Andrew Dismore

See article here: https://www.theguardian.com/commentisfree/2020/may/19/bailout-london-transport-network-tories-tfl-coronavirus-pandemic?CMP=fb_cif

Last Thursday evening, Transport for London came within hours of running out of money. What would have happened to the tube, the buses, the Overground and everything else TfL is responsible for if it had is unclear: I don’t think it would have meant bailiffs walking off with DLR carriages, but who can say?

Anyway, it didn’t happen: at the last minute the office of the mayor of London, Sadiq Khan, agreed a £1.6bn bailout package with national government. In return, it had to accept two government officials on the TfL board, plus the inevitable public statements about how this proved the mayor couldn’t be trusted with money.

In truth, it proves nothing of the sort: to hold Khan responsible you’d need to be politically motivated, innumerate or both. And while this may look like a little local difficulty of no interest to those outside the capital, the affair highlights the Tory party’s chronic inability to comprehend the difference between public services and private goods, and sends worrying signals for how the government might approach the question of public sector deficits across the country in months to come.

To explain how we got here, you need to dig back into recent history. In 2015, the then chancellor and the then mayor of London agreed a new financial settlement for TfL. No longer would it receive £700m a year from the Treasury to keep its transport services running: instead, excepting a few quid from things like devolved business rates, it would be expected to pay its own way.

And lo, it came to pass. Since 2018, most of TfL’s income has come from advertising, congestion charging and, predominantly, fares. Because TfL is also responsible for a certain amount of road maintenance in London, this has led to the frankly ludicrous situation in which tube passengers are subsidising drivers. The result, in the words of the current mayor, was that London would be “the only transport system in western Europe that gets no government grant”.

Nonetheless, all this was working fine – ish – until the pandemic hit: at that point, people stopped travelling, fare income collapsed and TfL nearly ran out of money. Which brings us to the current situation.

There are several things about this that are messed up. Let’s start with the conditions attached to the bailout. Barring the use of Freedom Passes – which offer free travel for Londoners over 60 – from peak hours services may not be pretty, but you can see the logic, in terms of both spreading demand and minimising the chance of older people catching the coronavirus. (Freedom Pass holders who work have seemingly not been considered.) But promising to raise fares at a moment of economic crisis – when it’s the poorest and most vulnerable who are least able to work from home – is not the action of a government that thinks we’re all in this together. Meanwhile, requiring TfL to switch its “stay at home” messaging for the baffling, government-preferred “stay alert” formulation is just plain weird.

Then there’s the way the Tories are turning their own incompetence into an assault on a popular Labour politician. Assorted government outriders have tried to blame this mess on Khan’s fare freeze, which has been estimated to cost TfL around £640m over four years. They have yet to explain how avoiding such a freeze would have plugged the gap caused by the pandemic, which, at £600m every month, is roughly 45 times larger. Perhaps Khan will now spin a fare increase that would have happened anyway as the result of Tory cruelty; but you can already see the contours of the “Labour can’t be trusted with money” argument that still, somehow, resonates, even though the economy collapses every time we let the Tories anywhere near it.

The really messed up thing about all this, though, is that the government seems genuinely to have believed that London transport should be self-funding. But millions of people use TfL services every day: they’re as basic to the successful running of the city as the roads or the sewers, and without them London would grind to a halt. It makes little sense to force the public infrastructure that underwrites London’s economy to “balance its books”, as if it were a private company looking to make a profit.

It is telling that few major western cities have copied the UK capital’s unusual transport funding model: the closest seem to be Manchester and Toronto, both of which are also in trouble, and neither of which are nearly so dependent on their metros as London. By agreeing that deal in 2015, the men who signed it showed that they don’t understand what public transport is for.

The current situation is not sustainable. Last week’s bailout was worth £1.1bn in cash, plus another £505m in loans. But with TfL down £600m a month, this won’t be enough to see it through to the end of the summer. And it’s no good looking elsewhere for inspiration: no other city has been foolish enough to get itself into this sort of a mess.

An editorial in the Evening Standard on Friday claimed that Khan “has a bad habit of blaming others when things don’t work out”. It modestly neglects to mention that the editor of that paper, George Osborne, is the very chancellor who imposed this financial settlement on TfL in the first place. The mayor who signed it off, incidentally, was called Boris Johnson.
• Jonn Elledge is former assistant editor of the New Statesman