18 Oct 2016, 9:17 pm
#120
(18 Oct 2016, 6:42 pm)GuyParkRoyal The withdrawal of concessionary travel on the red arrow was not a commercial decision on the part of Trent barton. It was cost cutting by Nottingham Council who claimed red arrow is a premium service and they are under no obligation to fund such services. Derbyshire are still funding journeys on red arrow that originate in their area. Trent Barton raised no issues with either authority regarding the use of concessionary passes.
I understand the circumstances around Nottingham withdrawing the support they provided to allow use of concessionary passes on red arrow which went beyond their statutory obligations. If concessionary reimbursements were at all important to trentbarton, they're fully entitled to make the commercial decision to offer pass holders a reduced fare which would be in line with the reimbursement they previously received from the council. As they have not done this; it can be assumed trentbarton are happier pursuing fare-paying passengers.
It's worth noting the following from the official guidance issued from the government on reimbursement of concessionary fares:
The Objective –"No Better, No Worse Off"
3.1 Requiring operators to use their assets to provide a free service for a proportion of the population is a major market intervention, and the requirement to provide adequate reimbursement is a fundamental one. Equally, however, European regulations prevent concessionary travel schemes being used to provide hidden subsidy (or state aid) to operators. The underlying principle which underpins reimbursement is set out in domestic Regulations which state that operators should be left 'no better and no worse off'3 as a result of the existence of concessionary travel schemes.
What this means is that despite pass holders taking up seats, the reimbursement of their fares cannot
legally be used to boost a service's profitability. I totally accept that concessionary reimbursements prop-up off peak services and indeed justify a lot of routes existing in the first place; but they can be deadly for express routes. I am not in any way diminishing the
social need for concessionary bus passes as they are a lifeline for thousands of people. Looking at them in a purely commercial sense, however, finds them to be very much a double-edged sword.
