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Session 1999-2000
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Delegated Legislation Committee Debates

Local Government Finance (England) Special Grant Report (No. 53) on Rural Bus Subsidy Grants for 2000-01 (House of Commons Paper No. 302), and the Local Government Finance (England) Special Grant Report (No. 54) on Rural Bus Challenge 1999 (House of Commons Paper No. 303)

First Standing Committee on Delegated Legislation

Monday 20 March 2000

[Mr. BARRY JONES in the Chair]

Local Government Finance (England) Special Grant Report (No. 53) on Rural Bus Subsidy Grants for 2000-01 (House of Commons Paper No. 302), and the Local Government Finance (England) Special Grant Report (No. 54) on Rural Bus Challenge 1999 (House of Commons Paper No. 303)

4.30 pm

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Keith Hill): I beg to move,

    That the Committee has considered the Local Government Finance (England) Special Grant Report (No. 53) on Rural Bus Subsidy Grants for 2000-01 (House of Commons Paper No. 302).

The Chairman: With this it will be convenient to consider the Local Government Finance (England) Special Grant Report (No. 54) on Rural Bus Challenge 1999 (House of Commons Paper No. 303).

Mr. Hill: Let me say what a pleasure it is to serve under your able and wise chairmanship, Mr. Jones. I commend you for avoiding the pitfall of having to designate me by my name. I recall a certain difficulty on an earlier occasion.

That notwithstanding, I am glad to have the opportunity to open the debate on the special grant reports Nos. 53 and 54. Both reports are about rural buses. Report No. 53 will allow for the third year's payment of rural bus subsidy grant to all eligible local authorities; report No. 54 is about grants to particular schemes put forward by local authorities under our rural bus challenge competition in 1999. Before I examine the reports in more detail, it may be helpful to the Committee if I set out a little of the background to them.

Members of the Committee will know that the special grants that we are debating today are funded from the new money that the Government have provided for the support of rural public transport in the United Kingdom. On 28 February, I announced the continuation of funding for the rural bus subsidy grant at least at its current level for a further three years. That is a further £100 million in addition to the money that was previously provided. The grants are just part of the Government's positive action to support rural communities, in particular to help improve their mobility and to ensure that they have more travel choice.

The grants reflect our commitment to improve public transport services for all in town and country alike as part of our integrated transport policy. We must encourage a viable alternative to the private car. With the changes that we are making, most notably under the Transport Bill, we are establishing the necessary framework for the achievement of our policy objectives. The reports are about helping to provide that alternative, with new, conventional bus services as well as innovative solutions to the provision of public transport.

Report No. 53 provides for the continuation of the rural bus subsidy grant. As members of the Committee will know, the grant can be used to support new or improved scheduled bus services in rural areas. In its first year, the grant provided for 1,845 new and enhanced services in England, many to communities that previously had no service at all. At least 10 million passenger journeys were undertaken on those services.

It has been claimed that some of the services have few passengers and that subsidy costs are far too high. I recall the Opposition spokesman trying to cast doubt on the value of the new services in our recent discussions on the Transport Bill. Hon. Members will recognise that it would be surprising if every new service was an instant success. Let us remember that new services need time for patronage to build up. We must give them that time before declaring any one service a failure. I know that local authorities are keeping a close eye on the viability of each service that they support, but monitoring has shown that there have already been many good examples of successful new services.

I shall refer to two of the many such services. In Staffordshire, a mainly new route operating between Codsall, Penkridge and Stafford—a route that provides eight settlements in south Staffordshire with a service for the first time—has been so popular, with significant passenger and revenue growth, that the authority is considering introducing an enhanced frequency on the service. Dorset, in conjunction with Devon, has improved and enhanced frequencies with additional journeys, additional days of operation and new low-floor buses on the Weymouth to Axminster service. Patronage on the service has increased by more than 80 per cent., which is much higher than initial expectations and is rightly considered an outstanding success by the authority.

We attach considerable importance to the need to monitor the impact and effectiveness of the grant, and will shortly ask local authorities for the latest information on changes to services in the second year of the grant—1999–2000—and on the performance of the services being supported.

I turn now to the specifics of report No. 53, which, as I have said, deals with the third year of support for rural bus services. In the interests of continuity and stability, we believe that the allocations and grant conditions should be the same as those in previous years, except for one change. I am well aware that some people have argued that the grant should be available to replace services that have been recently withdrawn for various reasons. The grant condition that prevents that from happening is known as the 1 May rule. The essence of the grant is to provide new money for new services. We want the funds to continue to be targeted on additional bus services for rural areas. The conditions set out in the report are designed to achieve that aim. However, we have taken careful account of the representations and concluded that the 1 May rule should be advanced by a year, so that rural bus subsidy grant for 2000–01 may not be used to support a service that was already available on 1 May 1999, unless the service was being supported by the grant.

The precise amounts payable to local authorities for this financial year are listed at annex A of the report. There are some very substantial amounts, nine authorities receiving more than £1 million. Annex B details the main features of the report, including the mechanism for calculating the distribution of finds to local authorities on the basis of the size of their rural populations. Annex C describes the conditions for the payment of grant, including the criteria for those services eligible for grant and the grant payment arrangements.

I turn now to Report No. 54. Conventional bus services are of great importance in rural transport, but we believe that other solutions must be stimulated and supported to allow a flexible approach to the local circumstances of particular areas. Therefore, we have set aside separate funds for the rural bus challenge competition, with the money going to the authorities with the best ideas. Report No. 54 contains the list of schemes that were successful in the second of those competitions.

The bidding guidance issued to local authorities set out criteria that were deliberately broadly drawn so that local authorities had the freedom to make bids within the overall objective of the competition. For example, we made it clear that the bids could be for capital as well as current account expenditure. The bidding invitation stressed a number of important factors that local authorities should take into account in developing their proposals, including the need to consider public transport networks—that is, connections between services to improve links between remote rural areas and existing public services. Local authorities should also consider the needs of women and the mobility impaired. They should take account of interaction with community transport providers as well as bus operators and the need to consider better public transport information.

By the closing date in October last year, we had received 124 bids from 47 authorities. The value of the bids for support was more £37 million. Total bids far exceeded the amount available for distribution for the second year running, so the Committee will realise that, as a matter of hard arithmetic, several authorities were bound to be disappointed. I am sure that the Committee will understand that, but I regret that arithmetic meant so many hard choices in a large and encouraging field. I stress that another competition will be held this year.

In deciding which bids to support, we aimed at a balanced range of schemes, in size and content, from all over the country. The aim was to choose a variety of ideas to discover what lessons could be learned for wider application and to fund some simpler schemes of more immediate but none the less valuable local benefit. Some of the schemes being funded are quite high tech. Others involve new ideas for services, perhaps with flexible routing so that the bus can follow demand. Others involve simpler ideas for new facilities such as better waiting or information arrangements for passengers.

It is not easy to pick out just a few examples of the schemes that we have selected for support. I mean no disrespect to the local authorities whose schemes I do not mention today, but time does not permit me to detail the complete list of schemes. However, the Committee will expect me to outline at least some examples of successful bids.

In South Yorkshire, we are providing £1.3 million—the largest single award—for a 30 per cent. contribution towards the bus element of the south Rotherham transport strategy, including new bus services, enhanced schools transport, the development of community transport, a quality bus transport corridor and improved interchange information and ticketing systems.

Cheshire will receive £632,388 for a three-year project to improve integration through a network of community transport schemes to make better use of existing resources and to introduce new technology and vehicles. At the other end of the spectrum, we are providing £5,000 to Redcar and Cleveland for the provision of a minibus turning circle at Mount Pleasant to enable the area to have a bus service for the first time. The scheme is modest in size and time, but none the less thoughtful, and will provide genuine benefits for the local community.

I should outline for the Committee the contents of report No. 54. Annex A of the report lists the amounts payable to each of the 42 successful authorities for which the 58 schemes approved, which total £16.8 million. Hon. Members will note that the report seeks approval for the total cost of the schemes. Some of the schemes listed will run for one year, while others will run for longer. The funding figures shown relate to total scheme costs, not merely the costs related to one year. It seemed only right to present to the Committee the full costs for which the Government seek approval.

Annex B details the main features of the report and contains an explanation of the objectives of the competition and the criteria against which bids were assessed, including the extent to which they took account of several key factors highlighted in the bidding invitation.

The conditions and payment arrangements are set out in Annex C of the report.

The special grants that are the subject of Report No. 54 represent a variety of bright, innovative ideas conceived by local authorities throughout the country about how to improve rural bus transport. I am sure that the ideas will prove their worth in years to come and will encourage others to adopt similar plans for their areas. Similarly, I believe that the special grants that are the subject of report No. 53 can make and have already made a genuine difference to rural transport. I am therefore glad to commend both reports to the Committee.

4.43 pm


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