Bus fares to be capped at £2 to help ease cost of living

By the Editorial Team · Thursday, July 23, 2026

The UK government will cap single bus fares at £2 across England (excluding London) for 12 months starting in January to help ease the cost of living for millions of passengers. Funding of over £400 million for the scheme will be reallocated from the energy department’s budget and existing transport funds, reflecting the government's effort to provide affordable travel amid budgetary challenges.

The UK government has announced that single bus fares across England will be capped at £2 for a 12-month period starting in January, as part of efforts to alleviate the cost of living pressures on households. Prime Minister Andy Burnham unveiled the measure, which aims to reduce fares by up to one-third for millions of passengers, providing some financial relief amid rising household expenses.

This initiative comes alongside other recent government actions targeting the cost of living, including a move to cut VAT on household energy bills. However, the funding for these policies has sparked debate within the administration. Officials indicated that more than £400 million allocated for the bus fare cap would be redirected from the energy department’s budget, partly by converting funding previously designated for international climate finance projects from grants to loans. Additional resources will be drawn from existing transport department budgets already earmarked for bus services.

The £2 fare cap is a revival of a policy introduced under the previous Conservative government, which implemented a similar cap for two years starting in January 2023. However, upon taking office, the Labour Party had expressed concerns over the sustainability of extending the scheme nationwide. Despite this, Andy Burnham, who served as mayor of Greater Manchester before becoming prime minister, had maintained the cap’s extension within the Greater Manchester region through local funding.

The new fare cap will apply only outside London, as single bus fares in the capital are already capped at £1.75. Burnham emphasized the importance of affordable transport, stating that it is essential to ensure no one is excluded from opportunities due to high travel costs. He framed the policy as part of a broader commitment to fostering connected communities and reducing the financial burdens on individuals.

The measure signals the government’s ongoing attempt to address economic challenges faced by citizens, balancing social support initiatives with budgetary constraints and competing funding priorities.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.