Transport for London: Financial Settlement

Lord Davies of Brixton Excerpts

Tuesday 2nd March 2021 Lords Chamber

[Baroness Vere of Norbiton (Con)]

My noble friend raises a very interesting period of time that unfortunately I do not remember, but it is the case that the Mayor of London has some very interesting ideas as to how he wants vehicle excise duty to be spent. It is one of the proposals in the financial sustainability plan he has prepared, which I have to say does seem to have been drafted with a money-no-object mindset. Noble Lords will know that vehicle excise duty is used for the strategic roads network, which is the motorways and the major A roads, so unless we are going to stop Londoners from using our motorways and buying products that have been brought into London by HGVs travelling on them, I see absolutely no rationale for devolving VED.

[Lord Davies of Brixton (Lab) [V]]

My Lords, I read in the Financial Times today that the ONS says that as an average Londoner I receive about £4,000 less in public spending than I pay in tax. As a proponent of progressive taxation, I am happy to pay, but the fable of the goose that lays the golden egg comes to mind. Will the Minister agree that the economic prosperity of the whole country depends on a prosperous London, and that that requires, among other things, a well-connected London with excellent public transport? Is it not remarkable that London is the only major city in the world where there is no contribution from general taxation, from which the whole country would benefit?

[Baroness Vere of Norbiton (Con)]

The noble Lord is right that London will play a very important part in the economic future of our nation; in 2018 it made 23% of UK GDP. But while much of the funding for Transport for London comes from passenger revenues, there are other routes by which it gets money; for example, business rates retention, which is a retention which would otherwise have gone to Her Majesty’s Government. So one might assume that there is a broad breadth of sources of funding for TfL, but I agree—the Government want to support London’s recovery and we want to keep the capital moving.