A Bill to entitle an estimated one million men in England and Wales aged 60 to 64 to concessionary travel fares will increase local authority expenditure, acknowledged local government and transport minister Lord Falconer.
The issue has been discussed with local authority associations and a further meeting is to held this week between government and the Association of London Government, which says the department of transport, local government and the regions has underestimated the cost to London authorities. Another important issue still being dicussed is whether 100% or 50% will be reimbursed.
The Travel Concessions (Eligibility) Bill, which was given an unopposed second reading, has been introduced because of a decision of the European Court of Human Rights, which ruled that men were being unfairly discriminated against by having to wait until they were 65 years old before qualifying for concessionary travel fares, while women were entitled to them from the age of 60.
Local authorities must not offer a scheme less than the statutory minimum of half-price bus fares - although many offer further concessions on other passenger transport services as well as concessionary travel outside their boundaries.
Lord Falconer said: 'There is no doubt that concessionary fares are expensive for governments. In England local authorities at present spend£440m each year on their schemes. Extending eligibility to men aged 60 to 65 could involve an additional£50m per year in England, and we will need to take this into account in the local government finance settlement'.
Conservative spokesman Lord Dixon-Smith said local authorities had never found the revenue support grant an adequate and precise means of distributing government revenues. He said the Bill would give concessionary fares for the first time to a group of people who may be still at work.
He added: 'It is very easy - dare I say, facile - to describe the existing arrangements for calculating demand as rather erroneous, because if those people are at work they will be much greater users of the transport system than the people who at present are able to use it.
'To calculate the liability on the basis of existing practice, therefore, is potentially quite dangerous and would leave the local authorities with a shortfall of funds'.
Lord Dixon-Smith said the government suggested an extra cost in London of about£15m whereas the ALG thought costs could rise as high as£28m.
Liberal Democrat Baroness Scott, a Suffolk county councillor and vice chair of the Local Government Association transport committee, pointed out that her party tabled amendments to the Transport Act last year aimed at equalising the age of eligibility. Now, local government was faced with altering within a matter of weeks a scheme only recently introduced. Even at this early stage it was not clear whether the costs incurred by local authorities as a result of the Transport Act 2000 would be fully met by grant; indications were that even with the increased figure available, the costs were underestimated.
Unlike Lord Dixon-Smith, she would like to have a national concessionary fares scheme. Currently, the administrative areas were set on district council boundaries. In rural areas the nearest bus stop might be in another district council area and therefore outside the concessionary scheme.
Baroness Scott said some local authorities had always offered up to 100% concessionary fares to blind and partially sighted people. There was a danger that future conformity with the 50% concessionary fare could severely disadvantage that group.
Cross-bencher Baroness Greengross, former director general of Age Concern, said the government had brought forward the Bill only because it was forced to do so by court action. And she was concerned it was being presented as something more than it really was. It benefits men aged 60 to 64 only for seven or eight years, until 2010.
'That is very welcome to the people who will benefit, but it does not say that between 2010 and 2020 all women who turn 60 to 64 will lose this benefit, and that men will have to wait until they are 65, as now', she added.
This was because the Bill refers to the Pensions Act 1995, which will equalise the state pension age at 65 between 2010 and 2020.
Hansard 9 July: Column 935-976