Burnham reintroduces £2 bus fare cap reversing Starmer increase
The £2 bus fare cap has been reinstated by Prime Minister Andy Burnham, reversing a decision to increase it made by his predecessor Sir Keir Starmer.
The cap across England is set at £3 until the end of March 2027 although some areas – including London and Greater Manchester, where Mr Burnham kept the £2 limit as mayor – have lower top rates for single tickets.
The £2 cap will be in place from January and will last throughout 2027, undoing the increase to £3 put in place by Sir Keir and his chancellor Rachel Reeves in 2024.
A previous £2 cap had been in place between January 2023 and December 2024 under the Conservatives but the incoming Labour administration argued it was not affordable.
Reinstating the £2 maximum fare will partly be funded by switching grants for international climate projects to repayable loans instead.
Mr Burnham said: “Good, affordable transport links are an essential. No-one should be priced out of those and left behind.
“But for too long, people have said that cheaper transport isn’t an option. I don’t accept that. I’ve done it before and I will do it again now: a £2 cap on bus fares for millions across the country.
“Lower fares will help people get to where they need to – giving them breathing space to help with the cost of living.”
The measure is backed by £454 million of funding, including money to allow devolved governments to take similar action.
Some £400 million of that funding will come from shifting investment in international climate finance to loans, with £54 million from savings in the Department for Energy Security and Net Zero budget.
The total cost of the scheme is expected to be more than £500 million, with the rest coming from Department for Transport funding already allocated to buses.
Chancellor John Healey said “millions of people” would benefit from fares being slashed by a third and insisted the measure could be paid for.
“This action to ease the cost of living is funded by savings made elsewhere, so there’s no burden to British taxpayers, just pounds going back into their pockets,” he said.
Shadow transport secretary Richard Holden questioned how the Government would pay for its promises.
“Conservatives in government introduced the £2 bus fare cap, expanded it, and pledged to keep it,” he said.
“Labour increased this by 50% to £3 and now expect praise for returning it back down to £2 in line with the Conservative manifesto.
“The real question is how Labour will pay for these policies. Labour MPs will not take the hard choices like cutting the surging benefits bill. That is why borrowing or taxes will have to rise to pay for their pledges.”
Graham Vidler, the boss of bus industry body CPT, said: “This will be the sixth continuation or extension of the national scheme since it began as a three-month offer in January 2023.
“As it enters its fifth year, it is vital that the Government works with the industry to place it on a sustainable footing, with a long-term strategy and a fair reimbursement model for every operator choosing to take part.”
Meanwhile, Mr Burnham is continuing to put in place his ministerial team, with Scottish Labour leader Anas Sarwar expected to be given a peerage and a job in the revamped Department for Business, Innovation, Science and Trade.
Mr Sarwar, who has been Scottish Labour leader since 2021, was among the first to call for Sir Keir to stand down in February.
He hailed successor Mr Burnham for his “bold Labour vision” as he entered No 10 this week.
Downing Street confirmed appointments including Dan Jarvis, who stepped in as Sir Keir’s defence secretary when Mr Healey resigned amid a funding row and has been returned to his previous post of security minister.
James Murray, who was health secretary when Wes Streeting quit, has been made Financial Secretary to the Treasury and Paymaster General.
Anna Turley is no longer Labour Party chair and has instead been made a Home Office minister.
Florence Eshalomi has become a housing minister and Andy Slaughter Solicitor General, freeing up their roles as heads of parliament’s housing and justice committees.
There were also 17 reappointments for ministers to remain in their roles, including Sarah Sackman as justice minister and Luke Pollard as defence minister.
Published: by Radio NewsHub