I don't think anyone is advocating a straightforward return to the pre-deregulation position. My own bus use in that time was mostly in semi-rural Greater Manchester and more urban Tyne & Wear PTE areas where the service was actually pretty good, but I get the point that at the point of deregulation it was much less good in the more rural areas run by NBC. Bus use overall has been declining steadily since the 1950s regardless of the regulatory structure.
But there are places where numbers have held up or even increased. London of course under franchising, but also others including Brighton, Nottingham (falls in recent years probably due to the tram, but still in top 5 outside London) and Reading. These seem to have in common a local authority that is pro-bus and implements priority measure, plus often a municipal operator or at least one that is more locally focused and a relative lack of on-road competition. While they have to have an arms-length relationship with the local authority, it is likely that these operators have more of a public service rather than a fully commercial ethos. This pays dividends in passenger numbers and perhaps even leaves these operators in a better position financially than the big groups driven mainly by short-term profits. Cardiff and Newport may be like this too, but I can't find any useage by local authority figures for Wales.
In deeply rural areas few residents will want to rely on buses - with widespread car ownership there just aren't enough people left over to sustain a frequent and attractive service so the sort of rural services we apparently had in the 1950s are probably a lost cause. This level of car ownership also contributes to congestion that delays buses, particularly on the way into local towns and cities which might otherwise be attractive bus destinations. Here I think buses could sometimes act as feeders into trains to bypass this congestion, and in general provide a fairly basic but reliable service particularly for those without a car and for those visiting the area by public transport.
It is the big metropolitan areas outside London where bus use has fallen most. Causes might be: increasing traffic congestion, adoption of light rail in some cities, service decline from previously above-average quality. But there are areas where urban density is surely high enough that buses can make a difference and I believe some sort of franchising system integrating with local light and heavy rail would be a big contributor to achieving this.
https://assets.publishing.service.g...ual-bus-statistics-year-ending-march-2017.pdf
Unfortunately I can't find breakdowns of bus use by local authority for Wales, but the overall bus useage trend is similar to England outside London.