The Chancellor announced in her Spring Spending Review yesterday that the government funding for the maximum single bus fare of £3 is being extended until at least March 2027.
On the surface, this is good news. However, there are caveats. The bus companies have complained ever since the introduction of the fare cap scheme in 2023 that the monies from government have not been sufficient to cover their loss of revenue from the reduction in fares charged to the passenger; and I am fairly sure that they are right. The government has simply estimated what they thought was a reasonable sum and presented it to bus companies as a fait accompli. The bus companies have been faced with little choice but to accept.
However, because the bus companies have probably been losing money on the scheme, they have had to squeeze what they can from passenger revenue by increasing fares on shorter journeys. For example, in Cornwall, the minimum adult single fare is now £2.50 and this applies to only very short journeys. It means that the £3 “maximum” fare is the de facto fare for virtually all journeys. Return fares that used to be one-and-half times a single fare are now twice the single fare. Child fares that used to be half the adult fare are now, at best 20% cheaper than an adult fare on short hops, and the same as adult fares on longer journeys because of the £3 cap. See more details on fare rises.
Overall, the government support for exending the fare cap is just about a good thing, but because the total amount of money that the government is committing to it is essentially a pittance, it is not going to stop a continuing decline in bus mileage and passenger numbers. Meanwhile, the government continues to pander to the motoring lobby by continuing the freeze on fuel duty.
The Bus Users UK website has welcomed the government announcement but they do emphasise the need for long term support for buses.