The Department for Transport (DfT) has agreed to support Transport for London (TfL) during the Coronavirus (COVID-19) crisis.
TfL has kept transport services going, running 70 per cent of Underground services and 80 per cent of buses, even though ticket revenues have declined massively. As a result, TfL had admitted it was rapidly running out of money.
Now, the government has confirmed that it will contribute towards TfL’s funding shortfall, which is forecast to be in the region of £1.6 billion for the period 1 April 2020 to 17 October 2020. The £1.6 billion will be made up of an Extraordinary Support Grant of £1.095 and incremental borrowing by Transport for London from the Public Works Loan Board of £505 million.
However, given the uncertainties in predicting demand, if the actual funding shortfall is greater or less than £1.6 billion, then the amount of the grant and the PWLB loan will increase or decrease proportionately, up to a maximum of £1.9 billion in aggregate. The funding requirement will be kept under review throughout the period to 17 October 2020.
Mike Brown, transport commissioner for London, said: “I welcome this support from government which will help us continue to get London moving and working again, safely and sustainably.
“London’s transport network is absolutely fundamental to the economic, social and environmental health of the Capital. Throughout the pandemic, transport workers have played a heroic role in the response to the virus – ensuring NHS and care staff have been able to get to work and save lives.
“We have worked closely with the government and Mayor as part of the national effort to fight the virus, rapidly reducing passenger numbers to levels not seen for 100 years. This has meant that our fare and other revenue has fallen by 90 per cent.
“We now need to help London recover as restrictions on movement are gradually eased, with public health and more active forms of travel at the forefront of our thinking.
“We have been operating up to 70 per cent of peak Tube services and over 80 percent of bus services with many of our staff ill, shielding or in self isolation. From next week we will further increase services beyond this as we progressively build towards restoring services to pre-covid levels.
“To maintain social distancing wherever possible, the transport network needs to operate differently during this extraordinary period. In line with advice from the Government and Mayor we are encouraging people who can work from home to continue to do so to enable the people who must travel to do so safely.
“We are asking everyone to try and avoid the busiest times to support social distancing wherever possible, to wear non-medical face coverings when they do need to use public transport, and to walk and cycle whenever possible. We are providing extensive new cycling and walking facilities to support journeys by these means.
“Enormous challenges remain, including agreeing longer term sustainable funding for transport in the Capital. In the meantime, we will continue to do everything in our power to help deliver a successful recovery for our great city.”
In addition, TfL has revealed that, with respect to the Crossrail project, the existing funding package agreed in December 2018 will continue to apply. TfL and DfT as joint sponsors will make all reasonable efforts to complete the project as soon as practicable and will continue to work on identifying the additional funding that will be needed for completion.