Agreement covers investment plans for next year
Ministers and Transport for London (TfL) have agreed a new £250m funding package to invest in upgrades to the capital’s infrastructure next year.
November saw London’s transport authority record its highest passenger numbers since the pandemic, prompting it to call for a long-term capital funding settlement from the government.
An existing funding deal, struck last summer after months of wrangling, had been set to run out in March 2024 and the new injection of cash will allow TfL to continue its investment programme, which includes new trains for the Piccadilly line.
Andy Lord, London’s transport commissioner, said TfL was now able to cover the cost of “the majority” of its capital investment but said it would need to reassess its recent draft business plan to “address the impact of the continuing shortfall in funding”.
It is also short of the multi-year funding arrangements that have been introduced elsewhere in the country, including in the West Midlands.
Multiple capital projects, including the Bakerloo line extension and the Crossrail 2 project, were mothballed after the pandemic due to lower passenger numbers.
“Through a huge effort to reduce costs and rebuild our ridership and revenue following the pandemic, TfL is now on track to be financially sustainable in terms of its day-to-day operations,” Lord said.
Rail Minister Huw Merriman said the agreement would have a “tangible, positive impact” for travellers and would underpin skilled manufacturing jobs across the rail sector.
“We have invested billions into the capital’s transport system in recent years. This investment must be well managed in a way that doesn’t unfairly burden the pockets of taxpayers and motorists,” he added.
The injection of cash brings the government’s support for TfL to more than £6bn since 2020.
Under the last settlement, £1.2 billion of government funding supported almost £3.6 billion of major transport projects in the capital.
As part of today’s deal, TfL will set out a plan to maintain and strengthen its finances in July and has committed to reforming its pension scheme.