Boroughs ask Parliament to protect the Freedom Pass from stealth tax

London's boroughs will this week call on the government to prevent the Mayor of London using the Freedom Pass free travel scheme as a stealth tax on Londoners.

The move to get Parliament to protect the Freedom Pass follows an escalation of the cost of providing the pass on the services operated by Transport for London (TfL). In the seven years since TfL was formed this cost has risen by 52 per cent.

For the last 23 years London's boroughs have paid for and run the Freedom Pass, providing older and disabled Londoners with free travel on the capital's buses, trains, tubes, and trams. Boroughs pay for the Freedom Pass through a mixture of national taxes and local income, including the council tax.

London's local authorities have no intention of changing any of the benefits enjoyed by the capital's older and disabled people under the scheme. However London Councils believes the Mayor is putting the future of the pass at risk through his excessive demands on the cost of providing it.

The cost of providing the pass on the capital's buses, tubes, trams and Docklands Light Railway, is negotiated annually between London Councils and Transport for London (TfL). But if no agreement is reached by the end of each year, TfL has the power to dictate the amount boroughs have to pay with no right of appeal for the boroughs.

It costs London's boroughs £216 million to provide the pass on the TfL network in the current financial year, compared to £142 million in 2000-2001. This represents an increase of 52 per cent since the year TfL was created. Any increase in the cost of the pass impacts on London's council tax payers.

The unique power TfL and the Mayor has over the negotiations on the Freedom Pass is shown by TfL wanting to double the price of providing the pass on the North London Railway when they take over the network's franchise in November. Currently London boroughs pay the Association of Train Operating Companies (ATOC) around £600,000 to provide free travel on these routes. TfL is seeking more than £1 million to provide the same service.

Now London Councils is calling on the government to safeguard the future of the scheme by introducing changes through the Concessionary Bus Travel Bill.

London Councils wants the government and not TfL to act as the final arbiter if no agreement over costs is reached. This would protect the scheme's benefits while preventing the Mayor continually using the Freedom Pass negotiations as a way of imposing a secret levy on Londoners.

Chair of London Councils' Transport and Environment Committee, Cllr Daniel Moylan, said:

"London's councils pay out hundreds of millions of pounds a year to provide the Freedom Pass, the most generous free travel scheme in the country. More than a million people use it to live as independent a life as possible and we have absolutely no intention of changing that.

"But the Mayor is currently using the Freedom Pass as a stealth tax on Londoners. It is for this reason alone he is doing his utmost to claim the law should stay as it is. It has nothing to do with protecting the Freedom Pass.

"We think the law has to be changed. Nowhere else in the country can a provider of transport schemes hold council tax payers to ransom in this fashion.

"We are not threatening the Freedom Pass. We are simply asking that if we cannot agree with TfL each year how much we should pay for it, the government should make the final decision. This has to be a fairer way of negotiating the cost of the pass."