Bus fares slashed across England in new cost of living announcement

Prime Minister Andy Burnham has announced that single bus fares across England will be capped at £2 from January 1, 2027, representing a reduction of a third from the current £3 limit. The policy, which was previously set to end in March 2027, reverses an increase put in place by Keir Starmer and Rachel Reeves in 2024, returning to the level that had been in place between January 2023 and December 2024.

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." He added that lower fares would help people get to where they need to, giving them breathing space to help with the cost of living.

The announcement follows Mr Burnham's earlier decision to scrap VAT on domestic gas and electricity. The transport measure is backed by £454 million in funding, including money to allow devolved governments to take similar action. Approximately £400 million will come from switching investment in international climate finance to loans, with the remainder from savings in the Department for Energy Security and Net Zero budget. The total cost of the scheme is expected to exceed £500 million, with the remainder coming from Department for Transport funding already allocated to buses.

Chancellor John Healey said: "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." Transport Secretary Heidi Alexander said the move would make everyday journeys easier and cheaper.

When serving as mayor of Manchester from 2017, Burnham set a £2 limit on single fares, a rate that has been maintained for the past four years. Free bus travel for everyone under 15 will come into force from August 1.