Council leaders have warned that the cost of concessionary bus travel in England could spiral out of control, even if the Government plugs the current funding gaps.
New research has found that demographic change, changes in commercial bus fares, bus operating costs and other potential factors could drive up the cost of the scheme by as much as 20% in real terms to £1.14bn by 2013/14.
The London Councils, Local Government Association and pteg-commissioned research argues that increasing numbers of older people alone could lead to a 7.3% increase in the scheme’s costs by 2013/14.
The report also predicts that operating costs and commercial fares will outpace inflation, and could easily increase annually by between 1.5% and 3% in real terms. Together with demographic change, this could result in up to a 20.3% real increase in total expenditure on free bus travel by 2013/14.
Councils receive money for free bus travel in a special grant from the Government, which is fixed for the next two financial years. But the amount of money they may have to spend is beyond their control. Many local authorities with popular tourist destinations or shopping areas have suffered severe financial difficulties since free bus travel was introduced in 2008.
‘Free bus travel for the over-60s has been an immensely popular scheme which has benefited millions of people,’ said Cllr David Sparks, chair of the LGA’s transport and regeneration board. ‘Funding shortfalls have led to many unforeseen and unintended consequences since the scheme was introduced. Councils have been left facing difficult choices about how to fund other popular services, such as libraries, swimming pools and meals on wheels.
‘It should not be the council taxpayer and council services that suffer because central funding is failing to keep up with demand.’
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