Organisation willing to sacrifice major upgrade projects like Bakerloo line extension is return for funding

 
Transport for London could be forced to suspend or scrap plans for major upgrades to the capital’s transport network in return for a £2bn bailout from the government.

According to media reports this weekend, TfL is locked in “increasingly desperate” talks over the bailout after the coronavirus pandemic wiped out most of the organisation’s revenues.

London Underground currently carries around five million passengers each day but patronage has slumped by 95%. Bus use is down 85%.

Revenue streams have also been hit by the Congestion Charge and Ultra Low Emission Zone road charging schemes being suspended since March. Bus passengers have also travelled for free since centre door boarding was introduced last month.

TfL is now down to its last £1bn and is burning through around £21m each day. At the current rate of attrition it will run out of money in less than two months.

In March London mayor Sadiq Khan announced he was scrapping his controversial fares freeze from 2021 after his mayoral term was extended by a year.

Sources suggested to the Financial Times at the time that while Khan will campaign in 2021 on a platform of limiting future Tube fare increases to no more than the cost of living and freezing bus fare, some form of fares increase is likely to come into effect at the start of 2021, although no formal decision has been taken.

Any bailout for TfL will come with strict conditions attached – projects that could be suspended include the planned extension of the Bakerloo line into south east London and Crossrail 2.

The Sunday Times said this weekend the prospect of heightened Westminster scrutiny in return for a bailout had caused tension between City Hall and the government.

However, the Treasury and Department for Transport have little choice but to continue to pump in funds because of the risk of the capital grinding to a complete halt.

TfL has not received government funding in recent years after central government grants were phased out, leaving the organisation largely reliant on commercial revenue streams.

TfL has declined to comment on specific details, but said that it was facing a “substantial reduction in income over a period of months”.

 
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