SBG profit 4.5 per cent aim
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THE SCOTTISH Bus Group's profit target has been fixed at 4.5 per cent again for next year, several weeks after local authorities' deadline for fixing their rates.
Scottish Secretary George Younger said the established target of a 4.5 per cent return on net fixed assets before interest would remain in force until January when new long-term targets are set.
By then, it is expected that the Department of Transport will have set new targets for the National Bus Company, when its study of deregulation and future subsidy requirements will be complete.
But the SBG target is of no comfort to the Convention of Scottish Local Authorities, which opposes the target in principle, partly because SBG's substantial subsidy requirement diminishes its scope for commercial trading, and more so because its obligation to pay Corporation Tax on its profit means that local authorities are paying subsidy direct to the Treasury.
Cosla is further incensed by the delay in fixing the target, as its member councils were required by Parliament to fix their rates by mid-March, before they could establish definitively what level of subsidy SBG would require.