Transport for London Quarterly Performance Report – Clearly a Financial Basket Case

Transport for London (TfL) have published their quarterly performance report. It covers the quarter to 11 December 2021 and gives some useful information on the slow recovery in passenger numbers from the pandemic lows.

In Q3 demand plateaued however and is still only 68% of pre-pandemic levels. But to really get a good picture of how TfL is a total financial basket case you only have to jump to the Appendix. That shows that the “Net Cost of Services” is £2,267 million (i.e. £2.3 billion of costs more than income) for the quarter. This deficit is only made up by £3.4 billion of “Grant income” no doubt mainly from central Government.

Indeed the Chief Financial Officer clearly thinks that he is doing a great job because he says “we are performing better than budget” while staff numbers have actually increased despite passenger numbers falling.

Somebody asked me recently how much London buses were subsidised. I did not know the immediate answer although the last time I looked at this it was an enormous figure. But this report gives you guidance on it. The Appendix reports that for the Operating Segment of “Buses, streets and other operations” there is a deficit of £754 million for the quarter and that probably includes the income from the Congestion and ULEZ charges.

It is clear that TfL are still relying on enormous Government bail-outs to stay afloat and that shows no signs of changing.

Roger Lawson

Twitter: https://twitter.com/Drivers_London

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Sadiq Khan Wants Your Views

The Mayor of London, Sadiq Khan, wants your views on the future of London. He has issued a survey which is available on the Talk London platform which asks a number of questions and also allows you to post some general comments.

The survey starts out by asking you to pick your top three choices from the following changes you would like to see in the next ten years:

Safer streets for walking and cycling; Cleaner streets; “Improved parks and green spaces; More attractive outdoor public spaces; More trees and greenery outside of parks; More workplaces; Better public transport; More housing; More attractive high streets and town centres; More physically accessible public spaces; Don’t know”.

This list does not include my top choices at all which would be: “1) Better private transport (i.e. more road space and less congestion, with fewer closed roads, bus lanes and cycle lanes); 2) Fewer people and less encouragement to move into London to reduce the stress on housing provision and transport provision; and 3) Lower taxes such as the ULEZ, Congestion Charge and Mayor’s Council Tax Precept.

I might vote for more trees and greenery but more housing we do not want in an already congested city.

In other words, it’s a typical biased survey from the Mayor that asks both the wrong questions and asks leading questions.

Some of the later survey questions are more innocuous but miss the opportunity to really find out what Londoners want. It then takes you to a section where you can add general comments on a few issues.

This is a good opportunity to give your real feelings about what how you think London should be improved (and you could of course mention the removal of Sadiq Khan as a starter). So please do respond to this survey.

You’ll need to register for the Talk London platform first but that’s easy. Go here to start: https://www.london.gov.uk/talk-london/planning-londons-future?

Roger Lawson

Twitter: https://twitter.com/Drivers_London

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Using PCNs to Raise Council Funds – It’s Unethical

With local Council budgets under severe strain, they have looked at raising money by maximising PCNs being issued. These can be issued for breaches of bus lanes, no entry signs in Low Traffic Neighbourhoods (LTNs), infringement of yellow box junctions, illegal turns and for a number of other reasons.

Many millions of pounds are now being raised by some London Councils in this way, totally unethically, particularly by those Councils who are prejudiced against motor vehicle use. The number of fines issued by the London boroughs and TfL in 2020-2021 are given in this document: https://www.freedomfordrivers.org/Annual-pcn-statistics-2020-21.pdf

You can see that the worse London councils are Croydon, Hackney, Hammersmith & Fulham, Islington, Lewisham and Newham with a large number issued by Transport for London (TfL) also.

In Lewisham for example, after the LTN was introduced in Lee Green the Council issued 87,443 PCNs for infringement in Dermody Road between August 2020 and January 2022. These would have been picked up by camera enforcement systems. There were also 5,462 issued in Ennersdale Road, 12,002 in Manor Lane and 19,961 in Manor Park.

The campaign group One Dulwich also reported these figures: “More than £6.6 million paid to Southwark in fines. An FOI to Southwark has revealed that 123,853 fines were issued in 2021 to vehicles going through the timed closures on Burbage Road, Turney Road, Dulwich Village and Townley Road, raising a total so far of £6,623,517. Once all fines are paid (calculating 123,853 PCNs at the lower rate of £65 each), the total will be more than £8 million. With this kind of annual revenue, the financial benefits of continuing with the Dulwich Streetspace scheme must have been part of Southwark’s thinking”.

You can see now why Councils are so keen to install camera-based enforcement systems – they are actually money spinners because the money they generate exceeds the cost of installation and operation.

A recent example is a proposal from Lewisham Council to introduce up to five yellow box junctions in a recent “Budget Reductions Report” to the Sustainable Development Select Committee. The capital cost would be £100,000 but the first-year rate of return is given as £150,000, i.e. there is a payback in under one year. It’s a highly profitable measure! But there is no evidence that such box junctions actually improve the flow of traffic.

In summary, LTN schemes enforced by cameras are not about reducing vehicle use, improving road safety or improving the environment. They are about generating money in a totally unethical way.

The approach by local councils and the number of PCNs issued very much depends on the policies set by Councillors. Please bear that in mind when voting at the forthcoming May Council elections.

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Sadiq Khan’s Plan to Screw Drivers Even More

Two days ago (on 17/01/2022) I pointed out on this blog that the Mayor’s Budget document spelled out that road pricing in London was definitely anticipated. His budgets for future years depend on it.

It became clearer what he is planning yesterday when both the BBC and London Evening Standard provided more details of the Mayor’s plan – see links below.

His proposals include a small daily charge on everyone who drives in London – perhaps £2. He claims this is required based on a report commissioned by City Hall that found that a 27% reduction in London’s car traffic was required by 2030 to meet net-zero ambitions. He has the powers to introduce this but he is also considering a London entry charge for anyone who drives in from outside. A boundary charge (of perhaps £3.5 per day) would require Government consent when they don’t currently favour it.

Longer term, by the end of the decade, he would like to introduce a pay- per-mile system although the technology to do that is not yet available.

In the meantime it looks very likely that he will extend the ULEZ to the whole of London.

The Mayor has said “I have got to make sure there is a disincentive to drive your car, particularly if it is petrol or diesel, when there are alternatives, like public transport”. Yes he would like to force everyone to use public transport which of course he has a financial incentive to advocate. It’s yet another reason to take TfL out of the control of the Mayor.

The justification for these measures is to tackle air pollution and defeat climate change. It certainly won’t do the latter and there is a very good debunking of the claims of death from air pollution on the web site Not a Lot of People Know That – see link below.

Improving air quality is certainly something the Freedom for Drivers Foundation supports but there needs to be a clear cost/benefit and the measures our national Government has been taking have been by far the most effective to reduce air pollution. London’s measures introduced by Sadiq Khan have been enormously financially damaging with very little benefit. He postures about saving the world while spending your money ineffectively.

BBC Report: https://www.bbc.co.uk/news/uk-england-london-60030127

Evening Standard Report: https://www.standard.co.uk/news/london/sadiq-khan-clean-air-charge-petrol-diesel-cars-ulez-expansion-london-b977223.html?

Deaths from Air Pollution: https://notalotofpeopleknowthat.wordpress.com/2017/08/15/claims-of-40000-deaths-from-air-pollution-debunked-by-death-statistics/

Roger Lawson

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Sadiq Khan’s Budget for London – Mayor Cuts Bus Services but Plans for Road User Charging

Sadiq Khan has published his proposed Mayor’s Budget for 2022-23 which covers support for Transport for London and other services in the capital.

His foreword says this: “At the time of writing, London is in the grip of a serious crisis. Our city has more COVID-19 infections than any other UK region, we are seeing an explosive and alarming rise in the number of Omicron cases, and our NHS and other public services are being placed under immense strain because of staff absences caused by sickness and the need for key workers to self-isolate. The government is also still refusing to properly fund London’s public services, particularly Transport for London, the Met police and the London Fire Brigade. It’s against this extremely challenging backdrop that I’m having to take a series of tough decisions to ensure that the progress we have made towards building a fairer, greener, safer and more prosperous London is built upon, rather than put at risk. The pandemic is the only reason TfL is facing a financial crisis”.

The last sentence is a lie and he yet again blames the Government for his own financial mismanagement over the past several years that meant that TfL had no financial resilience to meet the unexpected impact of the Covid epidemic.

The Mayor goes on to say “However, as a condition for the emergency short-term funding, the government is forcing us to raise additional revenue in London through measures, like council tax, that will unfairly punish Londoners for the government making our transport network so dependent on fares income”.

Why should not Londoners pay for the transport network they use? Either in fares or council tax (preferably the former)? Basically he is begging the Government to fund TfL rather than getting Londoners to pay while TfL continues to run uneconomic services instead of adapting its business to meet the new market conditions.

Sadiq Khan’s foreword is a classic example of him blaming the Government for his problems. We need less politicking and more constructive and practical steps to get TfL back on an even keel.

I’ll pick out just a few interesting points from the budget document:

  • The budgets anticipate a reduction in bus services of 18% by 2024-25.
  • Road pricing is definitely anticipated. It says on page 56: “In addition, further to the requirements of the 1 June 2021 funding agreement, the budget assumes a widening of road user charging schemes in later years to deliver the Mayor’s transport policies, subject to a full impact assessment, consultation as appropriate, and decision-making processes. The implementation costs have not at this stage been included as discussions are still ongoing”.
  • The Mayor talks about cost reductions in TfL but in reality the total operating expenditure rises from the expected £6.8 billion in 2021-22 to £7.5 billion next year.
  • The deficit between operating income and expenditure in TfL remains high at £1.35 billion in 2022-23 and is still £638 million in the following year. That ignores the capital expenditure and other items making the total “financing requirement” of £2.1 billion for next year. See page 95 of the budget document for the breakdown. Clearly the Mayor is expecting the Government to come up with the cash to finance these deficits which is surely unreasonable.
  • Expected income next year from the Congestion Charge, LEZ and ULEZ schemes is £754 million which just shows how much money is being taken out of the London economy and from the pockets of Londoners to support the Mayor’s grandiose plans. This is a charge on Londoners for which there is no countervailing financial benefit.
  • The proposed adjusted basic amount of council tax is £396 for a Band D property (an increase of £32 over 2021-22). Yet again the Mayor is increasing his council tax precept at more than inflation when the general population is facing major cost of living increases from food and energy bills. Normally such a large increase would require a public referendum (see pages 109/110) but the Mayor is apparently asking the Government to waive that requirement.

Summary and comment: This is a typical socialist “spend, spend, spend” budget where instead of cutting the cloth to what he can afford the Mayor wants to continue spending regardless of economic and market conditions. The budget should be reconsidered and brought more into line with reality.

Please make sure you submit your own comments on the budget by sending an email to GLAbudget@london.gov.uk (but it needs to get there by the 18th January so it’s URGENT).

Mayor’s Budget: https://www.london.gov.uk/sites/default/files/mayors_consultation_budget.pdf

Roger Lawson

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Making London Transport Sustainable

The battle over funding for London’s Transport goes on.  At the time of writing the government has granted a paltry 7-day extension of funds to TfL while demanding Mayor Sadiq Khan comes up with alternative proposals for how he will generate an extra £500m – £1bn a year to fund his apparently unsustainable transport system.  This while at the same time the Government is encouraging people to work from home again, significantly reducing public transport usage once more. In granting this 7-day extension it’s interesting to note the plans proposed by Khan, which the government rightly rejected.  These were:

•         A return of VED paid by London car owners to TfL

•         A Greater London Boundary Charge, charging motorists who come from outside London into it £3.50 a day.

•         A levy on deliveries made for online purchases, targeting delivery drivers.

Other ideas still on the table include raising the Congestion Charge and ULEZ tax rates.  The latter would be after the recently expanded zone failed to raise the income anticipated. Khan may speak of how it has reduced the number of polluting vehicles, but you do not introduce a new tax without planning on it raising substantially more revenue in the future.

What do all the above have in common? They are all targeting private motor vehicles – the car and delivery vans. Khan’s message is crystal clear: he wants to raise money from drivers rather than tackle the basic problem that public transport users in London do not pay for the cost of the services that are provided. It’s unsustainable.

Fundamental reform is needed to make transport in London more sustainable. Only then will Sadiq Khan need to stop asking the Government for more bail-outs.

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Spend, Spend, Spend – Andy Byford’s Solution to TfL’s Financial Problems

An article in the Financial Times this week (17/9/2021) spelled out how the London Transport Commissioner is looking to solve the financial problems of Transport for London (TfL). Andy Byford who heads TfL called on the Government to provide £17 Billion of funding over the next decade.

TfL has certainly been badly affected by the pandemic with a big reduction in income as people have avoided travelling on the Underground and on buses. They have already had several temporary bail-outs to keep operations running although the Government imposed a number of conditions on their financial support. Usage of buses and the tube is increasing but it may be a long time, if never, before it returns to the same levels as seen before the pandemic as working from home (WFH) or hybrid office use has become adopted.

Mr Byford hopes to achieve financial stability by the financial quarter ending in March 2022. But that is a hope rather than a certainty. That will not include funding for replacing diesel buses by electric ones, the purchase of trains for underground lines nor any major new projects. It is also dependent on Crossrail opening on the long-delayed schedule and providing extra income. Mr Byford suggests that without extra “investment” (i.e. spending money he does not have), London’s transport network could enter a doomsday scenario of managed decline.

In other words, instead of using profits from existing operations to maintain and improve the network, he wants the Government to donate large sums of money out of our taxes to help him implement grandiose plans. This is surely no way to run a business – and make no mistake TfL is a business not just a public service.

Mr Byford seems to want to follow the typical socialist mantra of spend, spend, spend to solve his financial problems. Surely there is a better way.

FT Article:  https://www.ft.com/content/60e63984-dad6-4fed-ae9c-9c0888b74bb6

Roger Lawson

Twitter: https://twitter.com/Drivers_London

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London Transport Commissioner and Mayor’s Special Pleading

The Evening Standard has published an article by London’s Transport Commissioner, Andy Byford (see Reference 1). In it he welcomes the £1 billion in Government funding to keep Transport for London running for another few months.

But like Sadiq Khan’s press release over the deal (see Reference 2), it complains about the lack of a “long-term settlement”. The Mayor even called it “yet another sticking plaster”. They do not seem to understand that the basic problem is that they are looking for taxpayers (i.e. you and me as represented by the Government) to fund an uneconomic business called Transport for London.

Andy Byford does spell out where some of the money will go which includes this: “And it means we can continue with innovative and creative schemes to decarbonise transport by 2030 and to clean-up London’s air through the expansion of the Ultra-Low Emission Zone, further electrifying the bus fleet, promoting active travel — including more Santander cycles — and improving road safety”. In other words, they are spending taxpayers’ money to expand the ULEZ (a very ineffective scheme on a cost/benefit analysis) and provide more cycles. Clearly the approach seems to be to spend their way out of trouble in the socialist paradise of London.  

The Mayor says that TfL only needs emergency funding from the Government because the Covid epidemic cut fare income by 90%. That might have been true in the short term and over a few weeks but the details do not seem to have been disclosed. Usage of public transport is fast recovering so this may be only a temporary problem and the financial problems of TfL are a long-standing failure to run a prudent budget that takes into account not just operating costs but capital expenditure and financing costs in addition.

Regrettably the Mayor is acting like the animal that bites the hand that feeds it with his attacks on the Government.

Roger Lawson

Reference 1: Evening Standard article: https://tinyurl.com/2fc4vtut

Reference 2: Mayor of London Press Release: https://tinyurl.com/82uwfr38

Twitter: https://twitter.com/Drivers_London

Avoiding Road Taxes

With Sadiq Khan being re-elected many Londoners are going to be faced with an expanded ULEZ scheme in October. That means £12.50 per day for every day you use non-compliant vehicles within the North/South Circular. Perhaps you think that your vehicle will be compliant because it’s relatively new, but that is not the case for diesel cars. Petrol cars sold after 2005 are generally compliant but diesel cars that are not Euro-6 standard (registered since September 2015 mostly) are not.

You can check the taxes you pay in Congestion Charges and ULEZ charges in London for your current vehicle here: https://tfl.gov.uk/modes/driving/check-your-vehicle/

Personally I made the mistake of buying a diesel car in 2013 after the Government chose to exhort people to purchase them to cut CO2 emissions and car manufacturers such as Jaguar dropped most of their petrol models. With me doing relatively low mileage in recent years, and hardly any in the last year while we have been in lock-down, my vehicle would have lasted several more years. This retrospective legislation to penalise vehicles that were compliant with all emissions regulations when purchased is somewhat annoying to say the least.

If you live inside the North/South Circular you will have a difficult choice to make come October. Either buy a new compliant vehicle or trade-in for a second-hand one that is. You might consider an electric or hybrid vehicle for example.

But there are some other options. I happened to read an article published by Motoring Research recently on “What is a historic vehicle?” which intrigued me. Historic vehicles are those more than 40 years old. Such vehicles (except those used for commercial purposes) are exempt from the ULEZ and are also exempt from road tax (Vehicle Excise Duty).

In theory you could buy a restored classic car for a reasonable price and save a lot in tax. But you need to pick the vehicle carefully. Most “popular” cars more than 40 years old are likely to be full of rust and have very high mileages so they won’t be good buys. Classic cars such as E-Type Jaguars might be attractive but are now very expensive if well preserved. But there are other Jaguar models such as early XJs or 2.4 models that would be more practical. Parts would be readily available but maintenance costs might be high.

Having run some ancient and decrepit vehicles when I was younger, I am not particularly recommending this approach unless you are keen on classic cars and don’t need to use a vehicle every day.

It’s always amusing to watch the TV programme Bangers and Cash available on some channels. It’s very clear that the cost of restoring a beat-up vehicle is never recouped so buy a fully restored vehicle if you want a classic. And be careful on your choice. Vehicles that were unreliable and expensive to maintain when new will not have changed. While some models such as Jaguar E-Types are way too expensive for the average person.  

But there is another option which is to move to a ULEZ compliant vehicle that is not brand new. The car I owned before my current one was a Jaguar XJ8 registered in 2006 with petrol V8 engine and that is ULEZ compliant. See photograph above. This had an aluminium body so shouldn’t rust and you can pick a good one up for £12,000. This was a superb and spacious vehicle with all mod-cons. Perhaps I should simply go back in time and buy another? Or one can buy a low mileage Bentley Continental of a similar age for £25,000.  

If you want to go for something smaller and cheaper, look at Japanese cars which are generally reliable and Japan retained the love of petrol versus diesel. How about a one-owner Lexus GS 450H (a hybrid power train) with 66,000 miles on the clock for £7,500 advertised on AutoTrader if you want a luxury vehicle with a gesture to environmental soundness?

There are certainly some interesting and good quality vehicles that would enable you to avoid paying Sadiq Khan’s tax every day – at least for the present.  

Remember the ULEZ tax is about raising money for the Mayor’s empire, not about improving air quality where it will have minimal impact – see this page for the evidence: https://www.freedomfordrivers.org/environment.htm

Roger Lawson

Twitter: https://twitter.com/Drivers_London

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Mayor Spells Out His Policies in the Times

Sadiq Khan has reiterated his policies on cars and air pollution in an article in the Times. He repeated his call for drivers to give up their cars and said: “Where you can give up using cars, I would encourage that. We can avoid a health crisis that is around air quality and obesity but [it] will also mean that those who do need to use the roads for good reason, be that you are a black-cab driver, electrician, plumber, blue-light services, delivery driver and so forth, are not stuck in traffic and frustrated about productivity when others who have alternatives aren’t using them.”

He repeats his gross exaggeration of the dangers of air pollution to the health of the public as a justification for the expansion of the ULEZ and the proposed charge for entering London from outside. In reality, the expansion of the ULEZ will have minimal impact on air pollution and in just a few years’ time the benefit will have completely disappeared. But there will be massive costs imposed on London’s vehicle owners. See this previous blog post for the data: https://freedomfordrivers.blog/2020/04/15/ulez-the-latest-information-including-poor-financial-outcome/

However you look at it, it’s about raising taxes not improving the health of Londoners.

Times Article: https://www.thetimes.co.uk/article/c71af668-a4ff-11eb-be8f-c06519de93dd?shareToken=88c7f827c16cd944a33cd315efb17e2d

Twitter: https://twitter.com/Drivers_London

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