Last reviewed 10 November 2020
Replacing the agreement signed in May, the Government and the Mayor of London have agreed a second extraordinary funding and financing package for Transport for London (TfL) for the period to 31 March 2021.
Mayor Sadiq Khan said that this would keep tube, bus and other TfL services in the capital running and that has had rejected Government plans for a huge extension of the Congestion Charge zone.
He said that the proposed extension of the £15 daily Congestion Charge to the North and South circular roads would have “hit four million more Londoners hard”.
According to Transport Secretary Grant Shapps, the new package comprises a central funding scenario of £1 billion — made up of £905 million grant funding and £95 million borrowing — with flexibility for changing the grant payment in response to changing passenger demand.
As well as the conditions in the package agreed in May, the new agreement sets out further measures to put TfL on a sustainable financial footing as soon as possible.
Over the next six months, Mr Shapps continued, the Mayor will impose fare rises of Retail Price Index (RPI) plus 1% on all modes from January 2021, maintain the central London congestion charge at the hours and level to which it was increased in June, maintain the withdrawal of 60–65 Pass and 66+ Freedom Pass concessions in the morning peak, and make a further £160 million in-year savings.
“If the Mayor wishes Londoners to continue to benefit from travel concessions and/or other benefits above those typically available elsewhere in England,” Mr Shapps said, “he and TfL have recognised that the costs of these additional benefits will not be met by the government and that they will meet these costs themselves, without recourse to additional borrowing, savings, service changes or deferrals.”
The full text of his letter to the Mayor can be found at assets.publishing.service.gov.uk.