Welsh Government has announced a new scheme to help sustain bus services across Wales in return for greater public control over how they are run.

Revenue has plummeted throughout the coronavirus pandemic, with passenger numbers dropping by 90% and expected to remain low for the foreseeable future.

Last week, Stagecoach Cymru said they feared they would not be able to meet the costs of increasing bus services as demand increases with five-mile travel restrictions being lifted across Wales.

In a statement, they said as long as two-metre social distancing remains in place on buses, operators will not be able to meet the cost of ramping up services.

The Welsh Government’s Bus Emergency Scheme will provide an operating subsidy in replace of lost revenue, which will maintain levels for an initial period of three months.

In return, operators will be expected to work with local authorities and Transport for Wales to match evolving supply and demand of routes and services.

Operators will also be expected to comply with Welsh Government guidance on the safe use of public transport and not increase fares.

In the longer-term, Welsh Government said it will develop the scheme to form the basis of new funding, which will allow more than £100million worth of public funding to prioritise the needs of passengers.

Deputy Transport Minister, Lee Waters, said it has “been necessary to take action and provide funding to secure the industry’s future”.

He added: “This has meant buses have been able to help key workers get to work during the pandemic, and will mean the industry can continue to be an essential part of our transport network as we are hopefully in a position to ease restrictions and restart the economy.

“As well as providing short-term funding with conditions that secure public value, I want the Bus Emergency Scheme to be the start of a pathway to a greater say for public sector funders and users reshaping our bus network in the interests of passengers across Wales.”

The Confederation of Passenger Transport (CPT), who represent the bus and coach industry across the UK, welcomed the announcement.

CPT Cymru director John Pockett said: “With social distancing measures restricting bus capacity there has been an unprecedented fall in passenger revenue meaning, despite cutting costs, operators are unable to cover the costs of running the network from fares alone.

“We look forward to working with Welsh Government to ensure communities have access to safe, clean and sustainable bus links and to understand how the proposed transition arrangements will impact on the number of bus services we can run and how quickly we can get more buses on our roads.”