THE boss of a Bournemouth bus firm has spoken out against plans to cut government fuel subsidy amid warnings from some of the nation’s biggest operators that fares could rise.

Derek Lott, the managing director of Yellow Buses, said it was too early to say if fares would rise in Bournemouth, but criticised government plans to reduce the Bus Service Operators Grant.

The grant – formerly known as the Fuel Duty Rebate – is due to be cut by 20 per cent from 2012/13 in a bid to save the government £300m a year.

“Any reduction in government or local authority funding that impacts upon services provided to the passenger is disappointing,” said Mr Lott.

“Where this occurs then Yellow Buses will determine what action is required to ensure that we continue to provide the best possible service to our customers whilst obviously maintaining the viability of the business.”

Senior figures from two of the UK’s “big five” bus operators warned an influential committee of MPs earlier this week that passengers would feel the effect of the cuts.

Robert Montgomery, service performance director with Stagecoach UK bus, told the House of Commons transport select committee that cutting the Bus Service Operators grant could drive up fares by as much as six per cent.

He added that services in Shire counties, and the south of England would be worst affected.

Mike Cooper, managing director of Arriva Bus UK, warned the committee that some routes were already being cut and the frequency of services altered.

And councils warned the committee that services could be reduced if a range of grants for local authority transport schemes were reduced.

In a written submission, the Local Government Association said: “The spending review will affect bus passengers by making it harder for councils and operators to maintain the current number of routes and by increasing fares.”