London First: Give more powers to City Hall to fund TfL
Business group London First has this morning called on the government to devolve further powers to the Greater London Assembly in order to secure the long-term finances of Transport for London (TfL).
In a new report produced in partnership with KPMG, the group argues that unless City Hall is given access to tax revenues via devolution, as well as additional revenue raising measures, it will be unable to cope with the recovery from coronavirus.
Further fare rises will have to be part of the mix, as well as ensuring that all those who benefit from transport services and developments help pay for them.
The report comes just weeks after TfL received a £1.6bn bailout from the government after the collapse in fare revenue due to coronavirus pushed it to the brink of issuing a bankruptcy order.
The short-term cash crisis has also drawn into focus the long-term funding gap for TfL, which according to its own business plan sits at £50bn over the next 20 years.
Despite the bailout, the group said that further investment would be required if TfL was to reinvigorate and update its oldest lines and carriages.
London First’s chief executive Jasmine Whitbread said: “The Government’s short-term bail out of TfL has rightly been the focus of debate, but it was at best a sticking plaster that failed to address the long-term structural funding challenges.
“While London requires a fair funding settlement from Government, greater devolution of powers to City Hall would help the capital to raise its own revenues, freeing up resources for the rest of the UK and supporting the levelling up agenda.
“To get TfL on a sustainable footing, other options may also need to be considered, including further fare rises and ensuring those who benefit from transport projects pay their fair share.”
The report said a long-term funding agreement with the Treasury would be one possible model, but that a combination of extra devolved powers and a grant was more likely.
TfL yesterday announced that Andy Bycroft would take over from Mike Brown as the body’s new commissioner in July.
Bycroft, whose last job was running New York’s public transport network, will face a government review into TfL’s finances as part of the bailout conditions.