Coronavirus: Government ‘optimistic’ of Transport for London rescue deal after Sadiq Khan warns cash-starved services could collapse
TfL is close to running out of cash, Sadiq Khan has said.
Grant Shapps has said he is “optimistic” about striking a rescue deal for Transport for London, after the city’s mayor said he would be forced to cut services without extra state help.
The Transport Secretary said he was “confident in the short term that TfL will continue to run” after Labour’s Sadiq Khan warned that the tube, train and bus operator was close to running out of cash amid the coronavirus lockdown.
Mr Khan has said TfL is spending £600m a month to run services but has seen a 90% drop in income from fares, advertising and the Congestion Charge, and told ministers they have until “close of play” to come up with extra funding.
“Being blunt, today’s the last day,” the London mayor told LBC earlier.
“Unless the Government today gives us confirmation of the grant that we need, then the consequences could be quite severe and the ramifications for all of us will be huge.”
Speaking at the Government’s daily coronavirus press conference on Thursday, Mr Shapps said: “We are now in a situation where I am optimistic of having a solution with TfL and the Mayor of London.”
He added: “We don't know what the long term will be, however I am confident in the short term that TfL will continue to run.
“And I am encouraging the Mayor to make sure we get that back to 100% very quickly as people are starting to travel more. It is very very important... that we do not have over crowding.”
The warning over the future of TfL comes after the Government urged Brits who cannot work from home to head back in following weeks of a nationwide lockdown aimed at halting the spread of coronavirus.
Mr Shapps - who said citizens had a “civic duty” to avoid public transport wherever possible - urged Mr Khan to scrap a long-running freeze on TfL fares to avoid piling the costs onto the rest of the country.
'If you have consistent fare freezes it means more money isn't going into the system' - Grant Shapps
The Transport Secretary said: “It is very important that in providing a rescue package for TfL that the London Mayor can work with, that we don't end up in a situation where people from outside of the capital are unfairly carrying the burden.
“By which I mean, sadly... fares do end up having to rise with inflation otherwise everyone knows there is less money going into the system.
“And if you have consistent fare freezes it means more money isn't going into the system.”
Warning such a move would lead to “an unfair settlement where other British taxpayers are bailing out the system”, Mr Shapps called for the “right balance” to be made to keep services running.
But Labour’s Shadow Transport Secretary Jim McMahon said ministers were in “a mess of their own making” on public transport.
The opposition frontbencher said: “It’s extremely worrying that despite repeated requests, the Government is doing a papering over the cracks style rescue package at the 11th hour to protect Transport for London in the short term.”
He added: “It was right that action was taken in relation to the privately operated bus and rail network.
“The Government must do the same for publicly-owned transport providers, which need long term secure funding for what could be a lengthy period for which they won’t be able to operate at full capacity.”