Andy Burnham's recent announcement that most bus fares in England will be capped at £2 from January is a significant policy shift. This move comes as a stark contrast to the approach of his predecessor, Keir Starmer, who initially emphasized the challenges of addressing the cost of living. Burnham's strategy, which includes a £2 cap on bus fares and a reduction in VAT on household electricity bills, is a clear indication of his focus on tangible, quick-to-implement measures. This shift in tone and policy is particularly notable given Burnham's previous commitments and instincts on major policy questions.
The cap on bus fares is not a new concept. During his time as Greater Manchester mayor, Burnham launched the Bee Network, a London-style integrated bus and tram system under local control. This initiative, named after Manchester's iconic worker bee, has been successful in boosting bus usage, especially among lower-income passengers. However, it has also been criticized for not providing the best value for money.
The current cap of £2 has been in place in Manchester for the last four years, funded initially by central government. The ONS has acknowledged its role in reducing inflation and its popularity, but it has also noted that the financial benefits vary depending on the local fare structure. The Burnham government argues that a £2 cap will particularly benefit passengers in rural and coastal areas, where fares can be higher.
The extension of the bus fare cap to the rest of England is expected to cost over £500 million. This funding will be reallocated from the Department for Energy Security and Net Zero, with £400 million coming from switching investment from international climate finance to loans and the remaining £54 million from budget savings. The Department for Transport will also contribute funds already earmarked for buses.
This move is part of a broader strategy to ease the cost of living and provide 'breathing space' for people. Burnham's government has also promised to cut VAT on household electricity bills, funded by reallocating funds from the cancellation of the digital ID program. These measures reflect Burnham's commitment to addressing the cost of living crisis and his focus on tangible, quick-to-implement solutions.
However, the Shadow Chancellor, Mel Stride, has raised concerns about the funding of these measures, accusing the government of not specifying where the money is coming from. This highlights the ongoing debate about the sustainability of such policies and the need for clear financial planning. Despite these concerns, Burnham's approach to addressing the cost of living crisis is a significant step towards making transport more affordable and accessible for millions of people across the country.
