Local and central government are currently spending £2.5 billion a year on bus services, including those linking rural areas with nearby towns and cities. This total includes bus service operators grant (BSOG), the costs of mandatory concessionary fares, local authority subsidy of non-commercial services and capital expenditure on bus-related infrastructure schemes.
It is for local authorities to decide which particular bus services to subsidise in their area and how much of the resources available to them to devote to supporting bus services.
These resources include funding we have provided to local authorities in the form of rural bus subsidy grant (RBSG). This grant is currently supporting some 2,000 services many of which provide the vital links to nearby towns. A total of around 38 million passenger journeys are made annually on RBSG supported services. This year's allocations total £55.6 million, bringing the grant's total to nearly £450 million since its introduction in 1998.
The Local Transport Bill, now before Parliament, will benefit rural areas and urban areas alike by modernising the regulatory framework for buses, giving local authorities a bigger role where this is necessary and providing strengthened arrangements for partnerships between local authorities and bus operators.
The Bill also contains measures to expand the role of community transport and to enable private hire vehicle operators to provide local bus services, extending the existing taxibus provisions to this sector for the first time. Both these measures are of particular relevance to meeting rural transport needs.