Thousands of cleaners, catering and security staff will be given free travel on London’s transport network.
Mayor Sadiq Khan announced the cost-of-living boost to 5,000 low-wage workers who supply Transport for London.
Staff who work directly for TfL already get free travel on buses and Tubes, saving up to £2,800 a year.
But until now third-party workers that supply the transport body did not get the same perk. This will now change “by April 2023”.
Mr Khan said: "London’s transport workers, who did so much for us during the pandemic, continue to play an essential and much-valued role in keeping our city’s transport network safe and operating.
“I’m deeply concerned about the fact the spiralling cost of living is hitting those on lower incomes the hardest."
The policy is estimated to cost £10million in foregone fares, which will be funded out of Mr Khan's City Hall budget.
Mr Khan has also asked TfL "to look into whether sick-pay standards for the lowest paid workers could be improved in future".
London's transport network will receive another £1.2billion from the government until March 2024 after passengers fell post-Covid.
RMT general secretary Mick Lynch said: “We warmly welcome this news, which is a victory for our campaigning and a big step forward in our campaign to win justice for London’s tube cleaners.
“For years, we’ve been pointing to the rank injustices in the way these heroic cleaners are treated and we’ve fought to get them a better deal.
“What Sadiq Khan has done here is exactly what a Labour Mayor should do and we’ll be redoubling our efforts now to make sure we finally put an end to the scourge of outsourced Tube cleaning and get cleaners brought in-house in April.”
It comes after Chancellor Kwasi Kwarteng was accused of offering little for the poorest, but a £10,000-a-year tax cut for Britain's 660,000 top earners in Friday's budget.
Keir Starmer has vowed to bring back the 45p top tax rate if he wins power - but not reverse the Tories' separate 1p cut in Income Tax.
Greater Manchester mayor Andy Burnham urged the Labour leader to reverse the 1p cut in Income Tax too.
He told Sky News: "I don't think it is the most targeted way of using the resources that we’ve got at this moment in time.
"I don't think it's a time for tax cuts. I think this is a time to support people through a crisis."
