Clause 3

Part of Concessionary Bus Travel Bill [Lords] – in a Public Bill Committee at 12:30 pm on 5th June 2007.

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Photo of Paul Rowen Paul Rowen Shadow Minister, Transport 12:30 pm, 5th June 2007

As the hon. Member for Tyne Bridge stated earlier, the introduction of the local concessionary bus scheme had a number of unintended results, although some hon. Members warned the Government at the time about what was likely to happen. The use of the block grant and/or the revenue support grant as a mechanism for funding is, as anybody who has been involved in local government will know, a notoriously unreliable and inaccurate means of funding local government for the services that it provides.

The hon. Member for Tyne Bridge spoke about a shortfall of £9 million that affected Tyne and Wear. The London boroughs have estimated that the actual cost to them of the basic concessionary travel scheme was £100 million, yet they received only £53 million. Clearly, there is a huge shortfall. As the hon. Gentleman said, such a shortfall can only be met by increasing council tax or cutting services elsewhere.

All hon. Members support concessionary bus fares, but we want to ensure that the scheme, when operating, delivers what it is said that it will deliver. Anybody using concessionary buses should able to do so without affecting other services. It is clear that where huge numbers of people are travelling to a tourist destination—London, for example, or Blackpool, Scarborough or York—the revenue support grant, which calculates the number of people in the local authority area, is not the best means of delivering a fair recompense for the additional costs.

If we are to have confidence in the operation of the Bill, full costs have to be reimbursed. I do not wish to see a nationally administered scheme, as has happened in Scotland. The local authorities—the passenger transport authorities—should continue to have discretion to provide additional services or concessions that would not be available under the national scheme. However, the basic scheme must provide full compensation. New clause 2, which is similar to the amendment moved by the hon. Member for Tyne Bridge, ensures that full costs are reimbursed. It will ensure that all the local authorities introducing measures under the Bill can do so while ensuring that other vital services will not be compromised.

New clause 2 also deals with capital costs, which we discussed earlier. The Minister has reassured us, with regard to London, that she will provide a grant to meet the additional capital costs of replacing the Oyster card and the freedom pass for London. We do not know what the total capital cost of introducing the scheme throughout the country will be. The new clause would ensure that there is a contingency scheme, making sure that local authorities and passenger transport authorities can bid into that concession for the costs that they have incurred. I hope that the Minister can provide some reassurance about those issues, because although we know that there will be increased usage, we cannot predict what it will be. We need to ensure that local authorities, and particularly those where there are tourist destinations, are fully recompensed for the costs that they incur.

On Second Reading, I asked the Secretary of State whether he would be willing to meet a cross-party  group of local authorities affected by this scheme. There is huge concern about what the additional cost will be in, for example, London and Blackpool, because there are no figures on how many 60-year-olds visit those destinations. I therefore fail to see how the Minister can give an assurance that the full costs of the scheme will be reimbursed to the local authorities affected. That can be done retrospectively, by putting a commitment in the Bill to reimburse the full costs. Relying on the block grant will once again ensure that there are winners and losers, and I suspect that this time round there might be more winners than losers.