The concessionary fares scheme has come under more pressure after a new study suggested it was not offering value for money.
The Local Government Association (LGA)-commissioned report claimed taxpayers were bankrolling England’s bus industry as the £2.5bn annual subsidy it received equated to half its overall turnover.
This figure has gone up by £1bn in the last five years. The LGA has called for a fundamental review of the bus subsidy system to ensure better value and outcomes could be secured from continued public sector investment. The organisation added that reforms should include scrapping the fuel duty rebate for bus services and combining subsidies into one single fund instead of the seven separate streams currently used.
The Subsidising buses: How to get the best from taxpayers’ money report dubbed the national concessionary fares scheme as an ‘inefficient and high-cost way’ of delivering public policy objectives.
‘Better targeting at the scheme’s intended beneficiaries would generate savings which could be made available to local authorities to support lower-cost travel for locally-prioritised, additional concessions,’ it continued. The LGA has distanced itself from the proposal that ‘means testing’ should be introduced to select those eligible for the scheme.
Cllr David Sparks, the LGA’s transport spokesman, said: ‘Councils are emphatically not in favour of means testing free bus fares.
‘There are real problems with the way the scheme has been funded which have caused major financial headaches for town halls.
‘We would like the Government to look again at the details, to come up with a better way of helping councils pay for this popular scheme.’
The Government has ruled out means testing for concessionary bus passes. A spokesman for the Department for Transport (DfT) said: ‘The intention of the bus travel concession has always been to ensure that no older or disabled person in England need be prevented from local bus travel by cost alone.’
The spokesman added the DfT was confident there was enough money in the scheme to support it but confirmed it was looking into how these funds were distributed following the councils’ concerns.
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