Councils will be banned from setting up bus companies to run their own services under a major reform of public transport, it emerged last night.

A clause introduced to the Bus Services Bill was criticised by Labour as a “senselessly partisan” attack.

Ten municipal bus operators remain in England and Wales after a drastic reduction in the 1980s, and many are highly rated. Reading Buses was operator of the year in 2015 and Nottingham City Transport has the best passenger satisfaction rating of any provider. As existing companies, they will not be affected by the law change.

The bill, which the House of Lords will debate today, was part of the Queen’s Speech and had been introduced as an attempt to boost local mayoral control over buses, which provide more than 60 per cent of public transport trips. More than 4.65 billion journeys were made in England last year.

It will give mayors in cities such as Manchester and Birmingham the power to franchise services, with more control over ticketing, routes, frequency and fares, and raises the prospect of Transport for London’s operation being emulated in other major cities. The new clause seeks to prevent councils directly running their own buses rather than franchising to private companies such as Stagecoach and FirstGroup.

A spokeswoman for the Department for Transport said the bill would give councils more influence over services and so it would “not be appropriate for them to also provide these services”.

Lilian Greenwood, the shadow transport secretary, said: “A ban on municipal ownership was not mentioned once in the government’s consultation and it’s incredibly disappointing to see this ideological and divisive clause appear.”