"The way the concessionary travel scheme is funded by Whitehall has not kept up with growing demand and cost."

A study by the LGA shows bus journeys in England were at their peak in 1984 with 4.8bn journeys compared to just 4.5bn now.

Its report on the future of public services will be launched at its Annual Conference next week, when it calls for the Government to fully fund the concessionary fares scheme and give councils control over the Bus Service Operators’ Grant.

It says the fuel duty rebate, currently paid directly to bus operators, would enable councils to protect vital bus routes, and give them the funding they need to provide an effective and efficient bus service.

Mick Cash, general secretary of the Rail, Maritime and Transport union, said: "This report comes as no surprise when we consider that since 2010, bus fares have increased by 9.2 per cent over the rate of inflation while at the same time bus funding has been cut by a third and in the last year alone 500 bus routes were reduced or completely withdrawn.

"Until our bus services are treated like a public service and taken into public ownership we will continue to see a fall in bus use and the increasing isolation of those who are consigned to the misery of transport poverty."