Transport for London secures £1.8bn bailout to operate over winter

Transport for London secures £1.8 billion bailout to keep it operating over winter as Sadiq Khan claims he succeeded in ‘killing off the very worst Government proposals’

  • Transport for London has secured a £1.8 billion bailout from the Government
  • The agreement enables TfL to continue operating services until March 2021
  • London Mayor Sadiq Khan claimed victory in securing the package for winter

Transport for London has secured a £1.8 billion bailout from the Government to keep it operating over winter as Sadiq Khan claims he succeeded in ‘killing off the very worst Government proposals’. 

The London mayor said the Government had wanted TfL to introduce a series of ‘ill-advised and draconian’ measures in return for the financial package. 

Mr Khan said it is ‘not a perfect deal’ but insisted he ‘fought hard to get to the best possible place’ in rejecting the ‘very worst’ proposals. 

London Mayor Sadiq Khan claimed victory in securing a £1.8 billion bailout for Transport for London and claims he succeeded in ‘killing off the very worst Government proposals’

The capital’s transport body said the agreement will enable it to continue operating services until the end of March 2021.

The exact amount of money involved is subject to passenger revenue in the coming months.

TfL’s finances have taken a severe hit from the collapse in fare revenue during the coronavirus pandemic. 

Some of the Government proposals Mr Khan said the Government had wanted TfL to introduce in return for the financial package included extending the Congestion Charge zone to the North and South Circular roads.

The capital’s transport body said the agreement will enable it to continue operating services until the end of March 2021

They also included scrapping free travel for older and younger Londoners, and raising fares by more than previously agreed. 

‘I am determined that none of this will now happen, Mr Khan said.

‘I am pleased that we have succeeded in killing off the very worst Government proposals.

‘The only reason TfL needs Government support is because almost all our fares income has dried up since March as Londoners have done the right thing.’ 

In a statement, Transport for London said: ‘Discussions on longer-term sustainable funding continue.’

Amendments to the Congestion Charge introduced in June as part of a previous bailout – a 30% increase in the fee and longer operating hours – will remain in place due to the new deal.

TfL’s finances have taken a severe hit from the collapse in fare revenue after passenger numbers collapsed and revenue crumbled as a result of the pandemic (Kahn pictured on the tube in 2016)

London Mayor Sadiq Khan said last month that the Government wanted TfL to extend the charging zone to the North and South Circular roads, covering around four million more Londoners.

Other proposed measures described by Mr Khan as ‘ill-advised and draconian’ included above-inflation public transport fare rises.

Last month Boris Johnson claimed TfL was ‘effectively bankrupted’ before coronavirus, and proposals to hike charges were ‘entirely the responsibility’ of Mr Khan.

Responding to the new agreement, Mr Khan said the negotiations have been ‘an appalling and totally unnecessary distraction at a time when every ounce of attention should have been focused on trying to slow the spread of Covid-19 and protecting jobs’.

He went on: ‘The only reason TfL needs Government support is because almost all our fares income has dried up since March as Londoners have done the right thing.’

Grant Shapps, the transport secretary, wrote to Mr Khan with a series of demands in return for any financial rescue package

Transport Secretary Grant Shapps said: ‘This deal is proof of our commitment to supporting London and the transport network on which it depends.

‘Just as we’ve done for the national rail operators, we’ll make up the fare income which TfL is losing due to Covid.

‘Londoners making essential trips will continue to be able to use Tubes, buses, and other TfL services, thanks to this Government funding.

‘At the same time, the agreement is fair to taxpayers across the country. The mayor has pledged that national taxpayers will not pay for benefits for Londoners that they do not get themselves elsewhere in the country.’

He added discussions will continue over the coming months to achieve a ‘long-term settlement’, which will include London being given ‘more control over key taxes so it can pay more costs of the transport network itself’.

City Hall said current passenger revenue projections mean the bailout is worth around £1.8 billion in grants and borrowing.

TfL will carry out cost savings to make up a remaining £160 million ‘gap’ based on its forecasts.

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