Government continues to turn the screw on London: TfL cuts incoming

The latest settlement between Government and Transport for London has been revealed this morning with the Department for Transport insisting on further cuts in services and/or extra revenue raised through measures such as above-inflation fare increases.

For the current financial year the Department for Transport insist upon “Delivery of further operating efficiencies of at least £300m in 2021/22 through appropriate revenue sources and/ or cost saving initiatives”. That increases to £730 million a year by 2023.

Potential revenue sources are rather limited in a pandemic, which means cuts are extremely likely. TfL have already cut 824 member staff over the past year, and compared to original budgeted plans have 1,500 fewer:

Staff cuts

This sets up services cuts: “A joint review of demand (in September 2021) to inform future service level requirements and potential changes from 2022/23 onwards as described in paragraphs 15 to 17 below, with the requirement to report back to HMG”.

“A review for London Underground and Rail will take place by the end of September that will allow HMG and TfL to reconsider required service levels in light of both outputs from the ongoing review and observed demand across the network.

Lewisham DLR station. Future service improvements at risk?

A review for buses should take place in July and September subject to the result of the Government’s social distancing review.” 

Staff will see no pay increases and fares will continue to rise above inflation:

“TfL will continue with its existing plan to increase fares in line with their Business Planning assumption of an overall fares increase of RPI+1% on fares under the Mayor’s control in January 2022.”

Maintaining roads

Transport Secretary Grant Shapps has refused to allow a greater share of Vehicle Excise Duty raised in London to be retained within London to maintain roads, stating “I do want to reiterate that we regard any proposal to transfer Vehicle Excise Duty income from the Exchequer to TfL as, in effect, a permanent government grant.”

What’s wrong with that you may think? However grants are a big no-no for the current Government – which is pretty much unique in the world.

VED raised in London amounts to £500 million a year. The vast majority of excise duty paid by London’s drivers is spent on roads outside the capital, and thus public transport users were and still are cross-subsiding roads. A bizarre situation seen no where else in the world.

The action also goes against calls by Conservatives in London to use a greater share of VED raised in London to be retained and spent within London.

Letter from Gareth Bacon in 2018 seeking retention of VED in London

This doesn’t appear to be the actions of a Government keen on encouraging people to use sustainable means of transport.

Shapps then states a boundary charge is wrong, and then claims while government support capital investment, they won’t be providing any in the near future: “It is thus still too early to make long-term capital funding commitments of the kind you seek – many of which appear to assume that, for instance, commuter demand to central London will return exactly as before”.

Don’t expect DLR to Thamesmead soon or the Bakerloo Line to Lewisham despite tens of thousands of homes either underway or planned. Many of these improvements are not centred around central London commuters, though that appears to make no odds.

A common theme is to insist on raising more income in London but then doing all they can to block many measures.


Government have been active in encouraging the ULEZ extension (Tories in London were keen to hide this during the Mayoral election) and this continues:

“Should the Mayor choose to amend his existing plans to extend the ULEZ boundary from 25 October 2021 these will have to be paid for without recourse to Government funding and without recourse to additional borrowing, savings, service changes or deferrals”.

In effect, go ahead with it.

Active travel

Some London Tories have continually attempted to pin cycle lanes and active travel measures on Sadiq Khan alone. Once again this deal shows central Government are pushing it:

“TfL will commit to set aside at least £100m within the 2021 Funding Period to continue the delivery of healthy streets and active travel programmes including funding for the London Boroughs under the local implementation plan process. Within this funding, TfL will continue to prioritise the urgent delivery and operation of a temporary walking and cycle ferry as a replacement crossing for local communities affected by the closure of Hammersmith Bridge.”


There are some positive points such as emphasis on using land around stations for housebuilding. The report states that:

“TfL to agree a plan for housing delivery through a dedicated commercial property company that meets the shared ambitions of the Mayor and HMG to deliver housing in a high demand area and to provide an increased revenue stream. The plan will be agreed between TfL and HMG by June 11th and include a clear milestone for housing to be delivered by the end of 2024”.

TfL have a poor record here in many places. Woolwich DLR station remains a wasteland 12 years after TfL signed a joint agreement for new housing.

Driverless trains

The old favourite of tabloids, god-awful talk radio hosts and and those who generally havn’t much of a clue – driverless trains – pops up. This is something for Shapps to use to distract the public and gullible. The cost of converting trains and lines would be in the billions – and Government have already made clear they do not want to fund upgrades such as new stock. Even if large sums were spent on it, drivers would simply be replaced – by law – with a member of staff on board. Staff wage differences would be minimal at best. The entire issue is a massive distraction.

When this pops up you know it isn’t a very credible response by Shapps and the Government. Instead of a serious attempt to rejuvenate public transport they play to the gallery.

TfL have been ordered to “produce a Full Business Case for the Waterloo & City Line within 12 months and for the Piccadilly Line within 18 months”, involving ” one Underground line to Grade-of-Automation 3 (driverless, but with an on-board attendant, as on the Docklands Light
Railway), subject to a viable business case and its statutory responsibilities.”

So they want TfL to cut staff, yet allocate those remaining on this. Just as well there’s no more pressing issues. And while funds are reduced, TfL will be forced to spend money on “Market engagement into alternative platform edge protection technology, to be led by TfL and completed by 30 November 2021” and “design work on rolling stock specification, new signalling, and Platform Edge Doors (PEDs).”

Spiral of decline?

There’s a lot about monitoring service usage to determine future spending, but the obvious question is how short term cuts and inflation busting fare increases depress demand and drive people to cars, which then creates a spiral of decline. All noises from central Government show little interest in an affordable, well funded public transport network.

For all the rhetoric about “levelling up” once again it appears levelling down is the real aim. Other English cities are not seeing investment to raise them to London standards; instead London – which is is far and away the city that saw healthiest growth in public transport usage the past two decades – get dragged down to regional levels through service cuts and cost increases.





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    5 thoughts on “Government continues to turn the screw on London: TfL cuts incoming

    • I really wonder how all the “rescue packages” would have looked like if there would have been a tory mayor the past few years, as there would be no Labour person to blame then….

      Fortunately the funding issue has been rightly addressed by the Guardian, that it is solely caused by the complete lack of ridership and thus lower level of fee income.
      I don’t understand how central government can blatantly lie about the reasons behind the funding gap again and again, and get away with it?

      Besides Corona there should be a proper investigation in the management of funds around London/TFL, which could hopefully shed some light on governments particular interests here.

    • Looks like we are set for more cuts to services which are already overcrowded meaning longer waits for passengers. This is not good a time we are being encouraged to use public transport more.

      A good reliable and frequent public transport infrastructure is required for the success of any City let a lone a capital City like London.

      Ww must properly invest in our public transport infrastructure. The last 15 months have been eceptionally difficulty for us all includiung TFL with a loss of fare revenue. We need to all work together now as we move forward from the pandemic.

    • I totally agree the public transport infrastructure does need to be properly invested in and is vital to the success of any City.also TFL have had a very difficult time over the last 15 – 16 months due to a huge reduction in fare revenue due to the Covid pandemic. So I hope an agreement between the Government and TFL can be reached. .

      On a separate note TFL now have to step up tackling fare evasion again which was costing TFL millions of pounds prior to the pandemic and sadly will continue as more people start to travel regularly again.

    • Fellow local jjournalist 853 reported that Sadiq Khan as paid £10 million to settle a legal dispute over the Silvertown Town Tunnel. If they are so much in debt and could face bankruptcy withold these bail ours to keep TFL a float and services running.

      Where did tihis money (bearing in mind it is £10 million) come from? A lot of Organisations Local Authorties and other Administrations say the are broke but have millions of pounds in reserves which they are not using. As reported by local journalist on their sites over the last couple of years.

      My main concern for London is that we keep bus, underground, and DLR services running with out further cuts to services. while investing in these services and improving bus services particular in Outer London Boroughs where theren iis no or very limited access to the London Ubderground services.

      including Bexley, Bromley, Greenwich and Lewisham Boroughs. Which are also seeing huge increases in the local population as new homes have already been are completed. with thousands of more new homes still to be built.

    • I agree Kay TFL must keep services running and the transport infrastructure must be properly invested in to improve public transport which really is essential to the success of London as a major capital City on the world stage. Otherwise businesses will start to invest elsewhere in the UK and overseas.

      The public transport infrastructure is not keeping up with demand as thousands of new homes are being built across Greater London. I also agree Bexley, Bromley, Greenwich and Lewisham have very little access to the London Underground System with the nearest tube stations being at North Greenwich or New Cross. So we do rely heavily on our bus services in these areas.


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