Government extends TfL funding for two weeks amid emergency bailout talks
The government has extended its funding package for Transport for London (TfL) for two weeks, as the transport body scrambles to shore up emergency cash ahead of further lockdown restrictions in the capital.
A spokesperson for TfL said: “We have today agreed with the government that our funding will be extended for two weeks so that these constructive discussions can be concluded.”
In May the Department for Transport handed TfL a £1.6bn bailout as the nationwide lockdown crippled revenue for the capital’s rail network.
TfL this week held emergency talks over its future financing, after London mayor Sadiq Khan warned the government cash would run out on 17 October.
Khan has asked the government for a further £5.65bn for TfL over the next 18 months, as Covid restrictions and the Prime Minister’s orders to “work from home where possible” continue to weigh on Tube and bus passenger numbers.
The operator’s income plummeted 90 per cent between March and July, with footfall from July to October only rising marginally.
London is set to face further lockdown restrictions as the capital moves from Tier 1 to Tier 2 at midnight tonight.
The new “high” alert level will mean a ban on households mixing indoors, while Londoners will be told to avoid public transport where possible.
It comes after a source in the mayor’s office last week told CityAM that around City Hall there was a “vague sense that [negotiations] are f****d”, and that TfL was at a major risk of running out of cash.
Eleventh-hour talks between the mayor and ministers have stalled because of sticking points surrounding the government’s demands for a potential bailout.
The mayor is understood to have rejected conditions including an expansion of the congestion zone to the North and South Circular, and a demand for fare hikes across the Tube network.
The government is also said to want to axe free travel initiatives for children and those over the age of 60 as part of a potential £1bn bailout.
A spokesperson for TfL said: “We continue to discuss our funding requirements with the government and hope these discussions can be concluded successfully soon, so we can help London through the next phase of the pandemic.”