London Transport funding
Late last Friday (22 July) the Department for Transport (DfT) sent over their funding package for London with a brash ‘the ball is in your court’ message from Transport Secretary Grant Shapps to London Mayor Sadiq Khan. This is the latest – and potentially last – stage of short-term funding meant to keep London’s transport network moving.
The government are pushing a narrative that the Labour Mayor has mismanaged London’s finances and as a result of the pandemic, has had to hold a begging bowl out to the government.
But this is not true. To set the record straight – Transport for London (TfL) has been deliberately underfunded by a dodgy Conservative deal between then-Chancellor George Osborne and then-Mayor Boris Johnson. In a move to reduce the national subsidy for London transport, £700 million a year was withheld from the budget.
Back in 2015, TfL was told to be fully funded by commercial revenue, cuts or passenger revenue by 2020 – a proposed 37% cut to the budget in just five years. This was a crisis waiting to happen well before the pandemic.
It is not normal
London is the only major city in the world that does not subsidise its public transport. Other countries do not operate like this. It’s clear that moving people around the city efficiently is vital for the smooth running of business and tourism and doesn’t just benefit Londoners. London currently funds 72% of its costs from passenger fares, compared to 38% in New York and 38% in Paris.
It is now even more important in the face of significant climate change and oil price hikes caused by the conflict in Ukraine and the cost-of-living crisis that we get people using efficient and affordable public transport. Shifting away from private vehicles and onto clean public transport will reduce the use of fossil fuels which are expensive and in short supply, as well as bad for the environment.
Impact
Despite an uncertain financial future, TfL has not given the unions any assurances on job reductions, pensions or changes to working conditions. The plan for how to fund London transport long term – including necessary infrastructure upgrades – is completely unclear. TSSA has said before that the proposed 600 job cuts are accidents waiting to happen. Stations are already left unstaffed and being closed intermittently on parts of the network, particularly in the outer zones and I fear this is a managed decline of our Underground network which could have terrible consequences for passengers.
It gets worse
The pandemic funding deal proposed by the government and being thrashed out in City Hall had specific conditions to increase income, review pensions, implement driverless trains and investigate selling off property. Those that have been around the transport sector for a while know some of these measures are fanciful. The pensions review conducted by Sir Brendan Barber on behalf of TfL has highlighted that changes wouldn’t be prudent, so demands for pension reform is simply the government backing the Mayor into a corner and blaming him for the financial mismanagement.
It is outrageous that the government is trying to pass the cost of getting to work onto passengers at a time when the public are under pressure and the economy is trying to recover.
Meddling with the pension scheme is clearly aimed at provoking staff and unions and could put current pensioners at risk. We haven’t been allowed to see the details of the deal put on the table by the Department for Transport yet, but as they are citing ‘commercial sensitivity’ for not releasing details, I suspect there is an element of selling off the family silver and we have to draw the line here and say that staff, passengers, London businesses and tourism can’t accept any ‘deal’ which cuts transport services.
