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Cost of bus passes soars

PUBLISHED: 10:57 26 February 2010 | UPDATED: 16:52 30 June 2010

Free bus passes are costing North Norfolk District Council nearly £1m a year and government grants to compensate the authority are set to plummet.

The scheme, first set up in 2006 and extended in 2008 to cover off-peak travel anywhere in England, allows over-60s and the disabled to travel free with any bus operator.

Free bus passes are costing North Norfolk District Council nearly £1m a year and government grants to compensate the authority are set to plummet.

The scheme, first set up in 2006 and extended in 2008 to cover off-peak travel anywhere in England, allows over-60s and the disabled to travel free with any bus operator.

Councils reimburse the bus companies each month - aided by Westminster grants - to ensure they do not lose income as a result of the government initiative.

This week, NNDC councillors were told of the rising cost of the scheme to the authority.

A surge in uptake of bus passes in recent years, along with a 50pc cut in the grant next year, could leave the council facing a huge bill.

In a report, Sheila Oxtoby, deputy chief executive, told the overview and scrutiny committee that the council looked set to have reimburs-ed bus companies to the tune of £954,989 by the end of this financial year - up £211,212 since last year and up £349,323 compared with 2006/07.

More that half of that - £498,000 - will be covered by the government grant, but it is set to plummet to just £248,000 next year while changes in the future could see the taxpayer picking up an even bigger bill.

Speaking ahead of the meeting, Mrs Oxtoby said: “It means it's now costing local taxpayers when it is a national scheme. It's now an additional burden.”

North Norfolk District Council looks set to have to draw on its reserves to cover costs next year and will be bracing itself for announcements about how much more could be taken away in future years.

Mrs Oxtoby told councillors that the changes “present a significant risk for financial planning from 2011 onwards” and would have to be looked at in detail.

The drop in grant is the result of a consultation, carried out in November, which followed lobbying by a number of councils nationwide who were concerned the existing scheme was not fair.

Some Norfolk authorities - including Norwich City and Great Yarmouth Borough Council - will see their share of the national pot rise.

But others, like NNDC, have found their grant cut and consequently face finding the money to compensate operators from elsewhere.

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