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Maintaining the £2 cap on bus fares in England would have only cost a tenth of the money the government spent on freezing fuel taxes, a leading think tank has claimed.
The cap would have cost £300m compared to the £3bn spent on the fuel duty freeze, according to the New Economics Foundation (NEF).
The existing cap was due to expire at the end of December, while the new £3 cap, which covers most bus journeys in England, will be in place until the end of 2025.
The cap was introduced after the pandemic to alleviate the cost of living crisis and also to encourage greater use of public transport. NEF has previously said that freezing fuel tax leads to more driving instead of using public transport and therefore more pollution.
However, single bus fares in London with Transport for London will remain at £1.75 and those in Greater Manchester at £2, after Andy Burnham, mayor of Greater Manchester, said he would maintain the cap.
Campaigners have called on the West Yorkshire mayor to maintain the limit. Tracy Brabin said she would consider the plea. The region was the first to impose a £2 fare cap in September 2022, with the government following suit in January 2023.
“Access to affordable public transportation should not depend on a regional lottery,” the think tank said.
“The cost of capping bus fares at £2 would have been minuscule compared to maintaining the freeze on fuel duty. “We should incentivize public transportation, which would help reduce carbon emissions, instead of continuing with this regressive cut in fuel taxes.”
A fare cap extension was announced in 2023 with funding of £300m; £160m to local transport authorities to improve fares, services and infrastructure and £140m to go directly to operators to help protect essential services across England.
Transport Secretary Louise Haigh said following the announcement: “Our bus revolution will give every community the power to take back control of their services, end the postcode service lottery and turn the page on four decades of failed deregulation”.
Liberal Democrats branded the change a “bus tax” that will hit small businesses and slow economic growth.
Environment spokesman Tim Farron said: “While this new government has had to make difficult decisions, it cannot allow the burden of cleaning up the Tories' mess to fall on people and small businesses across the country.
“The fundamental issue that neither Labor nor the Conservatives before them seemed to understand is that for rural communities, it doesn't matter whether the limit is £2 or £3 if they don't have a bus service to begin with.”
Greenpeace condemned Sir Keir's decision to raise the bus fare cap, saying it “makes no political, economic or environmental sense”.
