Sadiq Khan has rejected Government demands that he and Transport for London extend the Congestion Charge zone to the North and South circular roads and put up fares above inflation in return for further funding.
TfL’s revenues have been hit hard by plummeting passenger numbers in the wake of the Covid pandemic, forcing it to seek a £1.6bn emergency funding package from ministers earlier this year.
In return for that help, ministers imposed a number of conditions including fares rises of RPI+1% across all TfL services and the imposition of two government representatives to the TfL board. The deal also called for the suspension of free travel for students, although this has yet to be implemented.
The pandemic worsened an already bad situation for TfL which was having to cut spending in several areas as a result of lost commercial and fares revenue arising from the delayed opening of Crossrail.
Opponents claim the Mayor’s 4 year fares freeze had also placed pressure on the organisation, although City Hall insists the primary pre-pandemic squeeze on its finances was a 2015 Conservative government decision to axe TfL’s operating grant.
It also says a series of reforms, including the axing of hundreds of managers, had produced a leaner and more cost-efficient organisation and were on course to put the agency on a firm footing.
Mr Khan has called for a further £5.7bn in government funding, but today rejected conditions attached to an offer of help.
In addition to increasing the level of fares rises to more than the previously agreed RPI+1% and expanding the congestion charge area, ministers have suggested introducing a new precept on Londoners’ council tax to help fund TfL and proposed axing the over 60s Oyster card.
The card is separate to the Freedom Pass which is funded by local councils and isn’t affected by the proposals.
Rejecting the conditions, Mr Khan said: “I simply cannot accept this Government plan, which would hit Londoners with a triple whammy of higher costs at a time when so many people are already facing hardship.
“It is clear that difficult choices lie ahead to plug the huge gap the pandemic left in TfL’s finances. I have been ready to talk with Government about how the necessary funds can be raised – but a proposal which singles out Londoners for punishment is completely unacceptable, as well as making no economic sense.
“I urge Ministers to come back to the table with a revised proposal which does not punish Londoners for doing the right thing to tackle Covid-19 – and to publish their review into TfL’s finances in full. I remain ready to talk.”
According to the Financial Times, ministers have threatened to take direct control of TfL unless the mayor agrees terms.