Bus Service Operators Grant (BSOG) Reforms A guide for bus operators and local authorities

The BSOG Reforms The purpose of the slide pack is to explain what the upcoming reforms to bus subsidy mean for the eligibility of various bus services to receive BSOG. It will describe the changes in BSOG payment for each type of bus service operated.

Commercially operated Is the service…? Tendered Part Commercial & Part Tendered Community Transport Use this button to find out more about the definitions of each service type. Commercial Services Bus services that are run on a commercially viable basis without tendered support. Tendered Services A service where a Local Authority has invited tenders for the operation of the service, and a contract exists as a result of that tender. This does not include tenders for seats on a bus or subsidised tickets etc. Part Commercial / Tendered Services Services that are run commercially but with sections that are tendered (according to the definition above).

Commercially operated Is the service…? Tendered Part Commercial & Part Tendered Community Transport Use this button to find out more about the definitions of each service type. Commercial Services Bus services that are run on a commercially viable basis without tendered support. Tendered Services A service where a Local Authority has invited tenders for the operation of the service, and a contract exists as a result of that tender. This does not include tenders for seats on a bus or subsidised tickets etc. Part Commercial / Tendered Services Services that are run commercially but with sections that are tendered (according to the definition above).

Commercial Services Is the service operated: In a BBA? Outside a BBA? Partly in a BBA? BBA - Better Bus Area. Local authorities will have contacted operators if they are submitting an application for BBA status. Should the application be successful, BSOG generated within the BBA will be given to the local authority rather than to bus operators. This guide will provide information on the implications of BBAs on BSOG payment. Follow this link for more information about the Better Bus Area policy

Non-BBA Commercial Services Bus operators will still be able to claim BSOG for commercial services after the reforms taking place in 2013, unless they are the following types of services: –ones which are replacing rail services for a temporary period; –ones which last less than 6 weeks; –those which are mainly for tourists, or which use vintage vehicles; –shuttles which connect car parks to ports, airports or rail stations; –free buses; –plus those services which are already ineligible. You can see existing eligibility conditions by following this link.You can see existing eligibility conditions by following this link The services will also continue to be eligible for automatic vehicle location, smartcard and low carbon bus incentives.

Part BBA / Part Non-BBA Commercial Services Local authorities will request from operators details of commercial mileage generated within the BBA so they can estimate the total BSOG amount within the defined area. Services which cross the border of a BBA should be split into the commercial portion within the BBA and the portion outside the BBA. For the portion within the BBA, the payment of BSOG will operate in the same manner as a commercial service wholly within a BBA (follow the link for more information).the payment of BSOG will operate in the same manner as a commercial service wholly within a BBA For the portion outside the BBA, operators can continue to claim BSOG.operators can continue to claim BSOG What happens to dead mileage? Dead Mileage Dead mileage within BBAs should be calculated by operators so that the appropriate amount can be devolved to local authorities. Each stretch of dead mileage in a BBA should be calculated as either: dead commercial BBA - to be gradually devolved to local authorities; dead commercial non-BBA – to remain with the bus operator; dead tendered BBA, or, dead tendered non-BBA - to be devolved to local authorities. Some bus journeys will include a mix of live and dead stretches, some of which are tendered and some of which may cross in or out of a BBA. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Part BBA / Part Non-BBA Commercial Services Local authorities will request from operators details of commercial mileage generated within the BBA so they can estimate the total BSOG amount within the defined area. Services which cross the border of a BBA should be split into the commercial portion within the BBA and the portion outside the BBA. For the portion within the BBA, the payment of BSOG will operate in the same manner as a commercial service wholly within a BBA (follow the link for more information).the payment of BSOG will operate in the same manner as a commercial service wholly within a BBA For the portion outside the BBA, operators can continue to claim BSOG.operators can continue to claim BSOG What happens to dead mileage? Dead Mileage Dead mileage within BBAs should be calculated by operators so that the appropriate amount can be devolved to local authorities. Each stretch of dead mileage in a BBA should be calculated as either: dead commercial BBA - to be gradually devolved to local authorities; dead commercial non-BBA – to remain with the bus operator; dead tendered BBA, or, dead tendered non-BBA - to be devolved to local authorities. Some bus journeys will include a mix of live and dead stretches, some of which are tendered and some of which may cross in or out of a BBA. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Commercial Services in BBAs If a local authority in an area is considering applying for Better Bus Area status, they should have contacted operators in the area to discuss partnership arrangements. Part of the discussions will include a request to operators for the details of commercial mileage operated within the BBA so they can estimate the total BSOG amount generated within the BBA. BBAs will start on 1 October Commercial services within BBAs will move to a common April to March claim year from 1 April Operators with services inside a BBA will have their other services also move to an April to March claim year. A certified claim will be sent out to operators to reconcile payments up to the end of March 2014, prior to the start of the common claim year. What happens to BSOG payments? In BBAs, the amount of commercial BSOG operators can claim will gradually reduce to zero as it is devolved to the local authority across a 4 ½ year period (between Oct 2013 and April 2017) at a rate agreed between operators and the local authority. What happens to incentive payments? What happens to dead mileage? Incentive Payments in BBAs Incentive payments for services within a BBA will not be devolved to the local authority; operators may continue to claim for incentives at the national rate. Dead Mileage Dead mileage within BBAs should be calculated by operators so that the appropriate amount can be devolved to local authorities. Each stretch of dead mileage in a BBA should be calculated as either: dead commercial BBA - to be gradually devolved to local authorities; dead commercial non-BBA – to remain with the bus operator; dead tendered BBA, or, dead tendered non-BBA - to be devolved to local authorities. Some bus journeys will include a mix of live and dead stretches, some of which are tendered and some of which may cross in or out of a BBA. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Commercial Services in BBAs If a local authority in an area is considering applying for Better Bus Area status, they should have contacted operators in the area to discuss partnership arrangements. Part of the discussions will include a request to operators for the details of commercial mileage operated within the BBA so they can estimate the total BSOG amount generated within the BBA. BBAs will start on 1 October Commercial services within BBAs will move to a common April to March claim year from 1 April Operators with services inside a BBA will have their other services also move to an April to March claim year. A certified claim will be sent out to operators to reconcile payments up to the end of March 2014, prior to the start of the common claim year. What happens to BSOG payments? In BBAs, the amount of commercial BSOG operators can claim will gradually reduce to zero as it is devolved to the local authority across a 4 ½ year period (between Oct 2013 and April 2017) at a rate agreed between operators and the local authority. What happens to incentive payments? What happens to dead mileage? Incentive Payments in BBAs Incentive payments for services within a BBA will not be devolved to the local authority; operators may continue to claim for incentives at the national rate. Dead Mileage Dead mileage within BBAs should be calculated by operators so that the appropriate amount can be devolved to local authorities. Each stretch of dead mileage in a BBA should be calculated as either: dead commercial BBA - to be gradually devolved to local authorities; dead commercial non-BBA – to remain with the bus operator; dead tendered BBA, or, dead tendered non-BBA - to be devolved to local authorities. Some bus journeys will include a mix of live and dead stretches, some of which are tendered and some of which may cross in or out of a BBA. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Part Commercial & Part Tendered services A revised certified claim form will be sent to claimants with claim periods ending after 31 December This will enable operators to split services into commercial and tendered sections. Commercial sections Bus operators will still be able to claim BSOG for commercial services after 31 December 2013, unless they have been made ineligible (follow the link for more information). unless they have been made ineligible The services will also continue to be eligible for automatic vehicle location, smartcard and low carbon bus incentives. Tendered sections BSOG on tendered sections will be paid to operators until 31 December 2013, and will be devolved to the tendering local authority after this date. From 1 January, claimants should only submit claims for smartcard, LCEB and/or automatic vehicle location incentives. Operators that are claiming for these incentives should continue to submit tendered mileage details so that incentive payments can be calculated. What happens to dead mileage? Dead Mileage Some bus journeys will include a mix of live and dead stretches, some of which may be tendered. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Part Commercial & Part Tendered services A revised certified claim form will be sent to claimants with claim periods ending after 31 December This will enable operators to split services into commercial and tendered sections. Commercial sections Bus operators will still be able to claim BSOG for commercial services after 31 December 2013, unless they have been made ineligible (follow the link for more information). unless they have been made ineligible The services will also continue to be eligible for automatic vehicle location, smartcard and low carbon bus incentives. Tendered sections BSOG on tendered sections will be paid to operators until 31 December 2013, and will be devolved to local authorities after this date. From 1 January, claimants should only submit claims for smartcard, LCEB and/or automatic vehicle location incentives. Operators that are claiming for these incentives should continue to submit tendered mileage details so that incentive payments can be calculated. What happens to dead mileage? Dead Mileage Some bus journeys will include a mix of live and dead stretches, some of which may be tendered. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Tendered Services Is the service: Franchised by TfL? Tendered by a non- London Local Authority? If you operate a service not tendered by a local authority, consider it a commercial service.commercial service

Services tendered by non-London Local Authorities What happens to BSOG? BSOG on tendered services will be paid to operators until 31 December 2013 only. After this date, BSOG funding for these services will be devolved to the tendering local authority, and operators will no longer be eligible to apply for BSOG. What happens to the incentive payments? Smartcard, automatic vehicle location and low carbon bus incentives will continue to be payable for tendered services after 31 December Operators claiming incentives for these should continue to submit tendered mileage details so that their incentive payments can be calculated. These will be paid in arrears once a certified claim has been submitted. What happens to dead mileage? Funding for dead mileage operated on tendered services will also be devolved to the tendering local authority.

TfL Franchised Services What happens to BSOG? Operators providing services under contact to TfL will be able to claim BSOG up until the end of September After this date, BSOG previously paid directly to the bus companies running services in London under contract to TfL will be split and devolved between TfL and the Greater London Authority. What happens to the incentive payments? Franchised services will remain ineligible for the BSOG automatic vehicle location (AVL) and smartcard incentive payments. Funding for the low carbon bus incentive will be devolved on 1 October 2013.

Community Transport Services Is the service operated under a: Section 19 permit?Section 22 permit?

Community Transport Services Is the service operated under a: Section 19 permit?Section 22 permit? In-house? Independent? Section 19 Community Transport Services In-house Services Community Transport services administered and funded from within a local authority using local authority staff instead of relying on outsourcing. Independent Services other local authority and charitable CT operations Use this button to find out more about the definitions of each service type.

Community Transport Services Is the service operated under a: Section 19 permit?Section 22 permit? In-house? Independent? Section 19 Community Transport Services In-house Services Community Transport services administered and funded from within a local authority using local authority staff instead of relying on outsourcing. Independent Services other local authority and charitable CT operations Use this button to find out more about the definitions of each service type.

In-house Section 19 Community Transport Services Section 19 services operated in-house by a local authority – these authorities will have an amount equivalent to the BSOG they current claim for those services devolved to them from October 2013 onwards. They will not be able to claim BSOG separately for those services after that date.

Independent Section 19 Community Transport Services Independent section 19 services will continue to be eligible to claim BSOG; this includes services that operate under local authority tender or with a grant from the local authority. The same arrangements will apply regardless of whether a service is being operated inside or outside of a Better Bus Area.

Community Transport Services Is the service operated under a: Section 19 permit?Section 22 permit? Under tender? Not under tender?

Section 22 Community Transport Services tendered by Local Authorities What happens to BSOG? BSOG on tendered services will be paid to operators until 31 December 2013 only. After this date, BSOG funding for these services will be devolved to the tendering local authority, and operators will no longer be eligible to apply for BSOG. What happens to the incentive payments? Smartcard, automatic vehicle location and low carbon bus incentives will continue to be payable to operators after 31 December Operators claiming incentives for these should continue to submit tendered mileage details so that their incentive payments can be calculated. These will be paid in arrears once a certified claim has been submitted. What happens to dead mileage? Funding for dead mileage operated on tendered services will also be devolved to the tendering local authority.

Community Transport Services Is the service operated under a: Section 19 permit?Section 22 permit? Under tender? Not under tender? BBA Not-BBA

Section 22 Services in BBAs If a local authority in an area is considering applying for Better Bus Area status, they should have contacted operators in the area to discuss partnership arrangements. Part of the discussions will include a request to operators for the details of mileage operated within the BBA so they can estimate the total BSOG amount generated within the BBA. BBAs will start on 1 October Section 22 services within BBAs will move to a common April to March claim year from 1 April Operators with services inside a BBA will have their other services also move to an April to March claim year. A certified claim will be sent out to operators to reconcile payments up to the end of March 2014, prior to the start of the common claim year. What happens to BSOG payments? In BBAs, the amount of BSOG operators can claim will gradually reduce to zero as it is devolved to the local authority across a 4 ½ year period (between Oct 2013 and April 2017) at a rate agreed between operators and the local authority. What happens to incentive payments? What happens to dead mileage? Incentive Payments in BBAs Incentive payments for services within a BBA will not be devolved to the local authority; operators may continue to claim for incentives at the national rate. Dead Mileage Dead mileage within BBAs should be calculated by operators so that the appropriate amount can be devolved to local authorities. Each stretch of dead mileage in a BBA should be calculated as either: dead commercial BBA - to be gradually devolved to local authorities; dead commercial non-BBA – to remain with the bus operator; dead tendered BBA, or, dead tendered non-BBA - to be devolved to local authorities. Some bus journeys will include a mix of live and dead stretches, some of which are tendered and some of which may cross in or out of a BBA. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Section 22 Services in BBAs If a local authority in an area is considering applying for Better Bus Area status, they should have contacted operators in the area to discuss partnership arrangements. Part of the discussions will include a request to operators for the details of mileage operated within the BBA so they can estimate the total BSOG amount generated within the BBA. BBAs will start on 1 October Section 22 services within BBAs will move to a common April to March claim year from 1 April Operators with services inside a BBA will have their other services also move to an April to March claim year. A certified claim will be sent out to operators to reconcile payments up to the end of March 2014, prior to the start of the common claim year. What happens to BSOG payments? In BBAs, the amount of BSOG operators can claim will gradually reduce to zero as it is devolved to the local authority across a 4 ½ year period (between Oct 2013 and April 2017) at a rate agreed between operators and the local authority. What happens to incentive payments? What happens to dead mileage? Incentive Payments in BBAs Incentive payments for services within a BBA will not be devolved to the local authority; operators may continue to claim for incentives at the national rate. Dead Mileage Dead mileage within BBAs should be calculated by operators so that the appropriate amount can be devolved to local authorities. Each stretch of dead mileage in a BBA should be calculated as either: dead commercial BBA - to be gradually devolved to local authorities; dead commercial non-BBA – to remain with the bus operator; dead tendered BBA, or, dead tendered non-BBA - to be devolved to local authorities. Some bus journeys will include a mix of live and dead stretches, some of which are tendered and some of which may cross in or out of a BBA. Here, each stretch of dead mileage should be given the same category as the stretch of live mileage that comes immediately after it. The only exception to this is the BSOG for dead mileage back to the depot; this should be given the same category as the journey immediately preceding it.

Non-Tendered Section 22 Services not in BBAs Operators will still be able to claim BSOG for section 22 services after 31 December The services will also continue to be eligible for automatic vehicle location, smartcard and low carbon bus incentives.