The House of Commons transport committee, which published a critical report on the "crisis state" of school transport, heard that local education authorities were popular customers for cowboy transport companies and were regularly supplied with the oldest and cheapest vehicles.
Garth Goddard, county transport coordinator for Cheshire county council, told the committee that he and police had recently carried out checks on 11 vehicles at a Cheshire school and found 10 were unroadworthy.
The MPs reported that school buses could also be dangerous because of pupil misbehaviour.
The committee urged local authorities to follow Somerset council's example and employ school support staff as escorts on school buses.
It also suggested that the Department for Education and Skills should offer classroom assistants and others incentives to take on the additional work.
"It is clear that the behaviour of schoolchildren on public transport can make other people's journeys unpleasant and that the unsupervised school journey can be an unpleasant experience for a child," the committee said.
Members of the committee said the Government's School Transport Bill was "too timid" to tackle the crisis in education transport. They said the changes proposed, including allowing local councils to charge for school buses, would take too long to implement.
The MPs recommended that guidance on which children should receive free bus transport should be altered to take greater account of pupils' ages and whether they had a safe pedestrian or cycle route to school.
Unison, the union that represents classroom assistants, and the Professional Association of Teachers said they were not opposed to the concept of school support staff working as bus escorts.
However, both organisations said careful negotiations would be needed to ensure that classroom assistants and others received appropriate training and that they were not forced to take on the roles.
School Transport: eighth report of session is at www.publications.parliament.uk Leader 16