The current Transport for London (TfL) funding deal will be extended following an agreement between the Government and Mayor of London.
The deal was due to run out on 31 March 2021, however, the extended deal will continue to support the capital and the transport network until 18 May 2021, when a new funding deal will be put in place.
Transport Secretary Grant Shapps said that rolling over the existing funding deal until 18 May on the same terms as now will providing certainty during the election period running up to the mayoral elections.
Shapps said the government would work the newly elected Mayor to agree a new funding deal after the elections in May 2021. By this point, non-essential retail and other parts of the economy should be open and transport demand on the network will be considered when formulating a future settlement.
The extension comprises two additional funding payments totalling £260m, with a top-up grant available based on actual passenger revenues. This will take total government support for TfL to more than £3bn since March 2020.
Shapps said: “Support to TfL has always been under the condition that the network must make efficiency savings so it can reach financial sustainability as soon as possible. Those conditions will also form a part of the additional funding payments announced today.
“The Government is committed to supporting London and the transport network on which it depends, and will commence discussions for a further funding deal as soon as the Mayoral elections are concluded. Support for London needs to be balanced with the national recovery and supporting the national transport network as a whole.
“Since March 2020, the government has spent £11bn supporting the running of the national transport network apart from that directly provided to TfL, while continuing to spend money on vital infrastructure projects to level up the national transport network outside of London.”
Responding to the settlement, Mayor of London, Sadiq Khan, said: “This seven-week extension will enable TfL to carry on running the safe, reliable and frequent services that will be vital as lockdown restrictions begin to ease. These discussions will continue as it is essential that TfL has further financial support and a long-term capital funding deal that will allow it to support a strong and robust recovery for London and the UK.”
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