Transport for London (TfL) has announced that its funding deal with the UK government will be extended until 18 May.
The extension comprises two additional funding payments totalling £260m with a top-up grant available based on actual passenger revenues.
This will take total government support for TfL to more than £3bn since March 2020.
According to TfL, the agreement is on the same terms that have applied to TfL’s funding for the second half of 2020/21.
A TfL spokesperson said: “We continue discussions with the government on our need for further financial support and a long-term capital funding deal.
“This is vital for us to support a strong and robust recovery from the pandemic and to provide confidence to our UK-wide supply chain.”
UK transport secretary Grant Shapps said the extended deal would continue to support the UK capital and the transport network until after the completion of London’s mayoral election, whereafter a new funding deal will be agreed.
“By this point, non-essential retail and other parts of the economy should be open and transport demand on the network will be considered when formulating a future settlement,” said Shapps.
“Support to TfL has always been under the condition that the network must make efficiency savings so it can reach financial sustainability as soon as possible. Those conditions will also form a part of the additional funding payments announced today.”
Mayor of London Sadiq Khan added: “This seven-week extension will enable TfL to carry on running the safe, reliable and frequent services that will be vital as lockdown restrictions begin to ease.
“These discussions will continue as it is essential that TfL has further financial support and a long-term capital funding deal that will allow it to support a strong and robust recovery for London and the UK.”
Before the coronavirus pandemic, TfL claimed it was on a path to achieving a level of financial self-sufficiency “almost unheard of for transport authorities around the world”.
However, a 65% reduction in tube demand and 44% reduction in bus demand between March and November 2020 massively impacted TfL’s finances.
The government subsequently agreed to a £1.6bn bailout package in May 2020 to keep tube and bus services running until October 2020, followed by a £1.8bn deal in November 2020 to secure TfL services until March 2021.
Earlier this month, the London Assembly called on the government to publish KPMG’s review of TfL finances immediately.
Dr Alison Moore AM, who proposed the motion, said: “It is beggars’ belief that eight months on from the Department for Transport’s commissioning of KPMG to look into TfL’s finances, the full report still hasn’t been put out in the public domain.”
As previously reported by CiTTi, TfL could face losses of £2bn per year due to changes in travel trends, according to a report by business campaign group London First and professional services consultancy Arup.
