Sadiq Khan has accepted an offer from a Conservative London Assembly Member to join forces to lobby the government to allow Transport for London to retain car tax raised in the capital for its own use.
The idea was put to the Labour Mayor during his monthly Mayor’s Question Time session this morning by Keith Prince, who speaks for the Assembly’s Tory group on transport issues.
Prince made his proposition in the context of Transport for London’s latest round of negotiations with the government about its future funding arrangements, which has involved TfL suggesting retaining the Vehicle Excise Duty (VED) raised from car-owners in London as one way of helping to make its finances secure by 2023-24.
Keeping VED levied in the capital rather than almost all of it being spent in other parts of the country, as is presently the case, is one of two options for bringing in an additional £500 million a year put forward by TfL in its Financial Sustainability Plan, submitted to the government 10 days ago as required under the current emergency funding agreement.
The alternative option from TfL is a Greater London Boundary Charge, a new form of road-pricing which would see the owners of most motor vehicles registered outside the capital pay £3.50 a day when they enter Greater London.
Prince, who represents the Havering & Redbridge Assembly seat, which has a long border with Essex, opposes the Boundary Charge idea and said today that what he called “the border tax” would be “devastating for my patch”. His fear is that it would hurt businesses in his constituency’s town centres by deterring people from outside London driving in to visit them.
Khan, who had earlier in the meeting expressed his own preference for retaining VED, praised Prince’s suggestion as “a really good example of joint working on a cross-party basis” and expressed his hope that he would speak with other members of his group to make a joint letter to transport secretary Grant Shapps happen and that leaders of other Assembly party groups would also be signatories
Later in the meeting, the Mayor underlined that TfL’s finances have been “decimated” by the huge drop in revenue from fares due to passengers avoiding public transport during the Covid-19 pandemic. He described the Financial Sustainability Plan as “the starting point for discussions with government” before the latest bailout period expires in March.
Responding to questions from Labour AM Alison Moore, the Mayor again thanked Prince for his cross-party initiative and upbraided the government for continuing to refuse to release a KPMG review of TfL’s finances it commissioned with taxpayers funds last year, describing it as “locked in a safe somewhere”.
Asked by Moore how difficult it is to negotiate with a government which is guided by a document that neither he nor TfL commissioner Andy Byford have been allowed to see in full, Khan called the situation “unheard of” and described a version of the KPMG review he has been permitted to see as having “large chunks blanked out redacted”. He said this “beggars belief” and that he would soon be highlighting the issue as a way of “letting Londoners know what sort of government we have”.
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