Brilliant news.

I think it would be a shame if the allowance was cut to £500. I agree that you can but a perfectly good bike for that sort of money, but the allowance of £1000 gives many more cyclists the option to buy the bike they really want (mine was certainly more than £500) thereby extending its use beyond simply commuting.

It's also worth bearing in mind that the allowance also includes the cost of safety equipment and accessories (helmet, lights, pump etc) which can add up.