The government says the policy will "help with the cost of living and give people the breathing space they need"

The bus fare cap in England will revert to £2 from January, new prime minister Andy Burnham has announced. The government says the policy, which is expected to cost more than £500m, will "help with the cost of living and give people the breathing space they need". In January 2025, the England-wide bus fare cap rose to £3 under Sir Keir Starmer's Labour government, although Liverpool and Manchester are examples of city regions where fares have been held at £2. Burnham said affordable transport links were an essential, adding: "Lower fares will help people get to where they need to." Transport secretary Heidi Alexander told the BBC's Today programme the measure gives people "a little bit of hope" in a time when many are grappling with higher living costs - especially after fuel costs spiked as a result of the US-Iran war. The new cap will take effect from 1 January 2027 for fares on participating buses outside of London. The Burnham government said going back to a £2 cap should particularly help passengers in rural and coastal areas, where single fares can be higher. The previous Conservative government capped single bus fares in England at £2 in January 2023. The scheme was initially only due to last three months but was extended.