BUS companies in the North last night poured scorn on claims that town halls will gain "London-style" powers to decide routes and fares, forcing them to run unprofitable routes.

Go North East and Arriva, which run most services in the region, said a long-promised Bill fell far short of allowing councils to take control of bus services and pick operators.

Instead, any authority wishing to impose a "quality contract" on a bus company will be required to pass a series of checks.

A three-person panel appointed by the Government will decide whether a proposal is in the public interest, offers value for money and can be fully funded.

Transport Secretary Douglas Alexander had pledged to end the "free-for-all" at bus stops blamed on 20 years of competing private operators.

Yesterday's Local Transport Bill was expected to effectively reverse the deregulation of 1986 by allowing councils to decide fares and the frequency of services.

But Jim Boyd, of Go North East's parent company The Go-Ahead Group, said: "Going down the quality contract route will involve passing a number of tests.

"It will be a significant process to go through, so we believe the best way to serve passengers will continue to be through partnership with operators."

Steve Clayton, Arriva's group managing director, said: "Where all parties are committed to existing voluntary partnership arrangements, there are significant benefits for passengers.

"As the Secretary of State has stressed today, there is no 'one-size-fits-all' when it comes to improving services."

The relaxed attitude of the bus companies is likely to disappoint Northern authorities, who have long condemned their power to decide which bus routes to run.

Last year, scores of services were scaled back after Durham County Council cut the subsidy it pays to bus firms to operate loss-making routes.

A number of routes in North Yorkshire were also put under threat when the county council sought to cut its £4m-a-year bill for supporting services.

Under deregulation, the North-East has suffered an 11 per-cent fall in passenger numbers since 2000, the biggest fall in England.

Operators must give only 56 days' notice before they make changes to services.

As a result, popular routes become congested with buses run by rival firms, while councils pay expensive subsidies on less-used services or risk losing them altogether.

The draft Bill, which now goes out to further consultation, would remove the need for a council to prove a quality contract was the "only practicable way" the route could be run.

However, it would still require approval before it could draw up an exclusive contract for a firm.