Local Transport Bill [HL]

I am due to go to a 60th wedding anniversary celebration in the new year when I shall test the guests on the noble Lord’s assertion. Given where they live, I guess that they will be more likely than most to be using a bus pass. As the noble Lord said, reimbursement was discussed not long ago and certainly at length during the passage of the Concessionary Bus Travel Bill, which received Royal Assent in July. Operators are reimbursed for carrying concessionaires according to the objective that they should be no better or no worse off. Operators are entitled to reimbursement for certain additional costs over and above the basic operating costs; for example, if extra costs are incurred by providing additional services or larger vehicles to cope with rising demand. We are not afraid of rising demand. We want to see more people using buses. I agree that the national bus concession should be properly funded. The Government are providing a further £212 million to local authorities in England, through a special grant, from April next year. That is in addition to the existing funding provided by central government through the formula grant process. Following the introduction of the national bus concession next April, the Government will provide approximately £1 billion a year for statutory concessionary fares. No Government have ever been more generous in this regard. I am pleased to hear from the noble Lord that the party opposite shares our enthusiasm for this policy. We consulted with local authorities on the formula distribution of the special grant funding to ensure that it is targeted to meet the extra costs of reimbursement. We are confident that the total to be distributed is sufficient, based as it is on generous assumptions about fares, pass take-up, extra journeys and additional costs. I fully understand the concerns that arise over any formula distribution of funding. However, this amendment would oblige central government to underwrite fully the cost for deals done by local authorities with bus operators. That would pass all risk to the taxpayer while leaving control with the local authority. I am not sure that that is exactly what my noble friend intended. I know that he is a strong localist, but were he in the position that I occupy, or in the position that the bus Minister at the Department for Transport occupies, I am not sure that he would want to pass over that responsibility in quite the same way. There is no incentive in the proposal to fight fraud or to negotiate hard with bus operators the overall cost of concessionary travel. Inevitably, it would lead to significant increases. Authorities could also use the concessionary reimbursement as a back door for subsidising marginal routes, again at the expense of the national taxpayer. I would question the desirability of that strategy. We acknowledge that the current arrangements for concessionary fares reimbursement are not perfect, which is why we are working with operators and local authorities to put in place revised and more efficient arrangements for the national bus concession from April next year. It is vital that we secure the best deal for the taxpayer in taking this work forward. Those interests have to be understood and properly represented. I cannot accept the amendment. I accept that there may be difficulties in some parts, but we will continue, as we have throughout the introduction of this policy, to talk to our colleagues in local government and to work with bus operators to secure the best possible outcome and the best possible deal. I hope that the noble Lord will feel able to withdrawn his amendment.