Tube, bus fares to rise as DfT funding war with TfL continues

The cost of commuting is set to rise further in the capital, with Transport for London announcing its biggest fare increases in more than 10 years on Monday.
Fares on TfL services will rise by 4.8% overall on 1 March, the local government body said, to help it reach “financial sustainability”.

It said that increase was based on the retail price index plus one, although the RPI reached 7.5% year-on-year at last count in December, according to the Office for National Statistics.

TfL said the increase was in line with the conditions of the continued short-term funding agreements it had reached with the UK government.

“Since TfL’s finances were decimated by the pandemic, the government has set strict conditions as part of the emergency funding deals to keep essential transport services running in London,” said London mayor Sadiq Khan.

“We have been forced into this position by the government, and the way it continues to refuse to properly fund TfL, but I have done everything in my power to keep fares as affordable as possible.”

Tube pay-as-you-go fares within zone 1 would increase by 10p, making for their first increase since 2016, while bus and tram fares would increase by 10p to £1.65.

TfL said it was “only the second time” that fares had increased under Khan, after single fares were frozen between 2016 and 2021.

The body said all revenue raised from would ensure TfL could continue to operate, but would not negate the threat of what it called a “managed decline” scenario.

Such a situation would arise, TfL warned, if ministers failed to provide a “sustainable funding deal” critical to London’s transport system, and economic recovery.

“This fares package aims to keep fares as affordable as possible while still ensuring TfL can continue to run clean, green and safe services and support London’s continued economic recovery,” said TfL’s director of strategy Shashi Verma.

“Through daily and weekly capping, as well as the Hopper fare and our wide range of concessions, passengers can continue to get the best value fare by using pay as you go with contactless and Oyster.”

Boris Johnson’s Conservative government has been accused of running a two-tier support system for public transport, ensuring the viability of the privatised rail operators, while attaching stringent conditions to last-minute short-term funding deals with TfL in Labour-controlled Greater London.

The Department for Transport abolished railway franchising and struck ‘Emergency Recovery Measures Agreements’ with private operators on National Rail, whereby the DfT collects all fare revenue and pays guaranteed amounts to the operators, regardless of patronage.

By contrast, HM Treasury has entered into a series of short-term funding deals with TfL, often only reached at the 11th hour.

Those deals have had a number of unpopular conditions attached, such as an increase to the Congestion Charge and an extension of its hours.

Transport secretary Grant Shapps has said the deals were on the condition that TfL was working towards “financial sustainability”, despite the fact the body was self-sufficient and received no state funding prior to the pandemic-induced collapse in patronage.

“Support to TfL has always been on the condition that TfL reaches financial sustainability as soon as possible,” Shapps said in a statement on 7 February.

That statement was made when the DfT and TfL agreed a short extension to their current funding arrangement, to 18 February from the previous 4 February.

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