Fears of further traffic congestion in the city as bus operators used alternative routes, with increased use of on-street stops, also forced the policy u-turn.
Cabinet transport boss County Coun John Fillis gave the go-ahead yesterday to freeze departure fee charges until March 2018 at council bus stations and allow Preston bus operators to continue renting bus bays until October 2018.
Talks will now be held with bus operators “to establish a fair funding mechanism” from April 2018.
But the change of plan, which includes the council run Accrington and Nelson bus stations, means the council will face a shortfall between income and running costs of nearly £1.5m in the current and next financial year.
At Preston the shortfall will be £301,812 in 2016/17 and £314,967 in 2017/18. Preston Bus and Stagecoach had warned that the introduction of a 75p per bus departure charge, instead of the current bay rental system would cost them around £400,000 a year collectively.
The Council acknowledged that the bus companies are also having to cope with disruption caused by “the disruptive nature of the works” currently being carried out at the city bus station. In order to retain the service operators’ confidence the council said it will retain its bay rental model until the refurbishment work is completed.
The report approved yesterday by Coun Fillis revealed: “Bus operators have indicated that the planned raising of charges will have a very serious effect on their operating costs..and they may approach the Traffic Commissioner who has the power to set aside an unfair charge on operators.”
It continued: “They have made it clear they will resist these charges and, in many cases, avoid them by rerouting services not to call at bus stations. It is likely that diversion from bus stations will result in increased use of on-street stops with a consequential impact on the highway network and increased congestion.”
Mr John Asquith, (pictured), Operations Manager of Preston Bus welcomed the move saying: “The report is very welcome and it clearly sets out what the issues are for both sides ... really it’s over how hopefully everybody can try and keep the costs down.”
He said that the city station is a public facility not just used by bus operators, but by car park users too and bus companies should not be overburdened with charges.
The council plans to use a Bus Service Operators Grant to offset the shortfall in its income caused by not implementing its planned increases.
Chorley and Nelson bus stations will now charge £2.50 for non local coach and excursion trips in line with a fee currently charged at Accrington bus station.
At the three stations outside Preston it had been planned that the 75p bus departure charge would rise to £1.00 from April 2.
County Coun Geoff Driver, the leader of the Tory opposition group on the council said: “We warned them at the time that the bus operators would resist and now we are left with a £1.5m deficit. The position at Preston is particularly interesting Lancashire County Council bought it for £1 and plans to spend at least £16m on refurbishing it. That will incur debt charges of about £1m a year. Retaining the bay rental charges instead of the exit charge will add over £300,000 to the annual cost.”
• Councillors have until Thursday to call in the decision, which if not challenged , will come into effect on Friday.