The £2 bus fare cap: what it did last time, and what has happened to buses

What was announced

A £2 cap on single bus fares in England outside London, for all of 2027

The government announced the £2 cap on 22 July 2026, and the Prime Minister restated it in his Labour conference speech on 29 September. DfT's statement says single bus tickets will be capped at £2 in England outside London from 1 January until 31 December 2027, replacing the current £3 cap, on participating services. It is backed by £400 million of extra funding, £454 million including the devolved governments' share, paid for by switching international climate finance in the energy department's budget from grants to loans. The speech's wording, anywhere in England, is broader than DfT's: London is not included.

1. September 2022Greater Manchester caps adult single fares at £2 locally.
2. 1 January 2023National £2 single fare cap begins in England outside London, first for three months, then repeatedly extended.
3. October 2023Cap kept at £2 to the end of 2024; government spending on it reaches nearly £600 million.
4. 1 January 2025Cap rises to £3.
5. June 2025Spending Review extends the £3 cap to March 2027.
6. 22 July 2026£2 cap announced for 1 January to 31 December 2027.

“Single bus tickets will be capped at £2 in England outside London from 1 January until 31 December 2027.”

What the cap did to fares

Fares outside London fell 9.1 per cent in one quarter when the £2 cap began, and rose 11.0 per cent when it went to £3

DfT's local bus fares index for England outside London fell from 190.5 in December 2022 to 173.1 in March 2023, the quarter the £2 cap began, while consumer prices kept rising. When the cap went to £3 in January 2025 the index jumped from 185.9 to 206.4. In London, where the cap does not apply, the index moved differently. In the year to June 2026 fares in England rose about 2 per cent against 3 per cent consumer price inflation, and were flat in London, where the single fare has been £1.75 since March 2023. TfL says it is expected to rise to £1.85 after 1 November 2026.

Local bus fares index, England outside London, current prices, March 2005 = 100. Source: DfT Quarterly bus fares statistics, table BUS0415a (to June 2026). The index tracks change in fares, not an average price.

Green: quarters under the £2 cap (January 2023 to December 2024).

Did it work?

About 5 per cent more journeys, at a benefit to cost ratio below one

DfT commissioned Frontier Economics and SYSTRA to evaluate the first ten months of the £2 cap. They found it contributed about a 5 per cent increase in bus patronage, out of a 13 per cent rise outside London between January and October 2023 compared with a year earlier, and cut the price of single tickets that had cost more than £2 by 27 per cent, though those were under half of trips. Spending was £210 million, 14 per cent under budget. The preliminary benefit to cost ratio was 0.71 to 0.9, before benefits the evaluators could not quantify; most of the gain went to people who would have travelled anyway. The National Audit Office found the cap achieved its aims of making journeys more affordable for lower income households and increasing bus use, but that the government repeatedly extended it at short notice, making it difficult for operators to plan. The NAO puts DfT spending on the national fare caps, £2 then £3, at £60m in 2022-23, £280m in 2023-24 and £276m in 2024-25.

“The scheme contributed approximately a 5% increase in bus patronage, out of a total 13% patronage increase outside of London from January to October 2023 compared to the same period in the previous year.”

How many people use buses

3.67 billion journeys in England, 90 per cent of the level before the pandemic

There were 3,672 million local bus journeys in England in the year to March 2025, against 4,075 million in the year to March 2020, just before the pandemic, and 4,026 million in 2004-05. London accounts for about half. Outside London, the metropolitan areas have lost the most: 777 million journeys against 1,047 million twenty years earlier. Greater Manchester, where fares have been held at £2 since 2022 and buses brought under public control between 2023 and 2025, had 171.0 million journeys in the year to March 2025, against 189.7 million in 2018-19. About 28 per cent of journeys in England are made on concessionary passes.

Millions of local bus passenger journeys, years ending March. Source: DfT Annual bus statistics, table BUS01a.

How much service there is

28 per cent fewer bus miles outside London than in 2005

A cheaper fare only helps if there is a bus to catch. Local bus services outside London ran 736 million vehicle miles in the year to March 2025, against 1,027 million in 2004-05, a fall of 28 per cent. Across England mileage was 89 per cent of its level before the pandemic. The fall has been steepest in some county areas: the councils below lost the largest share of their bus miles between 2009-10 and 2024-25. Government support for local buses in England totalled £3.0bn in 2024-25, of which £0.8bn reimbursed operators for concessionary passes.

Change in local bus vehicle miles, years ending March 2010 to 2025, council areas outside London with at least 2 million miles in 2009-10; areas reorganised since 2010 are left out. Source: DfT Annual bus statistics, table BUS02d_mi.

Questions this raises

What the figures do not settle