Prime Minister Andy Burnham has announced that participating single bus fares in England outside London will be capped at £2 from 1 January to 31 December 2027. The measure is supported by £400 million in additional government funding.
The fare cap will apply to eligible single journeys on participating bus services across England outside London. Until the new scheme begins, the majority of eligible single fares will remain subject to the existing £3 limit.
The announcement was published on 22 July 2026 by Downing Street, HM Treasury and the Department for Transport. Funding will also be provided to the devolved governments through the Barnett formula.
Government Announces £2 Bus Fare Cap
The new limit will replace the existing £3 fare cap and remain in place throughout 2027. Eligible single journeys on participating services will cost no more than £2 under the scheme.
The government said the measure will apply to the most widely used form of public transport in England. London is excluded because bus fares in the capital operate under separate arrangements.
- Start date: The new fare limit will begin on 1 January 2027.
- End date: The scheme will remain in place until 31 December 2027.
- Coverage: Eligible participating services across England outside London will be included.
Passengers Could Save a Third on Fares
Millions of passengers could save up to a third on individual bus journeys under the lower limit. The government said cheaper fares would support access to employment, training, education, childcare, healthcare and leisure.
Passengers making longer journeys are expected to receive some of the largest savings. Without a national cap, the government said single fares on some of the most expensive routes could rise above £10.
Passengers in rural and coastal communities may particularly benefit because journeys are often longer and existing single fares can be higher. The measure is also intended to reduce travel costs for young people entering employment or training.
Government Provides Additional Fare Funding
The English fare cap will be backed by £400 million in additional government funding. A wider allocation of £454 million includes funding provided to devolved governments through established arrangements.
The government said the expenditure would be funded through a reprioritisation of the Department for Energy Security and Net Zero budget. The reprioritisation includes switching funding set aside for international climate finance projects from grants to loans.
Funding and Implementation
| Indicator | Arrangement | Context |
|---|---|---|
| Fare limit | £2 | Eligible single journeys |
| English funding | £400 million | Additional government support |
| Total additional funding | £454 million | Includes allocations for devolved governments |
| Scheme period | January–December 2027 | Full calendar year |
£2 Cap Replaces Existing Limit Three Months Early
The majority of eligible single fares outside London are currently capped at £3. That arrangement had been due to continue until the end of March 2027.
Introducing the lower cap from January means passengers will receive the reduced fare three months before the existing scheme was scheduled to expire. It will also prevent eligible fares from rising when the previous £3 arrangement had been due to end in March.
The full-year timetable is intended to give local authorities and bus operators more certainty when planning services and budgets. Participation requirements will continue to determine which routes are covered.
Bus Investment Supports Wider Transport Policy
The fare announcement forms part of wider government funding for bus services and local transport authorities. The written statement to Parliament said more than £3 billion had been committed to buses over the next three years.
Funding is intended to help authorities and operators manage rising costs, maintain routes and keep fares affordable. The government has also confirmed individual allocations for local transport authorities.
- Local funding: Transport authorities will receive allocations to support services and manage operating pressures.
- Service powers: Authorities can use franchising, enhanced partnerships or other locally led arrangements.
- Long-term support: National investment is intended to provide greater certainty for local bus planning.
Wider Bus Support Measures
| Measure | Value or Scope | Purpose |
|---|---|---|
| Three-year commitment | More than £3 billion | Support bus networks |
| Additional sector support | More than £100 million | Includes children’s travel and sector support |
| Children’s travel | Ages 5–15 | Free August journeys |
| Mayoral franchising | Six authorities | Increase local control |
Fare Reduction Follows Summer Travel Support
Earlier in 2026, the government announced more than £100 million in additional support for the bus sector. This includes free bus travel for children aged five to 15 on participating services during August. The Great British Summer Savings scheme is intended to reduce family travel costs during the school holidays.
The bus measure also follows the government’s announcement of a rail fare freeze. Ministers said that decision would save rail passengers an estimated £600 million, with some commuters saving more than £300 annually.
Local Authorities Receive Greater Bus Powers
Six mayoral authorities are receiving government support to establish bus franchising arrangements. Franchising allows local leaders to determine routes, service standards and fare structures within their areas.
The government linked the approach to Greater Manchester’s Bee Network, where single bus fares have been capped at £2 for four years. The government said locally controlled networks could help services respond more closely to community requirements.
Ministers also plan to consult on additional planning powers for mayors, including authority over decisions involving public transport and mass-transit projects. The proposed changes would sit alongside powers provided through the Bus Services Act 2025.
Stakeholder Comments
Ministerial Comments
Andy Burnham, Prime Minister, said:
“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.”
Heidi Alexander, Transport Secretary, said:
“We’re cutting fares by a third to help with the cost of living, open up opportunities and keep people connected to work, school, healthcare and their friends and family.”
Jason Prince, Director of the Urban Transport Group, said:
“Cheaper fares not only make bus travel more affordable but they can help to significantly drive passenger numbers, so this is a welcome intervention for both bus users and local communities.”
The £2 fare cap will apply to eligible single journeys on participating bus services in England outside London throughout 2027. The scheme is supported by £400 million in additional funding and replaces the current £3 limit. It will operate alongside wider funding for local transport authorities and reforms intended to maintain affordable, accessible bus networks.
Sources: Prime Minister’s Office, 10 Downing Street, HM Treasury and Department for Transport and Lord Hendy of Richmond Hill CBE.
Prepared by Ivan Alexander Golden, Founder of THX News, an independent news organisation delivering timely insights from global official sources. Combines AI-analysed research with human-edited accuracy and context.
