How to fund the planned new buses?

WALES HAS waited years for a green bus grant and now three have come along at once, but there are questions over how a loss-making bus company will provide millions of pounds of match funding.

The biggest Welsh grant – £5.4m – has been offered to Cardiff Council for Cardiff Bus to help buy 36 electric vehicles in the next two financial years.

But since the council bid for the money last summer, Cardiff Bus has admitted it is making unsustainable losses, and is preparing to axe 12 services.

The grant from the UK Govern- ment covers less than half the cost of buying the 36 buses, leaving Cardiff Council and Cardiff Bus to come up with about £7.7m.

The company, owned by Cardiff Council, says it is confident the funding structures are in place, but other bus industry sources say it lacks the resources to invest that kind of money while it is not making a profit. It made a £1.9m loss in 2017/18.

Cardiff Council, which led the bid for the grant, was unable to say whether all 36 electric buses would be bought by April 2021. A spokesman said £6m of the £7.7m “should be from Cardiff Bus’s existing expenditure”.

He added: “Discussion on the shortfall of circa £1.8m will need to be held, between Cardiff Council, Cardiff Bus and potentially Welsh Government, with one potential funding route being the Clean Air Fund, which would be in the form of a grant.”

We asked Cardiff Bus how it would raise the £6m and whether, in light of the company’s losses, the plan would have to be reviewed and potentially scaled back. A spokesman replied: “We are confident there are funding structures in place, in line with our fleet replacement strategy, to deliver these buses.

“This is a successful outcome for collaborative working with different partners – the Welsh Government, the city council, bus manufacturers and ourselves.”

One industry source said: “Where is the capital coming from? It’s a significant amount of money when you’re trading at a loss.”