AN "utterly absurd" situation linked to EU rules could spell disaster for bus services relied on by the elderly and children, leading councillors have claimed.

It is feared the Department for Transport (DfT) proposals, which could see not-for-profit community transport operations needing to have a costly operator’s licence and their volunteers a commercial licence, may force many lifeline services off the road.

While the legislative changes would affect the whole of Great Britain, counties such as North Yorkshire with large rural areas are set to be hardest hit by the proposed move.

Upper Dales councillor John Blackie, who runs the Little White Bus services between Hawes, Barnard Castle, Teesside Park and Ripon for 65,000 passengers a year, said the proposals threatened to "wipe off the map nearly all the community transport in North Yorkshire".

After attending a DfT consultation event on the proposals in Leeds yesterday he said: "The losers in this world of over-regulation will be the passengers we provide services for."

County councillor Don Mackenzie, North Yorkshire's transport boss, said community transport operators could be exempted from the changes if they did not charge for fares or work for the council, but without that funding the services would not be viable.

He said: "Without the community operators many of our bus services would not exist because we cannot afford to run them and commercial operators would not be interested in them."

Cllr MacKenzie told a meeting of the authority's executive the proposals had been sparked by a London commercial transport operator's complaint to the EU claiming it was facing unfair competition from community transport which used volunteer labour.

Since 1985, all community transport groups operating on a not-for-profit basis have been able to apply for permits to carry passengers without holding the Public Service Vehicle operator’s licence (PSV) that is needed for commercial operations.

Following the London operator's challenge it was found the government had been breaching EU law.

A DfT spokesman said until Brexit negotiations were concluded, the Government had to apply EU legislation.

Cllr Mackenzie said: "At the moment we have seven community transport providers to North Yorkshire County Council, including home to school transport. They fulfil so far 22 contracts with us. Their services are, generally, unattractive to commercial providers.

"The problem with PSV operator's licences are that they are very expensive. Volunteers who drive community transport may not be willing to undertake the testing that is involved in getting such a licence or indeed if they go through the process and find that they have been successful they may consider that their services are worth being paid for. So the voluntary aspect may be at risk as well."

The meeting heard that as commercial bus services had been cut back in recent years due to austerity, passengers in the county had become increasingly reliant on the volunteer-run services, particularly in rural areas with less profitable routes.

Cllr MacKenzie said the authority was pressing the county's MPs to lobby government over the issue and had relayed its concerns to the DfT.

He added: "We are hoping in the end good sense prevails and community transport operators will continue to be able to provide services to our residents especially in rural areas."

Councillor David Chance said: "Once again we seem to be having an objection lodged for something that has happened in a large conurbation which is having an effect on us because the attitude seems to be one size fits all."

Councillor Patrick Mulligan said: "To me community transport is more the future for North Yorkshire and to say it should be compared to something down in London is utterly absurd. I really hope we are listened to and this situation is recognised."

A DfT spokesman said it had written to local authorities to explain that there was "no need for them to cancel contracts precipitately".

He added: "We are exploring other ways to support the sector as well. We are making £250,000 available to fund advice for operators who need a PSV licence and are exploring what further assistance we can give."

"We hope that together these steps will reassure the sector, allow those community transport operators which are affected continue to provide valuable services for passengers while they work toward compliance, and to minimise any additional costs which they will incur."

Adrian White, Durham County Council’s head of transport and contract services, said last night: “We place great value on the work of our community transport (CT) operators, which provide some essential services to local residents. However, whilst we do provide support to the CT sector by helping cover the costs of things like vehicle replacement, we do not use our CT operators to provide contracted bus services. We will be responding to the consultation, but we do not see this as a threat to rural bus services.”