Bus drivers in Brighton and Hove are to receive an inflation-busting 13 per cent pay rise.

The move follows a troubled time for Brighton and Hove Buses, which has had to cut services to cope with a shortfall in staff.

It had also been threatened with industrial action and the new deal was thrashed out between management and the Transport and General Workers and GMB unions. It was approved in a ballot of members and agreed following concerns drivers could not cope with spiralling property prices in Brighton and Hove.

It will see drivers' average wages rise to £299 and engineers' to £372.

Managing director Roger French said: "We have been in discussions with the unions representing drivers and engineers for some months.

"I am pleased that we have been able to reach agreement on a bold plan to make significant increases in rates of pay."

The rise is being paid in stages, with two already paid and more agreed for October and February.

Mr French said: "Over the two-year period, pay will have increased by 13 per cent.

Such a large increase has proved necessary to ensure wage rates keep up with the high cost of living in this area.

"We need to retain existing staff as well as attract new staff in the ever-increasingly competitive local job market." Mr French said the company regretted the disruption passengers had faced recently through the staff shortage.

He added: "Our drivers are doing their very best to keep services running at this busy time of year and we are working hard to ensure services run more reliably in future."

Brighton and Hove Buses employ more than 800 and is one of the largest companies in the area.

At the end of last month, a new timetable had to be produced for most of the main routes in Brighton and Hove to give details of cuts in services because the company has not been able to recruit enough drivers.

The company has been conducting an intensive recruitment campaign throughout this year with some success and is managing to run most buses. Bob Walker, regional organiser for the Transport and General Workers' Union, said: "We are pleased that this was achieved without industrial action.

"But we would like to sit round a table with Mr French and discuss conditions such as long working hours for drivers."

Gary Smith, regional organiser for the GMB union, said: "The last thing our members want to do is to disrupt services.

"We are committed to providing a first-class service for the travelling public."

Mr Smith said the union and its members had reluctantly accepted the pay deal. He added: "They are underpaid and this can be seen by the company's problems in recruiting and retaining staff."

Mr Smith also said the GMB wanted to raise issues with the company, including stress for drivers and long hours behind the wheel.