The UK Government has stepped in with a £1.6 billion support package to ensure Transport for London can maintain public transport services in the Capital.
But the funding comes with strings attached – including an agreement to increase fares by 1% over inflation, a funding review and Government representation on the TfL board.
The alternative was for TfL to issue a Section 114 Notice – essentially declaring that the publicly owned organisation was bankrupt and risking wholesale slashing of transport services and mass redundancies.
TfL’s revenues from fares and advertising collapsed during the lockdown as passenger numbers dropped by around 90% across bus and tube services.
The package includes a £505 million loan plus £1.095 billion in grant aid. In exchange, two special representatives will represent the government on TfL’s board, its finance committee and its programmes and investment committee.
According to the DfT, the collective focus will be on taking all practicable steps to increase the number of services as quickly as possible to benefit passengers who have no alternative to public transport.
The DfT said the agreement includes increasing service levels as soon as possible to ensure people can follow social distancing guidelines while on the network, making sure those who have no alternative to public transport can travel safely.
London's Transport Commissioner Mike Brown MVO said: 'We have worked closely with the Government and Mayor as part of the national effort to fight the virus, rapidly reducing passenger numbers to levels not seen for 100 years. This has meant that our fare and other revenue has fallen by 90 per cent.
'We now need to help London recover as restrictions on movement are gradually eased, with public health and more active forms of travel at the forefront of our thinking.
'We have been operating up to 70 per cent of peak Tube services and over 80 percent of bus services with many of our staff ill, shielding or in self isolation. From next week we will further increase services beyond this as we progressively build towards restoring services to pre-covid levels.
'Enormous challenges remain, including agreeing longer term sustainable funding for transport in the Capital. In the meantime, we will continue to do everything in our power to help deliver a successful recovery for our great city.'
Transport Secretary Grant Shapps said: “People should avoid using public transport and work from home wherever possible, but as measures are slowly lifted it is vital that Londoners who need to use TfL services feel safe and secure.
“This deal will encourage a real move towards greener and healthier walking and cycling options, ease pressure on our public transport and provide certainty and stability for London’s transport services in the future.”