LONDON, July 22 (Reuters) - Britain's new prime minister, Andy Burnham, said on Wednesday he would cut the price of single bus tickets by up to a third as part of early measures to try to ease cost-of-living pressures.
Burnham wants to move quickly to show people he can improve their lives, after becoming Britain's seventh prime minister in 10 years in an unprecedented bout of political instability whileliving standards flatlined.
On Monday, he said his government would remove a tax from domestic electricity bills from October 1 to save around £45 a year, and the move to cap bus fares at £2 from a previous £3 will come into force in January.
EARLY SHOW OF GOVERNMENT'S INTENT
While the sums may be small, the announcements on the first two days of Burnham's tenure are designed to show his intent to give people what he calls more "breathing space" in life.
But the government faces financial constraintsin making bigger moves, leading to speculation that Burnham might increase either taxes or borrowing at a fiscal event later in the year.
Asked if he was planning to increase taxes, Burnham said, "we'll take decisions on tax at the budget," adding his initial moves were about reprioritising where possible to focus on issues like the cost of living.
"I've made a number of moves that will deal with some of these challenges, although I appreciate there's a lot more to do," he told reporters.
Burnham, a 56-year-old former Greater Manchester mayor, said that among the tax issues he was looking at was the tax-free personal allowance, which has been frozen since 2021 and has dragged more people into paying tax as earnings increase.
Any change could cost billions and markets are closely watching how Burnham, who has vowed to stick to fiscal discipline, would fund any support.
"We'll have to look at it at the budget alongside everything else," Burnham said, adding there was "no commitment (and) no unfunded promise," at this stage to increase the allowance.
The government said the bus price cap would cost more than £500 million, with £100 million coming from the existing transport budget and £400 million from the Energy Security and Net Zero Department, by switching grants for international climate projects to loans.
The fare cap will apply outside London, which has a separate regulated fare system.
(Reporting by Kate Holton, Muvija M and Alistair Smout, editing by Andrei Khalip and Andrew Heavens)
