Ticketing on Public Transport (HC 84-ii) Transport Committee 5 Dec 2007

Q19 Mr. Eric Martlew: Can I concentrate, gentlemen, on the concessionary fares scheme which is about to come within the spread. Mr Cook, I think you initially said there were reservations about this. Can you expand a little on that?

Mr Cook: I think the issues are in respect of reimbursement of the costs, so if the scheme goes to a national scheme there will be additional costs. We start with the proposition that neither the bus operators nor the local authorities should be out of pocket or in pocket as a result of these changes. One of the very good things is that a specific amount has been set aside for local government, £212 million, to ensure that local authorities get reimbursed for reimbursing the operators for the cost of travel. As colleagues have said, the smartcard would allow us to be more accurate about which people are getting on buses and what the price of journeys are, but that aside I think the first concern might be is £212 million the right amount of money? That question might be raised because experience in Scotland and Wales has shown that take-up is quite high. Anecdotal evidence we have from local authorities is that people have persistently and consistently joined concession travel schemes such as, for example, the local one which came in in 2006. So take-up does not step up and then plateau, take-up continues to rise, so £212 million may or may not be the right amount of money. Secondly, we have a distributional problem in that the £212 million may not go where it is needed and there are four options being consulted on by Government in terms of how one distributes the money. Just as a little colloquial example -

Q20 Mr. Eric Martlew: It seems to me - and I live in an area where it is two tiered and the local district councils are like ferrets in the sack at the moment about who is going to get the money. Surely it makes logical sense for the Government to give it to the transport authority, which in our case is the county council? I realise you are a district council representative, but surely there is a logic in that? There is no logic in giving it to the district council?

Mr Cook: Chairman, the logic is that it is the districts that are reimbursing the operators and therefore the districts which need to be reimbursed, even if it went through some sort of collective agreement, and the capacity exists at the moment for authorities to get together in clusters to manage this in a certain way if they want. So we could get together in clusters, but that would not deal with the fundamental issues of (a) is it the right amount of money, and (b) is it being distributed correctly, because even if it was county-wide and you have a county agreement, it still does not take account of the fact that distortions occur depending upon whether or not one is a destination for journeys, or not, and there is too wide a spread in the consultation options at the moment.

Q21 Mr. Eric Martlew: Can I ask Mr Yates, who I understand is from a county council?

Mr Yates: Yes. We broker a county scheme on behalf of six districts and two unitaries. I broadly support Mr Cook's point that we have both a funding and distribution problem. It would be different if the funding went to county councils because our main difficulty is the inequities between the individual districts because they have all got very different settlements so far, and are likely to get again, which brings out certain authorities which have got a 5% shortfall on their overall expenditure and others are in surplus.

Q22 Mr. Eric Martlew: That is the failure of the present system?

Mr Yates: It is the failure of the present system, and that was based on a district scheme, which was meant to just provide local travel, but obviously we recognise that local district travel is of limited use to lots of people who live in a rural-ish county like Cheshire with a lot of boundaries. So we strove early on to make sure the county-wide facility was there, even though it was above the basic scheme. The difference is now that the new scheme is going to be a country-wide scheme, so there is even less argument for targeting the pockets of money into small district-based things which are bound to pick out little inequities by virtue of doing that.

Q23 Mr. Eric Martlew: So you would support it going to the county, would you?

Mr Yates: I think I would support something that either provided an open-ended - well, I cannot say open-ended, but a more responsive method of funding so that the settlement responded to the actual amount of travel or that there was an aggregation of the authorities that dealt with it, because at the moment there is a massive amount of what I call non-Gershon efficient energy that has gone into all these separate little negotiations.

Q24 Chairman: Sorry, Mr Yates, what was that lovely phrase?

Mr Yates: Non-Gershon-like, you know, the -

Mr. Eric Martlew: We remember it, yes.

Chairman: Yes, we remember it only too well. I thought we had made another new name. Sorry, go on.

Q25 Mr. Eric Martlew: Does anybody else want to comment about the way the money is distributed?

Mr Jones: I am sort of neutral, being for a unitary, but there are lots of inequities in the way the money is distributed under all of the formulae and I think the key thing is that we have got to re-address this because it is going to happen in April and I think it is really important that quickly the Government comes back and learns from what happens in the first six months rather than just leaves us to solve the problem.

Q26 Mr. Eric Martlew: What you are saying is that you think it will not go right and we need to look at it very quickly?

Mr Jones: That would summarise my view, yes.

Q27 Mr. Eric Martlew: The two gentlemen at the end are very quiet!

Mr Scales: We are very happy because the grant is going to the passenger transport authority in a direct grant, rather than going through our district council colleagues.

Q28 Chairman: I do not want to spend too long on this. What you are really saying is that if the unit is big enough you get economies of scale and everybody will come back if the units are too small?

Mr Scales: Yes.

Q29 Chairman: It is not a new theory. Yes, Mr Cook?

Mr Cook: I think there is also an issue about reviewing the quantum, whether the amount of money is right. The Government has indicated a 2.5% increase in the £212 million for the next two years. Our concern is that as the number of people eligible for the scheme rises significantly ---

Chairman: Yes, I think you made that point actually.

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Q61 Mr. Eric Martlew: I think on two occasions you have mentioned it is the English concessionary fares?

Mr Scales: Yes.

Q62 Mr. Eric Martlew: I represent a constituency which is nine miles from the Scottish border and the reality of this concessionary fare scheme at the moment is that I think will all be able to travel north?

Mr Scales: Yes.

Q63 Mr. Eric Martlew: But is the technology that is going to be used compatible so that they will be able to travel there, or even into Wales, or catch the ferry to Northern Ireland?

Mr Scales: Scotland is part of ITSO and the Scottish system is ITSO-compliant. Wales is part of ITSO and their system when it is introduced will be ITSO-compliant, so you should be able to join it all up. We have not gone across the water yet, but I am sure we can do.

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.

The full transcript may be read at http://www.publications.parliament.uk/pa/cm200708/cmselect/cmtran/uc84-ii/uc8402.htm

On behalf of Eric Martlew, 3 Chatsworth Square Carlisle Cumbria CA1 1HB