It has been announced that Transport for London’s (TfL) emergency funding deal, set to expire on Wednesday 13th July, has been granted a further 2-week extension, now seeing it continue until the 28th of July.
This extension affords time for the Department for Transport (DfT) and TfL to conduct further negotiations on a deal to address the remainder of the financial year, as well as a long-term capital funding plan, which will enable TfL to repair roads and bridges and upgrade Tube and bus infrastructure.
Secretary of State for Transport Grant Shapps penned a letter to parliament addressing this funding extension, stating:
“This extension to the current funding settlement is necessary due to the unsatisfactory progress made by TfL on meeting agreed deadlines, including relating to pensions. Resolving these issues is an integral part of setting TfL on the path to financial sustainability.”
The current grant comes after a 19-day extension was awarded last month, where it was accompanied with a condition to provide evidence that the TfL could find £400m worth of savings. Reports are claiming that this condition has not been met, though these claims are being denied by the TfL.
Transport for London (TfL) issued the following update on Government funding:
"We continue to discuss our funding requirements with the Government. There is no UK recovery from the pandemic without a London recovery and there is no London recovery without a properly funded transport network in the capital. It is essential London receives the sustained long-term Government funding that is vital for the coming years if a period of 'managed decline' of London's transport network is to be avoided.
"We have today (13 July) agreed with the Government that our existing funding agreement will be extended until 28 July 2022 so these discussions can be continued. Whilst in receipt of Government support, we have worked hard to progress all conditions placed on TfL and continue to maintain that we have met them all. Working together, we must achieve a longer-term capital funding settlement that ensures London's transport network can remain reliable and efficient, can support the jobs and new homes that rely upon it and can support the economic recovery of the capital and the country as a whole. We hope these discussions can be concluded successfully soon."
The ongoing dispute over terms and conditions of renewal deals between the DfT and TfL must be resolved soon as the success of London’s public transport sector is integral to the cities economic recovery in the post pandemic climate.
The bailouts are designed to replace fares income that has been lost to TfL as a result of the pandemic, as recent figures show that tube travel have plateaued at less than 75 per cent of pre-pandemic levels. As a response to pandemic passenger number reductions DfT has provided close to £5bn in emergency funds since May 2020
The original terms of the Funding Package announced on 25 February 2022 can be found in the funding letter.
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