FOUR Worcestershire councils stand accused of misleading the public in a furious row over funding which has left Worcester taxpayers severely out of pocket.

A new report suggests grants given to local councils in Worcestershire this year to cover the cost of free pensioner bus travel were not distributed correctly, with Worcester City Council vastly underfunded and other authorities in line to make a surplus.

The issue has had a devastating impact on Worcester, with the city forced to make sweeping cutbacks in other departments to cover costs.

But the newly released study by Worcestershire County Council suggests that four authorities – Wychavon, Malvern Hills, Redditch and Wyre Forest – are on course to end up with hefty surpluses from their bus pass grants.

It concludes the Government gave more than enough money to Worcestershire as a whole to cover the cost of the scheme.

The suggestion that neighbouring councils could end the year with surpluses while Worcester suffered was hotly denied by the other councils last month, with all five leaders signing a strongly worded letter stating they “have not profited from the scheme”.

But the new report predicts Wychavon will end the financial year with a surplus of £130,000, Malvern with £126,000, Redditch £125,000 and Wyre Forest £87,000.

Worcester, meanwhile, will have a shortfall of £235,000 and Bromsgrove £75,000.

Worcester’s Labour MP Mike Foster had previously called for the Government grant to be redistributed between the six authorities.

He said yesterday the four ‘profiting’ councils have now been “caught red-handed” and should “apologise for misleading people”.

The four opposing councils have refused to back down, however, claiming County Hall’s report does not tell the whole story.

Meanwhile, Mr Foster’s Tory opponent Robin Walker says it’s the Government’s fault for not distributing the grants correctly.

But Mr Foster said: “Here is the proof four local councils are fleecing Worcester.

“The figures make it clear the Government has allocated more than enough grant to cover the extra costs of giving pensioners free bus travel – but some councils are ripping off the Government and punishing Worcester taxpayers. They have been caught red-handed. They should do the decent thing and cover all the extra costs of every council.”

Mr Foster said he will now lead a delegation from the city council to meet transport ministers and see if the situation can be rectified.

But his parliamentary opponent Robin Walker said the Government should have got it right first time.

He said: “The blame lies squarely with those in Parliament who drew up the legislation. This is a classic example of a good idea being badly implemented.

“Worcester has been underfunded once again and it’s outrageous for Mike Foster to blame anybody but his own Government.”

What the other councils say

WORCESTER’S neighbouring councils have again denied that they are profiting from the Government’s free bus pass scheme for pensioners.

Wychavon managing director Jack Hegarty pointed out the costs of the scheme referred to in the new Worcestershire County Council report are only an estimate, as the financial year does not finish until April 2009.

He said: “What the report does is give a snapshot. We are expecting lots more costs still to come through. People are signing up for bus passes all the time. In a year’s time we could be in deficit – it’s a dynamic situation.”

Wyre Forest leader John Campion agreed, saying: “The figures in the report are based on projections and we wholeheartedly refute them. Our figures suggest we will roughly break even.”

Malvern Hills’ deputy leader Ralph Madden claimed his council was only staying on-budget through “prudent financial management”, something he suggested Worcester had failed to achieve.

He said: “The report gives a very misleading impression of the financing of concessionary fares. It is important to understand that [only] around a third of the cost of concessionary fares is funded by Government grant.

“The expansion of the scheme in April brought uncertainty, and this council adjusted its budget in anticipation of increased costs. Not all councils have taken the same approach, which has left them facing serious overspend.”

Redditch deputy leader Michael Braley insisted the Government was to blame for the fiasco.

He said: “The problem is the failure of the Government to yet again fully fund a scheme they have brought in. As we said in September, our districts have not profited from the scheme.”