Local Government Finance

22:30:00

The Minister of State, Department for Transport (Ms Rosie Winterton)
I beg to move,

That the Local Government Finance Special Grant Report (No. 129) on the grant to be paid towards the cost of implementing the new statutory minimum bus travel concession in England (House of Commons Paper No. 256), which was laid before this House on 19th February, be approved.

The report sets out the extra funding that the Government are making available to local government in England to implement the national concessionary fares scheme—a scheme that means that 11 million people over 60, and eligible disabled people, will be entitled to free bus travel wherever they are in England. Access to effective public transport makes a real difference to many people’s lives. It plays a key role in boosting the economy, reducing congestion, tackling climate change, promoting social inclusion and improving our quality of life.

Buses are the most widely used form of public transport in this country. More than two thirds of all public transport journeys are made on them, and after years of decline the number of bus journeys is now on the increase. There were more than 4 billion such journeys in the UK in 2006-07. Clearly, buses are becoming more and more attractive as a means of travel. They are more accessible for disabled passengers than ever before and there has been good progress in improving the quality of buses, with the age of vehicles decreasing over the last 10 years. The flexibility of bus networks means that they can provide a genuine alternative to the car, not only improving social inclusion, but helping to tackle congestion and contributing to meeting our goals on climate change.

The Government recognise that buses are particularly important for some of the most vulnerable people in our society. They often provide a vital lifeline to services such as shops, leisure facilities and hospitals, and they are an important connection to the community. For many older and disabled people, buses provide a vital link to the places they want to go and the people they want to see. The Government are fully aware of that, and I am proud of our record in helping more and more older and disabled people to use buses. In 2000, we acted to ensure that, for the first time, older and disabled people in England were guaranteed half-price bus travel within their local authority area.

Tom Levitt (High Peak) (Lab)
I would like to put on the record my appreciation for the assistance that my right hon. Friend gave us to make sure that the community transport dial-a-ride scheme in Derbyshire would be advised that it fell within the concessionary scheme, thus ensuring that the services she described will remain available in a sparsely populated rural area. She will be pleased to know that all of the other major parts of the old Derbyshire Gold scheme have now been negotiated and will go on as part of the Derbyshire Gold card.

Ms Winterton
I know that my hon. Friend campaigned extremely hard on that issue, and that he worked closely with community transport members in his area. I know that he is interested in looking at how the Local Transport Bill, which the House will debate tomorrow, could contribute to the enhancement of community transport. I thank him for bringing that matter to my attention, and I am glad that I was able to confirm the fact that the Local Transport Bill will assist in this area. He is right; the scheme has proved extremely popular among disabled people and older people. In 2000, we ensured that older and disabled people would have guaranteed half-price bus travel. It proved extremely popular, but we did not want to stop there.

During his time as Chancellor of the Exchequer, my right hon. Friend the Prime Minister acknowledged the importance of concessionary travel and its potential for enhancing people’s quality of life. That is why, in April 2006, we improved the statutory minimum concession from half-price travel to free local travel for those eligible and we provided £350 million through the rate support grant in 2006-07, rising to £367.5 million in 2007-08 and £377 million in 2008-09. Once again, however, we wanted to go further—and we wanted people over 60 and disabled people to be able to go further, too.

Mr. Simon Burns (West Chelmsford) (Con)
The Minister has given us the figures on how much the Government will give local authorities towards the cost of the scheme, but will she also share with the House the total rounded figure that the independent consultant said would be the overall cost of fully funding the scheme?

Ms Winterton
Actually, those are not the figures for the new scheme. I have provided information on the amounts of money already in the system; I shall come on later to the extra money that will be made available. To provide one example, in the hon. Gentleman’s local authority, it will mean a 30 per cent. increase over the last financial year.

Mr. Burns
When the Minister reaches that point and provides those figures, will she also provide the total amount that the Government’s independent assessor calculated as the cost of fully funding the scheme? It amuses me to hear the right hon. Lady saying that my local authority area is getting a 30 per cent. increase in funding—and we are not going to complain about that. However, what she fails to say is that her own independent assessor estimated the total cost of fully funding the scheme in my area at £1.1 million, yet the Government have given Chelmsford borough council only £413,000, which means a shortfall of £738,000.

Ms Winterton
I am not sure that the hon. Gentleman is entirely clear about the calculation of the reimbursement system costs. Consultants are employed by local authorities and work with them on estimating the reimbursement amounts that should go to the bus operators. It is quite a complicated system of assessment, which is why the consultants are employed in the first place. As I have said, however, in the hon. Gentleman’s local area, a 30 per cent. increase in funding—in comparison with the previous financial year—will be available to his local authority from April. As I shall explain more fully later, we believe that that is a very generous settlement.

Paul Holmes (Chesterfield) (LD)
rose—

Ms Winterton
I shall give way in a few seconds.

We wanted to go further, as I said earlier, because we recognise that the places where people need to travel often have little to do with the sometimes arbitrary boundaries of the local authority in which they live.

Paul Holmes
rose—

Mr. Mark Harper (Forest of Dean) (Con)
rose—

Ms Winterton
I give way first to the hon. Member for Chesterfield (Paul Holmes).

Paul Holmes
I am grateful, but may I provide the Minister with a slightly less rosy view of what is happening in Derbyshire than was given by the hon. Member for High Peak (Tom Levitt)? There is a total of 10 councils in Derbyshire and they are variously run by all three political parties. The figures I am providing are the latest ones from this morning, as discussed in the Chesterfield borough council’s cabinet. Collectively, the 10 councils say that, across Derbyshire, the cost of the scheme is £15.5 million, but because of Government underfunding, the councils collectively have to put in £2.6 million. That applies to Labour-run councils like Bolsover, which says that it is £96,000 short, as well as to the Lib Dem-run council in Chesterfield, which says that it is £164,000 short.

Ms Winterton
As the hon. Gentleman may know, I have had discussions about the situation in Derbyshire, not least because of the interest shown by my hon. Friend the Member for High Peak (Tom Levitt). I am sure the hon. Gentleman is aware that there have been enhancements to the national scheme. There is the gold card, for instance, and concessionary amounts have been paid to Community Transport. That is absolutely fine, and it will continue if it is what local authorities want. What I am discussing, however, is funding for the national concessionary scheme. For Chesterfield, it means a 32 per cent. increase over and above what it spent in the last financial year, which is about 3 per cent. more than the average that most councils are receiving.

In Derbyshire, a county-wide scheme is already operating. In other areas an additional amount will be spent in the next year to cover journeys in and out of the county, but in Derbyshire that is covered by what it has been doing over the past year, which makes the 32 per cent. increase even more generous than it would be in a different area. About 4 per cent. of people tend to travel outside their county area. Chesterfield borough council will have £416,000 extra, which means that if £1 is spent per journey, 416,000 extra journeys will have to be accounted for in the area.

Mr. Harper
The Minister used the word “national”. When the Prime Minister, then Chancellor of the Exchequer, announced the scheme, many of my constituents thought that “national” meant “the United Kingdom”. As the Minister will know, because I have questioned her on the subject before, my constituency borders Wales, and it is not possible to travel from it to Wales if it is necessary to change buses. It breaks up the journey, and for many of my constituents that makes the scheme effectively worthless. [Interruption.] Someone who wants to travel from Lydney to Chepstow and then to the hospital in Newport cannot use the scheme at all.

Ms Winterton
I doubt that the hon. Gentleman’s constituents would consider a 41 per cent. grant increase worthless. I should be interested to know how much he thinks Conservative Front Benchers believe should be spent on the scheme if they do not think that 41 per cent. is enough for his constituents. He will probably want to ask them that question.

As the hon. Gentleman said, there are some cross-border buses, and there has been a local agreement on funding for them. We have had some initial discussions with the devolved Administrations, but we want to bed down the arrangements in England separately before considering the financial implications of extending them to Scotland and Wales, which would be fairly severe. The hon. Gentleman may wish to ask his Front-Bench colleagues whether they would use finances that may or may not be available to them for that purpose, but our priority is to ensure that the English system works well. Cross-border services can of course continue, but the financial implications of extending them further are, as I have said, considerable.

Several hon. Members
rose—

Ms Winterton
Because we are dealing with this subject, I will give way to the right hon. Member for Berwick-upon-Tweed (Mr. Beith), but then I must make some progress.

Mr. Alan Beith (Berwick-upon-Tweed) (LD)
It is clear from answers already given to me by the Minister and the Secretary of State that the Government have not done much work yet on the costs of reciprocal arrangements between England and Scotland and Wales. Ought not that work to begin? It is not at all clear that such large costs are necessary. To most of our constituents, who believe in the Union of England, Scotland and Wales, this seems an arbitrary limitation on the ability that people in other parts of the country have to use their passes across borders.

Ms Winterton
I know that the right hon. Gentleman has been concerned about this, as he raised it at Transport questions a couple of months ago. As I have said, we want to ensure that the system to deliver this settlement is in place. At some point, we might want to go further than that, but the priority is to make sure that the settlements that we have announced so far are implemented and that the scheme is up and running before we go further.

Mr. Michael Jack (Fylde) (Con)
I acknowledge that the borough of Fylde has received an additional £270,000 this year, but what assurances can the Minister give me about a small coastal borough such as mine, which may have this scheme used disproportionately because of tourism in our area? What can she do to monitor how the formula operates, in case under the current arrangements it does not recognise disproportionate use for tourist purposes?

Ms Winterton
I thank the right hon. Gentleman for acknowledging that there has been an increase in the allocation for his area, which ranges from 19 per cent. to 31 per cent. for the respective authorities—that is the increase Fylde has had. I shall discuss later how we made the calculations as that is an important point, but I assure the right hon. Gentleman that matters such as visitor numbers were taken into account in order to try to reflect the points that people in coastal towns have made.

In 2006, my right hon. Friend the Prime Minister announced that, for the first time, about 11 million older and disabled people would be able to use off-peak local buses free of charge anywhere in England from April 2008. That will deliver the freedom to travel across district or county boundaries to nearby shops, to access health care, and to visit friends and relatives. It will mean that there is free travel when visiting any part of England.

To refer to the point of the hon. Member for West Chelmsford (Mr. Burns), through the report before us tonight we are providing an additional £212 million to local government in 2008-09, rising to £217 million in 2009-10 and £223 million in 2010-11. Taking into account money received through the revenue support grant, including the extra added from 2006 and the special grant for this latest extension, the total value of funding for concessionary travel is now about £1 billion a year.

To date, all of the funding to travel concession authorities for reimbursing operators has been routed through the formula grant part of the wider local government finance settlement. As the report before the House makes clear, the figure of £212 million for this year—rising in the manner I have stated—is based on generous assumptions about pass take-up, fares and journey rates. This £212 million of funding is solely to cover the extra costs of the new concession. It does not cover the cost of the existing free local travel concession, the funding for which will continue to be provided through the formula grant. It also does not cover any discretionary concessions that authorities may choose to offer. Those must continue to be funded from authorities’ own resources in exactly the same way as in the past. The new concession does not prevent local authorities from continuing to fund discretionary concessionary travel if they wish to do so.

David Howarth (Cambridge) (LD)
I appreciate that the new money is simply allocated to deal with the additional costs of the new scheme, but Cambridge city council believes that the scheme will cost it £400,000 a year more than the Government are granting from this new money. Does the Minister accept that although that is a small sum for the Government, for a council such as Cambridge it is the equivalent of the entire increase in this year’s council tax? The sum is calculated on the basis of a 13-element flow diagram. Surely the Government must recognise that it might be wrong in some individual cases.

Ms Winterton
The hon. Gentleman’s authority is receiving a 60 per cent. increase compared with what it spent in the past financial year. Some Labour Members would feel slightly jealous about that.

David Howarth
The right hon. Lady repeatedly talks about percentage increases in funding, yet she omits to mention the percentage increases in costs. The whole point that the Liberal Democrats are trying to make is that the percentage increases in costs for some authorities clearly outweigh the increases in grant aid being offered. If this was only a matter of increasing funding, it would not be a problem. The problem is on the cost side.

Ms Winterton
Our rough estimate is that the extra journeys would cost £1 per journey. In the hon. Gentleman’s constituency, the money would account for about 645,000 extra journeys made by over-60s and eligible disabled people who decide to use buses to come into the area.

David Howarth
rose—

Ms Winterton
I am not going to let the hon. Gentleman in again, because I am sure that he might wish to contribute to the debate itself rather than through a series of interventions—he probably wants to make his own speech. May I reiterate that he must bear in mind the 60 per cent. increase on what was spent in the past financial year?

Let me deal with how we decided to distribute the extra funding. My Department worked closely with stakeholders. From our discussions, it became clear that local authorities wanted the additional funding to be provided by way of a special grant. We accepted that recommendation and listened to what local authorities had to say about it. We then consulted widely on the distribution mechanism for the special grant. Our consultation paper offered a number of different formula options for distributing the grant based on combinations of existing data likely to be linked to the eventual costs of the new concession. As I have said, we are talking about things such as visitor numbers, bus patronage and eligible population.

We then consulted further on four options, asking local authorities which they preferred. Our proposed distribution is based on the most popular of those options, changed to take account of some of the information received and views expressed during the consultation.

Annette Brooke (Mid-Dorset and North Poole) (LD)
All three of the relevant authorities in my constituency are predicting a massive shortfall. For example, Purbeck district council, which is a small authority that has a total budget of only £6 million, predicts a shortfall of £123,000. That makes me wonder whether the Government’s anticipation of the extra visitor numbers to a wonderful tourist area such as the one that I am proud to represent is the same as the predictions made locally. My three councils are all predicting massive shortfalls.

Ms Winterton
Actually, a lot of the figures that we use are based on figures provided by local authorities. We do not make them up—we use the data that are available. In the hon. Lady’s constituency, the increase ranges from 31 per cent. to 40 per cent, which is considerable. In the Poole area, the special grant allocation is £596,000, which equates to approximately 596,000 extra journeys that might be expected in the area. It is important to recognise that that is a generous concession.

Mr. Mark Todd (South Derbyshire) (Lab)
I thank my right hon. Friend for giving way, and repeat the congratulations of my hon. Friend the Member for High Peak (Tom Levitt) on the flexibility she has shown about the issues raised in Derbyshire. In weighing up the increase given to Derbyshire, did she take into account the arbitration dispute with the bus companies based on the previous scheme, which is still in place this year? I believe that the arbitrator has found in favour of the companies and therefore substantially increased the cost that local authorities will have to pay. Has she taken that into account in the awards that have been given?

Ms Winterton
My hon. Friend is absolutely right. There have been instances where the bus operators have challenged the amount that they receive through the reimbursement system. Overall, in terms of the appeals that have been heard, some £6 million has been granted through the appeals system although some £28 million had been asked for by operators. Overall, £6.5 million is a fairly small amount, compared with the £1 billion that is spent on concessionary fares.

If my hon. Friend is asking whether we took into account appeals that are taking place, the answer is no. We had a formula that was based, as I have said, on bus patronage, eligible population and visitor numbers. It is then up to local authorities to handle matters through the reimbursement scheme, under which the bus operator should be no better or no worse off—that is the point of the scheme. That is how the appeal system works. It is important that we have an appeal system, but we consulted with local authorities on what we thought and gave them a number of options based on a host of different ways of calculating the formula. We then based the award on that. In my hon. Friend’s area, the increase is about 21 per cent., but overall in the Derbyshire scheme there is agreement that we can move forward on the terms that we had before.

Several hon. Members
rose—

Ms Winterton
I shall now wind up, but I shall take one more intervention if my hon. Friend the Member for Carlisle (Mr. Martlew) wants—

Mr. Eric Martlew (Carlisle) (Lab)
No, no.

Ms Winterton
In that case, I shall take an intervention from the hon. Member for Teignbridge (Richard Younger-Ross).

Richard Younger-Ross (Teignbridge) (LD)
I thank the right hon. Lady for giving way—in fact, I thank the hon. Member for Carlisle (Mr. Martlew) for not intervening. The Minister has been very generous and I know that she has spent a long time listening to local authorities and Members making representations. Does she accept that there is real fear among local authorities that the figures might be wrong? I hope that the authorities are wrong and that the Minister is right. If it turns out that the authorities are right and there is massive use of the provision—even though that would be a great success—that results in their ending up with great deficits, what mechanisms will be put in place to ensure that they are reimbursed not in three years’ time but in at least one year’s time?

Ms Winterton
I met the hon. Gentleman and representatives of his council, as did my hon. Friend the Minister for Local Government, to discuss the issue. In the hon. Gentleman’s area, the increase on what was spent in the previous financial year is 31 per cent. There is a particular problem in his area because some of the councils have opted out of the county scheme, and he was concerned about that. However, we have to balance that with the certainty that we are able to give with a three-year settlement, and we believe that it is very generous.

The fact is that most councils will receive around a 30 per cent. increase on average. The mechanism will be available in the future so that the funding can move from district councils to county level. In some areas, representations have been made about that, and we retain an open mind on some of the issues. However, it is important that councils have some certainty over the three-year period as to exactly what their funding will be. We need to get the balance right between the two.

The formula that we eventually arrived at distributes the funding on the basis of eligible local population, visitor numbers, retail floor space and current bus use. As such, we believe that it takes account of likely demand in areas such as coastal towns, urban centres and other places likely to experience an increase in bus journeys. Using that formula, we have drawn up the funding allocations for each of the travel concession authorities in England, as contained in the report today. As I have said, the average increase for local authorities is 29 per cent. above the figures for the last financial year.

The national concessionary fares scheme has been widely welcomed by older and disabled people. It gives a new freedom to millions of people and it is a very good scheme. The formula is generous in how it distributes money between local authorities to fund the scheme and I commend the report to the House.

23:02:00

Stephen Hammond (Wimbledon) (Con)
The motion before us tonight is to approve the local government finance special grant for the new concessionary bus regime—the new regime—and does not include any moneys for any other regime. It is the new regime that will come into operation on 1 April on the basis of the regime passed by the House in the Concessionary Bus Travel Act 2007 last summer. That extended the free off-peak concession to national travel, starting at 9.30 am for all those aged over 60 or disabled.

As the Minister said, the grant is not to do with what was already in place in terms of local concessionary travel, under which arrangements local authorities could offer a more generous scheme. Indeed, they still have the right to do so. However, the thrust of the debate tonight—the Minister has already made her case by saying that the settlement is generous—is not about what the Government have provided, as that is fine, but about the fact that the Government made a commitment to local authorities that they would fully fund the extended regime. The question is whether the Government have fulfilled that commitment, and I suspect that the answer, from the Opposition Benches, will be that, generous though the Government believe 29 per cent. to be, it does not represent the cost implications of the extension to a national free scheme. Therefore, the Government cannot be said to have fulfilled their commitment.

Mr. Martlew
Would the Conservatives provide more money for this scheme?

Stephen Hammond
That is not the point. I am happy to talk about the Opposition’s plans, but I and the Liberal Democrats pointed out over several sittings of the Committee considering the Concessionary Bus Travel Bill that neither the amount of money on offer nor the funding formula were likely to be sufficient to meet the Government’s commitment to fund the new regime in full. The short answer to the hon. Gentleman is that the debate will show that the Government have not met the commitment that they made.

At the outset, I can tell the House that we shall not vote against the motion. However, it is important that the Government understand that the criticisms and concerns raised during the passage through the House of the Concessionary Bus Travel Bill should not be forgotten. We have repeated those concerns and criticisms in questions on the Floor of the House, and local authorities have voiced the same message.

We have always made it clear that we are in favour of the principle of concessionary travel for elderly and disabled people. Just as much as the Minister, we recognise that the ability to travel is especially important, but we cannot support legislation that appears to be both ill thought out and insufficiently funded. The Government promised that the scheme would be fully funded—but tell that to the local authorities that will no longer be able to subsidise certain bus routes, or which are being forced to cut other services as a direct result of the settlement that they are receiving, or those left with no option but to raise council tax as a result of the new regime.

The Government promised that the scheme would be fully funded—but tell that to the bus operators who will be forced to cut frequencies, or who have indicated that they expect that they will be withdrawing services this time next year, or whose businesses will be threatened by the financial uncertainty inherent in the reimbursement system.

Mr. Philip Hollobone (Kettering) (Con)
What is my hon. Friend’s view about how the system has been set up? There are 324 different travel concession authorities based on district councils, and bus operators have lodged more than 100 appeals to the Secretary of State. Does my hon. Friend believe that there should have been fewer travel concession authorities, perhaps on a county-wide basis? Would that not smooth the differentials that are going to occur?

Stephen Hammond
My hon. Friend makes an exceedingly good point. We have not suggested that the Government base the reimbursement authorities on different areas. The scheme offers national travel on a local basis. Both in Committee and on the Floor of the House, we have always said that the greater the number of local reimbursement authorities, the more complex the reimbursement procedures will be. Many people have spoken about hotspots and honeypots in respect of funding, and the problems with the scheme are evident in many of the responses that are being received.

Tom Levitt
The hon. Gentleman will have heard that the Government will pay Cambridge local authority an extra £645,000, which is equivalent to an extra 600,000 journeys by qualifying elderly and disabled people. Is he saying that that figure for extra journeys is an underestimate? If he is not going to use the figures provided by local authorities, what figures does he intend to use?

Stephen Hammond
On the basis of the responses that I have received from local authorities, I am not convinced that £645,000 equals 600,000 journeys. Many authorities believe that journey costs have been underestimated, and therefore that the number of journeys covered by the money being made available has been overestimated.

David Howarth
It might help the hon. Gentleman to know that bus fares in the east of England are the second highest in the country. The average fare is £1.60, rather than £1. Another part of the problem is that we are not comparing like with like. The new rule is that the authority that pays for the journey is the authority in which the bus journey begins, not the authority of residence of the person making the journey. As a result, authorities will now be liable for journeys that already take place, but for which they do not currently pay.

Stephen Hammond
The hon. Gentleman makes a good point about an inherent aspect of the scheme—a point that has been made several times in debate.

Mr. Martlew
The hon. Member for Kettering (Mr. Hollobone) suggested that the Conservatives would take the responsibility for the concessionary fare away from the districts and give it to the county. Is that the policy of the Conservative party?

Stephen Hammond
My hon. Friend the Member for Kettering suggested that it might be simpler to do so in terms of reimbursement. What I said in response, as the hon. Gentleman will know, is that the current structure was always likely to be inherently difficult to administer, and to cause problems when it came to ensuring that the funding followed the journey, as the hon. Member for Cambridge (David Howarth) pointed out. It is clear that there are a number of ways in which local authorities and districts run the schemes, and we have not said that we would change that. We have pointed out that the way in which the Government chose to structure the reimbursement made it highly likely that there would be problems with ensuring that revenue followed the journey, and clearly those problems are occurring.

The Local Government Association has commented on the pressure on some local authorities. It says:

“Since the 2006 extension to the concessionary fares, councils report rises of over 150 per cent…to operators”.

It also says that

“the government should keep under review”

what

“amount…in 2008/09…is sufficient”,

and:

“Councils are reporting difficulties in estimating the precise cost in the run-up to April 1st.”

Richard Younger-Ross
Earlier, the Minister said from a sedentary position that that point was covered by county-wide schemes. Does the hon. Gentleman accept that county-wide schemes might cover part of those costs, but not all of them? In particular, in tourist areas—cities such as Cambridge or seaside resorts—there is a regular annual or monthly input of people who are not covered by those calculations.

Stephen Hammond
I thank the hon. Gentleman for making that point. My hon. Friend the Member for Kettering effectively made that same point, and in response I said that in these debates, we have recognised hotspots and honeypots. Those are exactly the places where people who are not resident in the area may well use buses.

The Minister talked about the percentage of extra money that was being funded by the Government, but as several hon. Members said in interventions, that does not recognise the extra cost of concessionary fares or the formula estimating the number of journeys. Also, she said that current usage would be our indicator for future usage, but because of a number of issues such as the hotspot issue, that is unlikely to be a good indicator.

A number of councils across the country have talked about the budget deficits that they will experience in 2008-09 as a result of the problems. The Minister mentioned extra moneys, but let me talk about the local councils that have provided me with data relating to budget deficits that will be created. The Basildon authority has given a £500,000 figure. Blackpool has talked about £200,000. Brighton and Hove is talking about a sum of about £1.7 million. The hon. Member for Carlisle (Mr. Martlew) has told us that Carlisle expects a budget deficit of £270,000. The local authority of my hon. Friend the Member for West Chelmsford (Mr. Burns) has indicated that it is likely to have a budget deficit of at least £500,000. Hastings has given a £200,000 figure. I could go on, mentioning places across the country.

When the Bill introducing the scheme passed through Parliament last year, time and again my colleagues and I expressed serious concerns about the funding system and whether the Government would put enough money into the system to fund what they were proposing. At the time, I tabled an amendment calling for a review of the funding mechanism, which would allow the Government to establish the costs borne by operators and authorities. Such a review would allow the Government to see whether the moneys that they were putting into the scheme were adequate for the new extension; to ensure that the distribution of those moneys went to the right place; to achieve efficiency and savings; and to re-examine whether the “no better off, no worse off” principle was being followed. The short answer is that the amendment was defeated by the Government, and no one knows whether the funding provided by the Government for concessionary travel is sufficient. Had the amendment been accepted, we would not be seeing some of the chaos that we see today, and a proper review could be performed with the aim of evening out those unforeseen inconsistencies.

The Government have talked about providing £212 million extra this year; £217 million in 2009-10; and £223 million the following year. That might be enough, but it may not be. The Minister said that it was extra money. It is not: it is the money that was going to be necessary on top of what was already available for concessionary funding to implement the Government’s new scheme. Last year, when the Bill was in Committee, the then Minister was talking not about £212 million, but about £250 million. As for the £1 billion that the Minister has discussed again tonight, £400,000 of that is somewhere in the rates support system, and it is extremely difficult to trace whether the Government have really provided that sum, and whether it is reaching the places it should reach.

The moneys that the Government are providing may be enough, but from the experience of local authorities, that certainly does not appear to be the case. For the past couple of years, bus operator inflation, as recognised by all transport bodies, has been closer to 9 per cent. than to the consumer prices index of 3 per cent. The Government have proposed increases for the next two years of 2.3 and 2.7 per cent. Even if they think that the £212 million this year is enough, the position is not encouraging for the next two years. They must recognise that, up and down the country, local authorities face huge gaps in their funding. There may well be some generous funding, as the Minister said, but if it does not meet costs, there will be problems for local authorities.

Barnsley metropolitan borough council, for example, said:

“I do feel our authority is receiving inadequate compensation”.

Basildon council said, “We are seriously underfunded”. Bournemouth council said that

“this government grabs the headlines giving out concessionary fares”,

while

“leaving councils to pick up the mess and move on”.

Carlisle council said:

“This situation is not financially sustainable.”

I could go on, right the way through the alphabet, but I will not do so, because I know that colleagues want to make a contribution to our debate. However, the Government are clearly not listening to local authorities. When the consultation on the distribution method for the special grant was analysed, the Department for Transport reported that

“the main concern raised by many was that the additional money allocated by Government would not be sufficient to pay for the extra cost of the new all-England concession.”

Since then, countless local authorities have made representations to the Government and to many others, but to little avail. Council planners’ confusion has been exacerbated by poor, overdue Government guidance. Indicative of that is the fact that the DFT required councils to publish draft scheme details and reimbursement guidance before 1 December last year, but it published its guidelines for doing so only in January 2008. The expected delays in the deployment of smartcard technology are further evidence that while the Government expect councils to cope with short lead times, they cannot do so themselves.

At Christmas, parents spend their hard-earned cash on presents for their children, and it is Father Christmas who tends to get all the credit. The Minister says that the Government should have all the credit for giving pensioners and disabled people free bus travel, but they  ignore the fact that local authorities throughout the country will have to pay for it. The Government are trying to be Father Christmas, and the local authorities will be the out-of-pocket parents.

Concessionary bus travel is a positive thing and due credit should be given to the Government for introducing it. However, they cannot grab all the congratulatory headlines, for as we shall see in the debate, it is clear that they have not met their commitment to fully fund the extension to a national concessionary travel scheme, and it is still not clear whether they have provided sufficient funding for the local concessionary travel scheme. It is clear that the local authorities and the bus operators are suffering financial shortages as a result of the extension that will come into operation. The concern must be that the travelling public and exactly those groups that the Bill is designed to help will be hardest hit by the funding.

Although we will not vote against the motion tonight, I hope that the Government will recognise that they have not met their commitment to fully fund the scheme. I hope that they will accept that an immediate review of the funding is needed and will reach an agreement to do so with local authorities and operators. I urge the Government to confirm that they will do that, for if they do not, there can be no certainty that the scheme will be a success, or that throughout the country in three years the scheme will be able to help many of the routes or the people whom it was designed to help.

23:21:00

Norman Baker (Lewes) (LD)
I welcome this important debate and thank the Government for making time available for it. I agree with the Minister, who said that the scheme is welcome. It will tackle social exclusion, help the environment and enable people who would otherwise be in their houses to get out and travel. All those outcomes are good. I do not subscribe to Mrs. Thatcher’s view that anyone over 30 who uses a bus is a failure, as she said on one occasion. I am happy that people over 60 use buses, as do people of my age.

The Government have managed to reverse the decline in bus usage, as the Minister said. That, too, is welcome. Bus journeys declined from 9 billion journeys a year in the 1970s to 5 billion in 2005-06—a cut of almost a half. The concessionary fares scheme will enable that to be reversed. All that is good, but the problem for the Government is a problem of success. Large numbers of people will use buses—far more than the Government imagined—and local authorities will have to pick up the bill because the increase in funding that the Government have made available, significant and welcome though that is, is not equivalent to the costs that local authorities will have to pay. There is a shortfall.

I should tell the Minister that I conducted a survey of what she calls travel concession authorities. Well over half of those responded to my survey. Of those, almost half of the councils said that they were underfunded. The hardest hit councils were underfunded by £1.7 million. Those were Brighton and Hove, and Nottingham. That is equivalent to council tax rises of £40 per family. Many councils reported problems, as we have heard from hon. Members intervening on the Minister and from the Conservative Front-Bench team.

Mr. Martlew
The hon. Gentleman is generous in giving way. He said that about 50 per cent. of the councils responded. Does he think that the other 50 per cent. are doing well out of the scheme, and wanted to keep quiet about it?

Norman Baker
For the record, what I said was that more than 50 per cent. of councils responded, and almost half of those said that they were underfunded. It is perfectly possible that within the allocation given by the Government, some authorities are doing very well indeed, and keeping quiet about it. That is perfectly true. I believe that overall the scheme is probably underfunded by about £60 million. It should be around £270,000 million. Some authorities are doing very well from the allocation, but many are doing very badly indeed. It is crucial that the Minister reconfigure the scheme in the light of experience and take account of factors which, with the best will in the world, she may not have been aware of when the scheme was put together. She and her officials have probably done their best, but the reality on the ground is that local councils up and down the country are telling us that the scheme is underfunded for them. They cannot all be wrong. We have heard the list from the hon. Member for Wimbledon (Stephen Hammond).

Mark Hunter (Cheadle) (LD)
rose—

Norman Baker
We shall hear of more now, I suspect.

Mark Hunter
Does my hon. Friend accept that one of the key issues is that the Government have failed to forecast the take-up of the scheme accurately? That is the real crux of the matter. In many places it is manifested by the funding shortfall about which we have heard so much already—not only that, but in areas such as Greater Manchester, which covers my constituency of Cheadle, there is the key problem of the authorities not being able to deal with the applications in time. That has led to lots of constituents telling their MPs that there have been unacceptable delays in the processing of the applications. The Greater Manchester transport authority has now said that it will make the current passes valid for an extra six months, until September this year. Frankly, that will get people from one side of Manchester to the other—not to destinations further afield, although that was one of the principal points of the scheme in the first place.

Norman Baker
My hon. Friend is right: the problem is one of success. The Government have had a huge policy success: people out there love the concessionary bus fares and want to take up the free passes. As a consequence, local authorities are having difficulty coping with the sheer volume, and find great shortages of funding.

The Government have miscalculated the allocation to local councils. They may have made their best guess, but that is clearly well out. To compound the matter, they have arranged a three-year formula. That is a good idea when matters have settled down, but to base such a formula on an outcome that the Government cannot possibly predict accurately will in the short term compound the problems of the authorities that will be underfunded.

Julia Goldsworthy (Falmouth and Camborne) (LD)
Does my hon. Friend think that the Minister would acknowledge that another problem of the formula is the fact that it does not take into account the number of routes available, although it may take the demographics and potential number of visitors into account? Truro is a hub for many visitors from my constituency, who will park and ride into the town to use the bus scheme, because the routes are available there. That, in turn, gives the local authority additional costs.

Norman Baker
My hon. Friend has made a good point. There are a number of kinks in the system, and they will manifest themselves only as the scheme gets under way. That is happening as local authorities make proper assessments. No one blames the Government for making their best guess, but I am telling the Minister that it is an underestimate by some distance, and there is misallocation between authorities.

Earlier, my hon. Friend the Member for Teignbridge (Richard Younger-Ross) intervened to ask what the Government would do if it turned out that their best guess was wrong, and the local authorities’ predictions were accurate. We have not had an answer to that. The Government need to accept that there has been a problem and correct it at the earliest opportunity.

Mr. Adrian Sanders (Torbay) (LD)
Are there any common factors among the authorities that told my hon. Friend that they were underfunded? From what the hon. Member for Wimbledon (Stephen Hammond) said, it seems that a disproportionate number of seaside resorts are involved. Areas that attract tourists could end up carrying the biggest proportion of the underfunding.

Norman Baker
My hon. Friend is absolutely right. The areas tend to be very attractive: Lib Dem constituencies, for example, are badly affected. Undoubtedly, areas such as seaside resorts and historic towns are affected.

The Minister talked about the funding mechanisms that she was employing. She wrote in a letter to me:

“The Department’s recent consultation on the funding distribution offered four formula options based on data that is likely to be closely related to the key drivers of the extra cost…Our proposed distribution formula is based on the most popular option in the consultation responses.”

She used that latter phrase again tonight. With due respect, I suggest to her that it was not the most popular option but the least unpopular option with which local authorities were faced.

Surely the only accurate way of addressing the issue is to recognise the actual costs incurred by local authorities in the scheme that is now to come into force, and ensure that there is a reimbursement process to iron out some of the difficulties. Without that, many local authorities will be well out of pocket—and that situation will be compounded for three years, which would be wrong.

Mr. Hollobone
I am listening to the hon. Gentleman with great interest. What is the Liberal Democrat policy on the idea of having fewer travel concession authorities and aligning transport authorities—for example, county councils—with travel concession authorities?

Norman Baker
That is rather a red herring. The transport concession authorities are now in place. Had the allocation been made accurately, and had some of the points made previously been listened to, we would not be in this position. Even if the Government have done the best that they can, they can still put things right. There is undoubtedly complexity in this arrangement, but it still could have been got right. That has not happened, and that is part of the problem.

My hon. Friend the Member for Torbay (Mr. Sanders) mentioned some of the areas that have lost out, which are indeed seaside resorts. Brighton and Hove is short by £1.7 million, Scarborough by £0.94 million, Southampton by £0.74 million, Southend-on-Sea by £0.7 million, Worthing by £0.6 million, and Torbay, his own authority, by £0.5 million. In other tourist areas, Harrogate is short by £0.77 million and City of York by £6.5 million. My own authority, Lewes district council, is £0.6 million short, and Chester city council is £0.4 million short. Shopping areas such as Nottingham, Chelmsford and Braintree are also well out of pocket. Local authorities all over the country are finding shortfalls, and the Government must answer the question about what they are going to do if those local authorities are proven right.

Let me deal with one or two other relevant issues. Many local authorities faced with unprecedented increases in budget demands will look to make savings, and unfortunately some will look to make savings in concessionary fares. One of the unforeseen consequences of the Government scheme is that local authorities are taking away discretionary concessions and ensuring that some who currently benefit from bus pass concessions will no longer do so. For example, there is a problem with travel between 9 o’clock and 9.30 in the morning. Many local authorities start their services at 9 o’clock in the morning, but are now moving to 9.30 in a desperate attempt to save some money. In Seaford, in my constituency, there is a bus every half hour. The 9.29 bus would previously have been available to constituents with a bus pass, but is now not available: they will have to get the 9.59 bus, half an hour later, which means, in many cases, that they will miss a doctor’s appointment or whatever else they are doing in the middle of town. That is disadvantaging certain people who currently have access to bus pass arrangements.

Mr. Roger Williams (Brecon and Radnorshire) (LD)
One of the aspects that my hon. Friend has not touched on is travel between the devolved nations and England. Let me point out the difficulty that some of my constituents experienced in travelling from Knighton in my constituency to Hereford, where there is a district general hospital and major shopping centre. They were able to make the trip from Knighton to Hereford, but had to change in Kington on the way back. The bus company refused to take their concessionary fare, so they were stuck in Kington—a very fine town, I might say. The explanation is that when all this settles down it will work, but in the meantime my constituents, who expect some co-ordination, are stuck in Kington.

Norman Baker
I hope that they are not all stuck there. My hon. Friend raises an important point about cross-border issues. He may know, as may the hon. Member for Forest of Dean (Mr. Harper), that residents in Brockweir, which lies on the English bank of the River Wye, are unable to use their concessionary passes on their only local bus service as it runs wholly within Wales, over the bridge from the village. That is an example of the nonsense thrown up by this scheme, which the Minister and her colleagues need to rectify. My right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) also raised the consequences for cross-border services. He will know, as will the Minister, I hope, about Borders general hospital near Melrose. It is on the Scottish side of the border but is the nearest hospital for many people living in England. People who have to cross the border are disadvantaged by the way in which the scheme is operating. That is a key issue.

The position becomes worse when local transport authorities say that they cannot afford to run all the buses that are subsidised, which leads to the ludicrous situation whereby more and more people qualify for concessionary bus passes yet the number of buses that they can use is diminishing. They have the piece of paper entitling them to use a bus but there will not be a bus to use, because local authorities are forced into cutting services. That has not been factored into the equation. Neither has the fact that there will be successful appeals by bus companies. They are keen to make appeals, and of course they will test the water and try to get as much money as possible from local councils. It would be strange if they did not behave in that way.

The Minister said earlier that £6.5 million had been awarded to bus companies from successful appeals, and she took some comfort from the fact that they had applied for £28 million and received only a quarter of that amount. I have to say that it will not provide much comfort to the local authorities paying out the £6.5 million that the other £21.5 million was not granted through the appeal process. That is money that could not have been anticipated, but it has had to be spent by the local authorities. So a number of major problems have been thrown up by the scheme.

The Government have introduced a popular policy that has been well received by the population at large, but we are now seeing the problems that are resulting from its success. The Government cannot close their eyes and say that they have a fair solution that meets all the local demands, and that it is for the local authorities to sort the problems out. The Government have created a mess. I do not blame them for creating the mess, but it is a mess in financial terms, and the local authorities have been lumbered with tidying it up. The Government must recognise that many local authorities are now genuinely well out of pocket, and provide a guarantee that they will review the scheme not after three years but at the end of the first year. If the case can be made to stand up—as I believe it can—that a significant number of local authorities are well out of pocket, and that the overall settlement of £212 million is inadequate, the Minister should pledge to ensure that the scheme will be properly funded in future, and that the costs that local authorities are incurring will be reimbursed.

23:36:00

Mr. Eric Martlew (Carlisle) (Lab)
May I take it from that contribution that the Liberal Democrats’ policy is to put more money in? At least we know where we are with them. The hon. Member for Wimbledon (Stephen Hammond) refused to say that the Conservatives would do so, and refused to say that they would change the mechanism by which the money was given to the local authorities. I understand that he is in a difficult position.

Stephen Hammond
May I just correct the hon. Gentleman? The first part of his point was correct. I said that the Government were saying that they were fully funding the scheme, but that that did not appear to be so. I also said, however, that we would look at the funding formula.

Mr. Martlew
I accept that, but when the hon. Gentleman was asked whether he was in favour of dealing with the issue at county level instead of through the 342 different authorities, he had no answer.

Won’t 1 April 2008 be a great day, when 11 million pensioners and disabled people will be able to cross borders and enjoy life more—[Interruption.] I voted for devolution, but I am not sure about those on the Opposition Benches. There are bound to be differences. The reality is that the scheme will be very popular in my constituency. I can see my constituents going to the Lake district, or perhaps to the Metro centre in Newcastle. I can see them catching the train to Blackpool, then using the buses in Blackpool. We have heard people going on about tourist areas, but those areas will be getting more custom, as people will be spending money in those constituencies. That should have been pointed out.

Mr. Sanders
There is one important point that seaside resorts have been extremely concerned about. They might get extra custom, but they will also incur additional costs that they cannot recoup from the visitor. That is a problem for every seaside resort.

Mr. Martlew
Is the hon. Gentleman saying that people should stay away from his constituency? It sounds like that to me.

The reality is that the scheme will provide free travel for pensioners and the disabled, but £1 billion is going to the bus companies, and I worry about that. In my constituency, Stagecoach has cynically put up the single fare by 7.5 per cent. Many of us believe that that was done to offset the amount that it will lose through concessionary fares.

Norman Baker
Does the hon. Gentleman not recognise that that factor alone represents an increase for local authorities up and down the country, through the increase in bus fares, that cannot have been factored in by the Government?

Mr. Martlew
I actually think that there should be challenges to the bus companies. They are not supposed to make a profit from the concessionary fares, because under EU rules, that would be seen as state subsidy and would therefore not be allowed.

The main point that I want to make is that we need to move as quickly as possible from funding the scheme on a district basis to funding it on a county basis. We know that that cannot be done overnight, and we know the reason for that, but it has not been mentioned. A lot of district councils receive a lot more money than they spend on concessionary fares, and they spend it on other things. If we take that money away from those councils their MPs will start carping, and if we do it immediately, council tax will increase or services will be reduced. That is because some local authorities could have introduced concessionary fares, but decided to spend the money on other things. That must come to an end.

Carlisle has been mentioned. Carlisle city council has said that it is underfunded—but it would say that. It is controlled by the Tories and Lib Dems, and before the previous election it made a pledge that it would give free cross-border travel throughout the day, but then said, “We’re going to cut it now—it’s got to be the national scheme, starting at 9.30.” That was fortunate, in a way, because the individual who used his vote to clinch that decision—there was only a majority of one—happens to be my Conservative opponent at the next election, and I do not think that the pensioners of Carlisle will forgive him for that.

Then there was a row among the Conservatives. They came back and said, “No, we’re going to give it to the disabled now. They can have free travel all day, but the pensioners can’t.” I had an old lady ring me up and say, “I’ve got a pass here that they’ve sent me. I’m a pensioner and I’m disabled, but now I’ve got a letter saying I have to send the pass back, then they’ll send me another one because I’m disabled.” That is the sort of council that we have in Carlisle—a council that can’t make decisions and breaks pledges. I make a prediction that the Conservatives will lose control of the city council at the local elections. Labour will control Carlisle because of that issue.

Julia Goldsworthy
Is the hon. Gentleman suggesting that it would be an improvement if the Government scheme ran from 9 o’clock in the morning, too?

Mr. Martlew
No, I am not suggesting that at all. I am suggesting that local authorities should keep their promises. I forgot to say that the other person who voted against the scheme was the Liberal Democrats’ prospective candidate for Carlisle. We should have known that they would vote against it.

To be serious and to return to the major issue, if we are to have a truly nationwide scheme that does not have winners and losers, we need to move quickly to a county-wide basis. We have heard the arguments from Derbyshire and various other authorities; it could have been Somerset where it was argued that one of the authorities was no longer part of the loop. The scheme is not working, and we really need a system funded by the counties. If that happens—we will have to let councils have time to adjust—the Government will no longer have to put in any money at all, because the money is there, but in some cases has not gone to the right authorities. [Interruption.] That is true, and I have explained why. In the case of Carlisle, the money has gone to the local authority; it has just not been spending it.

Norman Baker
If the hon. Gentleman accepts that some money has been misallocated and gone to the wrong authorities—I agree with him on that—does he think it wrong for the Government to have a three-year funding arrangement? Should they not review it after a year?

Mr. Martlew
My view is that the hon. Gentleman should perhaps have listened more carefully. The system has to be put on a county-wide basis. It is no good adjusting the system in three years. We have to move to a totally different system. If we do that, we will have a better system, as well as larger authorities to negotiate with the likes of Stagecoach, First Group or National Express. The idea of my local authority arguing the case against Stagecoach frightens me, because to be honest I do not think that it is up to the job. We need large authorities to do that.

Let us return to the main point. The scheme is a great success. The Labour Government have promised to do this, and they are doing it. People will get the benefit in my constituency, and up and down the land, on 1 April this year. If it had been left up to the Opposition parties they would have talked about it forever, but they would never have found the money.

23:44:00

Mr. Simon Burns (West Chelmsford) (Con)
I do not intend to detain the House for long, but I want to raise one issue, and a spin-off problem. We have heard in the debate so far, particularly from the Opposition Benches, a common thread to many of the complaints: despite the majestic efforts of the Minister to spin the situation, it is not quite as rosy as she claims. The Government are not providing the full funding, despite the glowing percentage increases that she has cited. Of course it is possible to have glowing percentage increases if one does not take into account the other costs involved with a scheme. Moreover, what figures do those percentages relate to, and do they relate to the estimated cost of funding a scheme fully?

As I said to the Minister in an intervention, an independent study has been done by independent people on behalf of the Government, in conjunction with local authorities, to work out the cost of a fully funded scheme along the lines of what the Government have promised. Taking my local authority of Chelmsford borough council as an example, it was independently assessed that in order to fund the scheme fully the council would have to be given £1.1 million. The Government have actually provided £413,000 for the coming year, which leaves a shortfall of £738,000. That is a considerable amount of money. The borough council has to look for efficiency savings and switch around some of its priorities to help pay for the scheme, which it is determined to make a success for those who look forward to its starting on 1 April.

There is a second problem because of the underfunding. Under the ambit of the Government’s proposals, the scheme has to start at 9.30 in the morning, but under Chelmsford borough council’s scheme, the start time was 9 am. A responsible council cannot cut services dramatically in other areas due to the shortfall in funding, because that would cause significant problems, over and above efficiency savings. It will have to abide by the Government’s guidelines of a 9.30 start, because it cannot find the money for a scheme that is based on the Government’s scheme but that starts at 9 am. That will cause problems for a number of pensioners and disabled people in the Chelmsford borough council area who for a number of reasons have got used to using their bus passes from 9 o’clock; it may be convenient or necessary for them to travel at that time.

It is sad that there should be an element to this scheme, which is welcomed by everybody in this House in many ways, that spoils the overall effect. That has happened solely because the Government are not prepared to provide the full funding that independent assessors have said the scheme needs. I hope that the Minister will take the advice of a number of hon. Members in interventions and speeches today, and monitor the scheme from its start date of 1 April. A year may be too short a period of time for that—experience and time will tell. If the period in question is to be three years—a three-year period is not viable for the Minister and her Government, because they will not be in office to do this—I hope that the Government of the day are prepared to look at the scheme again to identify its strengths and weaknesses in order to address maintaining the strengths and buttressing the weaknesses.

23:49:00

Mr. Mark Harper (Forest of Dean) (Con)
Given the limited time available I shall focus on one issue and pick up the point I raised in my intervention on the Minister.

As one steps through the report, it is very clear that it is not a national scheme at all, but an England scheme. When the Prime Minister, then the Chancellor, promised the scheme, it was clearly spun and reported as a national scheme, so many of my constituents quite rightly thought that that meant they could travel anywhere in the UK. As has already been said by hon. Members with constituencies in Wales or near the Scottish borders, this has been a severe let-down. The impression was certainly given that the scheme would be UK-wide, but that has clearly not been delivered. All I ask for is a little honesty. Ministers should not use the word “national”; they should say only “England” to make it clear that the scheme allows people not to cross national borders but only local authority ones. Ministers should be honest about what exactly they are promising.

I said in my intervention that the scheme does not mean much to many of my constituents, and that is exactly right. If someone needs to travel across the border into Wales, the scheme will not help. A constituent who lives in Lydney can get the bus from there to Chepstow, but continuing will mean changing in Chepstow and paying for the rest of the journey. For many of my constituents, that will be the more significant part of the journey. Because of the geography, someone starting a journey from the southern end of my constituency and wanting to go back into England will have to pass through Wales. If that means changing buses, even though the start and end points of the trip are both in England, it will not be possible to claim for the cost of the whole journey. That is a ridiculous situation.

Someone starting in Lydney who has to catch a bus to Chepstow and then change, perhaps to go to Cribbs Causeway, which is also in England, will have to fund the bulk of the trip themselves. My constituents think that that is simply bizarre. It is all very well saying that the local authority has the option to fund that part of the journey: of course it does, but it will cost money, and it means that the Government have made a promise but not funded it. Something else will have to give—either council tax will have to rise or other services will not be funded. The Minister should take that into account and work on it with her colleagues in the Welsh Assembly Government.

Let me take hon. Members through some of the questions that I have asked on this issue. When I challenged the then Secretary of State for Wales, the right hon. Member for Neath (Mr. Hain), by asking him whether he would work with his colleagues in the Welsh Assembly Government

“to take up that framework legislation to ensure that we can have seamless journeys across the English-Welsh border”,

he replied:

“Indeed. I can assure the hon. Gentleman that Welsh Assembly Government Ministers will do that.”—[Official Report, 17 January 2001; Vol. 455, c. 772.]

When I asked the then Transport Minister, the hon. Member for Lincoln (Gillian Merron), the same sort of question, she pointed out in a written parliamentary answer that the Concessionary Bus Travel Bill had a framework for working closely with the devolved Administrations and that all had “indicated support”. She said—this was in May last year—that the Government and the devolved Administrations would have to work closely together. We do not seem to have made a great deal of progress since then.

When I questioned the present Minister in oral questions in December, she said that she wanted

“to see the scheme operating properly across the borders”.—[Official Report, 4 December 2007; Vol. 468, c. 670.]

When I challenged the Minister responsible for Transport in the Welsh Assembly Government on that matter, however, he said that he wanted to see the scheme “settle down”. That was not the Minister’s position at the time, but I notice that the two have now got their act together and co-ordinated their responses, as the Minister is now saying that she wants the scheme to settle down.

I do not see why my constituents should have to cope with an unholy mess on 1 April as they discover that they cannot use the scheme for many of the journeys that they need to take—going to hospitals, doctors’ surgeries, dentists and so forth. Why should they be denied that? Why should they have to wait for the scheme to “settle down” while the Westminster Government and the Welsh Assembly Government try to get their act together to ensure that the scheme will work across borders?

Mr. Beith
I remind the hon. Gentleman that the Government say that they have made no detailed assessment of the cost of introducing mutual recognition, yet they produced generalised financial arguments against it. Should they not at least be doing that work now?

Mr. Harper
Absolutely, and I am very grateful to the right hon. Gentleman for that point. The Minister suggested that mutual recognition would be very expensive. If we accept that that is the case, it follows that it would be very expensive for local authorities to fund mutual recognition across the borders. They cannot be expected to fund that from the limited resources available to them through the council tax. Many of their constituents are already hard pressed. If Ministers make generous promises, they should ensure that they fund them fully, as they have made clear throughout, but I do not think that they have done so, and they certainly have not done so in a way that allows my constituents to take advantage of a genuinely national scheme. This is an England-only scheme, and it needs to be looked at again.

23:55:00

Ms Rosie Winterton
This has been a very interesting debate, although I am not sure that it has been particularly enlightening in respect of the position of the Opposition parties. The hon. Member for Wimbledon (Stephen Hammond) refused to say how much extra he thought should be invested in the concessionary fares scheme. He certainly did not tell us whether a Conservative manifesto would include a commitment to providing extra funds, and whether that had been cleared with the shadow Chancellor, the hon. Member for Tatton (Mr. Osborne). The hon. Member for Forest of Dean (Mr. Harper) wanted the scheme to be extended even further. It would be interesting to know whether the Conservative Front-Bench team intends to fund the extra costs of extending the scheme to Wales and Scotland.

Stephen Hammond
I know that the right hon. Lady is always fascinated by what our policies are, but I remind her that the debate was about her policies. I assume that her fascination is due to the fact that in two years’ time she will be where I am now, and she is considering how she might oppose our policies.

Ms Winterton
Given all the unfunded schemes that the hon. Gentleman listed this evening, I think the electorate will recognise that without a Labour Government there would not be a national concessionary fares scheme, and there would not be nearly £1 billion going into it. The Conservative Government ran down bus services after deregulating the market. What we heard tonight were vague promises of unspecified future funding to which, as far as I know, the shadow Chancellor has not given the go-ahead. The same applies to the Liberal Democrats. The hon. Member for Lewes (Norman Baker) said that an extra £60 million was needed, and he too seemed to want to extend the system to Scotland and Wales. If that is a manifesto commitment from the Liberal Democrats, it would be interesting to know how their sums add up.

Norman Baker
rose—

Ms Winterton
I have only three minutes left, and I want to mention the important points made by my hon. Friend the Member for Carlisle (Mr. Martlew), particularly his point about the boost to the economy given by people coming into an area. The Liberal Democrats, and perhaps other Opposition Members, appeared to be saying “Our town is closed to visitors.” I am sure that the shopkeepers and restaurateurs in their areas will not be very pleased to hear that they do not welcome people from outside.

My hon. Friend mentioned the 7 per cent. fare increase imposed by one bus company. This is an issue that some Members overlooked in their speeches. Local authorities must take into account not just one increase but the whole basket of fares in reaching agreement with bus operators on what constitutes a fair reimbursement.

The hon. Member for West Chelmsford (Mr. Burns) spoke of an “independent assessor”. No independent assessor supplied an analysis to the Department for Transport. I believe that someone in the bus world has carried out assessments for bus operators, but that is entirely different from an independent assessment carried out for the Government. The hon. Gentleman may be confusing these arrangements with the appeals system.

The three-year settlement is very generous. I take on board some of the points that have been made about the possibility of county-wide settlements in the future, and we will keep that under review, but 11 million older and disabled people will benefit from this scheme. I think we should welcome it, and I commend the report to the House.

Question put and agreed to.

Resolved,

That the Local Government Finance Special Grant Report (No. 129) on the grant to be paid towards the cost of implementing the new statutory minimum bus travel concession in England (House of Commons Paper No. 256), which was laid before this House on 19th February, be approved.

DELEGATED LEGISLATION

Mr. Deputy Speaker (Sir Alan Haselhurst)
With permission, I shall put motions 4 to 11 together,

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Delegated Legislation Committees),

Social Security

That the draft Child Benefit Up-rating Order 2008, which was laid before this House on 6th February, be approved.

Social Security, Northern Ireland

That the draft Guardian’s Allowance Up-rating (Northern Ireland) Order 2008, which was laid before this House on 6th February, be approved.

Social Security

That the draft Guardian’s Allowance Up-rating Order 2008, which was laid before this House on 6th February, be approved.

Tax Credits

That the draft Tax Credits Up-rating Regulations 2008, which were laid before this House on 6th February, be approved.

Proceeds of Crime

That the draft Proceeds of Crime Act 2002 (Cash Searches: Code of Practice) Order 2008, which was laid before this House on 19th February, be approved.

That the draft Serious Crime Act 2007 (Amendment of the Proceeds of Crime Act 2002) Order 2008, which was laid before this House on 20th February, be approved.

That the draft Proceeds of Crime Act 2002 (Investigations in England, Wales and Northern Ireland: Code of Practice) Order 2008, which was laid before this House on 19th February, be approved.

Official Statistics

That the draft Official Statistics Order 2008, which was laid before this House on 26th February, be approved.—[Alison Seabeck.]

Question agreed to.