Chamber and committees

That is one of the recommendations from project Neptune. There are a number of other recommendations about how the tripartite process might look in future. I am not wedded to any one concept. As the minister, my view, informed by my experience, is that something will have to change pretty radically.

If CMAL were to be absorbed into CalMac—you alluded to that—that would create a challenge in relation to Serco NorthLink Ferries. We would need to be mindful of that. A number of other factors would play into that, too.

As the minister, my view is that there is no point in my changing the governance structures unless that is what island communities want. I go back to my original point in answer to Mr Ruskell’s question. I will not foist something on island communities that they do not want.

If I ask island communities tomorrow what they would like to see, they will not talk to me about governance structures; rather, they will to talk to me about better reliability, more boats and more sailings. Fixing the here and now is vital.

I accept that there is also a governance challenge, but the more pressing issues that island communities face relate to the delivery of services. That is why it is really important that the current arrangements work for island communities. Work is on-going, and I am clear that things will need to change in the future if we are to listen to island communities and reach an optimal solution.

As you have outlined, convener, the current structure is not dynamic at times, and it is not as reflective and responsive as it needs to be. We need to reach that point in order to better serve our island communities.

Good afternoon, and thank you for inviting me to discuss the draft order.

The order sets the reimbursement rate and the capped level of funding for the national bus concession scheme for older and disabled persons in 2023-24. It also sets the reimbursement rate for the national bus travel concession scheme for young persons in the coming financial year. In doing so, the order gives effect to an agreement that we reached back in December with the Confederation of Passenger Transport Scotland, which represents Scottish bus operators.

The objective of the order is to enable operators to continue to be reimbursed for journeys that are made under the older and disabled persons and the young persons schemes after the expiry of the current reimbursement provisions on 31 March. It specifies the reimbursement rates for both schemes and the capped level of funding for the older and disabled persons scheme for the next financial year, from 1 April 2023 to 31 March 2024.

The order is limited to the coming year and is undertaken on an annual basis to support both schemes. Because of the on-going impact of Covid-19 on bus passenger numbers and the continuing uncertainty for the coming year, it has not been possible to undertake the analysis and forecasting that usually underpins the annual revision of the reimbursement rates for the older and disabled persons scheme. In addition, only a limited amount of data is available for the young persons scheme, which became operational in January last year. Accordingly, the reimbursement models for both schemes could not be used with confidence for 2023-24.

I have agreed with CPT that the reimbursement rate for the older and disabled persons and the young persons schemes for 2023-24 will be retained for the current year. For the older and disabled persons scheme, it is set at 55.9 per cent of the adult single fare and the capped level of funding will be £216.2 million. That is set at a realistic level that takes into account patronage levels in the scheme since Covid-19. For the young persons scheme, the proposed reimbursement rates are 43.6 per cent of the adult fare for journeys made by passengers aged five to 15, and 81.2 per cent for journeys made by those aged 16 to 21. As for the past year, a budget cap is not being set for the young persons scheme in 2023-24.

I believe that the rates are consistent with the aim that was set out in the legislation establishing both schemes, that bus operators should be no better and no worse off as a result of participating in the schemes. Nonetheless, the rates will provide a welcome degree of stability for bus operators.

Free bus travel enables people to access local services and gain from the health benefits of a more active lifestyle. It also helps to strengthen our response to the climate emergency. The order provides for those benefits to continue for a further year on a basis that is fair to operators and affordable for taxpayers.

I commend the order to the committee and am happy to answer any questions.

The deputy convener makes a really good point. As I mentioned in the first response that I gave to Mark Ruskell, I get regular updates in relation to regional differences in different constituencies in Scotland. The pattern is that we do not necessarily look only at rural areas, because there are challenges in different parts of the country for different reasons. It is important that we take an intuitive approach to the implementation of the policy. I take on board the deputy convener’s point and will ensure that that is fed into the evaluation that Transport Scotland will conduct in April.

That was considered in a review that we carried out for under-26s. There is a piece of work that looked at that very issue on the Transport Scotland website. I think that we might have worked with the Scottish Youth Parliament on it, too, but that pre-dates my time in office.

It was considered, but I will be honest with Ms Lennon that, as a Government, we would not currently be in a financial position to fund it. The scheme is extremely costly—according to some news reports, more so than it actually is. I think that the scheme’s costs are worth it, but the financials that would be involved in extending it to people under 25 would be excessive under the current budget pressures that the Scottish Government faces.

Mr Ruskell is absolutely right. I see my officials nodding beside me, so I am sure that we will be looking at the qualitative feedback. Such feedback is vital in telling the story of the success of the scheme, because it is not just about facts and figures but how the scheme is changing young people’s lives and their approach to engaging with our transport networks. That is really key, so we will certainly take that away as an action point, although it will probably be captured in the planned evaluation.

The other issue is that the scheme has been a huge help in relation to the cost of living crisis. The scheme is not just about free bus travel; it is providing families with a level of protection and support, and it is important that we reflect that. We need to build some of that into our quantitative analysis, as Mr Ruskell has alluded to.

No; quite.

Pricing of fares is regularly raised with me. RET has been successful, and since its introduction there has been a substantial increase in the number of vehicles and passengers travelling on the network. It is now more than 5 million; it certainly was in 2019, the last comparable pre-pandemic year.

It also true that RET has reduced the average fare by 34 per cent for passengers and 40 per cent for car traffic, which is important. As I mentioned in an earlier response, it saves travellers around £25 million a year. However, I am keen that we use the ICP to consult island communities on their views on dynamic pricing. It is a fair observation.

I read in the Official Report of the committee’s previous evidence session that Mr Drummond, I think, was looking at that approach. As Ms Dunbar outlines, it is used in other transport sectors, so we need to be live to it.

I go back to my guiding principle from the start of the evidence session, which is that anything that we do next has to be informed by islanders’ views. We will not foist something on island communities. If more dynamic pricing is what they would like and would opt for, which would move us away from the current structure, I am amenable to that.

That is under consideration. As I outlined in my response to Mr Ruskell, a key part of the ICP will be the chapter on onward and connecting travel. We are looking for that to be completed internally in the first half of 2023, and there will then be stakeholder engagement.

Ms Dunbar is absolutely right that we need to ensure that there are more joined-up approaches to our broader transport network. There are already great examples of that in the transport network. I was in discussions with officials about that very point yesterday. In places such as Oban, for example, there is fantastic connectivity between ferry and rail, but that does not exist everywhere. We have that in other parts of the network, but we need to consider where we can build in opportunities to connect people’s journeys, because otherwise we are never going to facilitate the modal shift to get people out of their cars.

In response to Ms Lennon’s question about our net zero targets, we know that the transport sector is a significant contributor to our emissions, and we absolutely recognise the need to join things up better, whether that be through shared hubs or other approaches that exist in other parts of Scotland.

The committee will know well that not all island communities are the same. We need to be mindful in our policy development that they all have very different needs and that we should not try a one-size-fits-all policy, because that will not work.

CHFS3 also gives us an opportunity to do things differently, and there are definitely lessons that we will need to learn, particularly in relation to what CalMac has been able to come up with in quite recent times and how we will build things into the future contract.

That it is a fair question. Elise McIntyre will come in on the specifics, and I might speak about ministerial directions after that.