The financial sustainability of several key London bus routes is at risk due to rising operational costs, according to Go-Ahead London’s managing director, Andy Edwards. National Insurance increases and inflation have compounded the challenges facing the capital’s bus operators, leading to questions about the viability of specific routes.
Operating Costs Soar Amid Financial Strain
Go-Ahead London, which operates a significant portion of the city’s bus services, is facing mounting pressure on its finances. A combination of National Insurance hikes, rising diesel and electricity prices, and increased staff wages has left some routes struggling to break even. Edwards explained that the company is losing money on several routes it runs on behalf of Transport for London (TfL), which could lead to potential cuts if the financial model doesn’t change.
The rate of National Insurance for employers increased from 13.8% to 15% in April 2025, as part of the government’s broader fiscal policy adjustments. Meanwhile, inflation reached 3.4% in December 2025, a rise not seen since the summer. These factors have placed immense strain on transport companies like Go-Ahead, particularly with routes that operate on contracts set years ago when such cost pressures were not as prevalent.
Edwards highlighted that some of these routes are now “unsustainable” under the existing contract terms. As a result, Go-Ahead is unable to maintain services without incurring losses, which could affect the broader business. However, both Go-Ahead and TfL have reassured passengers that none of the affected routes—80, 93, 151, 154, 155, 163, 164, and 470—are in immediate danger of closure.
Bus Routes Face Review and Re-Tendering
All eight affected routes are set to be re-tendered by TfL as part of its usual process of renewing contracts for the city’s bus services every five to seven years. These routes were originally won by London General, a Go-Ahead subsidiary, in 2022. Go-Ahead intends to bid again to continue operating these services, but Edwards expressed hopes for more favorable contract terms in light of the current cost pressures.
Currently, TfL pays Go-Ahead about £26 million annually to operate six of these routes, with the 155 and 470 generating £4.8 million and £830,000 respectively. Despite this, the financial viability of these routes is being compromised due to the additional costs that were not accounted for when the contracts were first awarded.
Compounding these financial challenges, bus operators have raised concerns about the increasing congestion on London’s roads, which delays services and discourages passengers. Recent data revealed that the average speed of the eight affected routes was under 12mph in December, with the 155 route averaging just 8.1mph. These delays also impact the performance bonuses that bus companies can earn from TfL, which are based on the amount of mileage achieved.
In response to these ongoing issues, Go-Ahead reiterated its commitment to maintaining service quality and customer satisfaction. A company statement assured that there are no job losses at risk, as staff are protected under the TUPE regulations during the contract bidding process. TfL also continues to work on improving the network, including developing software to better manage traffic incidents and investing in better bus priority measures.
The overall decline in bus journeys in London has been noted, with 1.84 billion trips taken in 2024/25, a 1.5% decrease from the previous year. The broader context of these challenges includes a wider shift in the capital’s transport policies and an evolving landscape for public transport providers struggling with rising costs and changing traffic conditions.
