Source · Select Committees · Transport Committee
Recommendation 6
6
Deferred
Introduce a rural weighting into the BSIP funding formula for low-density areas.
Conclusion
The Department should consider introducing a rural weighting into its revised Bus Service Improvement Plan funding formula to reflect the higher per-passenger costs and structural challenges of serving low-density areas. This would help ensure that network improvement ambitions are not undermined by geographic disadvantage. (Recommendation, Paragraph 36)
Government response summary AI-generated
The government did not address the recommendation to introduce a rural weighting into its funding formula, instead stating it provides significant funding to LTAs and expects it to be used to support services.
Summary of the government's response below — read the verbatim text to verify.
Government Response
Deferred
HM Government · verbatim extract
Deferred
As noted in the Department’s written evidence to the Committee, the Government took the first step to reform bus funding by creating the Local Authority Bus Grant, which merged two previously separate funding streams. In 2025/26, the LA Bus Grant was allocated via formula based on local need, taking into account factors such as levels of deprivation, population size, and bus mileage. This formula was an interim process and only the first step towards a reformed allocation system. We have committed to reviewing this formula for 2026/27 allocations to ensure funding is allocated as fairly as possible and officials have been engaging with stakeholders on the development of this formula. We are currently considering several metrics to help us develop a simple and fair formula that ensures funding is allocated where it is needed most. We expect the revised formula will be confirmed and individual allocations announced later this year. The Department will actively consider this recommendation in finalising the funding formula.
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