London Mayor Sadiq Khan has pledged to slash wasteful spending at Transport for London by £800m per year while protecting investment in frontline services and major expansion programmes.
During this year’s election to succeed Boris Johnson as Mayor, Mr Khan branded the capital’s transport agency ‘flabby’ and promised to cut back office costs in order to help fund his four year fares freeze.
Today the Mayor published a new draft business plan setting out how the organisation would cut costs and still deliver major schemes necessary to accommodate London’s population growth.
A clampdown on the use of non-permanent and consultancy staff, and a reduction in the number of managers and executives is expected to save around £240m over the next five years.
The organisation will also review and renegotiate contracts with outside suppliers, building on a £80m per year saving achieved by moving Tube maintenance in-house.
These headline savings are part of a comprehensive review of how TfL operates which will see the entire agency “redesigned” around a ‘value for money’ ethos.
City Hall says the resulting savings will allow a number of ambitious projects, including installing new signalling on the Metropolitan, Hammersmith and City, District and Circle lines, and Tube station upgrades at Victoria, Bond Street and Finsbury Park to go-ahead.
In addition, Mr Khan has announced that an extension of the Bakerloo line to Lewisham will proceed, with the completion date date brought forward by two years from 2031 to 2028/29.
As with the extension of the Northern line to Battersea and the London Overground extension to Barking Riverside, the Bakerloo line project will support thousands of new homes and jobs.
Money has also been pledged for safer crossings, new cycling infrastructure and improvements to town centres and public spaces.
Unveiling the draft business plan, Mr Khan said: “From my first day as Mayor of London I’ve been on a mission to create a modern and affordable transport that works for every Londoner.
“The new TfL Business Plan being presented today sets out an ambitious and wide-reaching programme that allows us to both freeze TfL fares, and invest record amounts modernising London’s transport’s infrastructure.
“The greatest city in the world must also have a genuinely world-class transport system, and this is vital for the future success of London’s economy. Today sets out the scale of our ambition.”
Mike Brown, London’s Transport Commissioner, added: “Transport is not an end in itself. It is a means of helping a city prosper by supporting new jobs and homes and improving connectivity.
“This plans sets out how, over the next five years, we will become a more efficient and commercially-minded organisation and at the same time meet the Mayor’s vision of an modern, affordable, accessible and green transport network for all Londoners.”
Conservatives on the London Assembly claim that Mr Khan’s plans will leave TfL’s finances “resolutely unbalanced” and will require him to extend the agency’s borrowing.
Keith Prince AM said: “Since May we’ve seen the Mayor making wild spending promises with little real hint of how he’s going to balance the books.
“Now we know why – he’s going to leave the books resolutely unbalanced. This is the business plan of a one-term Mayor who is desperate to keep the show on the road for 4 years with no real thought for how to cope after May 2020.
“Instead of the prudent financial management TfL needs, we see a 46% increase in long-term borrowing, a 27% increase in long-term liabilities and useable reserves slashed by £1.689billion.”
Caroline Pidgeon, Liberal Democrat London Assembly Member, was more positive about the Mayor’s plans.
She said: “There is much in this new Business Plan that is very welcome, such as the commitment to continued upgrades to the Tube, the extension of the Bakerloo Line and a pedestrian and cycle bridge linking Rotherhithe to Canary Wharf.
“The reduction on TfL’s reliance on expensive agency staff is certainly long overdue. Tackling this is something I long urged TfL to address.”
“However, not every aspect of today’s announcement is clear cut. There appears to be no firm commitment to extending the tram to Sutton for example. It is also not clear whether the extension of the Bakerloo Line will run all the way through to Bromley. I am also disappointed by no plans at all for the extension of the cycle hire scheme.”
The draft plan will be presented to the TfL board for approval when it meets next week.
