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5.57 pm

The Parliamentary Under-Secretary of State for Transport (Gillian Merron): I thank hon. Members for their contributions to this debate, which is important, not least because it is about giving older and disabled people throughout the country better access to bus travel. I am delighted by the wide support that the Bill is enjoying in the House, but also intrigued by the requests from those on the Opposition Benches for many extra millions of pounds to extend the scheme still further, as the Bill is in fact about geographical scope.

Buses are at the heart of our commitment to cut congestion and pollution. Because they are at the heart of every community—taking people to work, to the shops and to see friends and family around the corner and throughout the country—buses are for me, in short, a social justice issue. That is why the Government’s extension of concessionary fares coverage is so important. Eleven million older and disabled people can already enjoy free local off-peak travel, but not everyone can get to where they want or to see who they want just within their communities. Grandchildren might live 30 miles away or more, and hospitals can be just over the local authority boundary, as we have heard in examples today.

The Government have listened. By removing the issue of local authority boundaries, which are indeed an artificial barrier to free bus travel, we are extending freedom and extending people’s horizons. We will continue to work closely with a wide range of stakeholders—local government, bus operators and groups representing older and disabled people—to achieve that important improvement.

I shall now turn to the specific issues raised by hon. Members. The definition of a bus, an open-top bus and a coach was the subject of a flurry of questions. If I may enlighten the House, we use the term “public service vehicle”, which is defined in other legislation, and I would be happy to supply the references. Earlier, we were talking about ladies and gentlemen of a certain age, but in this case we are talking about vehicles of a certain size—buses and minibuses that carry passengers for fares.

The hon. Member for Hexham (Mr. Atkinson) was particularly interested in the issue of coaches, although the hon. Members for Uxbridge (Mr. Randall) and for Rochdale (Paul Rowen) also raised the issue. Coaches will be obliged to provide the national concession where they provide local services as part of their routes—where sections of their routes have stops less than 15 miles apart and are sufficiently accessible to members of the public. Those local services will be registered as such, and do not include long inter-urban journeys with no local bus stops or services marketed exclusively for tourists.

Mr. John Leech (Manchester, Withington) (LD): Does not the Minister think that the bus companies, which are run by clever people, will be able to find a way around the current definition of a bus and a coach?

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Gillian Merron: That has not been the experience to date, and I am sure that Members will raise any examples.

Considerable interest has also been expressed in the “no better off, no worse off” reimbursement arrangements for operators. The objective is set out in the Travel Concession Schemes Regulations 1986. Under the Transport Act 2000, which will be amended by the Bill, authorities will reimburse the operator for providing the concessions, as is the case at present. Importantly, there is full reimbursement for reasonably incurred loss arising directly from the provision of concessions. In relation to bus operators putting up fares, it is worth reminding ourselves that the majority of bus passengers are not in receipt of concessionary fares, so bus operators must take account of the impact on fare-paying passengers.

Mr. Kevan Jones: May I point out one anomaly? Currently, a bus company gets reimbursed for providing concessionary fares on a route. However, if it subsequently withdraws that route and another operator takes it over, the concessionary fare reimbursement stays with the original company for, I understand, 12 months. Should not we examine whether that can be transferred to other operators when a company withdraws a route?

Gillian Merron: I assure my hon. Friend that all those matters are under discussion with the interested parties. Operators do not receive the full fare charged, about which some hon. Members have been concerned, but an average fare, which takes into account the whole range of tickets, including discounted tickets.

The other big area of debate today has been on technology and smartcards. I confirm to the House that we are doing everything possible to assist local authorities in their delivery, and will continue to provide support and advice beyond April 2008. The Government support entirely the faster and wider spread of smart ticketing. The Department has already gone a long way to promote that. But the introduction of full smart ticketing with bus-based card readers, which many Members have mentioned, takes time. It would be neither practicable nor sensible to ask local authorities to implement that for April 2008.

In the longer term, however, smartcards can reduce fraud and help to secure better data for reimbursement calculations. We are having discussions with all the interested groups, and if the smartcard format is chosen, the Government would look to assist in local authority procurement. Through the negotiation of framework agreements, that would be of great assistance to local authorities up and down the country. We remain committed to funding any new burdens imposed on local authorities. We have said that we expect to fund reasonable new cost burdens arising from the issuing of passes.

Let me clarify what will happen in April 2008. Subject to consultation, concessionaires will have a credit card-sized photo-pass with a national logo so that it can be recognised throughout the country, and locally customised so that eligibility for local concessions beyond the national scheme can also be noted. I can reassure London Members that the freedom pass will have a national sticker as a temporary measure, again because it is not practical or cost-effective to introduce a national pass in time for April 2008.

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Mr. Randall: Will the Minister explain further what she meant by the Government’s “assisting” local authorities? Does that mean handing them some catalogues or giving them some money?

Gillian Merron: Assistance will come primarily through a procurement framework, but there will also be people in the Department to provide the necessary practical advice and support. As I have said, funding for new burdens is also possible.

Mr. Kevan Jones: I do not want the Minister to pour millions of pounds into the Go-Ahead Northerns of this world, but will small operators operating the scheme be helped to obtain equipment that will accept the new cards?

Gillian Merron: We know that card readers will not be in place by April 2008, but the cost of introducing them has been estimated and discussions are taking place with all the main parties, including representatives of small operators.

The hon. Member for Epsom and Ewell (Chris Grayling) asked about start times. In the event of start times that are earlier than the national minimum, local enhancements to the national scheme may indeed continue. Local authorities that currently have the flexibility to offer more than the statutory concession can of course continue to do so. The extension to morning peak-time bus travel that the hon. Gentleman requested would cost at least £84 million a year, but, as with other requests for extensions, it is not just a question of cost; it is also a question of local bus services’ ability to cope with higher demand. That is why I consider it much more important to provide a national minimum that everyone understands, while allowing local authorities to go beyond it if they wish.

Chris Grayling: May I ask the Minister to stop giving such a creative impression of comments made earlier? We asked her a number of questions about cost, but we did not ask for extensions to the scheme. What I asked was what work she had done on assessing the extension of the scheme in a number of contexts. I asked about community buses, and about extended hours. Opposition Members do not have that information. Can the Minister tell us what the costs might be, in order to inform future debate on this worthwhile scheme?

Gillian Merron: I thank the hon. Gentleman for that clarification, but I am sure the House will accept that inquiries of that nature are normally assumed to indicate an interest in the means, not least because they have been made many times before. However, as I have said, we do have the information: £84 million is the estimated cost of extending the scheme to peak-time travel in the early mornings.

As for the extension of the national concession to community transport, I have listened closely to representations from the Community Transport Association. Our initial estimate of the annual cost of such an extension is at least £25 million, and it is purely indicative: the cost could be higher. But, as I said earlier, it is not just a matter of cost. This is about the ability to provide a service. If we were to go down this route, there would be no assurances that the community transport
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sector could meet the extra demand and we would run the risk of disappointing many vulnerable people who would not be able to access the services that they would expect. I would not want to do that.

David Taylor (North-West Leicestershire) (Lab/Co-op): I had talks with Arriva Midlands senior staff on Friday, and I have been in contact with Leicestershire county council at county hall recently. They both confirm that it is extraordinarily difficult to estimate the extra cost at the local level of the extension of the pre-9.30 concession. Will the Minister say on what basis the figure mentioned has been arrived at, and whether that is sufficiently robust for the purposes of our discussion this evening?

Gillian Merron: My hon. Friend raises an important point. It is extraordinarily difficult to pinpoint that. However, we are talking about “in the order of” certain sums. One of the difficulties in calling for extensions to the current scheme—as some Members do, particularly on the Opposition Benches—is that we do not know precisely what will be the extent of take-up. Therefore, our estimates are conservative—with a small “c”—and based on what we anticipate will be the case. We also get information through discussions with the relevant provider. Clearly, the figure to which my hon. Friend refers can only be an estimate.

Paul Rowen: The Liberal Democrats have asked for scheme extensions in cases where there is not a bus service in operation, and in respect of community transport services or other such services, and where journeys are in part covered by a bus service—a ferry or tram service might do that. That could easily be done by extending the definition of what is a public service vehicle and registering particular community transport services as public services.

Gillian Merron: That is why the Bill allows local provision to be made where it meets local circumstances. However, I respectfully remind the hon. Gentleman and others that we are talking about a funding commitment of many millions of pounds. Opposition parties might wish to consider whether they would be prepared to back up what they are asking for.

The hon. Member for Epsom and Ewell suggested that smart ticketing was in place in Wales and Scotland. For clarity, let me confirm that while some pilots are in place in Wales, full smart ticketing is some years off, and in Scotland smart ticketing is operative only in Shetland, and full roll-out is also some years off. The hon. Gentleman also suggested that some 45 appeals from last year had not been resolved. That is not the case. All appeals from the last financial year have been resolved.

The hon. Gentleman and other Members inquired about the £1 billion every year that this Government will be putting into concessionary fares. I am happy to supply further information, but for the sake of clarity let me say today that there will be £250 million of new money to extend to national provision in 2008. There is also a sum in the order of £420 million—which was new money in 2006—for the change from half-fare to free travel within local authority areas, and there is an estimated £400 million of funding to be put into the
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rate support grant for the original half-fare statutory concessions. By any assessment, that is a considerable commitment.

My hon. Friend the Member for Tyne Bridge (Mr. Clelland) asked about the distribution of funding of the national concession to hotspots. It is in the interests of all of us to ensure that funding reflects usage. We are confident that the overall level of funding will be sufficient, and our overriding principle is that the extra £250 million will be directed to where the extra costs fall, to recognise such hotspots as far as we can. Various options are being discussed with the concessionary fares working group, which includes representatives from all tiers of local government as well as operators.

We will consult widely on the formula for distribution, and I can assure the hon. Member for Rochdale that the data sources examined will include, for example, tourist beds, retail floor space and bus patronage. I can also assure the House that it is our policy to ensure that the net additional costs and new burdens placed on local authorities will be fully funded. I agree with my hon. Friend the Member for Tyne Bridge that this Bill should be a cause for celebration. I do understand the situation in Tyne and Wear, and I know that the Department for Communities and Local Government continues to talk to concerned local authorities.

We are working closely with local authorities via the concessionary fares working group, which includes representatives from Nexus and other passenger transport executives. I met Nexus representatives on my visit to Newcastle to explore the best way of distributing additional funding. In fact, officials were in Newcastle only last week to discuss these issues with local authority officers and operators in the north-east.

Mr. Clelland: I am not quite sure that my hon. Friend has answered the point that was made. The Bill deals with the national roll-out of concessionary fares. Is there any reason why it cannot deal with the shortfall in Tyne and Wear last year and this, which was quite unique, as it goes through its parliamentary stages? It is all very well saying that discussions are going on in the background; in my view and in the light of advice from the Clerks, the Bill could contain provisions to compensate Tyne and Wear for the money that it has lost. Will it or will it not?

Gillian Merron: I am sorry to disappoint my hon. Friend but the Bill has the scope only to expand the geographical extent of concessionary fares. It is about setting out a national scheme and cannot deal with local points.

Several hon. Members rose

Gillian Merron: I want to make a bit more progress. Reference has been made to the Isles of Scilly, which is an issue that excites a lot of interest. It is probably worth pointing out now that residents of the Isles of Scilly are of course entitled to the national concession on the mainland, so there will be a need to administer passes for those residents.

My hon. Friend the Member for Tyne Bridge asked why the local authority where the journey starts has to pay. The answer is that that is the only practical solution before us for reimbursing operators; otherwise, places such as London would have to
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cross-charge hundreds of other local authorities across England. We are seeking to provide a workable, practical and easily understandable scheme.

The hon. Member for Rochdale requested an extension—he was not alone in that—of the definition of “disabled”, and the extension of free travel to companions of disabled travellers. That is another spending commitment. It would cost about an extra £10 million a year to extend free travel to companions of disabled travellers, and some £50 million to extend it to people with mental impairment. Again, however, it is not just a question of cost but of defining eligibility and managing bus services’ ability to respond.

My hon. Friend the Member for North Durham (Mr. Jones), who represents his constituents so well on the issue of buses, asked about the administration of the scheme. There will be no change to who administers the scheme for 2008; again, our priority is to get it up and running properly. However, we are looking at who is best placed to carry out such functions in the medium term, and we will consult widely on that issue.

The hon. Member for Uxbridge raised a number of issues, including one that was raised earlier: those who have disabilities, and the ability of bus drivers to be understanding. Although I accept that training is important, along with increased accessibility—some 50 per cent. of buses are now accessible to people with disabilities—it is important that we put on the record our thanks not just to the bus drivers but to the staff who work behind the scenes: the cleaners, mechanics, trainers, administration staff and managers who keep bus services running.

On the issue of photographs on passes, we need a single national standard, including for London. The passes will need photographs because they will be used in areas that do not yet have a smartcard system and will need to be shown to drivers. We are also all concerned about fraud and, as the concession has become more generous, so it becomes more valuable. That is why we are seeking to encourage smart ticketing in the longer term.

Several hon. Members raised the issue of young people, and that is a further funding commitment from Opposition Members. If the concessionary fares scheme were extended to young people aged five to 18, the Department conservatively estimates that it would cost more than £500 million a year. There are no plans to make concessionary travel a statutory entitlement for young people, but local authorities are free to offer it if they wish.

David Taylor: Will my hon. Friend give way on that point?

Gillian Merron: I am just coming to the end of my remarks.

Buses are getting better. They are becoming more accessible for elderly and disabled passengers than ever before. There are more buses on the roads, and they are
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getting newer. The average age has come down by more than 20 per cent. over the last 10 years. Bus stops are better lit, and there is more and better information.

As we take forward the “Putting Passengers First” proposals in the forthcoming draft Local Transport Bill—I know that many hon. Members will welcome that—we will see more improvements over the next few years, making the bus the first choice, not the last resort. We want more people to enjoy bus travel, especially those for whom it is more than a convenience—indeed, a lifeline.

For the first time, the Government via this Bill will guarantee that no older or disabled person in England need be prevented from travelling by bus by cost alone. It is a major step forward for some of the most vulnerable in our society, not just in transport provision, but in social inclusion. It will make a real difference to millions of people. My hon. Friends and I are proud of this Labour Government’s commitment to improving the lot of bus passengers, to bringing more people on to buses and to our achievements on concessionary travel. I know that this important Bill will be welcomed by people up and down the country. The Opposition support this Bill, but this Labour Government have introduced it and are delivering for 11 million over-60s and disabled people. I commend the Bill to the House.

Question put and agreed to.

Bill accordingly read a Second time.

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