Government to provide up to £1.7bn funding for TfL as passenger numbers fall

A London transport organisation has announced that it will be receiving up to £1.7bn of funding from the government due to a fall in passenger numbers.

Transport for London (TfL), which operates the city’s buses and Underground system, has agreed on a funding package from the Department for Transport, which will provide the company with a core amount of £1bn.

The package comes as the UK goes back into lockdown, with TfL forecasting a funding shortfall of approximately £2bn for the second half of the year due to the loss of passenger revenue.

It will consist of an Extraordinary Support Grant of £905m and incremental borrowing by TfL from the Public Works Loan Board of £95m, with a provision to increase the total amount to £1.7m depending on passenger numbers going forward.

This follows a previous support package of £1.6bn, and will last until March 2021.

Grant Shapps, Transport Secretary, commented: “This deal is proof of our commitment to supporting London and the transport network on which it depends.

“Just as we’ve done for the national rail operators, we’ll make up the fare income which TfL is losing due to Covid-19.

“Londoners making essential trips will continue to be able to use tubes, buses, and other TfL services, thanks to this government funding.

“At the same time, the agreement is fair to taxpayers across the country.

“The Mayor has pledged that national taxpayers will not pay for benefits for Londoners that they do not get themselves elsewhere in the country.

“Over the coming months, as we look to move beyond the pandemic, I look forward to working with London’s representatives to achieve a long-term settlement, with London given more control over key taxes so it can pay more costs of the transport network itself.

“This agreement marks the first step towards that, potentially allowing a longer-term, sustainable settlement for TfL when the course of the pandemic becomes clearer.”