FARES on London buses and Tube trains will increase again next year.

However, the price hike will be restricted to cash journeys.

Holders of pre-pay Oyster cards will see the cost of their journeys fall.

In a move designed to encourage more people to use Oyster cards, a one-way Tube journey in zone one will cost £3 instead of £2, while a single bus journey will rise from £1.20 to £1.50.

With an Oyster card, a zone one Tube ride will fall from £1.70 to £1.50 - half the cash fare. Mr Livingstone said the aim was for fewer people to pay with cash.

In January this year the basic fare for bus journeys in London rose from £1 to £1.20. The cost of Tube and train travel in the capital also increased.

At his weekly press conference in City Hall, Mr Livingstone said: "This proposed fares package focuses on halving the number of cash journeys made in 2006 to speed up journeys and improve the efficiency of the network.

"The simple message is that you don't have to pay the new cash fares - switch to Oyster and pay as you go and you will save money as well as time."

Critics, however, were quick to round on Mr Livingstone after the latest price increase.

Roger Evans, chair of the London Assembly Transport Committee, said: "This fare increase proves the Mayor is unclear about his transport policy for London.

"How can he expect people to leave their cars at home when bus and Tube tickets are spiralling out of control?

"Ken Livingstone obviously has not added up his sums correctly. He needs to boost his coffers through the already fed up and frustrated commuter.

"London has the most expensive transport system in the world. If the Mayor wants people to use public transport the whole network must be both efficient and affordable."

Liberal Democrat London Assembly Transport spokesperson, Geoff Pope said: "Londoners will rightly to feel betrayed by Mr Livingstone going back on his word not to increase fares in real terms.

"With gas, electricity and water bills having already risen massively this year, any fare rises above inflation will come as a deeply bitter blow to Londoners.

"The failure to tackle the transport funding black hole shows that leaving the Mayor to manage a budget is like leaving a goat to tend the cabbages.

"The failure in his accounting has led to commuters facing what is in effect a stealth tax on their earnings.

"Unfortunately Londoners are now reaping what the Mayor has sown.

"Over the last five years his, I spend now, you pay later', attitude to getting his pet projects off the ground has left a legacy of debt the less well off in the capital will struggle to afford."