Prime Minister Andy Burnham is preparing to implement a nationwide £2 cap on bus fares as part of a broader strategy to address the ongoing cost-of-living crisis. The policy, expected to take effect from January next year, builds on a similar measure Burnham introduced while serving as mayor of Greater Manchester in 2022.

Burnham has long advocated for affordable public transport as a means of supporting economic recovery and community connectivity. During his campaign in the June Makerfield by-election, he emphasized the importance of keeping fares low, citing earlier initiatives such as free bus travel for 16 to 18-year-olds and the removal of time restrictions on passes for older and disabled passengers.

An England-wide bus fare cap was originally set at £2 by the Conservative government to encourage ridership following a sharp decline during the COVID-19 pandemic. However, Labour’s autumn 2024 budget raised this cap to £3, with the aim of balancing affordability and service sustainability. Some regional and city mayors retain the authority to set fares below the national ceiling.

The reintroduction of the £2 cap aligns with Burnham’s recent announcement that VAT will be abolished on electricity bills, another move intended to ease financial pressure on households amid rising living costs. The Prime Minister has indicated that the estimated £850 million cost of removing VAT will be offset by scrapping a digital ID scheme initially proposed by Labour leader Sir Keir Starmer.

However, the funding plans for the digital ID initiative remain uncertain. Darren Jones, the scheme’s original architect who was dismissed by Burnham earlier this week, stated that no allocated funding exists for the project, adding complexity to the government’s proposed financial adjustments.

Burnham has framed these measures as efforts to provide the public with "breathing space" in the face of soaring prices. The forthcoming bus fare cap and VAT removal together form a key part of his administration’s cost-of-living response, which aims to improve access to public transport and reduce household energy expenses.