Transport for London (TfL) have been forced to respond to concerns of a looming financial crisis after reports it is planning for a near-£1 billion deficit next year. TfL’s operational deficit has continued to rise year-on-year, from £171 million in 2012/13 and £458 million in 2016/17 to £785 million this year. By 2018/19 the deficit is expected to hit £968 million.
A surprise fall in passenger numbers and increased competition from ride-hailing apps, such as Uber, as well as the axing of a UK Government grant, worth £700 million per year has already seen tube upgrade plans shelved. But, London’s transport authority has responded by bullishly predicting an operating surplus by 2021.
Transport for London are expecting increased revenues when the new Crossrail starts carrying passengers in late-2018.
despite the prize freeze
The fall in passenger numbers comes despite Mayor, Sadiq Khan, imposing a prize freeze on fares. A TfL spokesperson insisted:
“London is leading the way in showing how you can keep fares affordable, while still investing record amounts in creating world-class infrastructure. Although overall ridership is currently slightly lower than originally budgeted, ridership on the bus, tube and rail services is regularly outperforming that elsewhere across the country, helped by the fares freeze, the Hopper fare and improved reliability.”
David Begg
Former TfL board member, David Begg, has claimed they are “in a crisis.”
Mr Begg added, “There’s a genuine concern that the organisation is starting to creak. I’m starting to worry about TfL and its ability to deliver against this financial background.”
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