Yesterday Transport for London put out a press release boasting that it was making “good progress towards achieving an operating surplus by 2021/22” and in which it lists a number of savings it’s delivered or is on course to deliver in order to achieve that surplus.
The release says:
“Significant savings have already been achieved through reducing management layers, merging functions, renegotiating contracts and delivering transport improvements more efficiently. In the last financial year the day to day costs of running London’s transport network were reduced by £153m, the first such reduction in TfL’s history.”
Put another way, the organisation just told Londoners that it’s not been running itself very efficiently for the past 18 years despite previous public claims to the contrary, and that it only finally bothered to start stripping out the waste when the loss of government grants and the impact of Sadiq Khan’s fares freeze forced it to make some tough but long-overdue decisions.
Some of these decisions mean changes in the way services are delivered – for example the review of bus routes – and the pushing back (rephrasing as TfL puts it) of some upgrades and projects.
Obviously politics dictates that Labour politicians at City Hall must bash the Government for their meanness while their Tory counterparts repeat their attacks on the Mayor’s fares freeze.
The rest of us can afford to step back and acknowledge that, while the agency could always do with the money that both policies have cost it, it’s right that TfL is finally forced to re-examine how it uses public money in an age of minimal wage increases and increasingly squeezed household spending.
It isn’t difficult to put forward an argument that Boris’s fares policy was – initially at least – the right one. It guaranteed that the agency had the money to deliver much-needed upgrades and allowed it to fund innovations such as the cycle hire scheme.
But it’s also probable the policy lived longer than it should have.
What was right when TfL was just 8 years old – as it was when Boris became Mayor – and still seeking to reverse decades of Government under-investment, wasn’t necessarily right in his second term when households were already under pressure and the wider public sector was being asked to manage with less.
TfL was able to avoid making the same tough choices the Met, London Fire Brigade and local councils had no choice but to confront, for far too long.
If, as a result of government cuts and Sadiq’s fares freeze, it now has to catch-up with the rest of the public sector and review how many layers of management it needs, and ask whether some functions really need to be carried out by separate teams with similar remits, then this is a very welcome development.
But the Mayor – almost certain to be reelected in 2020 – must make sure he doesn’t repeat the mistake of his predecessor and stretch a first term policy into his second 4 years at City Hall.
He should be willing to head into the next election proud of sparing Londoners from another four years of rising fares, but open to increasing them should extra funding be necessary to ensure services don’t suffer.
In the meantime he and transport deputy Val Shawcross should keep challenging managers to show that every penny is being used wisely and that every contract is delivering value.
They could start by clamping down on the number of times any contract can be renewed without being tendered and asking themselves whether a top management tier which needs constant outside help to do their very well paid jobs is really the right one to keep in place or deserving of their bonuses.
