TfL rejects new Covid bailout over ‘unacceptable’ terms imposed for extra cash

TfL is seeking a long-term deal to keep Tube and bus services running following a huge drop in income
Ross Lydall @RossLydall9 February 2022

Transport for London failed to agree to a new Covid bailout because of the “unacceptable” conditions attached by the Government, it has been revealed.

TfL commissioner Andy Byford said he refused to accept the latest deal last Friday — which would have only lasted until June — because he was unhappy at the terms being imposed in return for extra cash.

A two-week extension was instead granted in a bid to find a solution acceptable to both TfL and the Department for Transport.

Mr Byford told the London Assembly transport committee on Wednesday: “What was put before us last Friday was unacceptable in terms of the conditions that were attached.”

TfL is seeking more than £1 billion until April next year to keep Tube and bus services running — by which time it is required to break even on a day-to-day basis — plus a longer-term capital funding for “big ticket items” such as new trains and signalling systems.

Mr Byford said he expected a further short-term deal to give the Government extra time to decide how to fund major transport infrastructure projects.

He said he was “not expecting a blank cheque” but added: “What I don’t support is either a temporary deal that has intolerable, unacceptable conditions. I won’t be able to sign up to this — it would be irresponsible of me to do so.

“If the conditions are too onerous, I cannot in good faith sign up to them.”

However, on Wednesday evening the Department for Transport contacted the Evening Standard to dispute that a “deal” had been rejected - with sources saying discussions with TfL had not got to the point of a final proposal having been tabled.

Instead, both sides were said to have agreed to a two-week extension of the deal first struck last June - the second time it has been extended, after initially being due to run out in December last year.

A DfT spokesperson said: “The claims that Transport for London rejected a deal last Friday are false. Both the Government and TfL agreed to a short extension of the current funding deal to ensure the next settlement represents value for money for taxpayers across the country.

“We have repeatedly shown our commitment to supporting London’s transport network throughout the pandemic, providing more than £4.5bn in emergency funding to TfL and pledging a further billion pounds of capital investment every year up until at least 2024/25 - all at a time of significant pressure on national finances.”

Previous bailouts have included conditions such as requiring Mayor Sadiq Khan to review the TfL pension scheme — sparking a Tube strike on two days next month by the RMT — and to fund any free travel concessions for children and pensioners from City Hall funds.

The Government’s stance is that it is willing to cover the huge drop in income suffered by TfL due to the pandemic but will not use national funds to subsidise Mr Khan’s “policy choices”.

Mr Shapps, announcing the two-week extension to the Commons on Monday, said that he was aiming to secure a “robust” deal by February 18.

Mr Shapps said: ““This short extension will enable us to finalise the terms of a robust settlement for this period, ensuring TfL and the Mayor take steps to move towards financial sustainability.

“Support to TfL has always been on the condition that TfL reaches financial sustainability as soon as possible and with a target date of April 2023, and government continues to press the Mayor of London and TfL to take the decisions needed to put the organisation on a sustainable footing.”

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