1. What assurances will the Minister provide that the transition away from bus emergency scheme funding will not lead to the closure of bus routes and render rural bus services unviable? TQ727

An initial extension of three months gives the industry the stability it needs in the short term while we continue to work together with them and local government on planning bus networks that better suit the new travel patterns that we've seen since the end of the pandemic.

Diolch, Weinidog. I appreciate that the last couple of days have been exceptionally busy for you. The uncertainty that you've touched on about that future funding is causing a great deal of concern, and I welcome the fact that you've extended this transition period for three months. That temporary reprieve, though, is not going to do much to assuage the concern of bus operators. I do appreciate that you're in a difficult position—I know that we touched on this in the Siambr yesterday—but the shift in messaging on this has confused things, I think, and I'd like to get some more information on that. There have been some statements that have been made that this scheme was due to come to an end in March of this year, but that seems to run contrary to the ministerial evidence that was submitted on the draft budget, as well as, as I understand it, the tone of discussions that bus operators have had with the Welsh Government in the months leading up to this change.

I would say, Minister, that you have taken bold steps this week towards realising a net-zero future. The impetus behind that is one I truly welcome; I think that it's incredibly brave. And it's for that reason that I'd urge you that now is surely the most important time for the Welsh Government to be looking at providing certainty of funding for public transport, because if we want to encourage people to use cars less, to make sure that there are viable bus and train networks there available for them, that's the way of making sure that people can get where they need to be—in more ways than one, of course. So, could you please tell us is there any prospect, as you see it at the moment, of a more sustainable footing for a scheme of this nature to continue, or one that replicates it, taking into consideration that it was, of course, one for COVID?

Well, thank you for raising the question, because it is an issue that is concerning us greatly. Clearly, this is not a happy situation. We have a privatised bus network, which relies on commercial operators being able to make a profit. Clearly, the pandemic has turned that business model on its head and it was our intervention, with £150 million of public investment, that kept the sector from going under. It was always meant to be an emergency scheme; it was meant to be temporary. We do spend, every year, £60 million subsidising concessionary fares for older people, we spend a further £2 million subsidising the mytravelpass scheme for 16 to 21-year-olds, plus we provide £25 million of grant to local authorities for the bus services support grant, plus school transport now accounts for about a quarter of local authority education budgets. So, we're putting a lot of public money in, and on top of that, we've had the bus emergency scheme.

Now, in this year's budget, it was always intended to wind that down. One of the things that the industry themselves say is that we are ossifying—that's the word that they've used—bus networks to run along lines that suited passengers pre pandemic, but passenger behaviour has changed. There are fewer older people travelling, there are more leisure journeys than there are commuting journeys. So, we're probably still running a bus pattern based on pre-pandemic behaviour. So, regardless, there does need to be a reconfiguring of the networks. Clearly, we'd prefer to do that in an orderly way. Now, we have been trying to square a very, very difficult budget settlement with our policy aspirations and, as you know, we do have great ambitions for bus. But, essentially, unless we're prepared to fully subsidise the industry, we're not able to do anything to retain services as they are. And this is a problem right across the UK. A quick internet search will show this right across England and Scotland. They're all facing the same.

We haven't seen any additional money coming from the Treasury and the Department for Transport that would produce any consequentials for us to put further funding in this year. We're also having to meet significant cost pressures in the rail industry. So, we are in a fix here. We did manage, through last week, through some very constructive conversations with the industry and local government, to get a reprieve. So, we've got a guarantee of the BES scheme for a further three months, and we hope to work closely with them during that time to try to work out which routes should be maintained within the declining bus budget envelope to give us the best chance to have a skeleton service that then will take us into the new franchise, which is still a couple of years away. So, we'll have a real bridging problem.

I would desperately like to find the money to be able to do it properly, but our options are limited. We know the cost pressures that the Government is under, and together, Labour and Plaid Cymru have prioritised a whole range of funding for free school meals, for the cost-of-living crisis and for a pay deal for the NHS. Now, that money can't be spent twice. So, there simply isn't money floating around within the Welsh budget that we can move onto this, much as I would dearly like to. So, we've got a real challenge now to try, as best we can, to get a smooth glide path out of BES in a way that causes the least amount of disruption to passengers, whilst keeping a core of bus networks that allows people to use public transport and achieve the modal shift, as we want them to do. But, I can't in all conscience say that we're going to be able to do all the things we want to do, given the money that is available. I desperately hope, and I would make a plea to the UK Government, because they're having these problems as well, to put extra money into the transport budget at the UK level to deal with the crisis there is in England, too, which will produce extra consequentials for us that we can then put into the bus system and work with the industry to create a rational network.   

I'd like to thank my colleague, Delyth Jewell, for actually raising this as a question today. Now, with all due respect, the end of March was set to be the cut-off point for BES 3, as it was commonly known, and now, we are finding out that it obviously gets pushed back to the end of June, which is fine. So, I'd like to know what exactly is going to happen when we reach June, Deputy Minister? You mentioned previously that criteria have to be met for certain bus routes to run. What are those criteria? What support is going to be put into place to help Wales's bus services, and what actions will you be taking so that our rural communities and members who live there don't feel neglected and isolated going forward? Just 24 hours ago, you unveiled the roads review and transport plan—in a rather rushed manner, which is fine—in which you placed a lot of emphasis on public transport. On 31 March 2022, you published 'One network, one timetable, one ticket: planning buses as a public service for Wales', and in this—and I quote—you said that you wanted to create an

'excellent travel option, wherever people need it, whenever people need it, throughout Wales'.

On the one hand, the Welsh Government wants to have more people use more buses and get out of their cars, but on the other hand, you're stripping away a much-needed cash lifeline. It just doesn't add up to me, Deputy Minister. If funding plans are not put into place by cutting financial help for buses, this Government's going to inflict major problems on countless people in all four corners of Wales. I understand that one big bus operator has warned that it's actually going to preparing to cut a quarter of its current services, due to the funding scheme's impending withdrawal. How on earth can you expect people to use public transport more when this Government's actions will ultimately lead to bus services being cut? It's already a nightmare to catch a bus in Wales, so this decision is only going to make things worse if funding is not provided. I'm sure that you'll make the argument, Deputy Minister, that buses simply aren't being used—as you've mentioned previously—as they were in the past, so my question is: what are you doing to increase the use and availability of public transport? Surely, the more people use public transport, the more financially viable they become, and less Government support will be needed. Do you agree, Deputy Minister, that axing this funding going forward completely flies in the face of your Government's policies? And, what alternative help will your Government be providing to bus operators in Wales from June 2023, going forward?

Well, I think I've covered all those points in the answer to Delyth Jewell.

No, I don't think you have.

We have a privatised bus system, as I've explained on many occasions, which is a legacy of Conservative privatisation in the 1980s, and we are living with the reality of that now, and it has failed; the business model has failed, there is market failure here, and we're going to see cuts and a disappearing of vital public services. None of us want to see that, but we're also living in an age of austerity; again, a political choice by her party's Governments, where public funding has been reduced next year and we simply do not have the funding available to continue to invest in propping up private companies that are not able to run commercially viable services at the rate that we were through the pandemic. We've been able to find some additional funding this year to extend the scheme temporarily, but the money simply is not in the budget to be able to continue that into the future. I wish it was; it is not, I'm afraid. And I just can't get away from that reality, much as I would like to.

So, I fully concede that this is a pretty grim situation that none of us want to see, but our options are limited. The best we've been able to manage is to get a reprieve for the industry, to work closely with them to try and design as smooth a glide path out as we possibly can, but I can't say with any certainty that we're going to be able to manage that, and there's always the danger that commercial companies will simply decide themselves—which they're free to do in a commercial deregulated bus system—to withdraw services, because they're already having trouble recruiting, retaining and training bus drivers, and being able to keep to the advertised schedule as it is.

So, the bus industry is facing a number of different challenges, and the fact that passengers haven't returned to make those commercial services viable is a profound one, but there's a limit to what the Government can do with this budget settlement from her Government.

The Deputy Presiding Officer (David Rees) took the Chair.

I'm grateful to the Minister for his response, and I share his analysis of the problem. But Governments exist, of course, to solve problems, not simply to rehearse them. And for my constituents, in Blaenau Gwent, when they hear a Minister talking about a skeleton service, they think, 'Well, that's a service that's going to serve Cardiff, Newport, Swansea and a few other places, but we know it won't serve Cwm, it won't serve Blaina, it won't serve Abertillery, Tredegar or Ebbw Vale'. And that isn't a service that we can accept. So, what I would like to hear from the Government—and I know it's a difficult situation, and I think the moves this week to extend the programme for three months does buy a breathing space—but what I want to see from Government is a clear action plan to deliver the public services that yesterday, when he stood in this Chamber, he said he wanted people to use. In my constituency, those public services don't exist today, and if they're not going to exist in six months' time, how do people then reach public services? How do they reach shopping? How do they buy their food? How do they move around, go for training and work? We simply cannot allow this situation to continue. We need a plan for buses and we need it now, and, if the Minister brings through emergency legislation, I will certainly vote to enact it as soon as possible.

Well, if only it were that simple, Presiding Officer. We certainly do have a plan for legislation, and we've consulted on that. We're working through the design of that now, and we hope to introduce it in the Senedd later this year, and we are working, alongside that, with Transport for Wales and local authorities on designing optimum bus networks for their communities. So, we will have a strategic, planned integrated bus network with integrated ticketing between rail and bus. We'll have universal service standards. We'll have pay and conditions across the country. We'll have a significantly better framework in order to operate bus services.

But, in the absence of passenger revenue, and this is the problem here, the only way to keep those services running in the meantime is through direct public support, and our budgets have been cut and we have prioritised cost-of-living pressures, pay deals and free school meals and other things, rightly. I'm not resiling from that at all, but I'm just simply pointing out to Members that they've welcomed those announcements of where this money is going to go, and there are consequences financially to what resource is available. He says it's the job of Government to solve problems. I agree with him. I think we have managed to get ourselves some breathing space to work with the industry to see what we can do, and, if he has other suggestions that we haven't thought of, I'd be very grateful to hear them.

Deputy Minister, one of the major issues of the initial announcement of the cut of emergency funding was the relatively short notice of it, which meant that some bus companies, especially smaller ones, did not have the necessary financial reserves to keep unprofitable but vital services open, and also the allotted time to change their services to accommodate, resulting in much uncertainty and worry. Last week, Deputy Minister, you spoke about the importance of bus routes and maintaining rural services in terms of meeting our carbon footprint requirements and reducing our reliance on cars. This was re-emphasised yesterday in your roads review announcement. But the inconsistent messaging from the Welsh Government about sustaining the long-term future of the bus network and our rural routes does nothing to assure bus companies or the general public of that importance.

With this in mind, Deputy Minister, do you recognise that this inconsistency in messaging and action is having a detrimental impact, not only on the survivability of bus routes, but the longer term planning and forecasting for rural services? What commitments do you make to provide better engagement with bus companies and the public to ensure longer lead-in times for future funding announcements? Thank you.

Well, let's just be clear; the major threat to the bus industry is Tory austerity. So, let's not get away from that fact, and I'm not going to let the party opposite shift the blame for the situation we are facing. It's their Government's economic policies that have led us to this position.

Now, I don't accept his characterisation of the communication we've had with the bus industry, which we've worked very closely with through the pandemic and beyond. After the publication of the budget, officials met with operators to discuss its contents and its implications. This was followed up in writing, where it was made clear that the budget was draft and was subject to change prior to finalisation. Officials also made it clear that underspends from mandatory concessionary fares, because older people haven't come back in the numbers that we saw before the pandemic, may not be available to bus support because of other budget pressures across the Government, and industry was asked to plan for a reduced funding package during these meetings. So, I don't think it's fair to say that this was sprung on them. We knew that BES was coming to an end, we were doing our best to try and find resource to extend it for as long as possible, and we're in the position that we are in, but we've talked to the industry throughout.

This Government doesn't do irony, surely. On the one hand, yesterday, the Deputy Minister announced that plans to build many rural roads in Wales were to be ceased, talking at that point about the importance of public transport and how the most disadvantaged, women, the disabled and vulnerable people are the most reliant on public transport, and how important it is, therefore. Then, in discussing the bus programme, the same Deputy Minister said that the funding provided to buses in Wales wouldn't be enough to maintain the current routes and services. Now, it's not as easy to jump on a bike and cycle to the nearest shop in rural Wales. Our communities are miles apart, and services are centred in areas that are a long way away. People have to travel long distances to see a GP, a dentist, to get their education, to shop, to go to a leisure centre and all sorts of other activities. And older people and vulnerable people will live very isolated lives as a result of this.

If bus services aren't properly funded, then you will force more people to rely on private vehicles. And in the absence of a network of charging points, what we will see is a nation like Cuba in rural Wales, with people sustaining the old fossil fuel vehicles for decades to come. But, more than that, you are putting another nail in the coffin of rural Wales, forcing people to leave their communities to live elsewhere because of an absence of transport and access to services. Therefore, can we have an assurance that you will ensure that the current routes, at least, are maintained, with real investment happening in the bus network in rural Wales when the first opportunity arises?

Well, I don't need any lectures on the importance of public transport and the vital role that buses play in rural areas. I really don’t see the point in flippant remarks about people not being able to cycle in rural areas. Who is suggesting that? So, let’s get serious about what the issues are here. We all are concerned about this. No party has a monopoly on that, and I think that my track record speaks for itself in understanding and valuing the importance of buses and of public transport.

We have a real budget problem here, and his party is a part of the co-operation agreement in agreeing the priorities for Government. So, there’s no point in him standing there, lecturing me about the consequences of the funding being available when, jointly together, we've agreed a set of budget priorities, and this wasn’t one of them. So, there are consequences to those choices. To govern is to choose, and he and his party have been part of that process, along with ours.

Now, we had hoped that the passenger numbers would have returned by now, which would have allowed the fare box to recover, and allowed us to put in the significant subsidy that we already do, but taper down the BES scheme. That has not been possible, and additional money has not come from the Treasury to be able to fill that gap. Now, we are still hopeful that the UK Government might respond to its own pressures and provide some emergency funding, which would allow us to extend the support that we give to the industry, which we want to redesign in any case. But, absent of that, unless he knows of some money down the back of the budget sofa that I don’t, then I think that our options are limited, which breaks my heart.

Can I thank Delyth for raising this topical question, and also for the way that she raised it, when she expressed not only her support for the roads review yesterday, and the principles behind it, but also tied this into the other side of that coin, which is providing the multi-modal, sustainable other forms of transport, which this topical question focuses on today?

I cannot give the Minister any easy solutions whatsoever, and I know the bind that he's in. But would he join me in urging all Members of this Senedd Chamber who are demanding more money to sustain this beyond the welcome few months’ breathing space that we have got, to then support representations to the UK Government, who are seeing bus companies threatening to walk away today, not in three months’ time? But also, genuinely, to Plaid Cymru, to say: if there is a way in which we can sequence, renegotiate, nuance some of the aspects of co-operation agreement that would help that Minister go through—[Interruption.] Now, this is a genuine ask for you to look at it, because, if we are serious about maintaining the bus network in Wales, which everybody seems to be, then everything needs to be on the table. So, would he join me in those calls? But, as you've made clear, Minister, it’s not all to do with money. It’s also to do with re-regulation and taking back the disaster of the deregulation under the Conservative Government.

Thank you for that. I think that we do have the right long-term plans, both from the roads review to reallocate funding in the medium to long term, and the re-regulation of the bus industry. Our problem is a short-term one, and the Member rightly points out that the Government in England has not extended by three months its support, as we have, and so the cliff edge is faced there now. And because of the nature of the commercial set-up, it's simply up to operators to surrender their routes in a completely random and uncoordinated way. What we’re trying to do is to have some kind of order and some stability so we can have a rational discussion about what routes might be salvageable if the fare book doesn’t recover, and we’re still hopeful that it might. But, in the absence of additional funding, then our options are very limited. But we’re going to try and do what we can in the time we’ve got and with the money we’ve got to get the best possible outcome, while crossing our fingers that there might be a UK-wide funding settlement that allows us to do more.

Sioned Williams.

Diolch, Dirprwy Lywydd, and thank you for letting me come in on this. The chief executive of Neath Port Talbot council wrote to me regarding the possible devastating impact of the Government’s decision around this on a number of local bus services, and I just want to make the point that it’s not just rural bus services, but services in counties like Neath Port Talbot, and she’s particularly concerned about the impact on young people attending school or college. Student transport to Neath Port Talbot College is via the local bus network, and the routes operate on a commercial basis. She thinks that this route will be made unviable, which will of course lead to unintended consequences across the wider network. There’s a very real possibility that reductions in revenue support will impact on home-to-school transport services as operators reduce their capacity, close their business or increase contract prices to compensate. In the last few days, and even just literally before coming to the Chamber, I’ve heard from residents who rely on buses, who are really concerned about this—a mother concerned about her son’s bus to school, a daughter concerned about her mother’s bus to hospital. I just want to know what assurances you can give the people of Neath Port Talbot that their bus services will remain in place.

Well, as I’ve now explained several times, I’m not in a position to give any assurances beyond the extra three months that we have been able to negotiate. But I desperately hope we’ll be able to both come up with a transition plan, but really what we need is additional funding for us to be able to sustain the bus network while passenger numbers recover and while we move to our new, regulated bus system.

Mike Hedges.

Thank you, Presiding Officer. As you know, I wasn’t going to speak in this debate, but I think there are three issues that have come up now that I feel I've got to make. To many of my constituents—in fact, most of my constituents—public transport is buses. Eighty per cent of transport is by bus. Morriston Hospital, as you know, Presiding Officer, or Deputy Presiding Officer, is incredibly difficult to get to, but it’s good by bus, because we’ve got the No. 4. I have two questions, really, for the Minister. Why do trains take priority over buses? To the poorer people, buses are their form of transport. Trains are for the wealthier people. And you say: where do we get the money from? Well, you’ve going to give additional rate relief to large hotels, out-of-town shopping centres, fast food outlets, supermarkets. You've never asked me about that as a Government. In fact, if you had, I’d have said, ‘No, we don’t do that. We should spend it on public services’, and I think that there’s a whole range of things that we could not be spending money on. Spending money on rate relief for large companies who are very profitable is not my idea of a priority, and certainly not a socialist priority.

Well, I understand those points, obviously. In terms of the relative priority of buses versus trains, clearly we need both. We need an integrated transport system. I think it’s wrong to characterise train users as somehow the privileged elite—that’s not the case—but it’s certainly the case that buses carry the majority of passengers, and, like him, buses are my priority. We have investment plans for the rail service, which will be significantly to the advantage of passengers, but they cost money. The money is committed and needs to be followed through, because there are penalty clauses and we wouldn’t realise any meaningful savings were we to stop doing that now. So, we are set on a course to continue investment in the rail industry, which will significantly help our modal shift ambitions, but it remains the case, and I agree, that buses have got the greatest potential. As I’ve explained previously, we’ve been working on a plan to try and reduce bus fares to do just that—to help bus passengers, existing bus passengers, and attract new ones on there. And until the Liz Truss budget blew up our economy we had a sporting chance of being able to do that, but now we simply don’t. That is a matter of deep regret to me. We have to make the best of the situation that we have got, and we are doing all we can to try and work with the industry and local authorities to try and get the best outcome we can with the money available.

And finally, Heledd Fychan.

Diolch, Dirprwy Lywydd. Can I just reference the co-operation agreement, as it has been mentioned a number of times? Public transport is in the agreement, including encouraging people to switch to public transport. And I think we all need to take responsibility, in terms of ensuring that priorities are there, but this is part of the cost-of-living crisis, because people are completely dependent on buses, to be able to reach vital services. It's nice to have buses when you have a car, as an alternative route of transport, but for the majority of people I represent, there isn't that choice—a bus is the only choice. And that's a choice that's been taken away from them.

We have to remember as well that a number of people are still scared of leaving their homes, people who would have traditionally used buses—elderly people. Tackling isolation is a huge problem. I know of people who haven't ventured out more than once a week, and that's through taxis, where they would have had their independence with buses previously. So, I think there is an issue to understand why people aren't returning to bus use and how we can support them. Because I don't think it's a matter of just people who are working in offices not returning, because the majority of those have cars and are able to use those. We need a deeper understanding.

I would like to ask specifically, Deputy Minister, what conversations you've been having with bus companies and providers around the bus driver shortages, and the increasing use of agency staff by bus companies, meaning that a lot of the funding that's currently going in through the bus emergency scheme, the profit is actually going outside of Wales, to these agencies. Therefore, with that funding, how do we ensure that we are tackling the bus driver shortage and ensure that the investment that you're making, which is rightly extended for three months now, is actually benefiting users at the end of the day, and not leading to greater profit margins for these agencies?

Well, I don't want to repeat the points I made about the relative priorities that we've jointly agreed—I think the record stands on that, and we as a Government stand behind it too. I'm simply pointing out there are consequences for other budgets. The phenomenon of people being slow to return to public transport is not unique to our country—it's been seen right across the world, and it's particularly acute amongst older people, for reasons I think we can all understand and surmise pretty quickly. So, we do have a vice-like situation, where the fare box hasn't returned, and we have the particularly wicked issue in our country of a privatised system, where routes that aren't commercial will not run without direct subsidy.

On the issue of agency workers and profits, under the bus emergency scheme, we do have strict conditions on how the money is spent, how much profit can be taken out, and we have a reasonable amount of leverage with the bus companies about the decisions that are made. But we can't get around the fact that, whichever way we try and slice and dice this argument, the fundamental issue is that the demand is down, the running costs are up, and the public subsidy is coming to an end. And it's an unhappy situation, there's no denying it, and one that I would desperately wish to avoid, if at all possible. But as I said earlier, there's a chance, and let's hope it comes through, of the UK Government responding to its own bus crisis and we'd be able to benefit from some consequentials. But in the absence of that, we're working closely with the industry to try and get the best settlement we can.

I thank the Deputy Minister.