9% rail cuts warning after latest TfL funding extension
TRANSPORT for London needs £927 million funding to survive 2022-23, according to its latest financial reports, with this money expected to come from central government. Even with this sum, TfL is warning of 9% cuts to London’s rail and Underground networks (and 18% cuts on its bus services), as well as cuts to renewals which will lead to declining reliability and a halt to new upgrade projects. TfL and the Department for Transport are locked in discussions about TfL’s funding, with the latest deal having expired on August 3 following a 5½-day extension from July 28. TfL had asked for two weeks in order to properly consider the latest government offer, which it said it received “late on July 22” (a Friday). On August 9, TfL reported to its board that it had made changes to the proposed deal, but that DfT had neither confirmed nor rejected those changes. Secretary of State for Transport Grant Shapps said in a Tweet on July 27: “I’ve offered @TfL a settlement that supports £3.6bn worth of projects, matching the Mayor’s own spending plans from 2019. This is our final offer which more than delivers for London while being fair to UK taxpayers.” The following day Shapps added: “At the request of @TfL, I’ve granted one final extension to August 3. After two years and over £5bn of funding, I know the settlement offered supports London’s transport network and offers value for money for taxpayers. It’s now up to the Mayor to put London first and accept.”
On the same day, London Mayor Sadiq Khan responded: “Today, the Government has given TfL a short-term extension to the current emergency funding deal until August 3 2022. This is only necessary as the Government shared the long-overdue draft proposal for a funding settlement to TfL late last Friday, and it’s right that time is taken to thoroughly scrutinise the offer and understand its impact on Londoners and TfL services.
“This is a £10bn transport authority that is crucial to supporting jobs and economic growth across the country. TfL
must consider if this draft proposal provides the funding needed in order to avoid having to make painful cuts, and it’s in no one’s interest to have conditions attached to this funding deal that come at a cost - damaging TfL, unfairly punishing Londoners and our economic recovery.”
Meanwhile, TfL presented its first-quarter financial results to its board on July 27. This report noted: “We have set out a requirement for sustainable, long-term capital funding, to replace London’s strategic national transport assets and support other transport priorities. This would
require c£0.5bn-£1bn per annum over the medium- to long-term. The Government has recognised we are not able to solely fund the replacement of major assets such as rolling stock and signalling from our own operating income.
“Longer-term Government funding will enable us to deliver major renewals and capital projects in a more planned, efficient and effective manner. A number of studies, including those commissioned by Government, have estimated that long-term funding can enable cost efficiencies of between 10%-30%.”