Deals on the bus: Sydney locked into $5 billion in contracts until 2030s

The previous Coalition government signed multiple long-term deals with private bus companies worth $4.8 billion in the months leading up to the NSW election, locking the state into contracts that will thwart any plans for a major shake-up of bus services across Sydney.

Tender documents reveal Transport for NSW struck an $876 million contract in late February with Busways for regular passenger services covering Sydney’s north-western suburbs including Blacktown, Penrith, Windsor and Richmond for more than eight years.

Bus delays and cancellations have plagued commuters over the past two years.Credit: Janie Barrett

In the same month, the agency sealed another eight-year contract with Transit Systems worth an estimated $564 million for bus services in Sydney’s south-west including Liverpool, Campbelltown and Camden.

The deals were inked about two weeks before the NSW parliament entered caretaker mode on March 3, before the state election three weeks later.

Transport Minister Jo Haylen accused the former government of signing large contracts with private operators days before the official start of the campaign.

“Bus passengers across Sydney are facing thousands of service cancellations a month because of the former government’s failed bus privatisation experiment,” she said.

Transport Minister Jo Haylen labelled the former Liberal government’s bus privatisation “experiment” a failure.Credit: Dominic Lorrimer

“But the Liberals didn’t rewrite these contracts to deliver better services. They put the people of NSW on the hook for paying massive amounts of compensation to make it nearly impossible to cancel them.”

The tender documents also show the previous government signed four contracts totalling $3.3 billion last November and December with private bus companies including Singapore multinational ComfortDelGro.

Those four contracts for passenger services in Sydney’s south-west, north-west, north shore and northern beaches each run for about eight years.

After campaigning heavily on the consequences of privatisation before the election, Labor has pledged to set up an industry taskforce to look into bus services.

An unprecedented shortage of drivers led to several private bus operators in Sydney cutting services in January.Credit: Louise Kennerley

It follows a parliamentary committee recommending late last year that the government consider putting privately operated bus networks back into public hands.

However, the new long-term contracts will make any substantive change difficult because the government will likely be exposed to break fees if deals are altered.

Neither the transport agency nor the private bus companies responded to questions about the compensation payable if contracts were torn up or altered.

Transport for NSW said the deals recently signed had been for areas of Sydney that had always operated under contract with private operators, and were re-tendered when the previous terms ended.

“They were tendered in accordance with NSW procurement guidelines and signed prior to the pre-election caretaker period,” it said.

“Transport for NSW runs an extensive competitive tendering process for the provision of bus services with the aim of delivering the best service for customers at the best value for money for NSW taxpayers.”

Greens transport and treasury spokesperson Abigail Boyd said the previous government’s decision to sign new contracts totalling billions of dollars in the months before the election raised serious questions about the integrity of the process.

“It pre-empted the will of the electorate when transport privatisation was such a major focus of the election,” she said. “The Coalition must have known that this would make it much harder to unpick these contracts and for a new government to improve bus services.”

Former transport minister David Elliott was approached for comment.

The last regular bus services in Sydney to be run by the government were in the eastern suburbs, the northern beaches and some north-western suburbs, which were contracted out to private companies in 2021 after the State Transit Authority was disbanded.

Delays and cancellations of bus services have plagued commuters on routes across Sydney over the past two years, hitting the eastern suburbs, inner west and northern beaches hardest.

Government figures have shown about 28,000 bus services in Sydney were fully or partially cancelled last August, which was the worst month over the past two years for cancellations.

The bus companies that signed new contracts between November and February were approached for comment. Those that responded said the contracts were commercial in confidence and referred questions to Transport for NSW.

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