The £2 cap on English bus fares outside of London will be extended until 31 October 2023, before rising to £2.50 until 30 November 2024, the UK government has announced.
The extension comes following £200m in government funding into the scheme to help passengers with the rising cost of living, with a further £300m settlement announced by UK transport secretary Mark Harper to protect vital routes and improve services until 2025.
According to the UK Department for Transport (DfT), the Office for Budget Responsibility estimates that inflation will be halved by the end of this year. The DfT claims that capping fares at £2.50 until November 2024 will create longer-term certainty for bus users over the next year.
The fare cap will be reviewed ahead of November 2024.
The move is a part of the government’s Help for Households initiative, which is designed to benefit those on lower incomes who, claims the DfT, take nearly three times as many bus trips than those on higher incomes.
During the Covid-19 pandemic, bus usage is said to have dropped as low as 10% of pre-pandemic levels and, while passenger levels have reportedly recovered to around 85 to 90%, the fare cap aims to encourage people back on buses.
UK prime minister Rishi Sunak said: “By extending the £2 fare cap, we’re making sure bus travel remains accessible and affordable for everyone while helping to ease cost of living pressures.
“Buses connect our communities and play a vital role in growing the economy; they transport people to work, take our kids to school and make sure patients can get to doctors’ appointments.
“That’s why we’re determined to protect local routes and encourage more people onto the bus, ensuring people can get around easily and in an affordable way.”
This is the second time the £2 fare cap has been extended, with operators such as Go-Ahead reporting that it has carried more than 16 million passengers since it was initially introduced as a temporary measure on 01 January 2023. Bus operators continuing the £2 fare cap scheme will be confirmed in due course.
The additional funding announced will be shared between local transport authorities and bus operators. As part of the £300m to support services until 2025, £160m will be provided to local transport authorities to improve fares, services and infrastructure while £140m will go directly to operators to help protect essential services across England.
While Graham Vidler, CEO of the Confederation of Passenger Transport, welcomed the two-year funding settlement, he warned that it and the £2 fare cap extension combined would not save every service in every part of the country.
“Operators and local authorities will now work together to study the detail of the government’s proposals and ensure that the funding is used to safeguard the best possible network for local passengers,” said Vidler.