Members of City of York Council's City Strategy Panel will be discussing the directorate's 2007/08 budget at a meeting next month (10 September).

Early financial projections show that the directorate may overspend its annual budget of £14,428,000 by £774,000.

A large proportion of the projected overspend relates to the cost of concessionary travel fares.

In 2006 the government changed the regulations to allow free bus travel for the over 60s within North Yorkshire.  At that time there were around 1.75 million bus journeys each year being made by concessionary bus pass holders in York and this is predicted to rise to 3.25 million bus journeys a year by April 2008.

The extent of the growth in the use of the passes is way beyond that anticipated by the council and the government.
 
The North Yorkshire Partnership allows pass holders to travel freely not only in York but throughout North Yorkshire.  Many of these journeys would have been made by car, so this scheme is helping to reduce the amount of congestion on the city's streets.  It has also given a greater independence to the over 60s and more accessibility to bus travel.

The consequences of this scheme are that new and additional bus journeys are being made by residents and visitors from North Yorkshire who are travelling freely on both service buses and the city's park and ride bus services. The council is having to meet the costs of the scheme which is estimated to be an additional £0.75m for this year.  The amount of funding from government is over £1m less than the amount needed to meet the council's additional commitments for the scheme up to the end of the year.

In April 2008 the scheme will be extended beyond the current boundaries to free travel throughout England for those with a bus pass. The council will be contacting existing pass holders over the next few months to update them on the new scheme.

Planning income, from planning application fees, is projected to be £100,000 less than predicted this year, though this may change over the coming months if a number of large applications are submitted. A £50,000 shortfall in building control income is also being predicted as a result of developers submitting their building plans for checking but deferring development work.

Members will be asked to support a recommendation to make savings through putting a number of highway maintenance schemes on hold until the financial situation is more clear.