asked Her Majesty’s Government:

Whether they are aware of budgetary instability being caused to local authorities and commercial bus operators by the operation of the free concessionary bus pass scheme for older and disabled people in England including the impact on other local government services; and whether they will review the funding and administration of the scheme to bring it into line with the structure of the successful schemes being run by the Scottish and Welsh devolved Administrations. [HL224]

From April 2006, older and eligible disabled people have been guaranteed free off-peak local bus travel within their local authority area. The Government provided an extra £350 million in 2006-07 and a further £367.5 million in 2007-08 to fund the extra costs to local authorities. This funding was provided via the formula grant system in line with the wishes of local government to have greater freedom and flexibilities in how they use their funding.

The Government are providing local authorities in England with an extra £212 million next year, which is based on generous assumptions about the probable cost impact of the new national concession. This funding will be provided by special grant reflecting the views of local government. The Department for Transport is currently consulting on the formula basis for distributing the special grant; the consultation closes on 23 November. In addition, we have announced that we will be providing local authorities with approximately £30 million for the issuing of the national pass.

The Government are confident that the extra funding being provided is sufficient to cover the total additional costs to local authorities of this improvement in the statutory minimum. Any discretionary local enhancements, such as peak bus travel, are funded from an authority’s own resources.

It is for local authorities to implement affordable local schemes taking account of their statutory obligations and their assessment of local circumstances and need.

The policy on concessionary fares is a devolved issue and the different approaches taken in Scotland and Wales reflect very different circumstances from those that pertain to England. In England there is no single “scheme” but a statutory minimum concession, which local authorities can enhance if they so wish. This is consistent with the views expressed by local government during discussions over implementation of the national concession.

The Concessionary Bus Travel Act 2007 includes powers to change the way in which the national bus concession is administered in the future. However, there are no plans at present to centralise the arrangements.