Transport for London (TfL) has said it needs an average of £1.6 billon per annum capital funding between 2023/24 and 2029/30 in order to decarbonise.
In its Financial Sustainability Plan, which focuses on a green recovery, it sets out how it can achieve financial sustainability after fare income was “decimated” by the Covid-19 pandemic.
It outlines several scenarios with the preferred option being to decarbonise by 2030 which, it suggests, will require £1.6bn capital funding.
This is in addition to £500 million being generated either from retaining London’s VED or from introducing a Greater London Boundary Charge.
The Mayor of London Sadiq Khan’s preference is to retain London’s share of VED. Londoners currently pay around £500m of VED annually, “almost all of which is used to fund roads outside of London”, TfL says.
Fare rises from March
The Financial Sustainability Plan comes as TfL announces increases in its fares, which will be introduced on March 1 this year.
As part of TfL’s funding deal with Government in October 2020, the Mayor was required to increase fares under his control in order to deliver an overall fares rise of 2.6% (RPI+1).
From March, a single bus and tram fare will increase by 5p to £1.55, and the daily cap will increase by 15p to £4.65, the same price as three single journeys.
However, passengers will continue to benefit from the ‘Hopper’ fare - unlimited bus and tram travel within an hour for the price of a single fare
Some fares have been frozen, including some single pay as you go Tube, DLR, London Overground and TfL rail fares.
This will “help to encourage people back into central London, when the time is right, and aid the capital’s recovery”, while ensuring “the post-pandemic recovery is not car-led”, the Mayor’s office said.
Hire fees for the Santander Cycle scheme are set to remain the same - with 24 hours access for unlimited journeys of up to 30 minutes available for £2.
All current concessions, including free travel for young people under the age of 18, will remain in place
Khan said: “Londoners know that I have done everything possible to make public transport more affordable since I became Mayor - including introducing the unlimited Hopper bus fare and freezing all TfL fares since taking office - saving the average London household over £200.
“Unfortunately this year Ministers insisted on a RPI+1 per cent fares increase in order for TfL to get the emergency Government support needed as a consequence of the global pandemic.
“Public transport should be affordable to all, so I am pleased that I was able to fight off even worse Government proposals to scrap free travel for under 18’s and concessions for over 60’s as well as bigger fares increase.”
Shashi Verma, director of strategy at TfL said: “This fares package aims to help support the wider economic recovery of the city throughout 2021. Through daily and weekly capping, as well as the Hopper fare, passengers can continue to get the best value fare by using pay as you go with contactless and Oyster."