Government Expects London Tube and Bus Fare Increase

The government anticipates that London’s mayor will increase Tube and Bus fares by approximately five percent, mirroring the rail fare announcement made in the recent Budget. Transport Secretary Louise Haigh’s letter to the Mayor of London, sent after the Budget, suggests that future investment in London’s transport system over the coming years may be contingent on Sadiq Khan’s decision regarding a potential fare freeze. The letter stated that fare increases would be considered the “baseline” for discussions concerning future funding. City Hall indicated that a determination regarding next year’s fares had not yet been reached. The Budget, presented on Wednesday, included an announcement that regulated rail fares are set to increase by 4.6% next year, which is one percent higher than inflation. Within her letter, Ms Haigh conveyed the government’s expectation for the mayor “to consider the full range of revenue raising powers at your disposal as part of TfL’s business planning”. She further stated that an evaluation of TfL’s funding requirements “will be conducted against a baseline scenario where TfL rail fares rise in line with national rail fares.” Mr. Khan has implemented a freeze on TfL fares for five of the past eight years, though this did not encompass travel cards and pay-as-you-go Oyster caps. To offset the revenue loss resulting from a fare freeze, the mayor redirected funds from City Hall to Transport for London. This development follows Mr. Khan’s decision to halve, relative to the previous year, the minimum funding request he submitted to the government for significant transport initiatives. A spokesperson for the Mayor commented: “Once a final decision on the 2025 fares package has been made, this will be published as per usual”. The Department for Transport has been approached for a statement.