A SENIOR figure in Scotland's bus industry has hit out at an attempt to gloss over an "outrageous" funding crisis affecting the Scottish Government's free travel scheme.

Ralph Roberts, managing director of McGill's Bus Service, said the £10 million extra announced last week by ministers only went two-thirds of the way to covering the funding gap that emerged as demand outstripped this year's budget for the flagship scheme, which offers unlimited bus travel for disabled passengers and those over 60.

This has resulted in bus companies effectively carrying passengers for free, Mr Roberts claimed, and threatens to put a number of smaller operators out of business.

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In a letter to The Herald today, he hit out at claims made in a Scottish Government press release that the £10m represented additional funding.

"From a bus operator's perspective, this isn't additional money, this is only two-thirds of the money they owe us for free trips that will be made in March of this year anyway," he wrote.

"Had this money not been found, bus operators would not have been paid for any trips made between the 3rd March and the 31st March. An outrage."

He praised Transport Minister Keith Brown for "stepping up" to the challenge when contacted by smaller bus operators.

But he reiterated warnings, first reported by The Herald last week, that a 13% cut in the level of reimbursement to bus firms taking part in the National Concessionary Travel Scheme over the next two years would have an impact on services.

"Bus companies, private ones at least, are not making huge profits, so there is no fat to be trimmed off to absorb this cut. Bus companies are not daft, we have our customers at heart – they are our future, after all – and we will work hard to minimise the impact, but without doubt, change is on its way," Mr Roberts wrote.

The comments reflect a wider frustration in the bus industry that, because funding for concessionary travel is capped by the Scottish Government, operators effectively have to carry passengers without any reimbursement once the money runs out.

The overspend last year was between £7m and £9m and was expected to be between £13m and £15m this year before the additional funding was announced last week.

More than 1.2 million people hold National Entitlement Cards, which enable them to travel anywhere in Scotland on registered bus services for free. They were introduced in 2006 in place of a patchwork of local schemes, and later expanded to include war veterans.

However, a number of official reports have warned Scotland's ageing population is making the scheme unsustainable. Audit Scotland warned in 2010 that its cost could exceed £500m unless steps were taken to restrict access.

A Scottish Government spokesman said: "We welcome Mr Roberts's comments, which reflect the Scottish Government's determination to agree a deal which ensures both passenger and operators' interests are met.

"There will be transitional aid of £10m this March, we will maintain the budget next year and then increase it by about £5m in 2014/15 – in total £15m more than current budget plans for the three years 2012/13 to 2014/15.

"Our focus has been to offer a fair deal, phasing in changes and providing extra money in order to ensure the Concessionary Fares Scheme is sustainable and continues to bring all of the benefits that free travel brings to over-60s and people with disabilities."