The future of the £2 bus fare cap in England is expected to be announced at the time of Chancellor Rachel Reeves’s budget on 30 October, sources within the industry have said.
It is understood that representatives of the bus sector in England have been informed that nothing about how the government will deal with the scheme’s planned end on 31 December is to be released until then. That will give participating operators two months to prepare for whatever approach ministers take from 1 January 2025.
Modelling by the Department for Transport on upping the cap to £2.50 or £3 is underway, with operators having been asked to submit data to support that work.
In September, the Confederation of Passenger Transport (CPT) told members that it was supporting data supply and analysis to “make the strongest possible case for continuing the scheme at £2.50 initially.” CPT previously published various options for the future of the bus fare cap mechanism.
What happens beyond 31 December is an increasing quandary for the bus industry in England, with several calls already made for clarity to permit plans to be made for the period beyond that date.
While some businesses have credited the fare cap for contributing to patronage growth, others have questioned the long-term commercial health of the sector if it is constantly reliant on a high degree of public subsidy.
One senior figure has expressed a desire to move away from that position and back towards a largely commercial position, noting that decisions on capital expenditure projects such as fleet investment are difficult to make against a lack of long-term clarity.
Earlier in 2024, then-Managing Director of Safeguard Coaches Andrew Halliday observed that when fares are reduced, it is “exceptionally difficult” for them to be lifted afterwards, with such a challenge magnified by the duration of the cap.
Previous experience of that brought about by a ‘bus war’ saw Safeguard need several years to regain a commercial fare level. It has not participated in the £2 bus fare cap as a result.
