From today, up to a million people on income support will be eligible for half fares on London’s buses under Ken Livingstone’s oil deal with Hugo Chávez, Venezuela’s president.

Single parents, carers, the long-term sick and disabled people will benefit from the plan, first mooted during Mr Chávez’s visit to the UK last year, paying 50p for a single journey.

In exchange for a 20% oil discount to fuel London buses, an office will be set up in Caracas, Venezuela’s capital, where London officials will offer expertise in town planning, tourism, public transport and environmental protection.

Mr Livingstone, London’s mayor, said London and Venezuela had exchanged “those things in which they are rich to the mutual benefit of both”.

“This will make it cheaper and easier for people to go about their lives and get the most out of London,” he said. “The agreement which makes this possible will also benefit the people of Venezuela, by providing expertise in areas of city management in which London is a world leader.”

Angie Bray, the Conservative leader in the London assembly, said Mr Livingstone should rather have appealed to the Treasury if he needed financial support. “The spectacle of our mayor … going cap in hand to a dictator … is morally indefensible,” she added.