Secretary of State for Transport (): The
Government and the Mayor of London have agreed a second
extraordinary
funding and financing package for Transport for London
(TfL)for the
period to 31 March 2021. It replaces the agreement signed
in May. It will ensure the continued operation of public
transport services in London and is proof of our commitment
to supporting the capital and the transport network on
which it depends.
As with the national rail network, the government will make
up the revenue which TfL has lost due to the COVID
pandemic over the period. The new package comprises a
central funding scenario of £1 billion – made up of £905
million grant funding and £95 million borrowing – with
flexibility for changing the grant payment in response to
changing passenger demand.
Actual payments are likely to be greater than £1 billion
because of the move to national COVID restrictions.
TfL continues to
need substantial support due to the significant fall in
revenue caused by COVID-19. However, choices made in the
preceding 4 years have made TfL less resilient to the
impacts of the pandemic and this is why it’s of vital
importance that the Mayor brings forward plans to
re-establish a trajectory to financial sustainability as
soon as possible.
As well as the conditions in the package agreed in May, the
new agreement, therefore, sets out further measures to put
TfL on a
sustainable financial footing as soon as possible.
Over the next 6 months, the Mayor will impose fare rises of
Retail Price Index (RPI) plus 1 per cent on all
modes from January 2021, maintain the central London
congestion charge at the hours and level to which it was
increased in June, maintain the withdrawal of 60-65 Pass and
66+ Freedom
Passconcessions in the morning peak, and make a further
£160 million in-year savings, additional to those already
planned, with the exception of active travel, which will
remain as in the first half of the year.
TfL will
co-operate with a government-led review of driverless
trains. The 2 government special representatives will
continue to attend TfL board and panel meetings.
A new government-led working-level oversight group will be
created. By 11 January 2021, TfL will produce a single,
comprehensive management plan with options as to how a
trajectory to financial sustainability by 2023 can be
achieved. Any grant from government to support London must
be fair for UK taxpayers.
If the Mayor wishes Londoners to continue to benefit from
travel concessions and/or other benefits above those
typically available elsewhere in England, he and
TfL have
recognised that the costs of these additional benefits will
not be met by the government and that they will meet these
costs themselves, without recourse to additional borrowing,
savings, service changes or deferrals.
TfL and the Mayor
have proposed that this could be done by an increased
council tax precept from April 2021. They will submit their
proposals by 11 January 2021, alongside the fiscal
sustainability plan. The government will take all steps
necessary at the appropriate times to enable this proposal.
Extending the congestion charging zone to inner London has
been ruled out by both the government and the Mayor.
National travel concessions including free travel to school
for those who qualify under the 1996 Education
Act will continue to be funded by the government. The
Freedom Pass for pensioners and the disabled will continue
as now. It’s not funded by TfL or the Mayor.
You can read the full agreement on the GOV.UK website.
