Concessionary pass remuneration

[Leedsbusman]

I couldn't agree more. Let's be clear though, ENCTS is not a subsidy, it's legally prevented from being so. The only subsidy is BSOG (Bus Service Operators Grant).


The marginal cost is not zero though if a pass holder worth 83p is occupying a seat that could have been sold for £7. That's a direct loss to the business of £6.17. And before anybody says that is an unrealistic scenario, pay a visit to Dorset, Cornwall or other tourist areas where full fare paying passengers are left at stops by buses full of ENCTS passengers.

Anyone only getting 83p needs help negotiating a better deal!

 

[Robertj21a]

Anyone only getting 83p needs help negotiating a better deal!

.....and yet that sounds like a fairly typical figure. On short town routes it's certainly better than nothing (assuming the bus is unlikely to fill up with full fare passengers).

 

[Deerfold]

Anyone only getting 83p needs help negotiating a better deal!

They don't get to negotiate. They can go to court if they think the terms of reimbursement don't meet the legal requirements.

Is the payment for the under 22 scheme in Scotland the same as for the ENCTS scheme?
And do bus operators legally have to accept passes, or can they opt out?

Travsdev Coastliner threatened to make some of its routes express so they weren't eligible for ENCTS users and would also have meant that a large number of villages along their route would have been unserved. North Yorkshire County Council (at the time) came to an agreement with them that presumably improved the payment on those routes. Operators on shorter routes don't have that option.

 

[Leedsbusman]

They don't get to negotiate. They can go to court if they think the terms of reimbursement don't meet the legal requirements.


Travsdev Coastliner threatened to make some of its routes express so they weren't eligible for ENCTS users and would also have meant that a large number of villages along their route would have been unserved. North Yorkshire County Council (at the time) came to an agreement with them that presumably improved the payment on those routes. Operators on shorter routes don't have that option.

Operators absolutely do negotiate which is why most schemes reimburse on an agreed revenue per concession journey as an agreed best endeavour to be neither better or worse off.

Operators are encouraged by the DFT to supply their own data to help the concession authority model the results, rather than just apply the defaults. As someone else said average reimbursement is £1.55 and the 2024/5 new guidance should push this up higher reflecting post Covid impacts on the concessionary market.

Anyone getting less than £1 is getting a very bad deal. Either that or its fares are fare too low in the first place.

 

[158756]

Anyone only getting 83p needs help negotiating a better deal!

According to the latest published statistics, the average reimbursement per journey in West Berkshire is 79p. That's the lowest by some distance, but for example Kent covers a huge area and has an average of £1.23 or the most recent (2022) figure available for Dorset is £1.13, so journeys within towns are probably getting pence.

£50 an hour is a little outdated. When I moved into planning a couple years ago, we used £85/hr, and now it’s closer to £100/hr!

I'm surprised anyone is making money with those costs. The average revenue per passenger journey in 2023 for England outside London was £2.10 - including BSOG, ENTCS and council subsidies (which obviously don't apply to commercial services). So at £100/hr the average bus needs to pick up 48 passengers an hour to break even, more in urban areas with lower fares.

 

[Ken H]

Why does ENCTs have to be free. I would have thought a 50p fare for over (say) 5 miles would be fair. Giving people free bus rides for journeys like Newcastle - Berwick, Leeds - Scarborough, Skipton - Lancaster or Lancaster - Keswick is not a good use of taxpayers money IMHO

 

[Dai Corner]

Why does ENCTs have to be free. I would have thought a 50p fare for over (say) 5 miles would be fair. Giving people free bus rides for journeys like Newcastle - Berwick, Leeds - Scarborough, Skipton - Lancaster or Lancaster - Keswick is not a good use of taxpayers money IMHO

Why should card holders in rural areas more than (say) five miles from their nearest town pay for their journeys to the shops and other amenities while those in urban areas making shorter journeys don't?

A tap on tap off system would allow higher reimbursement for longer journeys which seems like a good idea to me, even if the total paid remained the same.

 

[JKP]

In Scotland the three National Entitlement Card schemes have different reimbursement rates. The other main difference from England is that it is managed by Transport Scotland nationally, rather than by individual local authorities.

Three NEC schemes? Please can you explain?

 

[computerSaysNo]

Why should card holders in rural areas more than (say) five miles from their nearest town pay for their journeys to the shops and other amenities while those in urban areas making shorter journeys don't?

1. Because they've chosen to live in an area where it is more difficult for public transport to serve them.
2. Because in towns and cities is where mass transit has the greatest positive effect, both in less congestion and fewer engines running = less pollution.

It would however probably be difficult to argue point 1 with the current nationwide housing crisis as people would (rightfully) argue that they either couldn't afford to live in a town or city or that there were simply no properties available.

Three NEC schemes? Please can you explain?

Pensioners, and Under 22s are the two I can think of. Disability passes might be the other one?

 

[Dai Corner]

1. Because they've chosen to live in an area where it is more difficult for public transport to serve them.
2. Because in towns and cities is where mass transit has the greatest positive effect, both in less congestion and fewer engines running = less pollution.

Aren't these arguments for not subsidising public transport at all, rather limiting concessionary schemes?

 

[HullRailMan]

There are plenty of pensioners that sit between those eligible for pension credit and millionaires! I see no reason why their pass should not be replaced with a half fare pass or have an annual charge of day £100 for free rides. I’ve seen plenty of luxury cars pull up at York P&R and their occupants then get a heavily discounted ride, despite probably having more spending money per month than I do - I’m certainly not driving round in a BMW!

 

[Stan Drews]

Three NEC schemes? Please can you explain?

Over 60 (& Disabled/Visually impaired etc) at 55%
16-21 at 81.2%
5-15 at 43.6%

 

[JKP]

Three NEC schemes? Please can you explain?

In 2023-24 in Scotland the reimbursement rates were as follows.

Over 60s. 55.9% of revenue foregone but budget capped at £216.2 million.
Under 16s. 43.6% of adult single fare.
16 to 21. 81.2% of adult single fare.

 

[neilmc]

Cumbria pays operators 58% of the revenue foregone by having to accept ENCTS passes. I will sometimes get the weekly (!) bus just to support the operator even if I don't have a pressing need to travel which I would not do if I had to pay £6+ for a return, so I see that as win/win. Maybe win/win/win, as the council has to pay up for a non-necessary journey but can claim credit for increasing the county's bus usage.

 

[class17]

Could I ask a question?
I live in an area with tendered services and commercial services. If I use my Senior ENCTS card on a commercial service to town, this is a net cost to the council, but should I use a my senior ENCTS card a tendered service, there is no net cost to the council?

I am not sure where cost and revenue fall between local and county councils for tendered services. I though tendered services are council funded (including grants from central government) and local councils pay the concession fare to the commercial bus company or county council.

 

[Cesarcollie]

Could I ask a question?
I live in an area with tendered services and commercial services. If I use my Senior ENCTS card on a commercial service to town, this is a net cost to the council, but should I use a my senior ENCTS card a tendered service, there is no net cost to the council?

I am not sure where cost and revenue fall between local and county councils for tendered services. I though tendered services are council funded (including grants from central government) and local councils pay the concession fare to the commercial bus company or county council.

Tendered services are either gross cost (the operator receives a fixed price and all revenue goes to the local authority) or net cost (where the operator bids based on passenger fares, concessions etc going to them). Some authorities will only offer one or the other, some will let operators bid on either basis. So in a net cost tender, ENCTS revenue will be paid to the operator in addition to the tender price.

In reality, the only difference is where the revenue risk lies. So from a local authority perspective, the money comes out of one budget pot (ENCTS) and goes in to another (tendered services).

 

[Trainman40083]

Why should card holders in rural areas more than (say) five miles from their nearest town pay for their journeys to the shops and other amenities while those in urban areas making shorter journeys don't?

A tap on tap off system would allow higher reimbursement for longer journeys which seems like a good idea to me, even if the total paid remained the same.

I have to say, that I am surprised all journeys aren't tap on/tap off. Without it, and certainly re ENCTS, there can be no data about where people are actually travelling. For all anyone knows, people might be travelling from A to C, but catching a bus from A to B, changing to go B to C. Where is the passenger flow data? How can you plan routes without it?

£50 an hour is a little outdated. When I moved into planning a couple years ago, we used £85/hr, and now it’s closer to £100/hr!

I would think the cost of actually running a bus is why so many routes have ended. Then there will be routes that are only just covering their direct costs, or very little to the overheads. Then there will be "profitable" routes, that keep the bus company going, but effectively subsiding lesser routes. Now post COVID, I feel sure the number of passengers in three main groups (ENCTS passholders, those going to work daily and ad hoc passengers who may well have alternatives (not necessarily car) has changed. Walking, cycling, local shopping, taxis, internet shopping, working from home etc have all changed the status quo. Indeed in some areas the percentage of ENCTS passholders on a bus may have risen, as other groups fell. Maybe the £2 fare has changed things, but as far as I am aware, the operators don't get the full difference between the normal fare and the £2 fare, again leaving them with less revenue.

 

[Ken H]

I have to say, that I am surprised all journeys aren't tap on/tap off. Without it, and certainly re ENCTS, there can be no data about where people are actually travelling. For all anyone knows, people might be travelling from A to C, but catching a bus from A to B, changing to go B to C. Where is the passenger flow data? How can you plan routes without it?


I would think the cost of actually running a bus is why so many routes have ended. Then there will be routes that are only just covering their direct costs, or very little to the overheads. Then there will be "profitable" routes, that keep the bus company going, but effectively subsiding lesser routes. Now post COVID, I feel sure the number of passengers in three main groups (ENCTS passholders, those going to work daily and ad hoc passengers who may well have alternatives (not necessarily car) has changed. Walking, cycling, local shopping, taxis, internet shopping, working from home etc have all changed the status quo. Indeed in some areas the percentage of ENCTS passholders on a bus may have risen, as other groups fell. Maybe the £2 fare has changed things, but as far as I am aware, the operators don't get the full difference between the normal fare and the £2 fare, again leaving them with less revenue.

Careful what you wish for. ENCTS changes behaviour. Pass holders may travel further for days out, or even may venture onto buses when they would not if they had to pay.
I do some quite short journies on my pass. I do 2 stop journies to use free on street parking to avoid payjng for parking.
So the average fair will cover a multitude of different fares from quite small to a lot of £££

 

[PeterC]

I have to say, that I am surprised all journeys aren't tap on/tap off. Without it, and certainly re ENCTS, there can be no data about where people are actually travelling. For all anyone knows, people might be travelling from A to C, but catching a bus from A to B, changing to go B to C. Where is the passenger flow data? How can you plan routes without it?

I have no idea how much effort companies put into this but it should be possible to identify interchanges based on route and time taken. In the majority if cases people will board at point A and return from point B inferring a return trip from A to B.

What isn't seen is mixed company journeys such as a trip to my local hospital which requires a change from Go-Ahead to Arriva.

 

[Trainman40083]

I have no idea how much effort companies put into this but it should be possible to identify interchanges based on route and time taken. In the majority if cases people will board at point A and return from point B inferring a return trip from A to B.

What isn't seen is mixed company journeys such as a trip to my local hospital which requires a change from Go-Ahead to Arriva.

A contact I have suggested that not many people make trips involving more than. One return trip. I would counter, how would you know they had not caught a subsequent bus? After all, these concessionary passes are just tap on. All it shows is someone got on a bus at a stop and went to an unknown destination.

 

[Ken H]

A contact I have suggested that not many people make trips involving more than. One return trip. I would counter, how would you know they had not caught a subsequent bus? After all, these concessionary passes are just tap on. All it shows is someone got on a bus at a stop and went to an unknown destination.

What happens on those buses where the bus runs through but on a different registration? The 555 Lancaster - Keswick does that. As does the 81/82 -581-580 Lancaster - Skipton. I dont think you have to re-do your pass tap, you just sit tight.
I am sure there are other routes like this in England, but I have given ones local to me as examples.

 

[Teapot42]

What happens on those buses where the bus runs through but on a different registration? The 555 Lancaster - Keswick does that. As does the 81/82 -581-580 Lancaster - Skipton. I dont think you have to re-do your pass tap, you just sit tight.
I am sure there are other routes like this in England, but I have given ones local to me as examples.

While I only have hearsay to go on, I believe this was one issue that contributed to the Hulleys X57 ending. It seems like ENCTS 'taps' which crossed the Derbyshire / GM border were not being remunerated. Whether it was the border that was the issue, or the change in service registration I'm not fully sure.

Either way, it sounded like they were required to get the second tap before they would be paid for carrying that passenger. Hopefully someone with a better understanding of the situation can clear up exactly what happened.

As an aside, now the post has been changed to be about concessionary passes in general rather than just the ENCTS, I'd be interested to know what happens with cross-country-border journeys and how other schemes such as the Derbyshire b_line2 for younger people remunerate operators.

 

[Haywain]

As an aside, now the post has been changed to be about concessionary passes in general rather than just the ENCTS, I'd be interested to know what happens with cross-country-border journeys and how other schemes such as the Derbyshire b_line2 for younger people remunerate operators.

ENCTS passes only cover travel in England, so cross-border journeys should see the passenger charged for the rest the journey - assuming they mention it when boarding.

On your wider point I am also curious as to whether TfL get anything for carrying non-London ENCTS passholders as they have no way of counting them.

 

[RT4038]

While I only have hearsay to go on, I believe this was one issue that contributed to the Hulleys X57 ending. It seems like ENCTS 'taps' which crossed the Derbyshire / GM border were not being remunerated. Whether it was the border that was the issue, or the change in service registration I'm not fully sure.

Either way, it sounded like they were required to get the second tap before they would be paid for carrying that passenger. Hopefully someone with a better understanding of the situation can clear up exactly what happened.

As an aside, now the post has been changed to be about concessionary passes in general rather than just the ENCTS, I'd be interested to know what happens with cross-country-border journeys and how other schemes such as the Derbyshire b_line2 for younger people remunerate operators.

On cross boundary journeys, the Authority where the passenger boards pays the re-imbursement. So, on the X57, Derbyshire would be paying the full reimbursement for one direction and GM in the other. As operators are often paid an average re-imbursement over their entire network in a particular county, these two figures may well be different.

 

[Deerfold]

ENCTS passes only cover travel in England, so cross-border journeys should see the passenger charged for the rest the journey - assuming they mention it when boarding.

There's a handful of routes where passes are valid to cross between England and Scotland or Wales.

On your wider point I am also curious as to whether TfL get anything for carrying non-London ENCTS passholders as they have no way of counting them.

Counties don't charge each other for carrying ENCTS passengers. Counties that are popular holiday destinations for passholders often complain about this.

 

[richw]

I know of at least one local authority who are agreeing an amount with the bus companies at the start of each financial year to cover predicted amounts to aid their budgeting for the year.
Eg council offer operator £3m to cover all concessions for the whole financial year. The amount is based on typical average usage of the pass in previous years.

 

[TheSel]

There's a handful of routes where passes are valid to cross between England and Scotland or Wales.

So I understand, but do you know whether (and if so where), a list of such exists? I'm thinking of having a day out with my ENCTS pass from Chester to Shrewsbury - in one direction via Whitchurch, in the other via Oswestry and Wrexham.

Chester > Whitchurch > Shrewsbury is no problem, as the routes remain within England. Ditto Shrewsbury > Oswestry. However Oswestry > Wrexham involves crossing into Wales, and Wrexham > Chester involves crossing back again.

Grateful for any relevant info anyone on this forum may have.

 

[JKP]

So I understand, but do you know whether (and if so where), a list of such exists? I'm thinking of having a day out with my ENCTS pass from Chester to Shrewsbury - in one direction via Whitchurch, in the other via Oswestry and Wrexham.

Chester > Whitchurch > Shrewsbury is no problem, as the routes remain within England. Ditto Shrewsbury > Oswestry. However Oswestry > Wrexham involves crossing into Wales, and Wrexham > Chester involves crossing back again.

Grateful for any relevant info anyone on this forum may have.

ENCT passes are valid on Borders Buses routes 60 and 67 from stops in Northumberland. Between Berwick and Eyemouth on Borders Buses 235 and 253. Peter Hogg X74 between Newcastle and Jedburgh. Passengers must state destination to the driver on all journeys.

 

[greenline712]

I know of at least one local authority who are agreeing an amount with the bus companies at the start of each financial year to cover predicted amounts to aid their budgeting for the year.
Eg council offer operator £3m to cover all concessions for the whole financial year. The amount is based on typical average usage of the pass in previous years.

I've been following this thread with interest, as I was involved (at bus company level) with concessionary fares reimbursement (on and off) from 1986 to 2020 . . . so I know a bit about it!!

Back in 1986, a "generation factor" was set, pretty much countrywide. This said that 70% of the single fare would be paid as reimbursement for each pass journey; the discrepancy was to allow for pass holders making extra trips because they only paid half-fare. It was impossible to quantify this, even with early electronic ticket machines passenger data, but it was felt to be reasonable.

Fast forward to 2008, and Gordon Brown's efforts to secure the "wrinkly" vote with free travel for the over-60s . . . initially this was to be funded by the Treasury, but rather quickly it was found to be far too expensive. The qualifying age was to be raised towards 66, and the monies available were reduced. Such monies that were paid over were not "ring-fenced", so some Local Transport Authorities would use the cash for other reasons. The 70% generation factor was retained, as there was still no way of quantifying it!!

The DfT made available a "Revenue Apportionment Tool", for LTAs to use . . . some did, some didn't. It was horrendously complex, and soon only consultants could understand it!! The LTA that I was concerned with took a different route (pun not intended) . . . a sum of money was agreed between LTA and operators, and this was apportioned route by route based on the average single fare for that route.

So . . . if a route had an average adult single fare of (say) £1.20, then around 60p would be paid; if the average single fare was £2.00, then around 100p would be paid. The number of season-type passes was also taken into account (ISTR that weeklies were assumed at 9 trips/week; monthlies at around 35 trips/month), so the "average fare" was pretty much understood. Note that the 70% generation factor was now around 50% . . . quite simply, this was all the LTA could afford (remember that the Treasury had slashed the relevant funding).
Every year, negotiations would take place . . . the LTA would say "we can't afford any more", the operators would respond with "we'll start cutting routes then", and a figure would be agreed that (sort of) satisfied each side.

The beauty of this is that bus operators can be pretty sure of the reimbursement, so budgeting is more accurate. With the RAT, a quiet month for passengers would mean lower reimbursement.

Quite how the £2 fare has affected matters, I'm not sure . . . during Covid, ENCTS reimbursement was paid at the previous rate, but I expect that's finished now.

Happy to answer any specific questions, if I can . . .

Just to add to my earlier comments . . . as far as cross-boundary routes are concerned, the authority in which the journey starts pays the piper!! So a journey from Watford to Luton will see Herts CC pay for the usage; a journey from Luton to Watford will see Central Beds pay. The operator would need to keep fairly accurate records of which pass boards in which County, but current ETM software can deal easily with the reports required. Thus applies for local journeys within Herts CC with a Central Beds pass . . . the hours of acceptance may be different, but the payment principle is the same.

I don't know how cross-border journeys England <> Scotland or Wales are accounted for . . . theoretically in the same way, although England passes would NOT be valid for local journeys in Scotland . . .does anyone know for sure??

As far as gross-cost or net-cost contracts are dealt with, I'm not sure now . . . it always was the case with gross-cost contracts, the operator was paid an agreed pence per mile, and ENCTS reimbursement went from LTA direct to LTA. With net-cost contracts, as the operator retained the revenue, they would need to receive the ENCTS monies, so would treat the route as "commercial" in that respect. There aren't many net-cost contracts now . . . the risk for the operator is too great.

And don't forget Bus Service Operators Grant . . . a route run commercially will receive this from DfT; a contracted route will have this paid directly from DfT to LTA. it's all income!!

 

[Haywain]

a journey from Luton to Watford will see Central Beds pay.

Luton Borough Council, rather than Central Beds.