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Single bus fares across England will be capped at £2 from January, Prime Minister Andy Burnham has announced.
The nationwide cap is currently set at £3 until the end of March 2027 although some areas – including London and Greater Manchester, where Mr Burnham set a £2 limit as mayor – have lower top rates for single tickets.
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 switching investment in international climate finance to loans, with the rest 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.
The £2 cap will be in place throughout 2027 and reverses an increase put in place by Sir Keir Starmer and Rachel Reeves in 2024.
A £2 cap had been in place between January 2023 and December 2024 but the incoming Labour administration argued it was not affordable, although some metro mayors, including Mr Burnham, decided to fund an extension of the lower limit in their areas.
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.
Transport Secretary Heidi Alexander said the move would make “everyday journeys easier and cheaper”.
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 John 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 re-appointments for ministers to remain in their roles, including Sarah Sackman as justice minister and Luke Pollard as defence minister.
