Decision on ‘devastating’ cuts to services delayed
A vote on “devastating” cuts to vital North East bus services has been delayed as talks with central Government continue.
Metro owner Nexus is facing a massive financial black hole in 2022/23 estimated at £21.2million, and North East leaders were expected to agree on plans yesterday, to deal with the shortfall.
Government is due to end emergency relief funding that has propped up the struggling Metro during the Covid-19 pandemic from the end of March 2022.
North East leaders have been urging Ministers for months to reverse that decision but, with no U-turn arriving as yet, councillors were set to ask to agree to an alternative that will involve severe cuts to public transport – with bus services taking the brunt.
As previously reported, the Metro will be protected from service reductions in the next year on the grounds that slashing the number of trains it runs would result in a catastrophic fall in ticket revenue and ultimately force the system to shut down entirely.
The final budget plan that would have been presented to the North East Joint Transport Committee (JTC), Nexus proposed:
:: A £7.5m reduction in money used to reimburse private bus companies for carrying passengers with free bus passes, potentially leading them to make cutbacks to services;
:: £2.4m of ‘efficiency savings’ from the Metro – including a pay freeze and contract renegotiations;
:: Increasing Metro’s revenue by £1.6m, with a ticket price hike due to be signed off later this week;
:: Spending £5.6m of Nexus’ reserves – which a JTC report warns is “not a sustainable long term solution” to the cash woes;
:: And asking the five Tyne and Wear councils to increase their levy payments to Nexus by £4.1m.
But a decision has been delayed to give time for more talks with Government and for local leaders to meet again.
Another meeting is expected to take place on Friday afternoon or Tuesday morning.
Cllr Martin Gannon, who leads on public transport for North East councils as well as serving as Gateshead Council leader, said: “We are seeking and are in further discussions with Government to continue Covid support beyond
the end of March this year.
“I’m of the very strong opinion that support is absolutely necessary. This unprecedented financial deficit is entirely related to the impacts of Covid.
“That case is still being put and therefore we are having to consider alternatives because we have to agree Nexus’ budget and recommend those levies to the constituent Tyne and Wear authorities.
“Those discussions are still ongoing with Tyne and Wear authorities. The prospect of raising the levy on Tyne and Wear authorities by 6.75% when all of the authorities are facing funding gaps going forward and still clarifying their financial positions has been extremely difficult.
“I’m proposing we’re going to have a further meeting of Tyne and Wear leaders, probably on Thursday and deferring this item and reconvene either on Friday afternoon or on Monday.”