Transport for London (TfL) has secured a third bailout from the UK government, with a £1.08bn funding package agreed.
This latest deal will extend financial support until 11 December 2021, and takes the total government support to more than £4bn since March 2020.
Under the latest agreement, TfL is required to find £300m of saving and find new income sources.
London’s transport commissioner Andy Byford, said: “The pandemic – during which our staff have worked so magnificently to keep London moving – has shown our financial model, with such a disproportionate reliance on fare revenue, to be not fit for purpose.
“We are working hard to rebuild revenue through attracting people back to our services with nearly 60% of pre-pandemic ridership already travelling again.
“It is vital that we also use this period to agree a longer-term settlement so that we can plan effectively for London’s future and deliver maximum value for money through our contracts and supply chain.
“The conditions placed on us by the government agreement and the amount of funding we will receive means we need to find a further £900m of savings or new income this year compared to our approved Budget and on top of the £730m of savings already assumed in our Business Plan.
“We will work through this while protecting front line services to deliver what London needs and to play our full part in recovery, decarbonisation, improving air quality and promoting active travel.”
Within the funding period TfL also needs to prepare a plan to accelerate its existing modernisation programme of £730m by April 2023.
It has agreed to prepare a revised medium-term capital investment programme and carry out a joint review with government of demand on London’s transport network to ensure service levels are appropriate.
Transport secretary Grant Shapps, said: “Throughout this process, the government has maintained that these support packages must be fair to taxpayers across the UK and on the condition that action is taken to put TfL on the path to long-term financial sustainability.”
