Issued by: Department for Transport

Funding will keep fares down, protect local routes and deliver more reliable services.

• new funding will support, improve and protect crucial bus services across the country

• part of more than £1 billion to support buses while keeping fares low

• government action to end the bus postcode lottery, empower councils to take back control of services, and deliver a bus revolution

This government is delivering fair funding to ensure better services up and down the country, with £955 million earmarked to support bus services until 2026.

Marking a further step in the government’s mission to deliver growth across the UK, Transport Secretary, Louise Haigh has confirmed £712 million funding for local authorities to improve bus services, and a further £243 million for bus operators – a longstanding grant paid to keep fares lower and services more frequent than they would otherwise be.

Every region in England will benefit from the funding – but particularly those areas which have been historically underserved, like rural areas and small towns.

The funding settlement will mean many more urban areas will be able to maintain their high levels of service – while other areas will be able to offer more services.

Totalling £955 million, the funding represents a record level of recent investment for bus improvements for the majority of areas, alongside once-in-a-generation reform to deliver London-style bus services to every corner of the country.

Areas receiving an unprecedented amount of funding for bus services include Leicester, the Isle of Wight, Torbay, and Cambridgeshire and Peterborough.

The investment has been designated to enhance popular routes, protect rural services and increase bus use for shopping, socialising and commuting. It will prevent service reductions on at-risk routes and improve punctuality across England, to bring an end to the current postcode lottery of unreliable services.

In recent years, services have consistently suffered from complicated and inconsistent funding which have ultimately impacted the passenger. Today’s reformed funding settlement marks a departure from that approach with a simplified commitment from the government, giving bus providers the certainty they have long been calling for.

As part of this investment, the way funding is allocated has been reformed, meaning it will be allocated based on place need, levels of deprivation and population. This will stop areas competing for funding as in previous years, which in turn wastes resources and delays decisions.

Transport Secretary Louise Haigh said:

"Buses are the lifeblood of communities, but the system is broken. Too often, passengers are left waiting hours for buses that don’t turn up – and some have been cut off altogether.

"That’s why we’re reforming funding to deliver better buses across the country and end the postcode lottery of bus services.

“And it’s why we’re providing over £1bn of funding to keep fares down, protect local routes and deliver more reliable services.

“This is part of our wider plan to put passengers first and give every community the power to take back control of their bus services through franchising or public ownership.

By delivering better buses, we’ll ensure people have proper access to jobs and opportunities – powering economic growth in every corner of the country.”

This £955 million investment will also ensure that lifeline services between towns and hospitals can continue transporting patients to vital appointments, supporting the government’s ambitions to reform the NHS (https://www.gov.uk/government/speeches/our-ambition-to-reform-the-nhs).

Across the country, local authorities can use funding to support community events, take the strain off commuters, or boost tourism. The government wants this investment to encourage social mobility by supporting those who need them most. In urban areas, some of the biggest allocations are given to combined authorities representing South Yorkshire (£17 million) and Liverpool City Region (nearly £21 million), while councils covering rural areas have also been allocated large allocations to protect lifeline routes. These include Lancashire (£27 million), Kent (£23 million), Essex (£17 million) and Norfolk (£15 million) county councils.

See more information about the funding allocations here: (https://www.gov.uk/government/publications/bus-service-improvement-plans-local-transport-authority-allocations)

Buses remain the most relied on form of public transport and the government is turning the tide on decades of failed deregulation. The Buses Bill will be introduced in the coming weeks and will give local leaders across England greater control to deliver bus services in a way that suits the needs of their communities. Local authorities will be empowered to deliver modern and integrated bus networks that put passengers at the heart of local decision making.

Alongside the £955 million, £150 million has already been committed to step in and cap fares at a maximum of £3, with an inflationary limit also set to ensure that other fares are not automatically increased to £3. The cap is designed to help people with the cost of living and everyday travel costs and will now run until 31 December 2025, enabling savings of up to 80% on some routes.

This is on top of the additional £200 million City Region Sustainable Transport Settlements funding announced in the autumn budget (https://www.gov.uk/government/publications/autumn-budget-2024), helping to improve local transport in our largest city regions and drive growth and productivity across the country.

This government is fixing the foundations and delivering change with investment and reform to deliver growth, with more jobs and more money in people’s pockets, and rebuild Britain.

Alison Edwards, Director of Policy and External Relations at the Confederation of Passenger Transport said:

"Buses are vital to economic growth – they carry ten million passengers a day. This funding is a valuable investment in journeys that help people to earn, learn and spend in local communities.

"It is encouraging to see that the funding will be shared across every English region. Bus operators look forward to working with local authorities on plans to speed up services, improve co-ordination and enhance frequencies.

"Bus passengers deserve a fair funding deal. Every pound of public money invested in buses delivers a return of more than £4 in benefits to the environment, to public health and to communities."

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