Sadiq Khan may be asking for as much as £1 billion to bail-out Transport for London (TfL). He did not deny it when interviewed on BBC television. The organisation is haemorrhaging cash as most of its income comes from bus and tube fares and usage of those has severely declined. It may be unable to pay its staff very shortly without some Government support and has already “furloughed” 7,000 staff from today. TfL will be able to access funding from the Government’s Job Retention Scheme for those staff, saving the organisation millions of pounds every week, but that’s only a short-term and temporary solution to the Mayor’s financial problems.
How did the Mayor get TfL into the position where it cannot survive the problems caused by the coronavirus epidemic? In essence because the Mayor is financially inept and has allowed TfL to run up massive deficits so it has minimal reserves to cope with such an event. We have commented on this issue repeatedly – for example here on the TfL budget in January: https://freedomfordrivers.blog/2020/01/17/tfl-business-plan-and-budget-for-the-next-5-years-more-of-the-same/
Total borrowing was forecast to reach £12.3 billion within 2 years because of delays to Crossrail and other issues, and that was before the impact of the coronavirus. A lot of the problem is caused by the Mayor spending money on programmes such as cycle schemes, Active Travel, Healthy Streets, Vision Zero road safety, the ULEZ and other policies for which there was no cost/benefit justification provided in this Mayor’s Transport Strategy (MTS). Now we are seeing the result of this financial incompetence and inability to manage the budget.
We suggest that before the Government hands the Mayor any cash, they should lay down some conditions on how it will be used and insist on some changes to the MTS. Scrapping the expansion of the ULEZ would be a good starting point.
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