses.
My constituents and I hope to see buses being built in Falkirk for a long time to come. I want the same for communities in Ballymena, Scarborough, Aldershot and beyond. I believe this Government can make that hope a concrete reality, but to do that we need to make the right choices. We need to make bolder choices, and we need to make them now.
However, there are serious challenges for bus manufacturers—notably from cheap foreign imports, especially from China—and that raises questions about the current procurement rules. The UK-wide Subsidy Control Act 2022 has prevented the Scottish Government from directly procuring from a single supplier, which puts avoidable strain on domestic bus manufacture.
Protecting skilled manufacturing in Scotland is critical to building our transition to a green industrial economy. That is why the Scottish Government committed £4 million to retain more than 400 manufacturing jobs at Alexander Dennis through a furlough scheme to protect crucial skilled workers until work can recommence. It was because of that collaboration and determination, and a shared belief in the value and the future of domestic manufacturing, that the Scottish Government and Alexander Dennis were able to negotiate that deal. But the obvious preference for the company, the Government and, most importantly, those workers is to have a steady stream of orders and no requirement for such a scheme.
There are several key things the UK can do to support bus manufacturing. The Subsidy Control Act needs reworking. As the hon. Member for Falkirk said, social value weighting needs to be ramped up. As a councillor, I argued very strongly for that for a wide range of contracts, and I continue to do so today. It is perfectly reasonable to place weighting on local supply chain content, quality assurance, apprenticeships and much more.
We also need to significantly tighten up certification of buses to ensure consistently high standards, especially on issues such as cyber-security. There have been multiple investigations in various countries into so-called kill switches in imported vehicles and other technologies, so that is clearly of critical importance.
There is a particular irony in trying to grow an electrically powered bus fleet in the UK by shipping buses in large numbers halfway around the world using heavy fuel-powered cargo ships. The green credentials of such procurement arrangements are highly questionable. The whole carbon impact of manufacture and delivery needs to be considered. Work also needs to be done by the Government and power distribution companies to ensure that grid connections for new charging installations are carried out in a timely way. Bus operators will not procure modern EV buses if they have nowhere to plug them in.
In conclusion, there are several actions the Government can take to support bus manufacturing and manufacturing more generally. That would also give public authorities and Governments across these islands more tools in the box to support procurement that drives growth and skilled jobs in our manufacturing sector, and ensures a future for these well-known, well-liked companies.
I say to the Minister that, sadly, Labour Governments do not come around all that often, so it is up to us to be assertive and to create, at the very least, a level playing field. In fact, why not make it more advantageous for British companies to do business? Where things are made matters, and “Buy British” and Britain being “Britain’s best customer” have to be more than political slogans.
Things must be changed to make it easier for our companies to be competitive, and we know that the SNP will not do it. It is easy for them to duck responsibility and point the finger at Conservative Governments of the past who treated working-class Scots and Scottish industry with utter contempt. But we have had 20 years of SNP Government with zero industrial strategy. Equally bad has been their public procurement policy. If it is not buses ordered from China, it is ferries built in Turkey or Poland; it is NHS Scotland contracts going to France; it is Scottish Government cyber-security services being outsourced to the United States. Over £7.7 billion of Scottish Government expenditure—public money—has gone to foreign companies. Stronger for Scotland? The treatment of Scottish workers, including the bus industry, which we are talking about today, is a national scandal.
In finishing, I say to the Minister: go back to the Department and be bold, be transformative and put our workers, our communities and our businesses at the heart of everything that we do.