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The UK Government has agreed to invest £250m into upgrading the transport system in London, allowing Transport for London (TfL) to continue working on part of its ongoing investment programme.
However, the investment is still set to leave a funding gap in TfL’s draft business plan, with another £250m expected to be needed towards its maintenance budget.
London Transport Commissioner Andy Lord said: “It is good news that we have now reached an agreement with the Government on the capital support that they will provide over the next year, and we are grateful for the support.
“However, we will now need to reassess our recent draft business plan and address the impact of the continuing shortfall in funding. That work is underway so that we can confirm as soon as possible what we will deliver for London.”
As part of the agreement with the government, TfL can not use the new funding towards its day-to-day operations, instead being put towards projects such as the purchase of new trains for the Picadilly line and a scheme to support new skilled manufacturing jobs in Yorkshire.
Rail Minister Huw Merriman highlighted the effects of the investment, saying it will have “a tangible, positive impact” for everyone travelling in the capital city, while also hinting towards TfL’s recent funding issues following the effects of the pandemic by saying the investment “must be well managed” to not “unfairly burden the pockets of taxpayers and motorists.”
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By GlobalData
While the government is spotlighting the more than £6bn it has put into TfL since 2020, the lower funding agreement will likely be disappointing for Mayor Sadiq Khan who had told the TfL board last week that he was “incredibly worried” by the possible impact of a cash shortfall.
The business plan first published in December 2022 had outlined £8.1bn of investment until 2026 into road and rail networks across the city with a number of projects looking to modernise, upgrade and replace ageing infrastructure such as a new fleet for the DLR and new signalling on the Circle line.
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