Bus Service Operators Grant

Oral Answers to Questions — Transport – in the House of Commons at 10:30 am on 28th October 2010.

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Photo of Stephen Hepburn Stephen Hepburn Labour, Jarrow 10:30 am, 28th October 2010

What his policy is on the future of the bus service operators grant; and if he will make a statement.

Photo of Alex Cunningham Alex Cunningham Labour, Stockton North

What assessment he has made of the likely effects on socially excluded groups of the proposed reduction in bus service operators grant.

Photo of Norman Baker Norman Baker The Parliamentary Under-Secretary of State for Transport

From 2012-13, the rate at which bus service operators grant is paid will be reduced by 20%. Our assessment is that this level of reduction will, overall, have a low impact on socially excluded groups. I spoke to the Confederation of Passenger Transport UK, which represents the bus industry, following the Chancellor's announcement on 20 October. It was hopeful that, in general, this reduction could be absorbed without fares having to rise.

Photo of Stephen Hepburn Stephen Hepburn Labour, Jarrow

That is absolute nonsense. The pensioners and the poor people of this country did not create the banking crisis, so why are the Government making them pay with cuts such as this, which will inevitably mean rises in fares and reductions in services?

Photo of Norman Baker Norman Baker The Parliamentary Under-Secretary of State for Transport

With respect to the hon. Gentleman, I do not think that he heard the answer I gave, which was that I have spoken to the Confederation of Passenger Transport UK, which represents the bus industry, and it was hopeful that the reduction in the bus service operators grant was marginal and could be absorbed without fares having to rise. I also draw to his attention the fact that the Government have protected the concessionary fares arrangements.

Photo of Alex Cunningham Alex Cunningham Labour, Stockton North

My constituent, David Gordon, has told me that he values his bus service, which has improved considerably in recent years, very highly, but he is worried about its future. Many others depend on the buses to get to work or to search for work across Teesside and beyond. Can the Minister reassure Mr Gordon that bus services really will be protected and that those seeking work and other excluded groups will be able to follow the advice of the Secretary of State for Work and Pensions and get on a bus in their area to look for work?

Photo of Norman Baker Norman Baker The Parliamentary Under-Secretary of State for Transport

The hon. Gentleman will know that the Tees Valley bus network's improvement scheme is going ahead. The Government have confirmed that only recently, so I hope he will welcome that particular suggestion. It is our intention to get more people on to buses, and we are working with local authorities and the bus industry to achieve that-for example, by the roll-out of smart ticketing. So, yes, his constituents will be able to get on a bus; in fact, there will be even more buses than previously.

Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire

How does the Minister propose that the local sustainable transport fund will fill the boots of resource grants, with the funding reduced now, especially in counties such as Leicestershire?

Photo of Norman Baker Norman Baker The Parliamentary Under-Secretary of State for Transport

The local sustainable transport fund is a fund of £560 million during the rest of this Parliament. By anybody's standards, that is an enormous sum to spend on prioritising local transport, cycling, walking, bus services-if that is what local authorities want to do-bus lanes and other such traffic management matters. I would have hoped that the hon. Gentleman would welcome that commitment by the Government; it is an enormous sum for those particular objectives.

Photo of Andrew Gwynne Andrew Gwynne Shadow Minister (Transport)

I thank the Department for responding so quickly to my named day questions, although I do not consider "I will answer this question shortly" to be much of a reply. On the bus service operators grant, the Minister has said:

"The benefits of that grant are clear: it ensures that the bus network remains as broad as possible, while keeping fares lower and bringing more people on to public transport, with the obvious benefits of reducing congestion...in our towns and cities."-[ Hansard, 29 June 2010; Vol. 512, c. 842.]

Given his swingeing 20% cut to the grant, why will he not now accept that fares are likely to go up, passenger numbers will decrease and congestion will worsen?

Photo of Norman Baker Norman Baker The Parliamentary Under-Secretary of State for Transport

First, the stories in the press throughout recent months have been suggesting that the bus service operators grant will be abolished, but they have clearly been completely off tack. Indeed, the cut to the grant has been less than the average for the Department, in recognition of the importance of bus services to local people. I come back to the point made by the Confederation of Passenger Transport UK, which, after all, represents the bus industry and so, with due respect, perhaps knows more about buses than the hon. Gentleman might do. It has said that, in general, the reduction can be absorbed without fares having to rise; that is the view of the industry.