Hammered by the pandemic and cuts, much-maligned and seeming unfashionable – are buses being unfairly overlooked in discussions around transport in Wales? What does the future hold?
The arrangements by which bus services are funded are slightly complicated. Despite being a mostly privatised, deregulated industry that pays out to shareholders, local bus services in Wales – even before the pandemic – were heavily reliant on public funding to remain viable.
In normal, pre-pandemic times the main sources of funding for bus services include:
- Passenger revenues – It’s been difficult to pin down an exact figure for how much bus companies make from fares and advertising on commercial routes, but a Confederation for Passenger Transport report suggested bus companies in Wales had operating revenues of £198million pre-pandemic (pdf). It’s not clear if this figure includes all the public subsidies mentioned below, though it’s likely to. Welsh Government figures show that bus fares have increased by 174% since 1995.
- Concessionary fare schemes – The free bus travel schemes in Wales aren’t “free” (see more at Radical Wales: Free Public Transport). The two major schemes in Wales are free bus passes for the over-60s, disabled and veterans and the MyTravelPass scheme which provides discounted bus travel for those aged 16-21. Both schemes reimburse bus companies – via local authorities- every time they’re used. The cost of concessionary fares in Wales is estimated to be up to £70million a year, though this will generate a positive economic and social impact due to increased mobility and independence for pass holders.
- Bus Service Support Grant (BSSG) – The Welsh Government grant is allocated to local authorities to enable them to subsidise otherwise unprofitable but locally important bus routes. Pre-pandemic, the BSSG was worth around £25million-a-year but it had been frozen at that level for several years resulting in real terms year-on-year cuts (due to inflation etc.).
- Welsh Government Local Transport Fund & indirect funding – Other funding may be provided by local authorities or the Welsh Government that directly or indirectly subsidies bus services. This may include financial support for community transport, community council and local authority spending on maintaining bus stops and capital grants under the Welsh Government’s annual Local Transport Fund – which may be used to build bus priority measures on the road network, for bus stop improvements or new bus fleets.
