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Bus Services Bill [HL] - Report (2nd Day) (Continued)

Part of the debate – in the House of Lords at 7:18 pm on 24th October 2016.

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Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport) 7:18 pm, 24th October 2016

I thank noble Lords for their brief contributions to this short debate. The noble Lord, Lord Bradshaw, has tabled an amendment on rural bus services and concessionary travel. As I have said before during the progress of this Bill, rural bus services play a vital role in helping people to get to work and school and in ensuring that they can access a wide range of services and leisure opportunities. Indeed, this issue has been raised in the House before. I believe that the noble Baroness, Lady Scott—who is not in her place at the moment—raised it on Second Reading.

I think we all accept that the loss of a local bus service, particularly in rural areas, can leave people isolated or dependent on friends and family to help them travel. However, commercial services in rural areas can be the most difficult to provide because of the need to achieve the critical mass of passengers required for a regular service. As I have said before, we are confident that the Bill provides significant opportunities for rural areas, and I again draw the noble Lord’s attention to the specific guidance which the Government have now published in which those opportunities are set out.

I turn specifically to the amendment. It would perhaps be useful to remind noble Lords that reimbursement by local authorities to operators is made on a no-better, no-worse-off basis. That means that operators are already fairly compensated for the cost of providing concessionary travel in both urban and rural areas. I believe that the reimbursement mechanism that is now in place is fit for purpose, as evidenced by the large decrease in reimbursement appeals that we have seen over the last few years since the new reimbursement guidance came into force.

If the noble Lord is seeking greater reimbursement for operators for their rural as opposed to urban services, we would be concerned that the amendment would lead to a distortion in the concessionary travel scheme because it is reimbursed on the principle of “no better, no worse off” to which I alluded a few moments ago. It is for that reason that we cannot support this amendment.

I finish by saying that the Government provide, as I indicated previously, significant funding for local bus services. We have talked before about BSOG and the £300 million to local authorities. The Department for Communities and Local Government intends to increase support for more sparsely populated rural areas by more than quadrupling the rural services delivery grant from £15.5 million to £65 million by 2019-20. That again underlines the importance of rural services—a sentiment which I know we all share. On the basis of my explanation, I hope the noble Lord will withdraw his amendment.