TfL in crisis as London transport given emergency funding for just 2 more weeks from government

Transport for London (TfL) has been handed another desperate two-week funding extension from ministers, as Mayor Sadiq Khan battles to secure long-term funding for the transport network. The last short-term bailout came just three weeks ago, after ministers refused to grant the transport network a three-year funding deal for upgrades.

Sadiq Khan has repeatedly warned that unless the capital secured long-term funding, TfL will head into “managed decline” with the equivalent of one Tube line and 100 bus routes at risk of closure due to failing infrastructure. In a statement on Wednesday (July 13), the Mayor of London, Sadiq Khan, said he was growing “increasingly concerned” about the impact of the lack of funding certainty: “This short extension [until July 28] is only necessary because the Government has still not put forward any proposals for discussion on the long-term funding London needs.”

The Mayor, who chairs TfL, added: “This is a £10bn transport authority that is crucial to supporting jobs and economic growth. Without a long term funding deal, TfL will have to prepare to make further painful cuts to London’s transport network – its ‘managed decline’ scenario. The devastating impact of the pandemic is the only reason TfL needs financial support. It is now imperative that the Government urgently works with me to agree a fair, long-term funding deal that will protect London’s transport network – not just for the sake of the capital, but the whole country.”

TfL’s funding collapsed during the pandemic, and the transport authority has been chasing government bailouts ever since, with around £5bn already secured from ministers. The bailouts have come with strings attached, including four per cent cuts to bus services, a review of pensions and savings of up to £1bn per year.

Negotiations between City Hall and ministers in central government over the future funding model of Transport for London (TfL) collapsed last month, with Sadiq Khan accusing the Transport Secretary of failing to meet him. But in a letter from Transport Secretary Grant Shapps to Mayor Sadiq Khan, Mr Shapps said “a reset of the relationship” was required before he will give TfL any capital funding, which it has asked for over the course of half a dozen bailout rounds since the pandemic began. The letter provoked a firm response from Mr Khan who suggested in a tweet that Shapps should “tell the truth”, and meet him directly.

The current extension allows TfL to continue operating on a day-to-day basis, but without capital funding it will not be able to start any projects to future-proof the network in the long-term, such as the Piccadilly line signalling upgrade, new trains for the Bakerloo line or extending the DLR to Thamesmead. There are also concerns that bridges and roads would go unrepaired and moves towards net zero carbon emissions on the transport network would be pushed back.

A Transport for London (TfL) spokesperson said: “We continue to discuss our funding requirements with the Government. There is no UK recovery from the pandemic without a London recovery and there is no London recovery without a properly funded transport network in the capital. It is essential London receives the sustained long-term Government funding that is vital for the coming years if a period of ‘managed decline’ of London’s transport network is to be avoided.

“We have today (13 July) agreed with the Government that our existing funding agreement will be extended until 28 July 2022 so these discussions can be continued. Whilst in receipt of Government support, we have worked hard to progress all conditions placed on TfL, and continue to maintain that we have met them all. Working together, we must achieve a longer term capital funding settlement that ensures London’s transport network can remain reliable and efficient, can support the jobs and new homes that rely upon it and can support the economic recovery of the capital and the country as a whole. We hope these discussions can be concluded successfully soon.”

A Department for Transport spokesman said: “For over two years, we’ve shown our unwavering support to London and its transport network, providing over £5 billion to keep vital transport services running and pledging over a billion pounds per year through business rates retention at the most recent spending review – all at a time of significant pressure on the national finances.

“With the cost of living rising across the country and the Tube nearing pre-pandemic passenger levels, it’s more important than ever that we agree a settlement which represents value for money for all taxpayers while delivering for London. Despite already granting one extension, TfL have been unable to provide information sufficiently demonstrating that conditions outlined in the current settlement are on track and reassure the Government that any long-term settlement will be in the interest of all UK taxpayers – we have agreed to another extension of 15 days.”

The London Assembly recently voted in support of the Mayor’s position to ask the government to provide a long-term funding deal for TfL.


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