Transport for London is in a race against time to agree its fourth pandemic funding deal with Whitehall amid warnings of a “death spiral” of service cuts and fares hikes, the London Assembly heard today.
The embattled transport authority’s current £1 billion bailout comes to an end on 11 December, with TfL currently squaring up to the government on “arduous” requirements in the deal to increase fares, review service levels on the buses and Underground and find between £500,000 and £1 billion additional annual income from 2023.
A possible 4.8 per cent fares hike under the deal’s retail price index inflation rate plus one per cent formula is “not a done deal”, TfL chief Andy Byford (pictured) told the first Assembly plenary session after the summer break. “There is a tipping point beyond which you should not go, or people will migrate to their cars.”
“It’s no secret that fares is an area where we want the government to show some flexibility,” added Sadiq Khan, confirming too that the controversial proposal for a “boundary charge” on vehicles registered outside London entering the capital remains on his agenda, along with City Hall’s call to retain Vehicle Excise Duty (VED) raised in the city.
“VED raised from vehicle drivers in London is spent maintaining roads, bridges, tunnels in other parts of the country, while maintenance of our roads is subsidised by London’s public transport users,” said the Mayor, signalling a further standoff with Transport Secretary Grant Shapps as funding negotiations get underway.
Shapps confirmed earlier this year that the government would consider “any proposal to transfer Vehicle Excise Duty income from the Exchequer to TfL as, in effect, a permanent government grant,” and therefore ruled out under Whitehall strings attached to the current funding deal.
And a boundary charge, he said in February, would effectively amount to “taxation without representation – people living outside London should not be made to pay for the pursuit of policy choices over which they have no say.”
Khan and Byford also warned that a review of TfL service levels required this month under the current deal was too early to be used for future planning. Tube and bus usage together at around half of pre-pandemic levels, with the impact of schools opening and commuters returning to the city still uncertain.
“I’m not opposed to a review per se. We continually keep service levels under review,” said Byford. “And we are not tone deaf to the fact that work patterns look like they are changing. But it’s easy to get steamrollered into making service cuts prematurely. I’m determined to resist that. If you are not careful you get into a bit of death spiral.”
The city cannot afford a “car-led recovery,” Khan warned. “It’s vital that a long-term, sustainable and fairer funding model is agreed. London can’t recover if there are less buses and less Tubes, and the UK can’t recover unless London does.”
The meeting also heard that the Crossrail Elizabeth Line remains on course to open in the first half of next year, with Byford, who took over the project a year ago, pledging to “arrest the slippage” with a “very directive approach”, telling AMs: “I have a check-in call every day, including weekends and Bank Holidays.”
Khan also rejected a call from Green party AM Sian Berry to take up a “last chance” to pause his Silvertown road tunnel scheme before tunnelling begins. The scheme had been subject to “10 separate consultations” and contracts had been signed, he said.
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