As expected, the Chancellor took a little sting out of the planned New Year train fare rise by reducing the increase by 2% today.
Before today's announcement, regulated fares, which include season tickets, had been due to rise by an average of 8% in January 2012 - 3% above the RPI inflation figure.
But Mr Osborne said an RPI plus 3% rise, introduced by this Government, was "too much" and that the increase would be limited to RPI plus 1%.
This will mean that the average rise in January will be 6% and that will also be the figure for the Tube and for London buses.
Mr Osborne said the reduction, which will be funded by the Government, would "help the millions of people who use the trains".
He said fares were already expensive and had been set to go up well above the inflation rate to pay for the much-needed investment in new rail projects and new trains.
Manuel Cortes, leader of the TSSA rail union, said: "We always welcome the sinner that repents but in George Osborne's case he plans to go right back to sinning against rail passengers for the next three years from 2013 with big inflation-plus increases.
"Our gut feeling is that he is really more interested in helping Boris (Johnson) beat Ken (Livingstone) for London Mayor next May rather than helping ordinary families, hence his curbing the big increases for one year only."