These Regulations amend, in relation to Wales, the Service Subsidy Agreements (Tendering) Regulations 1985 (“the principal regulations”) as amended by the Service Subsidy Agreements (Tendering) (Amendment) Regulations 1989, 1994 and 1998. The provisions of the principal regulations which are amended provide for exceptions to the requirement under section 89 of the Transport Act 1985 for tendering where local authorities enter into agreements for the provision of local bus services subject to a service subsidy.

Regulation 3 of the principal regulations provides for an exemption from the tendering requirement where the agreement provides for payments of less than £12,000 in any 12-month period unless the aggregate which a service operator receives from that local authority under such agreements exceeds £70,000.

Regulation 2 of these Regulations provides, instead, for the exception to apply to any agreement or agreements under which payments do not exceed 40 per cent of the budgeted total expenditure of an authority on such agreements in that financial year.