Preston operator unsure over bus cap plans

Preston Bus says it does yet know whether it will take part in the £2 fare cap reintroduced by Andy Burnham.

The new Prime Minister made reinstating the limit – from the new year – one of his first policies on entering Downing Street last week.

However, despite the seeming implications of its name, the cap is voluntary and operators are not obliged to adhere to it – but they are supposed to have their costs reimbursed if they do.

The England-wide cap currently stands at £3, having risen in January 2025 under Sir Keir Starmer’s premiership. It had originally been set at £2 when first introduced during Rishi Sunak’s reign two years earlier.

But Preston Bus withdrew from the scheme at the start of this year, claiming that “the level of reimbursement on offer from the Department for Transport” (DfT) did not match the real-world cost of delivering the cap – and had left it operating at a loss.

The move meant that the company’s standard one-way adult fares increased to £3.50.

Asked whether it planned to re-enter the scheme when the £2 cap returns next January, a spokesperson for Preston Bus told the Local Democracy Reporting Service (LDRS) it was too early to say.

“Preston Bus welcomes the Prime Minister’s announcement to cap bus fares at £2 from January 2027 and we recognise the impact that it would have on supporting [the] cost of living.

“At the moment, no further details have been shared with Preston Bus so we are unable to confirm whether Preston Bus services will participate or not.

“It is important that these schemes are fully funded. Once reimbursement information is received from government, we will be able to confirm,” the spokesperson added.

The company came in for criticism from several Preston city councillors when it dropped the £3 cap back in January – not least because Stagecoach services in the city remained within it.

However, Preston Bus said between the national funding on offer for the cap and local reimbursement levels for concessionary fares, it was more £100k a year out of pocket.

In February, the DfT said in response to Preston Bus concerns about the national cap: “It’s up to bus operators if they want to participate…but we’re providing over £150m a year for the scheme so bus fares can stay low, helping passengers get from A to B.”

The LDRS understands the methodology for calculating reimbursement of the costs associated with the nationwide cap is based on historical and current data, designed to predict each operator’s ticket sales and identify the funding shortfall that they will experience as a result of taking part in the scheme. Operators are also compensated in advance of each period of the programme.

In April, Preston Bus also withdrew from the Lancashire Combined County Authority scheme offering £1 bus travel after 7pm Monday to Saturday and all day Sundays and bank holidays – again citing issues with the level of reimbursement it received.

The company advises passengers to use the ‘tap and go’ option for paying on board its buses with a contactless debit card, which will ensure the “best value fare” is charged for each journey.

While he was mayor of Greater Manchester, Andy Burnham held the bus fare cap at £2 in the city region even after it increased to £3 nationally.