London taxpayers are set to save £1.6m each year after Transport for London renegotiated its poor value deal with mobile network O2.
As revealed by this site in 2014, the transport agency’s contract with the network offered worse value than standard consumer deals available on the high street because it include no bundled minutes.
This meant that each call to numbers outside the organisation was subject to an out of plan charge which in some cases saw individual members of TfL’s senior management incur hundreds of pounds worth of call charges each month.
In one month alone former transport commissioner Sir Peter Hendy cost taxpayers £525.61 in outgoing call charges while, in June 2013, head of surface transport Leon Daniels’ bill reached £1,390.
However in response to a Freedom of Information request first made last summer, TfL has today confirmed that the contract was renegotiated last June and now provides “all-inclusive calls and data”.
A breakdown of bills paid between March 2014 and January this year shows that line rental fees fell from as much as £36.50 to just £8.40 following the renegotiation while out of allowance call costs have been eliminated.
TfL says the new contract “will deliver a direct cost saving of at least £1.6m per year” based on historic usage.
Commenting on news of the revised contract, Liberal Democrat AM and mayoral candidate, Caroline Pidgeon said: “It is incredible that until recently TfL had a telephone contract offering a much worse deal than an ordinary consumer would achieve from any high street store.
“The huge bulk purchasing power of TfL should ensure that procure the best deal possible for every contract they enter into.
“When TfL waste money they are denying vital investment in improving London’s transport network.”
Labour’s Val Shawcross, who previously called for the contract to be reviewed, commented: “I’m pleased that TFL have responded to pressure and public exposure on this issue – they’ve taken an important step forwards in tightening their financial belts and seeking better stewardship of public money.
“We need them to apply this kind of financial self discipline at every level of the organisation and for every item of expenditure whether large or small in size.
“TfL Senior managers and staff on the front line alike all need to understand that they are expected to pursue best value for the fare and tax paying public.”
News of the revised contract has also been welcomed by Labour mayoral candidate Sadiq Khan who has promised to cut costs within TfL to fund a four year fares freeze.
Mr Khan said: “Well done to Val, MayorWatch, and everyone else involved in this campaign.
“This just goes to prove what I have been saying – TfL is good, but it’s flabby. There are savings to be made in TfL and I am the candidate to make sure those savings happen.”