BUS passengers across Glasgow face a hike in fares to help meet the rising cost of fuel, insurance and staff wages.

FirstBus has been given the green light to charge more by the Competition Commission which ruled the city's biggest bus operator couldn't afford to absorb the extra costs.

The Commission had imposed a fare cap when the firm took over bus services in Glasgow and Edinburgh in 1997 which prevented FirstBus from introducing increases higher than rises to the retail price index.

But FirstBus claimed it was costing more to provide services north of the border than in England and Wales because the Scottish Government had refused to increase grants given to bus companies to compensate for rises in fuel duty.

Commissioners ruled the bus giant could not meet the extra costs for fuel, staff wages, insurance and vehicle maintenance as a result of the current fares restriction.

In a statement, they said: "The Competition Commission remains concerned that the fare cap contained in the undertakings is distorting competition in the Glasgow and Edinburgh areas by restricting increases in First's fares below increases in bus industry costs."

Commissioners also said it would be appropriate to calculate future fare caps on specific data on fuel costs in Scotland.

They agreed to ease the restrictions so that FirstBus could introduce dearer fares but ruled the new charges must not be higher than an index which is based on fuel costs in Scotland and other UK transport costs.

FirstBus is also being allowed to make a "catch-up" adjustment based on the growing difference between costs and revenues.

An index by the Confederation of Passenger Transport is used to gauge average increases. The latest figures are for December, 2007, when costs incurred by bus companies in Scotland had increased by 5.9% compared to 5.3% across the rest of the UK.

Victory for FirstBus means a double blow for Glasgow commuters. First ScotRail is to increase fares on train journeys throughout Strathclyde by 4.9% from the middle of next month," as reported in the late editions of the Evening Times last night.