A funding package that provides cheap bus fares for young people, and a fuel duty rebate are listed among the key asks from the Confederation of Passenger Transport (CPT) and RHA ahead of the Budget on 30 October.
With Chancellor Rachel Reeves predicted to use her first Budget speech to raise fuel duty for the first time since 2011, both trade bodies were in agreement this week in calling for rebates.
CPT, which works on behalf of coaches and bus, recognises that reversing the 5p per litre cut introduced in 2022 and increasing it by a further 5ppl could encourage modal shift away from private car use to public transport.
However, it estimates that exempting coaches and buses from any rise would only cost the Treasury £385 million and would help operators to provide affordable and reliable public transport.
Meanwhile, RHA argues against any rise but requests a 15ppl “essential user rebate” to benefit the hauliers and coach operators which it represents.
As the scheduled end on 31 December of the Bus Fare Cap Grant in England looms, CPT has urged Labour to transition gradually away from the £2 scheme to which passengers have grown accustomed since the start of 2023.
A step up to £2.50 single fares either for a full year or combined with a further increase up to £3 for the last six months of 2025 are suggested in order to cushion the blow. However, CPT admits of the scheme: “In considering the balance between different policy goals such as net zero, economic growth and managing the cost of living, it is likely that there are better value for money ways of helping passengers.”
CPT says the sector wants to work with the government to “implement a gradual transition away from the universal cap to deliver a targeted fares intervention for young people that will support longer-term modal shift and help young people access education and jobs”.
Bus funding
The submission from CPT outlines a call for the maintaining of funding levels, including Bus Service Improvement Plan Plus and Bus Service Operators Grant Plus for 2025-26. It also wants a five-year settlement from 2026-27 as part of the longer-term Spending Review.
It adds that operators in North and Midlands need clarity with regards to redirected HS2 funds and that the South, which missed out in this reallocation, should not lose out on a “postcode lottery”.
The body also wants the government to use the Budget and Spending Review to “ensure that maximum value is reaped from the funding provided to local transport authorities (LTAs) for buses by giving LTAs clear direction through a national commitment to increase bus speeds which is reflected in local targets that they are required to deliver against”.
Net-zero targets
Both CPT and RHA take the opportunity to repeat calls for an interim fuel duty rebate which incentivises the take-up of low-carbon fuel alternatives which can reduce emissions by up to 90% versus diesel.
In its document, RHA asks the government to extend the Rapid Recharging Fund to also ultra-rapid recharging units up to 350kW suitable for HGVs and coaches. That is part of a request from both bodies for investment in charging infrastructure.
RHA Managing Director Richard Smith says: “On the road to net-zero, our industry needs a clear roadmap so that all haulage and coach businesses can make that journey.”
With regards to speeding up the move to zero-emissions fleets, CPT is asking for a five- year £1 billion investment programme to leverage more private sector investment in new vehicles, as well as for a strategy for coaches.
Full expensing for leased vehicles
A removal of the full expensing exemption for leased vehicles is an ask of RHA, with a view to helping particularly SMEs.
The previous government announced in the 2024 Budget that it would be extended to leased assets “when fiscal conditions allow”.
Clean Air Zones
CPT notes coaches are often unfairly targeted in Clean Air Zones (CAZs) despite having a much lower carbon emissions impact per passengers than private cars.
It proposes the creation a new class of CAZ which enables councils to charge vehicles with a heavier pollution footprint while exempting coaches and the establishment of a national fund to support operators to upgrade their engines.
Coach figures trailed
CPT’s submission was bolstered by figures from its recent report The Economic Impact of Local Bus Services and from its forthcoming equivalent for coaches.
Via the latter, it is noted that 475 million journeys take place by coach each year in the UK and that passengers spend £5.3 billion annually at tourist destinations. The report also found that the sector employs around 54,000 people.
