Concessionary fares and bus operator reimbursement in Scotland and Wales: No better or no worse off?

Governments in the three constituent countries in Britain--Scotland, Wales and England--have recently introduced much more generous concessionary fares on buses for people of 60 and above, in order to increase "social inclusion" (see Department for Transport (DfT), 2006. Concessionary fares for older and disabled people: regulatory impact assessment. DfT, London. Available from: http://www.dft.gov.uk/consultations/aboutria/ria/concessionaryfaresforolderan5508.)--i.e., to make it easier for people of limited means to access the activities that they want. To this end, in Wales and Scotland, passholders can now travel anywhere at zero fare, whilst in England, there is a free concession within a more limited area. As the majority of bus services in Britain outside London are operated commercially in a deregulated environment, these operators must be reimbursed for the cost of carrying at least some of the concessionary passengers. The main objective of this paper is to understand how much the concession costs, and whether or not it is a subsidy to operators (public funding that underwrites their costs). The paper draws on research carried out in Wales, for the Welsh Assembly and in Scotland, for the Scottish Executive, to achieve these objectives. It concludes that there are grounds for arguing that these countries' concession schemes are subsidising operators that there is some limited evidence that the new concessions are promoting social inclusion; but there are still many elderly people for whom the concession is of very limited use since they face barriers to bus use other than cost.