TfL accepts emergency funding extension until May
Transport for London (TfL) has this morning agreed to an emergency seven week extension to its current funding deal to keep it going amid the pandemic.
The transport network had been hoping to strike a long-term funding agreement with the government to begin fixing its finances, but last week transport secretary Grant Shapps pulled the rug out from under the current talks.
With two weeks until the existing deal ran out, Shapps elected to roll over funding until 18 May, when, he said, ministers would be in “a better position” to know about passenger numbers.
This morning TfL confirmed that it had accepted the extension on the same terms as existing deal. That means the funding package will comprise around £500m.
London Mayor Sadiq Khan, said: “This seven-week extension will enable TfL to carry on running the safe, reliable and frequent services that will be vital as lockdown restrictions begin to ease.
“These discussions will continue as it is essential that TfL has further financial support and a long-term capital funding deal that will allow it to support a strong and robust recovery for London and the UK.”
A TfL spokesperson said: ‘We have today agreed with the government that our funding will be extended until 18 May on the same terms that have applied to our funding for the second half of 2020/21.
“We continue discussions with the government on our need for further financial support and a long-term capital funding deal. This is vital for us to support a strong and robust recovery from the pandemic and to provide confidence to our UK-wide supply chain.”
It means that ministers will negotiate the new full deal with whoever wins May’s mayoral election, though Khan at the moment is the nailed-on favourite to do so.
The decision to extend the current funding package is a blow to TfL, which had been pushing hard to agree a multi-year package instead.
As well as £3bn for the coming financial year, it was also seeking £1.6bn a year in capital spending support between 2023 and 2030.
Ministers have already spent more than £3bn propping up the capital’s transport network, which has seen passenger numbers collapse due to the pandemic.
A spokesperson for the DfT said: “The roadmap set out by the Prime Minister to cautiously and safely reopen society and our economy means we can better understand the potential recovery in passenger demand, ensuring we deliver a sensible and appropriate deal in the future.
“The Government and the Mayor of London have therefore agreed to roll over the existing funding deal for TfL until 18 May on the same terms as now, providing certainty over the pre-election period.”
Business groups welcomed the extension. London First’s transport programme director Adam Tyndall said: “It is a relief that the funding deal for TfL has been extended, not least because it provides some certainty on service levels in the short-term. Cutting back public transport services in the coming months risks undermining economic recovery and rolling back the clock on carbon reduction.
”With the new deal now to be agreed post-election, there is an opportunity to come to a long-term funding agreement that backs a strong national recovery and boosts confidence at a critical moment for the capital.”
But the RMT Union slammed the government, saying that it was playing politics with the network’s funding.
“This stop-start approach is designed to try and assist the Tory mayoral candidate rather than giving London transport the stability it so badly needs as we emerge out of this lockdown” it said in a statement.