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2 November 2024

Has Rachel Reeves missed the bus?

Lifting the fare cap was better politics than it was policy.

By Jonn Elledge

The thing about buses, right, is that they’re not very sexy. Agatha Christie did not write murder mysteries set on one; Brief Encounter did not begin at a bus station. Even transport nerds prefer trains, because they look cooler, and because they often come with good maps. Throw in the fact that people who work in London are vastly more likely to commute by train than people anywhere else, and our political class has often seemed strangely oblivious to what remains the UK’s most used form of public transport.

In much of the country, buses are not merely the main, but the only form of public transport available. Yet the deep cuts to local services that came with austerity have gone largely unremarked. Such bus policies as did make it to the media’s consciousness often seemed, without mentioning any Thomas Heatherwick-designed monstrosities in particular, aimed more at those who saw buses as attractive set dressing than at anyone who might actually use them. All of which, I think, goes some way to explain the reaction to the government’s decision this week to raise the bus fare cap, from £2 to £3, at the start of next year. You can deregulate the network; you can cut services; you can leave entire communities dependent on one bus a day that goes to the nearest town and then immediately turns around and comes back. But woe betide anyone who changes something people have actually noticed.

The £2 fare cap was introduced by the last – Tory! – government at the start of 2023, partly to ease the cost of living crisis, and partly, too, to encourage public transport use. Because the cap applied to all bus journeys, no matter the distance, it inspired a lot of journeys that wouldn’t have been taken otherwise, and a lot of “and finally” style news reports about day trippers. In February 2023, the BBC reported on a man who spent a day travelling from his home in Derby to the Yorkshire seaside town of Whitby, 137 miles away. It cost him just £10. The scheme has worked well enough to be extended, but was never intended to be permanent. The cost of operating buses increased at this week’s Budget, too, thanks to the increase in employers’ National Insurance contributions. So the Confederation of Passenger Transport, which represents operators, has welcomed the “managed exit” from the scheme, raising the fare cap to bring in more revenues while avoiding the disruption to both wallets and bus companies that would come from scrapping it altogether.

That, however, is about it for the positive reviews, because everybody else is furious. The Guardian reported the story with the line, “Rachel Reeves prepares to raid transport funding.” The Lib Dems called it a “bus tax”. A Greenpeace spokesman said the policy “makes no political, economical or environmental sense whatsoever”, while the New Economics Foundation noted that keeping the cap would have cost just £300m – hardly pocket change, but around one-tenth of the money the Chancellor had decided to spend keeping the fuel duty freeze in place. Sure, there are more drivers than there are bus passengers. But there’s also a planet to save.

You’re not really meant to admit this in an opinion column, but: I’ve been pondering this all week, and I can’t work out what I think. On the one hand we should be encouraging people to use public transport, and subsidising buses is exactly the sort of thing the government should do. Any increase in fares will likely cut the number of journeys; it might also take money out of the pockets of poorer people, who are the most likely to spend it in the real economy. (The cost-of-living crisis has not, that I’ve noticed, abated.) At first glance, this looks like a bad move.

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On the other hand, the reason those long-distance journeys got so much press coverage is because that’s where the biggest cuts were, from fares that were previously £10 or even £15. Those who actually commute by bus are more likely to have season tickets, which aren’t covered by the cap, and to travel on routes that are priced below £2 anyway. Is it really the most progressive use of scarce public funding to subsidise long-distance day trippers? Worse, when the Treasury is left to fund public transport, it rarely plans for growth: its priorities tend to be keeping passenger numbers down to keep a lid on subsidies. (Witness the cut in frequency of some rail services since franchising came to an end.) If you really want to get people out of their cars, you need to grow the network – which means either pumping in a lot more money than the government is currently minded to do, or allowing operators to find new routes people are willing to pay for. Keeping the fare cap might also mean preserving the current network in aspic. The suggestion that the fuel freeze is in opposition to bus subsidies is also a red herring: buses, too, use petrol.

It feels at least possible that the bus fare cap was better politics than it was policy – another move intended mainly to impress those who never use buses anyway. But it rankles, all the same. There will be a small number of people whose finances will be genuinely hit by this. And they are not, as the government promised, those with the “broadest shoulders”.

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