Discounted bus travel for young people

The ‘MyTravelPass’ scheme, which has given 16-18 year olds a third off the price of bus journeys in Wales, has cost the Welsh Government significantly less since April 2017 compared with the initial 19 months of its operation. According to the Auditor General for Wales, this raises obvious questions about the value for money of the £14.74 million spent during the initial pilot phase, even accounting for any up-front implementation costs.

The Welsh Government suggests that this expenditure also helped secure additional benefits, amid wider concerns about the resilience of the bus industry.

The Auditor General’s report is a ‘facts only report’ which looks at budget announcements made and decisions the Welsh Government took in setting up the MyTravelPass scheme and then continuing it beyond the initial pilot phase. It also considers the costs of the scheme and its uptake.

In September 2014, Welsh Government Ministers announced a pilot discounted bus travel scheme for 16 and 17 year olds to cover travel to and from work or training. It identified £14.75m of funding for the scheme between September 2015 and March 2017. Ministers later approved an enhanced scheme within the same budget to cover any journey within Wales and to include 18 year olds. Actual expenditure has been significantly lower since April 2017.

• September 2015 to March 2016 - £5.0 million
• April 2016 to March 2017 - £9.74 million
• April 2017 to March 2018 - £1.09 million
• April 2018 to March 2019 - £1 million (budgeted prior to extension of scheme eligibility)

The lower costs since April 2017 reflect that the compensation being paid to bus operators is now taking account of actual use based on discounted ticket sales. After central costs for the administration and marketing of the scheme, the Welsh Government allocated the rest of the agreed budget for the period to March 2017 on a formula basis rather than on actual take-up and journeys as initially expected because it had not been possible to install systems to record the number of journeys. Welsh Government officials later told Ministers that the funding had also helped stabilise the bus network, supporting services that would have been withdrawn otherwise. However, they did not seek formal approval for the change in approach at the time.

Early Welsh Government estimates assumed that 80% of 16 to 18 year olds (around 90,000 people) would take up passes and use them on average twice a week. However, less than 10% of eligible young people had applied for passes by March 2017 – the end of the initial pilot phase. As at mid-August 2018, there were 14,939 live passes in circulation from a total of 20,953 passholders since the commencement of the scheme. There were 1,343,659 discounted journeys estimated in 2017-18. 

Notes to Editors:

• The report is deliberately limited in scope. We have not examined the wider administration of the scheme or the overall outcomes it has delivered, recognising that the future of the scheme was already under review by the Welsh Government itself.
• We have limited our evidence gathering to the Welsh Government. We have not sought the views of bus operators, local authorities, service-users or any other interested parties on the design or operation of the scheme. We make no comment about the future of the scheme and its merits which is a policy matter for the Welsh Government.
• The ‘MyTravelPass’ scheme applies to local bus services and the longer distance ‘TrawsCymru’ network. It does not cover coach services, such as National Express and Megabus. Bus operators are eligible for the Welsh Government’s Bus Services Support Grant providing they offer the discount to young people through the scheme.
• The £1 million budget for 2018-19 is the figure agreed when the scheme only covered 16 to 18 year olds. In November 2018, the Welsh Government announced that the scheme was being extended to cover 19 to 21 year olds.
• In response to issues raised during our review, the Welsh Government’s internal audit service reviewed controls around the scheme expenditure, focused on arrangements for the 2017-18 financial year.
• The Auditor General is the independent statutory external auditor of the devolved Welsh public sector. He is responsible for the annual audit of the majority of the public money spent in Wales, including the £15 billion of funds that are voted on annually by the National Assembly. Elements of this funding are passed by the Welsh Government to the NHS in Wales (over £7 billion) and to local government (over £4 billion).
• The audit independence of the Auditor General is of paramount importance. He is appointed by the Queen, and his audit work is not subject to direction or control by the National Assembly or government.
• The Wales Audit Office (WAO) is a corporate body consisting of a nine member statutory Board which employs staff and provides other resources to the Auditor General, who is also the Board’s Chief Executive and Accounting Officer. The Board monitors and advises the Auditor General, regarding the exercise of his functions.