Sir Sadiq Khan has ringfenced £20 million in next year’s budget for ‘fares innovation’ to get Londoners back onto the city’s buses.
Passenger numbers on the capital’s iconic vehicles fell last year for the first time since the pandemic, dropping from 1.869 billion journeys to 1.842 billion, with the London Assembly told that sluggish bus speeds were to blame.
The Mayor of London has now announced that £20 million of extra funding, discovered between the Draft and Final Budgets, will be given to Transport for London (TfL) for “fares innovation” and will aim to boost numbers.
This could include reducing fares for a limited period of time – such as the short-lived trial where all Tube travel on Friday was counted as off-peak – or even making some services free when they first launch.
“We’re a city with a remarkable public transport system which is getting better all the time,” he told the London Assembly Budget and Performance Committee today (Wednesday February 25).
“Ridership and revenues are two things we need to focus on and what we can do to increase both. We recognise we need to try new things – the Hopper Fare was innovation.
“We gave a free first week of travel on the Superloop – that costs money! We have put aside £20 million to see where we can innovate.
“We will be tasking TfL to look into ways we can encourage more people to use, in particular, buses.”
Sir Sadiq said it was particular important in the outer boroughs, where buses are a “lifeline”, but that more Londoners needed to be “incentivised” to ride them once again.
Watchdog London TravelWatch estimates that meeting the Mayor’s aim for 80 per cent of trips to be made by walking, cycling or public transport by 2041 would require bus journeys to rise by 40 per cent.
But average speeds on the capital’s bus network fell to 9.17mph in 2024–25, down from 10.27mph four years earlier, according to City Hall data. Michael Roberts, chief executive of London TravelWatch, told the London Assembly in December that every 10 per cent reduction in speed led to a six per cent fall in demand.
Assembly Member Elly Baker, the Labour group’s transport spokesperson who also sits on the Budget and Performance Committee, told the Local Democracy Reporting Service (LDRS): “I really welcome any innovation – times are tough with the cost of living crisis, and we have to keep public transport affordable wherever we can.
“The news that at least some of the funding is going to be put towards innovation around buses and bus fares is incredibly welcome to me.
“There are more bus journeys taken in London than anywhere else – it’s older people, disabled people, you know, young Londoners, more women, you know, low income Londoners, all the people who don’t have any options.
“Looking at ways that we can use fares innovation to drive up ridership, and make the whole network more sustainable is something I’m really looking forward to hearing more about.
“The statement of intent is really, really important.”
The £20 million investment, announced last week, is part of an extra £142.6 million ‘discovered’ by City Hall officials due to an unexpected surge in business rates and council tax returns.
The Mayor has also announced plans to spend £50 million on his Young Londoners programme, £20 million on implementing the recommendations of the AI Taskforce and £4.5 million on a new crackdown on mobile phone theft on the capital’s streets.
However, Sir Sadiq was unable to go into significant detail on any of the programmes, suggesting there had not been enough time to decide the best “value for money” investments for the extra cash.
“There has been so much uncertainty – we weren’t clear what figures we were working to,” he said.
“At the moment, we haven’t got the detail for the specific allocations of this funding.
“Had we set out details of how would we spend the money, we would have been criticised for having oven-ready plans and hiding the extra money from the Assembly.”
