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Concessionary Bus Travel Act 2007 (Variation of Reimbursement and Other Administrative Arrangements) Order 2010

My Lords, it has been a very interesting debate, and I thank all noble Lords who have taken part. I will do my best to answer the points that were made in the course of it. I sense from the Committee that we are all agreed on how important the concessionary bus travel scheme is for older and disabled people, and on the need to ensure its sustainability for the future. There is no political difference between the parties on that issue. The Committee understands the benefits of the administrative changes that the order before us will bring about, by harmonising concessionary travel and transport authority responsibilities to enable efficiencies to be realised by —for example—reducing the number of negotiations with bus operators. As I indicated earlier, the Government have consulted widely on the improvements needed to the current system. The changes being taken forward, particularly with respect to the mandatory concession, were supported by the majority of respondents. The Government understand the concerns expressed by some about the loss of lower-tier discretionary powers under the option that is being taken forward. However, the order does not remove the ability of district councils to consider discretionary travel schemes using the "well-being powers" contained in the Local Government Act 2000. Furthermore, the order does not preclude upper-tier authorities from maintaining or introducing district or local-level discretions—for example, where there are differing needs within different parts of a county. Neither does it preclude district councils from providing funding to county councils to administer discretionary concessions on their behalf. The Government acknowledge that there will be financial implications for both lower-tier and upper-tier authorities as a result of the changes being introduced. It is expected that from April 2011, all funding for concessionary travel will be provided to local authorities via the formula grant funding system. Therefore, it is not possible to consider the financial implications of this change at an individual authority level in isolation from the wider local government finance settlement. I will address more specifically the point raised by the noble Baroness in a moment. The Department for Communities and Local Government will consult later this year on how the financial implications of the changes will be taken forward as part of the overall consultation on the next local government finance settlement. These changes provide an opportunity to look again at how the totality of funding for concessionary travel is distributed from April 2011. We will also be able to look at the issues that the noble Lord, Lord Bradshaw, raised. I shall deal with some of the questions that were raised in the discussion. The noble Baroness, Lady Hanham, asked whether the order impacts on London or the PTEs. The answer is that it does not impact on London, but it does impact on the metropolitan districts in PTE areas. They will no longer be able to enter into discretionary schemes under the 1985 Act. We expect administrative costs to be minimal in terms of transitional costs but, if the counties feel that they will incur any additional costs in 2010-11, the DfT is willing to consider that. Overall, however, we estimate that the changes will generate approximately £3 million in efficiency savings each year. On special grant, by comparing concessionary travel spending in 2007-08 and 2008-09, we have been able to estimate where there might be funding shortfalls and where some authorities might have been receiving excessive grant. As it transpires, the vast majority of authorities have received sufficient grant funding to cover the costs of the recent improvement in the statutory minimum concession. However, we are aware that around 30 authorities out of the 264 which now receive the grant may have a genuine cause for concern over the level of grant they have received, which is the point made by the noble Baroness. We decided that the fairest course of action was to consult on a revised grant distribution for the final year, 2010-11, of the original three-year settlement. That consultation process began on 4 November 2009 and closed on 30 December. Our aim in this work was to deliver a fairer distribution, but to minimise the impact on local authority finances by changing as few payments as possible. Where grant payments have been reduced, the new distribution still leaves those authorities which benefited from the original distribution receiving more than sufficient funding to meet the additional costs of the new statutory minimum concession in 2010-11.