Single bus fares across England will be capped at £2 from January, Andy Burnham has announced.
The new Prime Minister has pledged to cut the nationwide cap for single tickets from £3 in one of his first measures in office.
Areas like the North East already have a cap lower than £3, while Burnham set a £2 maximum in Greater Manchester while he was mayor.
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.’
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The change will cost £500 million, including funding to help Scotland and Wales take similar action. The scheme won’t apply to London.
The money will mainly come from switching investment in international climate finance to loans.
The cap will also be funded from savings in the Department for Energy Security and Net Zero budget.
Questions have already been asked about the credibility of plans to switch climate grants to loans, including what the interest rates and repayment schedule on those loans would be.
Transport Secretary Heidi Alexander told Sky News this morning that ‘the details… still need to be worked through’ when asked about it.
Burnham’s decision also reverses a decision from Rachel Reeves in 2024 to raise the cap from £2 to £3.
The then-Chancellor argued it was not affordable when she decided to up the rates.
Many areas of England decided to keep a lower cap for their locals.
Both Liverpool and Manchester held the limit at £2, while the North East capped fares at £2.50.
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.
Healey kicked off his time in No 11 by announcing that VAT would be cut from domestic energy bills, helping families save an average £45 a year.
However, claims the idea was financed by scrapping the government’s digital ID scheme immediately came under fire, when former minister Darren Jones said money for the scheme had not yet been identified.
Transport Secretary Heidi Alexander said the cap on bus fares would make ‘everyday journeys easier and cheaper’.
Andy Burnham built his political reputation in Manchester on buses.
In 2023, he launched the region’s Bee Network – a system of joined-up transport that brought buses under local control through franchising.
The Conservative Party has accused Burnham’s government of wanting ‘to go back to the 1970s’ with their economic agenda.
Shadow chancellor Mel Stride told BBC Breakfast: ‘I fear that he is somewhat captive to a prime minister who seems to want to go back to the 1970s and huge spending and state intervention, higher taxes, higher borrowing, and all of that, which is what we’ve seen from Labour to date, but even more of it.
‘Also constrained by his backbenchers, who do not have any appetite, particularly for welfare reform, which I think is key to the success of our economy.’
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