The Minister of State, Department for Transport (Mrs Theresa Villiers)
I thank the hon. Member for Dudley North (Ian Austin) for raising this issue in the House today and I congratulate him on securing this debate on concessionary coach travel, which is a very important issue. From 2003, the coach concession has entitled the over-60s and eligible disabled people to half-price travel on many long-distance coach services, but the coalition has made it clear that our priority has to be reducing the budget deficit we inherited from the Government of whom the hon. Gentleman was a member. In order to achieve this, several difficult decisions have had to be taken, including this one on concessionary coach travel.
The deficit crisis we inherited has inevitably meant that some funding streams have had to be ended. But the consequences of failing to deal with the deficit would be worse, including spiralling interest rates and the kind of crisis enveloping other European countries; more and more taxpayers money being spent servicing debt; and a massive legacy of debt left for future generations. Given the scale of the crisis we inherited from Labour, it simply was not possible to insulate concessionary travel completely from the measures needed to reduce the deficit. Funding for bus and coach travel had to take a share of the cuts that we have to make, and so the decision was taken in the spending review to end the coach concession scheme from October this year.
I recognise the concern this decision causes to those who valued the coach concession and I welcome this opportunity to respond to some of the points made by Age UK and Mencap. We are listening carefully to what they have said, and I am sure that the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker), will be happy to meet them to discuss this matter further.
I want to emphasise that our decision does not in any way reflect our wider view of the importance of coach travel as a mode of transport. Coaches provide an important choice on many inter-urban routes, with services that offer good value for money in vehicles that increasingly offer a very high-quality and excellent environmental performance. However, taking a difficult decision to end the coach scheme has meant that we have been able to protect higher priority programmes, including the national bus concession. Even in these times of austerity, the coalition Government have been able to continue the national concessionary travel scheme for local buses, despite all the scare stories that were circulated by our opponents during the election. This support for the national bus concession scheme is contained in the coalition agreement, and it was reconfirmed by the Chancellor in the spending review.
The local bus concessionary scheme benefits about 11.5 million people every year, allowing free off-peak travel anywhere in England. In 2010-11, 1.6 million concessionary bus trips were made by pass holders in England—34% of total bus trips. This generous concession provides older and disabled people with greater freedom and independence and a lifeline to their community. It enables pensioners and eligible disabled people to have access to facilities within and outside their local area, and helps them to keep in touch with family and friends. That is why it has been a priority, despite the deficit, to protect this concession. However, a deficit reduction programme inevitably means making tough choices between competing priorities. The Government believe that keeping the local lifeline provided by free local bus travel had to be given priority over the coach concession scheme.
The hon. Gentleman complained about the lack of consultation. He will recognise that there was an urgent need to provide a credible deficit reduction plan at a very early stage of the coalition Government. If we had not done that, we would be facing the kind of crisis that has beset some of our European neighbours, who arguably have less serious deficits than we do. The only reason we have achieved the stability that we have in relation to the deficit crisis is that we have produced a credible plan. That required prompt work, which meant that it was not possible to carry out a consultation on this decision. However, an equalities impact screening assessment was carried out, and it was published on the Department for Transport’s website in November 2010. My ministerial colleague the hon. Member for Lewes recently wrote to the chairman of the Disabled Persons Transport Advisory Committee about the issue. When the funding for the scheme formally comes to an end on 1 November, a full regulatory impact assessment will be published and copies will be placed in the Libraries of both Houses.
As with all decisions in the spending review, we have sought ways to ease the process of implementation. This is one of the reasons the Government gave participating coach operators, and the public, 12 months’ notice of the scheme’s coming to an end. We recognised that a period of notice was very important to give operators sufficient time to plan for the removal of the grant and to give their customers reasonable notice of the changes to concessions that we had unfortunately had to make.
It is also important to note that coach operators are, of course, free to continue to offer concessionary travel to older and eligible disabled people on a commercial basis. Another advantage of allowing a period between the announcement that the Government scheme was coming to an end and this decision being implemented was to give coach operators the time to develop new concessionary travel products. Indeed, the Government were pleased to learn this week that, as the hon. Gentleman said, National Express will be offering a replacement concessionary coach scheme from 1 November this year. I understand that it will give those aged 60 and over and eligible disabled people a third off the price of coach travel in England when they buy a concession card.
Although the concessionary coach travel scheme had to go, I emphasise that the Government are still working hard to encourage more people to use buses. We fully appreciate how important they are for a range of groups in society. Bus services contribute to both of the Government’s key transport priorities: creating growth and cutting carbon. By providing an attractive alternative to the car, we can not only cut carbon, but unclog the congestion that can choke our local economies and hinder jobs and growth. Throughout our decisions in the spending review, we were determined that buses and public transport should continue to receive their fair share of funding, within the constraints of the deficit that we unfortunately inherited from the previous Government. A range of programmes aimed at making bus travel more attractive is under way. Again, that is despite the constraints on budgets.
The latest estimates show that in the last financial year, local and central government spent more than £2.5 billion on support for local bus services. That includes more than £1 billion on concessionary travel and £420 million in bus service operators grant. Reductions in that grant are to be implemented next year, but they are far less severe than many predicted and there is reason to believe that the bus industry will absorb them without a major impact on local fares. It is true that reductions in local authority budgets are having an impact on supported bus services in some areas, but by no means in all.
In addition to the formula grant that goes to local authorities to support bus services, the Government have paid almost £47 million to local transport authorities and bus operators to purchase 542 low-carbon buses across England. We are particularly keen to build the capacity of community transport organisations and have provided local transport authorities with £10 million of extra funding to support that sector. That money was found from savings made at the Department for Transport in the coalition’s first year in office. Lastly, we have established a £560 million local sustainable transport fund to support our transport goals of supporting growth and cutting carbon. Many of the successful bids to that fund are providing improvements to local bus services and facilities.
In conclusion, this Government have had to take difficult decisions to deal with the deficit that we inherited from Labour—a deficit as serious as anything that we have seen in this country’s peacetime history. Ending the concessionary coach travel scheme is one of the many melancholy consequences of the economic mismanagement of the previous Government, who borrowed heavily during the boom years and left us in a disastrously weak position when the lean years arrived. Although the coach scheme has gone, we have continued to protect free travel on local buses for older people and eligible disabled people, providing them with vital access to employment, health care and other essential local services.
Question put and agreed to.