Thursday, 6 August 2009

Big Red Fuss

Aha, transport. My territory. And here is one Labour idea that I watched on the news in April last year through my fingers (you know that excruciating feeling you have when you're mortally embarrassed for someone else? That's why). It had cock-up written all over it.

Veteran broadcaster Dame Joan Bakewell today led a pensioners' revolt against calls to scrap free bus passes for millions of middle-class pensioners.

A report by town hall chiefs yesterday said too many people who own cars or can afford tickets are taking advantage of the scheme and only the poorest should get free travel.

It said spending £1billion a year of taxpayers' money on them was a waste and free bus passes should be only for the poor. It called for 'targeting' - or means-testing - to select those who deserve the privilege.

I'm afraid Dame Joan, for whom I usually have a lot of time, is rather naive here. This scheme didn't make sense from the moment some air-headed Labour policy-wonk cribbed it from his sixth form ideology class textbook.

It is a scheme which belongs to pre-deregulation days, at which time Labour may well have gotten away with it (although it would still have been expensive and unwise, just not such a transparent mess).

However, bus services are now run by businesses who recharge the cost of journeys to councils on a monthly basis. The total amount of free journeys is multiplied by the average journey cost and a deduction made for 'generation factor', which isn't a Bruce Forsyth game show, but a figure designed to reflect the increased usage due to the service being free, which wouldn't occur were passengers made to pay for it.

Whatever figure was used for generation factor prior to April 2008 would not have been adequate to cope with the extra usage by generally more sprightly 60-65 year olds who, if it's free, will use it and use it more extensively. More prohibitive deductions may have been attempted, but transport operators would have resisted them strongly, or may even have agreements which prevent such decreases. Since local bus service registrations are granted without a finite curtailment date, and can't be cancelled by anyone but the Traffic Commissioner with very good cause (bad repute, safety, poor finance), local authorities are somewhat screwed. They simply have to cough up.

As Dame Joan's comments illustrate perfectly, Labour have now created a problem for themselves, just as they did when they introduced the 10% tax band. Namely, now people are used to saving outlay they previously wouldn't have missed, they want to keep it.

However, it is simply too expensive to operate as it is currently. Especially since the 60-65 age range is incredibly more healthy than they were 10 or 20 years ago and a vast proportion in that age bracket have no real vital need for free travel. If they are physically fit and of ample means or perfectly able to travel by an alternative, their free bus pass is merely giving taxpayers' money away unnecessarily.

Labour should have foreseen all this a long time ago, but since dogma is their sole driving factor, and they are functionally innumerate into the bargain, it's no surprise that they didn't.

Now Labour have check mated themselves once again, one wonders who will have to suffer for them to save face. Here are the likeliest candidates:

1) The taxpayer (via increased subsidies to local authorities to cover the free bus pass scheme which will only ever increase over time as numbers of over 60s burgeon)
2) Local authorities (via being told to find the costs by savings or increased revenue elsewhere - thereby inevitably punishing the taxpayer)
3) The transport industry (via legislating to change the way concessionary fares are reimbursed, thereby reducing profitability and inevitably leading to closure of uneconomic routes)**

This is truly a government of all the incompetents, is it not?

** There is, of course, the highly unlikely option of re-regulation. The proposal of which would have even Mr Puddlecote Sr reaching for his torch and pitchfork.


Mark Wadsworth said...

DP, that is all dealt with in my overarching 'Citizen's Pension' plan.

The cost of the 'free' bus pass is just one of a myriad of old-age benefits that will be pooled, averaged out and rolled into a single weekly cash payment for over-65s. The administrative cost saving gets split 50/50 so most pensioners will be slightly better off, and they'll need a slide rule and calculator to work out whether they are better or worse off anyway.

captainff said...

Forgive my uninformed and simplistic take on the situation but isn't it current government policy that public transport 'green' and 'good'?

Just imagine the chaos if the bus passes were revoked through all those extra cars on the roads .. .. ..

So the only viable alternative (for the Tories as well) is to fund it through the taxpayer. Which, as you can image, I'm delighted about. Not.

Witterings From Witney said...


Bloody good rant, however you seem to forget that we are talking about socialists here.......Hello?

And yes, whilst an OAP - and no, I have not applied for this freebie - as someone with a couple of private pensions and who pays CT, either way I shall, like all taxpayers, be subsidising something I don't use!

Like all their 'policies' this, as you say, was never 'thought through'!

The witch from Essex said...

They can stuff their free travel. I am a pensioner and prefer to use my 4 X 4 to pop to the local shops or go on a journey. I can get in my car when I want and not have to wait until a certain time. I don't have to sit near smelly people or nutters and I can enjoy a leisurely cigarette.

Grumpy Old Man said...

I haven't applied for my bus-pass either. The nearest bus-stop to my village is 1,1/4 miles away. My neighbours who do have bus-passes drive to the nearest town, then go free along the various scenic routes, have a nice pub lunch and return. I don't see why prescriptions should be universally free either. A yearly NHS pre-paid card works out as good value and is affordable by all but the poorest OAP. I would suggest that free bus-passes should be issued only to those who cannot, through poverty or infirmity,drive a car and should have a limitation of distance from home placed on them.Both free prescriptions and the Winter Fuel Allowance, which I have also not applied for, should be means-tested.