Its a private contract and nothing to do with Cornwall Council, the fact that students are allowed to travel free on First buses is a privilege enrolled into the contract
Ye I know that, I think it's more to do with services that are run my tfc that used to be first run.
For instance the 16 which a student would have bought a penwith college bus pass but now they can't and have to pay another more money (that is tfc fault for high prices)
Also because college want to stagger students in college and first is helping by providing additional services like the x variants of the 200 service and the L1. But not all areas are covered which means that you have to take a tfc bus.
But I would think it's unlikely for the council to do anything with it considering tfc are burning alot of cash at the moment, so they need any money they can get