Draft Business Plan outlines Transport for London’s expenditure plans for 2024-25

Picture of Glyn Mon Hughes

Share:

Draft Business Plan outlines Transport for London’s expenditure plans for 2024-25

Share:

Picture of Glyn Mon Hughes

Share:

New DLR trains at Canary Wharf
New DLR trains at Canary Wharf // Credit: TfL

Transport for London (TfL) has delivered its Draft Business Plan for 2024-25.  The plan confirms that TfL will deliver a full programme of improvements and key infrastructure renewals.

But it is warning that, because Government funding fell below the level that TfL had asked for, difficult decisions will need to be made that will have longer-term financial impacts.

The plan outlines how the organisation will work to rebuild ridership, increase income and reduce costs.

The result is that it will be financially sustainable in its day-to-day operations.  However, it reiterated that it needs Government support for capital investment across its business plan, which would amount to 25% of its capital investment programme for the next year.

TfL, along with business groups and stakeholders in , has told the Government that a proportion of capital investment is vital to find the whole plan.

They argue that every major transport authority around the world is supported with government funding also suggesting that investing in London benefits the whole of the UK economy as TfL’s supply chain supports 100,000 jobs around the country outside the capital.

The Government confirmed the provision of £250m of capital investment for TfL over the next year on Monday 18 December.

That represents only half the figure of Government investment required.

After working hard to assess the options available to it, TfL has implemented a number of measures – including rephrasing the timing of payments under contract with Siemens Mobility who are delivering the new Piccadilly Line trains presently under construction – and is now able to start the delivery of the plan.  As a result, the business plan was agreed by TfL’s Finance Committee through delegated powers on Friday 22 December.

 

A new Piccadilly Line train
A new train on a test run // Credit: Siemens

The increase in transport usage and some other factors will mean that TfL will have a greater surplus and, therefore, better access to borrowing in the future.  The planned rephrasing of payments to Siemens Mobile will not affect next year’s delivery of the first new Piccadilly Line train for testing.  The higher capacity walk-through trains are due to enter service in 2025, ahead of timetable improvements in 2027.

The new arrangements will also mean that more of the new trains will be built at the Siemens Mobility facility in Goole.

Originally, only half of the new trains were to be built there but, with Siemens investing up to £200m and creating 700 jobs at the factory as well as 1,700 in the supply chain, all the trains are scheduled to be built there.

In addition, if there is long-term certainty regarding Government funding, a replacement fleet for the Bakerloo Line will also be built at .  The present fleet is more than half a century old, the oldest trains in regular passenger service in the UK.

TfL’s assumption is that 50% of funding for major capital programmes from 2025-26 will be provided by the Government.

Rail passengers in London can look forward to a range of improvements which are included in the business plan.

These include the Four Lines Modernisation programme – involving the Circle, District, Hammersmith and City and Metropolitan Lines – which will provide additional capacity through improved .

The walk-through, air-conditioned trains for the Piccadilly Line will complement new trains for the Docklands Light Railway (DLR).  A procurement for new trams to replace the existing South London fleet will be drawn up to replace vehicles which have been in service for nearly 25 years.  Infrastructure works will include new stabling facilities for new Bakerloo Line trains.

Work will also be undertaken to deliver new step-free stations, the transformation of Tube station and contributing to further feasibility studies for a DLR extension to Thamesmead.

Mayor of London Sadiq Khan said: “These past few years have been the most challenging in TfL’s history, but following a programme of work to rebuild ridership, increase income and reduce costs, I’m pleased that TfL is now on track to be financially sustainable for the first time in its history in terms of its day-to-day operations.

“As the Government has only provided half of the capital funding that TfL needs, TfL has had to make difficult decisions about their business plan to ensure they can continue to make vital upgrades to London’s transport network. That’s why it is still vitally important that we agree a sustainable long-term funding settlement from the Government that allows us to plan and invest for the infrastructure London will need over the coming decades. Expanding our transport network and supporting jobs and economic growth in London has real and sizeable benefits for the economy of the whole UK.”

Andy Lord, London’s Transport Commissioner, added: “Through a huge effort to reduce costs and rebuild our ridership and revenue following the pandemic, TfL is now on track to be financially sustainable in terms of our day-to-day operations. We are also able to cover the cost of the majority of our capital investment.

“Following the confirmation of £250m in Government support for our capital investment programme, we have had to make difficult decisions about our business plan to ensure we can continue to deliver our vital programme of improvements. In order to achieve this, we are now finalising plans to rephase the timing of payments under the contract with Siemens Mobility, who are delivering the new walk-through and more energy efficient Piccadilly line trains that are currently under construction. This rephasing is not something we would have chosen to do, but we have ensured that it does not impact when the first new train will arrive in London for testing, nor the planned timetable uplift in 2027.

“While we can now deliver our full Business Plan for 2024-25, our shortfall in Government capital investment has only been mitigated in the near term and will reduce the amount of valuable investment we can make in future years, unless further funding is agreed. We, alongside London’s business stakeholders and others, will continue to make the case that ongoing Government support for capital investment in transport is needed if we are to be able to continue to deliver vital improvements to London’s transport network, unlock new homes and support growth across London and the UK.”

Responses

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

  1. I’m just here to see how many people take pot shots at Khan, even though central government has only given half the amount of money TfL requested…

  2. New DLR trains, new Piccadilly Line trains and new Bakerloo Line trains. This is what London needs to improve its transportation and to improve better transport services across London. Since the Elizabeth Line became operational last year.

Related Articles