Transport for London’s emergency funding deal with the government has been rolled over for a second time and will expire at midnight on Friday 25 February unless a new agreement is reached.
TfL has a current funding gap of around £1.9bn and has stated that it needs long-term government funding to avoid a period of “managed decline” of London’s transport network. The government has offered the latest of four deals and said that it was awaiting a response from the mayor ahead of Friday’s deadline.
Mayor of London Sadiq Khan suggested that the Covid-19 pandemic was the “only reason TfL is facing a financial crisis” and urged the government to negotiate a long-term funding deal.
“London’s economy plays a huge role in the national economy and around 43,000 jobs outside London depend on TfL’s investment. If the government fails to support TfL at this difficult time, it could impact TfL’s UK-wide supply chain, hitting jobs and growth and holding back the economic recovery in London and across the UK,” he added.
TfL said that it needed a clear indication of government support to offer certainty that it could balance its budget. If this is not forthcoming “TfL’s chief finance officer would have to consider a range of options including ultimately issuing a report under section 114 of the Local Government Finance Act 1988”.
Transport Secretary Grant Shapps told the House of Commons that the government had supported TfL with more than £4.5bn in extraordinary funding settlements. “Government is still committed to supporting London’s transport network as we have since the start of the pandemic and it has offered TfL and the Mayor of London a fourth extraordinary funding agreement.”
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