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Councils press for clarity on Skates' bus funding comments

08 June 2018

Welsh local authorities are seeking clarification about public funding of bus services in the light of comments in a letter from transport secretary Ken Skates. 

Skates has told councils that,  from April 2019, each authority's allocation of the Government's Bus Services Support Grant (BSSG) must be at least match-funded by a commitment to expenditure from the authority's own budget to support bus and community transport networks.

"My officials will work with your officers during the course of this year to enable you to plan for this outcome or, if necessary, to manage the consequences of an authority's decision not to make that commitment," he said. 

Skates said that a "small but significant number of local authorities" had reduced support for bus and community transport services or removed it entirely from their budgets. "This means that the Welsh Government's BSSG allocations are effectively being used to replace funding from authorities' own budgets."

The letter has caused confusion because it does not explain how much funding the authorities must at least match fund. Skates refers only to the £25m of BSSG, but most of that consists of the former Bus Service Operators' Grant which was paid directly to operators by the DfT until 2013. It is now channelled via councils.

A minority of BSSG comprises the former Local Transport Services Grant, which was intended to supplement councils' pre-existing bus funding.

Asked to clarify this, the Welsh Government told LTT that no explanations would be provided until Government representatives held a meeting with council officers and bus operators. The meeting has yet to be scheduled.

Bev Fowles, chair of the Confederation of Passenger Transport Wales' bus commission, said: "There's no doubt that the letter sends some confusing messages. It would be helpful for them [the Government] to clarify it as soon as possible. It does look as if the minister is looking for the councils to match fund his £25m."

Tim Peppin, the Welsh Local Government Association's director of regeneration and sustainable development, told councillors this would be "completely unrealistic".  

He added: "Local authority spending [on buses] in 2016/17 totalled £15.5m. To match pound-for-pound would require local authorities to find almost another £10m. A more realistic interpretation of the letter is that the requirement applies only to the former LTSG [Local Transport Services Grant] element, which made up £8m of the £25m." 

Peppin said the letter also appeared to be trying to impose conditions on how councils spend their revenue support grant (RSG). "RSG funds are non-hypothecated and therefore spend should be at the discretion of local authorities."

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