Bus fare cap expected to cost over £500mpublished at 06:33 BST
As with yesterday’s announcement on cutting VAT from domestic electricity bills, the government has similarly said this measure will be paid for through a reallocation of funds.
In this case, the government has said £454 million will be reallocated from the Department for Energy Security and Net Zero – £400m of which will come from switching investment set aside for international climate finance to loans and the remaining £54m from savings in the department’s budget.
This will be used in addition to funds already earmarked by the Department for Transport for buses.
The total cost of the scheme is expected to be over £500m.
Chancellor John Healey says: “This action to ease the cost of living is funded by savings made elsewhere, so there’s no burden to British taxpayers, just pounds going back into their pockets.”
