"Flabby" TfL to lose weight through Sadiq Khan's five year plan

London Mayor Sadiq Khan will this week present his draft five-year business plan for Transport for London to the TfL board of directors, including details on how waste will be cut from TfL to ensure it can maintain its operational and capital investment commitments.

The financial plan for the period up to 2021 is Khan's first as London Mayor and comes after TfL's revenue grant from central government was cut to reach zero from 2018/19, leaving a £2.8bn five-year funding gap. The plan details how this will be filled while paying for Khan's manifesto pledge of an inner London transport fares freeze up to 2020/21, which TfL has estimated will cost around £600m.

Efficiency savings will be made worth around £800m per year by 2021, the Mayor's Office says. TfL is being slimmed down and reorganised to make cuts to its operational budget, reducing 'management layers and reliance on expensive agency staff, merging functions to eliminate duplication and negotiating better deals with suppliers'. A programme of cuts that has already seen 49 senior managers leave TfL is expected save £2bn over the next five years.

Khan said: “From my first day as Mayor of London I’ve been on a mission to create a modern and affordable transport that works for every Londoner. The new TfL Business Plan sets out an ambitious and wide-reaching programme that allows us to both freeze TfL fares, and invest record amounts modernising London’s transport’s infrastructure.

“The previous Mayor refused to do it, but in reorganising a flabby TfL and finding major efficiency savings within the organisation, we’re securing this record investment without burdening Londoners with further hikes in TfL fares.

“Our plans over the next five years include modernising major Underground stations, bringing forward plans to extend the Bakerloo Line, and investing record amounts in cycling and cleaning up London’s air. The greatest city in the world must also have a genuinely world-class transport system, and this is vital for the future success of London’s economy. Today sets out the scale of our ambition.”

TfL's operational and capital investement will reach £10bn by 2020/21, £6bn of which has to be met from fares, with the rest coming from a mixture of capital grants, business rates, property income and borrowing. The plan relies on TfL's drive for efficiency and generating greater passenger numbers. To achieve its aim of a budget surplus TfL needs to attract passengers back to using buses and generate sufficient fares from the Elizabeth Line (Crossrail) when it opens, while reducing operating costs to absorb the additional cost of running the Elizabeth Line, the plan says.

Also set out is an ambitious programme of further Underground improvements, plus plans for a £2.5bn investment in cycling and initiatives to increase walking, support for a new Rotherhithe-Canary Wharf footbridge, plus an extension of the Docklands Light Railway from Gallions Reach to Thamesmead. TfL is hoping £3.4bn of the cost of its capital improvements will be met from property, advertising and consultancy.

TfL transport commissioner, Mike Brown, said: “Transport is not an end in itself. It is a means of helping a city prosper by supporting new jobs and homes and improving connectivity. This plan sets out how, over the next five years, we will become a more efficient and commercially-minded organisation and at the same time meet the Mayor’s vision of an modern, affordable, accessible and green transport network for all Londoners.”