Kent County Council Bus Funding Review
Published: 11 December 2017
KCC Press release
Thursday, 07 December 2017
The Leader of Kent County Council is to meet with Arriva and Stagecoach to establish which routes they will run as scheduled and which will need subsidy ahead of a consultation on Socially Necessary Bus Service funding in January.
The discussions with commercial bus operators will look at the likelihood of the bus companies taking on well-used routes which could prove to be commercially viable.
Today at KCC’s full council meeting Paul Carter, Leader of KCC, told members that the authority has not ‘axed’ any subsidies for bus routes in the last 12 months and that its budget for subsidised buses has remained constant for 2017-18 at £7.5m.
“It is true that bus subsidies are among the potential savings we must look at in the coming budget in February but we understand the importance of these transport arrangements to people and we are progressing a programme that could potentially significantly reduce the list of affected routes in advance of the public consultation, set to start in January.
“I think that list of routes was prematurely released and I am sorry it has caused people understandable concern,” said Paul Carter.
“Because of that I am making a personal pledge to handle the forthcoming programme of negotiations with bus operators to try to persuade them to keep a significant number of routes going without subsidy, which I believe they should be able to do. I plan to meet Arriva and Stagecoach before Christmas.
“In addition, and in advance of public consultation, I will also be meeting the smaller bus providers to discuss the routes at risk and how they could potentially help us to reduce the impact if the bigger companies remove their services.
“But we want to be more imaginative in looking after people’s transport needs. We have always planned to invest in alternative, lower cost transport options to make up for any changes the bus companies make to subsidised routes.
“To this end I have scheduled meetings with a number of taxi operators across the county to explore the development of a ‘Click and Ride’ taxi share scheme to support rural communities more comprehensively alongside expanding community minibuses and the Kent Karrier service. An indicative budget has been set for this purpose.
“These actions show a continued commitment to passengers on some of the very marginal routes but we also have a commitment, a duty, to taxpayers who can legitimately question if subsidies of £18.50 per bus ride is the best way to use their money.
“KCC’s budget for the coming year 2018-19 will be set at the County Council meeting on 20 February 2018 and we are making good progress on identifying the necessary savings.
“Demand pressures and inflationary costs, coupled with the reduction in the government’s Revenue Support Grant and the removal of transitional grant mean that we need to find savings of some £62.5m next year.
“Amongst the savings being considered is to reduce by £2m the spend on subsidised bus services with the potential of a further £2m in 2019-20. In the following year another £41m of savings will be required to balance the 2019-20 budget.
“In recent years the amount of money available from government has been decreasing while demand and cost for council services has been increasing.
“Through innovation, transformation, productivity and astute commissioning we have been able to deliver over £600m of savings without materially effecting frontline services, whilst at the same time improving the quality of services delivered.
“KCC is rightly proud of its achievements to date and is considerably better placed than many of our county colleagues across the country. Counties have had to endure the most severe financial challenges of any part of local government as the attached schedule clearly evidences.
“Figures for the current four year settlement from 2016/17 to 2019/20 show the average Revenue Support Grant per head of population for county councils reduces by 95% from £107.65 to £5.95 compared to a significantly more modest reduction of 59% from £227.68 to £86.02 for the upper tier element for Inner London councils.
“There is understandably a limit to what Kent and our colleague county councils can endure in the reduction of Revenue Support Grant from central government. This is why the County Councils Network (CCN), of which I am Chairman, have been putting our case to government, campaigning for the extension and increase of the transitional grant for the coming two financial years.
“The grant was introduced by Greg Clarke when he was Secretary of State for Local Government some 2 years ago, which ceases at the end of this financial year – currently worth £7m per annum to Kent County Council.
“In addition to the pressure from government in reducing our budgets we have faced an additional pressure from the bus companies with Arriva and Stagecoach. Both proposing price increases of up to 3.5% in the coming financial year - above inflation for the fifth consecutive year.
“It is important to understand that KCC commissions in excess of £40m of business predominantly Arriva and Stagecoach.
The breakdown of this is as follows:
English National Concessionary Travel Scheme (ENCTS)
Young Persons Travel Pass
(£8m KCC sub, £6m parental contribution)
Subsidised Bus Services
Mainstream home to school transport
(total school transport budget £33m – including special needs)
16+ Kent Travel Card
(£1m KCC subsidy, £2m parent contribution)
Other local authorities have already, or plan to, significantly reduce or completely end bus subsidies for socially necessary routes.
Oxfordshire has already removed its subsidy for all routes, Lancashire is consulting on the same whilst Cheshire East and Staffordshire are planning on making significant savings to their bus subsidy budget.
As a discretionary service, this is something that many county areas are considering given the very severe financial pressures they are under, and as they strive to maintain vital statutory services.
“Finally, I can provide reassurance that any changes will not materially impact on home to school transport for parents and their children given our statutory obligations for home to school transport, and the continued discretionary subsidy provided through Young Person's Travel Pass which we committed to keep in our manifesto for the County Council elections earlier this year.
“I can also reassure you that a full Equality Impact Assessment has been prepared and will be fully updated ahead of any decision on bus subsidies so that KCC meets its statutory duties under the Equality Act.”