As the Social Market Foundation recommends scrapping free travel for all people over 60, so Conservative London mayoral candidate Boris Johnson pledges to give 400,000 Londoners their bus passes early, at 60. Quite a dichotomy.
Older people definitely do not see free travel as a “perk”
The Social Market Foundation believes that the £1bil free travel bill does nothing to improve our beleaguered economy. The money therefore might as well be allocated elsewhere or be offered up in tax cuts. If it’s doing nothing for the economy and it’s not actually helping bus operators, then it really is a millstone. But then again, it’s not just about helping the economy. Free travel is neither an economic nor for that matter a transport policy. It’s a social policy and should be seen as such. It has clear benefits for older people. It has a number of primary and subsidiary benefits in that it:- Gets them out & about and moving.
- There are clear health benefits
- Encourages older people to socialise
- Helps meet government targets in terms of numbers using buses
- Encourages sustainability
- Encourages people who might otherwise be less observant and slower reacting away from a riskier mode of travel, driving the car.
So, leaving aside the fact that it just ain’t gonna happen, hypothetically, would we really like to see the end of free travel? Honestly? Losing it would be a risk because at a stroke a minimum of 40 per cent of our customer base would be travelling less frequently. What, if anything, would replace it? Would passenger journeys dip below the pre-free travel era? And, let’s face it, better £1bil coming to the also-beleaguered bus industry than being redirected elsewhere.
For someone who turns 60 today, the earliest they are eligible for an national free travel pass is now February 2014, at age 62. If you’re 60 in 2015, you’ll need to wait till 2020, when you’re 65. Previous applicants up to April 2010 have been able to use their passes at age 60. If Londoners are able to apply earlier, does this simply reinforce the idea that there is a transport gulf between London and the provinces? Is that fair? Well, London would pay, so London should have the choice. Interestingly, opponent Ken Linvingstone seems instead to be offering a significant reduction in fuel bills—that would benefit *all* over 60 and not just those between 60 and 65.
But the gulf widens when you consider the good people of Scotland and Wales can still apply at age 60. And in Wales, at any rate, the reimbursement mechanism’s better (though it’s about to change a little for the worse, again). It nevertheless seems that Wales has it about right, without any threat of moving from 60: politicians, officials, older people and operators are all largely happy. Unless you know differently.
29 comments:
Operators are certainly happy in Wales, where I understand bus pass usage is higher than most other parts of the UK (but I could be wrong).
First Cymru are currently running a promotion to win one of ten 40" HD TVs for anyone who collects 10 First bus tickets with their pass. http://www.firstgroup.com/ukbus/assets/pdfs/wales/home/win_tv.pdf
It seems clear with such a promotion where they believe their growth will come from, and it's not from those who pay for fares.
The cost in Wales is becoming unaffordable and all the indications are that the scheme in Wales willhave to change within 5 years. As elsewhere the problemis just being ignored at present but the amount of extra money needed to fund the scheme is simply not going to be available.
The cost of providing passses to those unsder 65 is going through the roof as many use them to commute to and from work.
Big cuts in services are going to come through soon as weel as large fares increases.
In Wales they are now almost at the point where more passengers travel free than pay the fare and fare paying passenger numbers continue to fall
http://waleshome.org/2012/02/the-minister-is-on-the-wrong-bus/
Anonymous said...
"In Wales they are now almost at the point where more passengers travel free than pay the fare and fare paying passenger numbers continue to fall
http://waleshome.org/2012/02/the-minister-is-on-the-wrong-bus/"
The article entitled 'The minister is on the wrong bus' doesn't appear to make any mention at all of concessionary travel reimbursement, so I wonder why you are quoting it in support of the otherwise unsubstantiated claims? That article is concerned with the reduction in BSOG, which is a separate matter - although, no doubt, equally troubling for bus operators.
In general terms, you may well have a point about the unaffordability of concessionary travel, even in Wales, but it is a good idea to quote relevant sources to back your argument up!
For every £1 reimbursed to the bus companies, the OAP saves £2 in fares which is mostly spent in retail. The goverenent gets 20% back in VAT (more if the reatailer is selling beer!), 40% of what it gave to bus companies. So the Gov could fund it properly. It must be a good job creator in retail.
It is not fair to taxpayers or pensioners who live in the sticks, but it is superb support for retail! Bad for bus companies as reimbursment is short change.
Whatever happens in London tends to give a misleading perception to the public elsewhere, particularly in those places close to the metropolis. They do not understand the differing financial and regulatory controls - neither quite often do the politicians!
I just can't see the logic of giving free travel to people who are below retirement age. Their circumstances are no different on the day after their relevant birthday then they are before.
I have no issue with the principal of helping people who have retired with travel costs, although I feel this should be done by increasing the pension and abandoning the concessionary scheme. I feel the help could be more effectively targeted by doing it this way.
I also feel that, if the scheme means fare paying passengers have to pay more, then it operates against trying to get people to use buses more. It's the journey to work that's the problem here, not trying to get pensioners out of cars when they travel off peak. Worthwhile though that is, it's not the main issue in achieving mode shift from cars to public transport.
Political reality is that not much is going to change.
Just who are the social market foundation??Can anyone tell me.Is it another wing of the CBI or or the NATIONAL FRONT or what. Never read such tripe.
Social market foundation? I agree tell them to get lost in there fancy Jaguars cars...
In England its Central government fault for introducing a half baked scheme in the first place, where operates have to ask all councils for them, this some bus companies having to asked 3-5 different councils.
At least in Scotland and Wales its dealt with Central government at better rates.
People are complaining about certain people gettings the passes, like Drug users and Alcoholics who believe there should be axed straight away.
RW's point about the direct link between concessionary fares and retail spend is very important in the context that government policy is likely to be influenced by Mary Portas' report on revitalising the high st. Mary made no mention of buses, and recommends free parking!
Also, February's edition of Buses Magazine had an article about cheap parking. Those councils surveyed who had cut parking charges were asked if they had considered the impact on buses - none had, even those who own bus companies! - Newport was an example given.
So it would seem that despite the 'greenwash' about sustainable travel, and the need to promote bus use, local and central government actually practise the opposite.
Pete
Instead of retiring to Bournemouth, perhaps people should retire to London!
The free bus passes weren't brought in to stimulate retail growth or to help the environment, they were brought in as a sop to OAP voters angered about successive pension cuts. The plan was never thought through, never budgeted for, and has been a fiasco since the very word go.
Most people using free bus passes would still travel anyway, they're just now taking up capacity for those who can and will pay.
"Most people using free bus passes would still travel anyway, they're just now taking up capacity for those who can and will pay."
Yes. I can see all these buses that are literally full of pensioners. So full that they are stopping fare-paying punters from boarding.
The Concessionary pass system is at breaking point. No one has the funding for it and at present the sticky plaster approach is used with BSOG cuts being one means of getting more funding for the scheme at the expense of cuts to the services and big fares increases.
Councils are underfunded for the passes so they have to put up council tax and make cuts eleswhere to fund the scheme. The bus companies get inadequate funding so they pass it on to fare paying pasengers . The whole system is a complete and unviable mess. Even worse is the costs are increasing tear on year at about 4 times the rate of inflation.
With some counties in England the scheme has already reached breaking point with no more funding available for it.
Most of a local councils Tranport budget now goes on Concessionary bus passes and free school travel
David said...
"Most people using free bus passes would still travel anyway, they're just now taking up capacity for those who can and will pay."
With the national schemes replacing the previous local schemes, perhaps the free pass holders now travel further than they did previously. Any impact on the retail trade would, in that case, simply be to transfer the spending from a town 2 miles away from the pass holder's home to one 20 miles away. However, it is probably asking too much to expect that the politicians would have foreseen the actual effect of their policies.
However, I would agree with those who say that policy is probably designed to maximise revenue for the Exchequer, and if people spend more money, then that objective will be achieved. The other benefits listed by Busing are worthy, but probably don't bring enough direct revenue for the politicians to give them priority.
I totally disagree that most bus pass holders would still travel anyway if they didn't have a free bus pass. They may still travel by bus but not nearly as often. I thought that had been clearly shown by various studies that consultants and others undertook after setting up the original (higher) reimbursement rates. Even those were of course not all correctly funded.
Until last year I worked for a District Council and saw this clearly - particularly on Park and Ride where such patronage grew from very few to around 50%. Without free passes we would have expected to loose a significant number to other towns and shopping centres with free parking.
There is a very real risk to many bus services if free bus passes are abolished.
'For every £1 reimbursed to the bus companies, the OAP saves £2 in fares.'
The OAP wouldn't travel so much if it wasn't free - that's why reimbursement ~ 50% - because the bus company would carry fresh air otherwise. Think of it as government solving a coordination problem: OAPs would like to club together and negotiate as much travel as they get now and pay out of their pensions AS THEY WOULD WITHOUT a concessionary scheme, but couldn't get together and agree it. The £1 govt spends replaces exactly £1 of revenue the company would get without the scheme, but with more passengers travelling as it 'buys in bulk'. Hence, 'no better or worse off'.
'The OAP wouldn't travel so much if it wasn't free - that's why reimbursement ~ 50% - because the bus company would carry fresh air otherwise.'
Buses would not be carrying fresh air, such buses get withdrawn. Urban buses get a boost from extra travel but rural buses mostly get the same loads but less revenue, and some get withdrawn.
I agree the scheme is totally unfair and ill thought out. It saves my wife and I abt £2k a year, 2 weeks extra holidays, but I would scrap it and divide the £1bn between all the OAPs by putting up pensions. But make no mistake, retau=il would be hurt and many bus co MDs would be celebrating.
Eric 14.58
"Yes. I can see all these buses that are literally full of pensioners. So full that they are stopping fare-paying punters from boarding."
Well can't say that any cash passenger has been turned away on any bus I've used my pass on. Could be though that an operator has been unable/willing to foresee the need and provide for a suitable vehicle,hhmmm?
Did some calcs based on Busing's 40% estimate, 40% averaged fares, and complete withdrawal of all concessions. Overall 40% of "free" riders would need to stay to break even. But that's the dreaded average, so the effect would be very uneven.
For those who want to find out about the think tank
http://www.smf.co.uk/
http://en.wikipedia.org/wiki/Social_Market_Foundation
Am I right in thinking that North Yorkshire pays lower % reimbursement than most other councils? I saw red with the scheme when Transdev claimed they were losing money on the Harrogate-York X54 even though they were getting good loadings... you're not suggesting they were dishonest?!
http://www.yorkshirexpress.com/
@Anonymous
Am I right in thinking that North Yorkshire pays lower % reimbursement than most other councils? I saw red with the scheme when Transdev claimed they were losing money on the Harrogate-York X54 even though they were getting good loadings... you're not suggesting they were dishonest?!
I doubt they are paying significantly less than anyone else. The problem with the X54 was that it pretty much only carried concessionary fares, because anyone who had to put their hand in their pocket would use the train, which was much quicker, operated later in the evening and on Sundays, but barely more expensive than the bus. Because H&D were attempting to run the service commercially using fairly new B7RLEs, they had reasonably high overheads to cover.
Whether the fact that it was a new route that started after 2006 and so had no prior passenger numbers to calculate from, or that there was such an extremely high proportion of passengers were pass-holders, influenced the reimbursement rate I'm not sure. I can easily imagine that the transport authority would determine that on a route where 90% of passengers were using passes, there was a much higher than normal rate of traffic generation, so they would give a lower reimbursement rate on that route.
@RW
For every £1 reimbursed to the bus companies, the OAP saves £2 in fares which is mostly spent in retail.
That's rather begging the question. What evidence have you got that pensioners are spending that money they've saved on bus fares? On the basis of traffic generation that's used for the reimbursement, they would only have spent £1 on fares before, even if they're now using £2-worth of travel.
From anecdotal evidence, there are a lot more pensioners going window shopping, but never stopping to buy ... I don't have any facts and figures, but I get the impression that a lot of them use the free travel just to have a day out, and maybe to spread their shopping out so that they buy the same amount of stuff but only half as much at a time.
Unfortunately, this whole scheme was introduced for political expediency, allowing central government to buy the grey vote at local councils' expense, and at bus companies' expense. Now any politician who tries to take away this "entitlement" (which has only been in place for 6 years, remember) will be seen as the bad guy, no matter what alternative measures are put in place such as improved pensions, tax relief, subsidised travel etc.
Two solutions to keep costs at a more manageable level that I would like to see explored are:
(1) entitlement to free travel only applies to the local area (eg issuing authority, and possibly neighbouring authority/ies depending on local context).
(2) pass to be means-tested and only available to those in receipt of other existing means-tested benefits or to anyone who rescinds their driving licence (or did not have one to start with). In particular, it should not be available to anyone still in employment.
OAH STEVIE Not the means test again!Too many oaps who scrimped and saved so as not to need benefits are now suffering for their thriftiness.A real means test should apply to thrEbig earners! Think about it.
There are clearly a lot of posters here who are completly clueless as to how the scheme works. It costs money it is not putting money back into the economy hence the recomendations by this report. By removing bus passes it would have an almost instant impact on creating more jobs and boosting the economy
@ Eric
Yes. I can see all these buses that are literally full of pensioners. So full that they are stopping fare-paying punters from boarding.
Try and get a summer Saturday bus from Teesside or West Yorkshire and let me know what you see. Last time I got the 93 from Middlesbrough to Whitby it was full and standing; two of us had paid. I counted.
Transdev Yorkshire Coastliner had to replace their single deckers with double deckers on the Bridlington/Scarborough because of the demand due to free bus pass users.
To clarify my point: people using the free bus pass locally would still make the journey even if it were half fare charged. The leisure travellers off for a jolly to the seaside wouldn't. That doesn't bother me, I think they should pay (a reduced fare) for their day out to the seaside.
I think there are two possible alternatives to replace the FRee concessionary passes. One would be say an annual charge of say £50 for the pass. The disadvantage of this is it stil exposes the council to an unknown cost as they dont know how much use will be made of them.
Perhaps abetter approach would be a smart card which would be charged up with a certain mount of money(The amount would have to be decided) Once they had used that up they would have to pay for their travel
So for example they could get a £120 a year of Free travel. Each time they used the bus it would deduct the fare from the amount left on the card. A bit like a London Oyster Card
Probably the council would negotiate a discounted rate for the fares
WRT the X54, the 'no better or worse off' question is, 'would it have run without any concessionary travel scheme', and the answer is 'no' and thus one can not expect it to run with a scheme.
Given that 'free travel' is solving a coordination problem, then the optimal response would actually be to cut pensions if funding the scheme is a problem, because with 'free travel' pensioners get more travel for their money* then they ever would paying for their travel themselves. (Depending on assignments to property rights to the pre/post-'free travel' distribution of wealth.)
Anonymous@11:03: there is a specific exclusion in the regulations that exclude those banned from driving *for persistent misuse of drugs or alcohol* from being entitled to a disabled (yellow) pass.
Quite a dilema. But it was always quite ridiculous that free travel was granted at 60. Should always have been 65 or normal retirement age. It was just a 'sop' from the Brown Government. However, now we have it going up to 66 eventually, that should be the age for EVERYBODY, including cosseted Londoners and both the Welsh and Scots.
Cardiff council, which owns Cardiff Bus, has already identified six routes in the capital which could be stopped.
The routes are: 37 (city centre to Gabalfa), 22 (to Rhiwbina/Pantmawr Estate), 32 (evening and weekends to St Fagans), 95 (to Penylan, Llanedeyrn and Pentwyn) 26a (to Tongwynlais and Castle Coch) and 55 (to Brynheulog and Llanedeyrn).
Stagecoach Wales managing director John Gould said the cut would cost his firm more than £1m a year.
He said: “In order to deal with this, It is inevitable that a number of marginal services will be adversely affected, ie reduced or cut, and fares will come under the spotlight, regretfully leading to increases above inflation for our customers to pay.”
Ironically, I imagine that many passholders would be prepared to pay a fare rather than see a local service cancelled due to low reimbursement rates.
What they are rightly not prepared to do is to pay voluntarily in order to simply make the scheme more viable for those that will not.
Classic game theory.
What does it say about localism when a community cannot get together to provide a service without the state deciding the price they must accept for it.
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