The West Midlands is facing a ‘financial time bomb’ by providing free bus passes for the elderly, Centro has said.

Funding the scheme could lead to a 75 per cent cut in spending on other transport services in 10 years’ time, the chiefs of the six largest urban transport authorities outside London warned.

The passenger transport executive (PTE) bosses from Merseyside, South Yorkshire, Greater Manchester, Tyne and Wear, Centro in the West Midlands and West Yorkshire have now written to Transport Secretary Patrick McLoughlin.

They have said that although the costs of the scheme are on an upward trend, Government funding will have been reduced by 27% between 2010/11 and 2014/15.

Already funding the scheme takes up around half of all PTE spending. The PTEs say they have very little influence over the cost of the scheme and have no choice but to fund what is a legal requirement.

With wider PTE funding also being cut this means that the rising cost of funding the concessionary pass rapidly eats into spending on other frontline transport services.

So by 2022, spending on these frontline services could be reduced by three quarters, the PTEs say.

The chairman of the group of the six authorities, Councillor David Wood, said the concessionary fare scheme had been a big success and something people wanted to flourish.

He went on: “However, it cannot be right that the cost of providing what is a national statutory scheme, determined by national government, should create such a heavy funding burden for transport authorities in a way that threatens the future of the services that we provide for all members of our communities, including older and disabled people.

“There will be little point in a free pass if the bus services that older people are using have to be withdrawn to pay for it.

"Nobody wants to see that - least of all older and disabled people - which is why we need a sustainable long-term funding solution for concessionary fares which will both guarantee the future of the scheme while protecting other essential transport services.”

Transport Minister Norman Baker said: “Statistics published by the Department for Transport just last week show that concessionary travel went down per journey, not up, in 2011/12.

“Last year we put in place reforms to help local authorities cut the costs of concessionary travel schemes and these reforms are already starting to take effect. In 2010 we introduced changes to the age of eligibility which will, over time, see a gradual increase to the age at which people are entitled to a bus pass.

“We are doing this to take into account growing numbers of older people and help with the financial sustainability of the statutory concession.”