Information on the Local Authority Bus Grant - direct from the DFT

In March, Howard, from Back Our Buses, wrote on behalf of the group to the Department of Transport, for clarification on details of the new Local Authority Bus Grant (LABG). This is a new grant which will soon be available for local authorities to use to improve bus services.

In his email, Howard proposed the following questions regarding this new funding:

1. Please advise of your target date for providing Local Transport Authorities with LABG information and guidance for funding bus services?

   
   

2. Is part of the LABG intended to cover socially necessary bus services?

   
   

3. Please advise what is the definition of a socially necessary bus service?

   
   

4. Will the guidance notes advise whether socially necessary routes can utilise LABG to subsidise the reintroduction of routes that have recently been axed through lack of previous funding? 

   
   

5. Will the guidance notes advise whether, (independently of socially necessary routes), LABG will be used to subsidise new bus routes that are not commercially viable, but where there is clear evidence of strong passenger demand and wider economic benefit?

   
   

6. Will the guidance notes advise whether any form of subsidy will continue in the long-term as long as LABG is available?  

   
   

We then received a reply from the Department of Transport about three weeks later. Here are some of the answers to Howard's questions:

• The Government is investing in bus services long-term

• It has confirmed over £3 billion from 2026/27 to support local leaders and bus operators across the country to improve bus services for millions of passengers over the remainder of the spending review period.

• This includes multi-year allocations for local authorities under the Local Authority Bus Grant (LABG) totalling nearly £700 million per year, ending the short-term approach to bus funding and giving councils the certainty they need to plan ahead to improve services for local communities.

• Hampshire County Council will be allocated £45 million under the LABG from 2026/27 to 2028/29, in addition to the £14.2 million they are already receiving this year.

• This funding is provided to local authorities to maintain and improve bus services and can be used flexibly to deliver better outcomes for passengers, including expanding services and improving reliability, with the overarching aim of making services more affordable, more accessible, and more frequent.

• The Department asks that this funding be used in a way consistent with the Department's guidance

• It is ultimately up to the local transport authority (LTA) to decide how their funding is used in their area to deliver improvements to bus services.

• LTAs may choose to use some of their LABG funding to subsidise bus routes which are not commercially viable but that they deem to be socially necessary, however this is a decision for the LTA.

• The Department does not intervene on decisions about individual bus routes.

• The Bus Services Act 2025 includes the socially necessary local services measure.

• Local authorities, in collaboration with bus operators, will need to set out the requirements that must be followed if bus routes identified as socially necessary are considered for potential withdrawal or significant variation.

• They will need to jointly discuss and consider the alternative options before making any changes to the service.

• A definition for socially necessary local services is set out under Section 14 of the Bus Services Act 2025: https://www.legislation.gov.uk/ukpga/2025/24/section/14.

• The Department will be publishing new enhanced partnership (EP) guidance in the Spring to help local authorities and bus operators with the implementation of the socially necessary local services measure.

• While this should be considered by local authorities as part of the wider EP process, it does not have a direct relationship to how local authorities should apply their current or future LABG funding."

We have not received any further information towards what or when the 'EP' socially necessary guidance will be released but we believe that the 61 route and it's removal could fall under this.

We are keeping an eye on this and when we have more information we will pass this on to our supporters!