Source · Select Committees · Transport Committee
3rd Report – Buses connecting communities
Transport Committee
HC 494
Published 13 August 2025
Recommendations
2
Deferred
Adopt ambition for local authorities to provide minimum public transport connectivity.
Recommendation
The Department should adopt an ambition for local transport authorities to provide by the end of this Parliament a minimum level of public transport connectivity, supported by long-term funding. As part of this, the Department should publish evidence-led guidance on …
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Government Response Summary
The government agrees in principle on the benefits of multi-year, long-term funding and confirms existing multi-year bus funding. It commits to simplifying funding streams from 2026/27 and will explore the possibility of a five-year funding settlement for bus services with HM Treasury as part of the next Spending Review. However, it does not commit to adopting an ambition for local transport authorities to provide a minimum level of public transport connectivity or to publishing evidence-led guidance on expected service levels.
Department for Transport
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4
Deferred
Move to a five-year funding settlement for bus services by end of Spending Review.
Recommendation
We welcome the Department’s intention to move towards multi-year funding for buses but believe it would be beneficial to go further. The Department should move by the end of the current Spending Review period to a five-year funding settlement for …
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Government Response Summary
The government agrees in principle on multi-year funding and confirms existing multi-year allocations. However, it commits only to exploring a five-year settlement with HMT as part of the next Spending Review.
Department for Transport
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8
Accepted
Reform the Bus Service Operators Grant to incentivise ridership growth in under-served areas.
Recommendation
The Department should, as soon as practicable, reform the Bus Service Operators Grant (BSOG). The overarching goal of reform should be to incentivise growth in ridership, particularly across under-served areas, for example instead of mileage the grant could be based …
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Government Response Summary
The government states it has already taken steps to reform BSOG, including incentives for zero-emission buses and devolving parts of the budget to LTAs. It agrees on growing ridership but expresses caution about passenger-based metrics.
Department for Transport
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16
Deferred
Establish minimum standards for bus stop facilities and real-time information provision
Recommendation
In order to increase ridership, the Department should establish minimum standards for bus stop facilities and the provision of real time information at bus stops where appropriate. While bus stops are used in different ways and a one-size-fits all approach …
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Government Response Summary
The government did not address the recommendation to establish minimum standards for bus stop facilities and real-time information. Instead, it discussed the complexity of regulations for Demand Responsive Transport (DRT) and Community Transport (CT) and their integration into the wider bus network.
Department for Transport
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21
Accepted in Part
Establish framework for local authorities' early access to operator data for bus franchising
Recommendation
The Department should set out a clear framework to ensure that local transport authorities have early access to operator data on patronage, fares and costs when undertaking a statutory assessment for bus franchising. The framework should include defined timescales for …
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Government Response Summary
The government states that LTAs already have statutory data powers requiring operators to provide necessary data. It commits to setting out a clear framework for data access, including timescales and safeguards, within the next substantive revision of the franchising guidance.
Department for Transport
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23
Acknowledged
Require local transport authorities adopting franchising to incorporate improved employment standards
Recommendation
The Department should consider the practicalities of requiring local transport authorities which adopt bus franchising to incorporate improved employment standards for bus workers. This should include minimum pay rates—based on the London model—and fair pay progression based on a driver’s …
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Government Response Summary
The government states that robust legislation (TUPE) already safeguards employees during franchising transitions and that franchising authorities can already include expectations for staff pay and conditions in contracts. Updated franchising guidance will address contractual matters following consultation.
Department for Transport
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25
Deferred
Develop clear strategic priorities for bus fares with local transport authorities within 12 months.
Recommendation
The Department should develop, in partnership with local transport authorities and within 12 months, clear strategic priorities for what bus fares are aiming to achieve. It should articulate the strategic purpose of fare structures and guide consistent, transparent fare-setting at …
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Government Response Summary
The government defers the development of clear strategic priorities for bus fares, stating it will consider options for the eventual end of the National Bus Fare Cap and bring stakeholders together to explore future models for fare support and structure. It highlights existing local authority flexibility and the commercial setting of most fares.
Department for Transport
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26
Rejected
Public transport is a major barrier to employment and education for young people.
Recommendation
Public transport remains a major barrier to employment for young people, especially in under-served areas where limited services and high fares make it harder to reach college, training , entry-level jobs, or shift-based work. In some areas, transport is restricting …
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Government Response Summary
The government rejects a national approach to youth concessions, citing unaffordability within the current spending review period and stating that local leaders are best placed to decide. It will gather learning from existing schemes and Transport Scotland to inform preparations for future Spending Reviews.
Department for Transport
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27
Rejected
Pilot a free bus pass for under-22s to support access to work and skills.
Recommendation
The Department’s review of the English National Concessionary Travel Scheme should consider piloting a free bus pass for under-22s, valid for travel at any time of day. This would support access to work and skills opportunities for younger people and …
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Government Response Summary
The government rejects piloting a free bus pass for under-22s, citing unaffordability within the current spending review period and the belief that local leaders are best placed to make such decisions. It will gather learning from existing schemes and Transport Scotland to inform preparations for future Spending Reviews.
Department for Transport
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28
Accepted in Part
Establish a coherent national framework for alternative transport models to ensure sustainable funding.
Recommendation
Alternative transport models such as DRT and community transport are essential for improving connectivity where conventional services are unviable. This makes them a possible model for sustaining socially necessary services. Their potential is being undermined, however, by fragmented regulation, inconsistent …
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Government Response Summary
The government is developing DRT best practice guidance and updating EP/franchising guidance to help local authorities integrate DRT/CT and use existing funding for socially necessary services, with the first version expected later this year. However, it does not commit to establishing a new coherent national framework for sustainable funding.
Department for Transport
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29
Accepted in Part
Develop a dedicated policy and regulatory framework for alternative public transport models within 18 months.
Recommendation
The Department should within 18 months develop a dedicated policy and regulatory framework for alternative and complementary public transport models, including Demand-Responsive Transport (DRT) and community transport. This framework should include growing and expanding their role in serving poorly connected …
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Government Response Summary
The government is developing DRT best practice guidance and updating EP/franchising guidance to support local authorities in integrating DRT/CT and coordinating existing funding streams. However, it questions the need for a new dedicated policy and regulatory framework, preferring to support local authorities within the existing framework, and does not address all specific components of the recommendation.
Department for Transport
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30
Deferred
Reform VAT rules for DRT services with Treasury, recognising them as public transport.
Recommendation
The Department should consider, with the Treasury, reform to the current VAT rules applicable to DRT services. This should aim to recognise the character of DRT as a public transport service, even when vehicles smaller than a Public Service Vehicle …
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Government Response Summary
The government recognises the issue but states VAT policy rests with HMT and any changes would need wider tax policy consideration. DfT has conveyed the sector's concerns to HMT and will continue to highlight them, but does not commit to actively considering reform itself.
Department for Transport
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31
Acknowledged
Devolving control alone is insufficient to deliver improved bus services without national strategic goals.
Recommendation
We welcome the Government’s reforms aimed at devolving greater control to local authorities. This will not on its own, however, be a sufficient vehicle for delivering all the positive outcomes the Minister described as wanting for bus services. There is …
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Government Response Summary
The government states it will consider future opportunities to outline its policy and vision for local bus services, and reiterates its existing vision for an attractive, accessible, and well-used bus service. It does not commit to creating a new national statement of strategic goals with a clear pathway as recommended.
Department for Transport
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32
Acknowledged
Publish a new national policy for buses within 18 months with a clear vision.
Recommendation
The Government should within 18 months publish a new national policy for buses that sets out a clear vision for what a successful bus network looks like and what it should achieve. It should outline how buses interact 52 with …
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Government Response Summary
The government states it will consider future opportunities to outline its policy and vision for bus services and describes its existing vision to grow usage and improve services through local empowerment and investment, without committing to publishing a new national policy within 18 months.
Department for Transport
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33
Accepted
Introduce a new regional bus performance metric to compare services and benchmark progress.
Recommendation
This vision should also be complemented by a new regional performance metric that enables meaningful comparison of services across different parts of the country. The metric should cover key indicators such as service frequency, reliability and passenger satisfaction, and it …
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Government Response Summary
The government accepts the recommendation and will implement a new regional performance metric through Outcomes Frameworks for Mayoral Strategic Authorities and a Bus Indicator Pilot, which will be extended to all LTAs from April 2026. This system will cover key indicators for comparison and benchmarking, with data made publicly accessible.
Department for Transport
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Conclusions (18)
1
Conclusion
Deferred
In larger cities like London, getting from A to B can be as simple as turning up and boarding. In many smaller towns and rural areas, however, whole communities can be cut off with no service at all, or have services that run so infrequently that they do not meaningfully …
Government Response Summary
The government acknowledges the potential benefits of standardized service levels but notes that implementing a national minimum level is challenging due to regional differences. It reiterates its commitment to devolving greater control and consolidating funding for local authorities, and states it will work with local authority groups to consider long-term options for raising service levels, alongside improved guidance.
3
Conclusion
Deferred
The short-term nature of funding for bus services has hampered local authorities’ ability to improve services. Five-year settlements in other transport sectors like rail and the strategic road network have enabled greater certainty and promoted strategic planning. Bus services, the most widely used form of public transport, require a similar …
Government Response Summary
The government stated it is reviewing the Local Authority Bus Grant formula for 2026/27 allocations and will consider the recommendation, but it did not commit to providing five-year funding settlements for bus services to ensure long-term certainty.
5
Conclusion
Deferred
The Department’s shift to needs-based allocation of Bus Service Improvement Plan funding is a welcome and necessary step away from competition. However, the current formula does not explicitly reflect the distinct challenges faced by rural and more isolated areas, such as lower population density, longer journey distances and higher per- …
Government Response Summary
The government confirms the current funding formula is interim and commits to reviewing it for 2026/27 allocations. It states that it will actively consider the recommendation for a dedicated rural weighting in finalising the new formula.
6
Conclusion
Deferred
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
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.
7
Conclusion
Deferred
The current Bus Service Operators Grant structure appears to disadvantage rural and low-demand areas, where lower fuel consumption per kilometre and longer average journey lengths can reduce the level of support received. This funding model does little to reflect the operational realities of low-density networks. As the sector transitions away …
Government Response Summary
The government did not respond to the conclusion about reforming the Bus Service Operators Grant due to its structure and misalignment with decarbonisation goals, instead discussing guidance for local authorities on socially necessary local services.
9
Conclusion
Deferred
The Department has not made clear what specific improvements to local bus services it expects the duty to list socially necessary services to deliver. Designating a service as ‘socially necessary’ under an Enhanced Partnership will not automatically guarantee its long-term provision or trigger additional funding, nor will it necessarily improve …
Government Response Summary
The government did not address concerns regarding the practical effectiveness of the duty to list socially necessary services due to a lack of ring-fenced funding or operator commitment. Instead, it outlined its commitment to supporting safe and accessible bus stops.
10
Conclusion
Deferred
The Department should ensure that there is funding to support the provision of socially necessary services by ring-fencing a dedicated portion of its bus grant funding or by other means. This will help ensure that the duty to identify such services has practical effect and is not undermined by competing …
Government Response Summary
The government did not address the recommendation for ring-fenced funding for socially necessary services or operator commitments to minimum provision. Instead, it discussed the Integrated National Transport Strategy and efforts to improve timetable coordination across transport modes.
11
Conclusion
Deferred
Growing fare box revenue from commercially viable routes is another possible source of support, in certain circumstances, for socially necessary services. The Department should require local transport authorities to consider using grant or fare box funding to enhance existing local bus services. In exercising the duty, the authority must have …
Government Response Summary
The government did not commit to requiring local transport authorities to consider using grant or fare box funding to enhance bus services and grow the network. Instead, it focused on supporting LTAs with franchising models through pilots and developing a guide on delivery models.
12
Conclusion
Acknowledged
The Department should mandate local transport authorities to publish a transparent methodology for how they determine which bus services qualify as socially necessary, to ensure public accountability. The Department should also develop common standards, and guidance, which the local formulas should take into account. This would enable residents to verify, …
Government Response Summary
The government stated it would clarify aspects related to socially necessary services in the next revision of the franchising guidance, but did not explicitly commit to mandating LTAs to publish transparent methodologies or developing overarching common standards for these assessments.
13
Conclusion
Acknowledged
The proposed statutory duty on local transport authorities to list socially necessary services applies only to those already in operation. There is no statutory requirement in the Bus Services (No.2) Bill for authorities to assess unmet needs or identify where new services might be required, although they may do so …
Government Response Summary
The government agrees with the vision to grow patronage and improve services, stating that local authorities are already expected to set out their vision in BSIPs and are supported with funding for new services. It acknowledges challenges and commits to working with LTAs to improve services, but does not address the lack of a statutory requirement to assess unmet needs.
14
Conclusion
Deferred
The Department should make clear that local transport authorities operating within Enhanced Partnerships should not only maintain existing socially necessary services but should also be expected to identify and address areas of unmet need and potential for new services. The Department’s vision should be for local authorities to preside over …
Government Response Summary
The government did not address the recommendation for LTAs to actively grow the bus network and address unmet need. Instead, it focused on extending the £3 National Bus Fare Cap until March 2027 and considering future options for fare support and reform.
15
Conclusion
Deferred
No national framework or clear design standard to improve the overall quality of bus stop infrastructure or real time information currently exists. Poor quality facilities like damaged shelters or seats and missing or inaccurate real time information undermine bus networks by deterring passengers. People without digital access, or whose bus …
Government Response Summary
The government did not address the conclusion about the absence of national standards for bus stop infrastructure and real-time information. Instead, it discussed the unaffordability of free travel for under-22s and local approaches to youth concessions.
17
Conclusion
Deferred
The Department should bring forward proposals as part of its upcoming Integrated National Transport Strategy for guidance on how local authorities and transport providers can achieve more effective integration between bus timetables and those of other transport modes. (Recommendation, Paragraph 65) Facilitating the transition to franchising
Government Response Summary
The government acknowledges the importance of the issue for the DRT sector but deflects responsibility for VAT policy to HMT, stating DfT will continue to highlight sector concerns rather than addressing the recommendation for guidance on bus timetable integration.
18
Conclusion
Accepted
We welcome the Government’s ambition to enable local transport authorities to undertake franchising. However, many local authorities continue to face operational and capacity challenges which may be further strained by implementing such a complex reform. The Department must take a greater role in strengthening local authority capacity to ensure effective …
Government Response Summary
The government commits over £1 billion in the Autumn 2024 Budget to support and improve bus services and keep fares affordable in 2025/26, stating it will empower and support local authorities to deliver its vision for bus services.
19
Conclusion
Deferred
The Department should expand the Bus Centre of Excellence (BCoE) to include a dedicated support strand for rural and other local transport authorities which may struggle to implement franchising successfully within their current capacity. This strand should focus on building local capacity by providing access to legal and procurement advice …
Government Response Summary
The government discusses implementing Outcomes Frameworks for mayoral authorities and a Bus Indicator Pilot to extend outcomes-based approaches for accountability, but does not address the recommendation to expand the Bus Centre of Excellence for capacity building support.
20
Conclusion
Accepted
Lack of access to consistent data about current services to support business cases creates an unnecessary barrier to franchising. The Department’s approach puts the cart before the horse: local authorities need access to the full range of relevant information before deciding whether to pursue franchising. (Conclusion, Paragraph 77)
Government Response Summary
The government states that local transport authorities already have statutory data powers, requiring operators to provide necessary data for franchising assessments. It clarifies that this will be further detailed in the next revision of the franchising guidance.
22
Conclusion
Acknowledged
The Government’s franchising reforms offer a clear opportunity to embed stronger and fairer employment practices across the sector. Better pay, fair progression, and stable conditions are not only essential for retaining drivers but are also critical to maintaining reliable and high-quality bus services. Without addressing these workforce issues, the wider …
Government Response Summary
The government states that robust legislation (TUPE) already safeguards employees during franchising transitions and that franchising authorities can already include expectations for staff pay and conditions in contracts. Updated franchising guidance will address contractual matters following consultation.
24
Conclusion
Deferred
Bus fares in England have risen faster than inflation and more steeply than other transport modes. While the fare cap has been broadly welcomed as a way of reining in unaffordable fares, it is a short-term measure, not a substitute for long-term policy. There is no clear national strategy guiding …
Government Response Summary
The government notes that LTAs can use existing funding for fare initiatives and has extended the national bus fare cap until March 2027. It commits to considering options for the cap's eventual end and will bring stakeholders together to explore future models for fare support and coherent fare structures.