Councils receive a government grant which they pay to bus operators. The amount of grant is based on an estimate of the number of 'free' passengers.
The extra grant promised roughly matches the overall£76.3m extra cost for metropolitan areas. However, the government plans to distribute this according to total population, rather than the numbers of passengers eligible for free fares. As some councils already contribute to concessionary fares but will get the grant as well, some will get too much while others get too little.
A Passenger Transport Executive Group paper showed Tyne & Wear councils would collectively lose£10.1m and Greater Manchester£9.1m, while West Midlands would gain£12.1m.
The Local Government Association is to research the impact on other councils.