Transport for London Funding

Robert Goodwill Excerpts

Tuesday 15th December 2015 Westminster Hall

[Mr Thomas]

My hon. Friend has made her point, and I stand with her on her concerns about Vauxhall station.

Also in south London, Waterloo’s overall passenger numbers have rocketed from 62 million 10 years ago to 100 million now. At some locations, peak-time travel is already close to unsafe, as I have said, and, for example, closure of Oxford Circus tube station due to overcrowding is now routine.

It is not just the rail and tube networks that TfL manages that are under pressure; its own estimates suggest that London’s roads are coming under greater pressure from increasing car usage, at a time when there is pressure to allocate more space to achieve safer cycling and good walking routes. If nothing else changes, by 2031 an increase in congestion of at least 60% is expected in central London; for the rest of inner London, congestion is set to rise by some 25%; and even in outer London, we expect to see a 15% increase in congestion. Traffic speeds are coming down and car journeys are taking longer. Congestion is already bad for ordinary car users, who face the nuisance of longer journeys, and it is bad for business, too.

As an aside, I hope the rumours that the Government are trying to ease air pollution controls are false, because in London the scale of air pollution, much of it diesel-related, is already extremely worrying. Perhaps the Minister will comment on that. The continuing need for TfL to invest in greener, less polluting vehicles is widely accepted, but such investment is a not insignificant future cost. However, from 2010-11 to 2014-15, TfL income from the Department for Transport fell by more than a third. In the coming year, Government grants will amount to only a little more than 20% of TfL’s annual budget. The transport systems of major competitor cities in Europe receive a considerably higher percentage of their funding from central Government sources. In Paris, for example, transport gets more than 40% of its funding from a Government transport tax.

Transport for London receives two types of grant from central Government: resource grants and infrastructure grants. The Department for Transport was hit particularly hard in the spending round, so it is perhaps no surprise that TfL has been significantly affected, with a 34% cut in funding overall in 2016-17. In the spending review, the Government said that they would phase out the resource grant to TfL, claiming that that

“will save £700 million…which could be achieved through further efficiency savings…or through generating additional income from…land TfL owns”.

It would be more accurate to say that TfL will, as a result of the Chancellor’s decisions, lose about £3 billion over the business plan period of 2015-16 to 2020-21. Inevitably, the loss of grant funding will have an adverse impact on the quality of service that my constituents can expect. The resource grant is to be axed—crucially, earlier than TfL had been led to believe.

[The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)]

The hon. Gentleman has outlined the massive increase in usage of the underground and other TfL transport. Congestion charge takings have also increased, because of more vehicles. Does he not therefore agree that any resource funding needs to be viewed in the context of fares, which are coming in in larger numbers?

[Mr Thomas]

I will talk about fares in a little while, and of course one has to look at TfL income in the round. Nevertheless, I hope that the Minister accepts that the loss of £3 billion over the current five-year business plan period is a huge reduction in funding.

Before the spending review announcement a couple of weeks ago, TfL had still expected to receive almost £800 million in revenue funding until as late as 2019-20. Any surplus in resource spending—there has consistently been a substantial surplus in the operating budget—has been reinvested to help fund TfL’s capital programme. Any loss in that funding will therefore inevitably have an impact on capital investment.

The announcement of those huge cuts comes at a time when TfL has had to announce a five-year delay to the wonderfully named sub-surface upgrade programme: a plan to increase by 40% the number of people who could travel on the District, Circle, Hammersmith and City, and—crucially for my constituents—Metropolitan lines. New trains and better signalling were to be delivered by 2018, but following the failure of the contract with Bombardier Transportation, the expected completion date has been shifted back to 2023. Will the Minister confirm that the cut in funding to TfL will not further exacerbate the delay in modernising the Metropolitan line and those other lines that were initially part of the sub-surface upgrade programme? TfL has estimated that the knock-on impact of the delay on London’s economy is £900 million. That is income and jobs that Londoners, some of them in my constituency, are set to miss out on.

TfL now claims that the cost of completing the modernisation of the Metropolitan line and the other routes under the sub-surface upgrade programme has increased by £1.15 billion since previous forecasts. To put that into context, TfL’s planned capital expenditure for 2016-17 alone is about £3.3 billion. Inevitably, the extra costs from the failure of the Bombardier Transportation contract, plus the huge cut in grant funding, call into question other investment projects and the speed at which they will be completed.

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[Mr Thomas]

Rather than getting into the detail of what may happen with the garden bridge, let me say that I would prefer to see that money reallocated to a series of other existing and necessary capital investment projects. If my hon. Friend will forgive me, I think the priority is Harrow, but I am sure that he will be able to make the case for south London well.

I come back to the concern that the £3 billion cut in funding in the spending review and the extra costs from the sub-surface upgrade programme might put other investment projects at risk. The Piccadilly line refurbishment is particularly important for many of my constituents who live in Rayners Lane, South Harrow and Sudbury Hill. Will the refurbishment programme for that line go ahead as planned? There has been much speculation about when, or if, the night tube will go ahead. Perhaps the Minister can give us an indication of whether it is at risk of cancellation or substantial delay as a result of those cuts. In the Minister’s intervention, he raised a point about fares revenue. The upgrade of the four lines in the sub-surface upgrade programme would have generated extra fares revenue that will now be lost, as more passengers will not be able to be carried until much later. Some estimates suggest that that could be as much as £270 million lost.

In the eight years in which the hon. Member for Uxbridge and South Ruislip (Boris Johnson) has been Mayor of London, fares have rocketed. Some of my constituents, such as those who travel from West Harrow on the Uxbridge branch of the Metropolitan line, have seen a 60% increase in the cost of travelling into central London. My constituents and others who live in outer London and use the tube regularly have been treated as a cash cow by the Mayor of London for too long. I am concerned that the loss of that £3 billion may increase the pressure on the Mayor, and/or future Mayors, to raise fares still further.

I am also concerned that further job cuts on Transport for London’s network, which are now inevitable, will further compromise the safety and security of passengers, including my constituents. TfL operational staff fulfil crucial operational functions as well as many safety-critical roles such as managing peak flows of passengers and handling emergencies. On the tube, DLR and Overground, adequate numbers of staff are needed to identify and respond to emerging crush situations.

Adequate numbers of staff are required to limit fare evasion, too, which is rocketing—it is up to £61 million a year following a reduction in staffing levels. I pay tribute to Greater London Authority Labour colleagues, led by the excellent Val Shawcross, Navin Shah and Len Duvall, for that information. Visible staff help to deter and detect crime, including people preparing for or engaging in acts of persistent serious crime and even—God forbid—terrorism. Staff also reassure passengers during tense periods such as now, but staffing is at its lowest level in recent history and Government cuts make it look likely that it will drop further.

Under plans for staff cuts at stations, Leytonstone station, which currently has four staff in peak periods, will be reduced to two members of staff—a 50% reduction at a station where there has already been a worrying terrorist incident. That is just a small indication of the worry that further job cuts, driven by the major cut in Government funding, might force on us.

I understand that London Underground Ltd now plans to cut a further 838 front-line staff positions from normal traffic hour operational levels. New staffing levels have apparently been derived from so-called business need schematics formulae, which do not incorporate the need for security checks or other operational needs. As a consequence, staff are required to meet the demands of security checks and will have to be removed from their allocated customer service positions for sizeable portions of their shifts to do so, leaving their areas unstaffed and effectively unmonitored on occasion. That is a concern. Will the Minister be willing to review with Transport for London’s managing director whether the loss of those front-line staff is a sensible way forward and whether alternatives might be found?

[Mr Goodwill]

Does the hon. Gentleman agree that, given Oyster and the introduction of other smart ticketing systems, the move to get staff out of ticket offices and on to stations to assist passengers and help with security is good and something that we wish to see more of?

[Mr Thomas]

I might have been more sympathetic to the Minister’s intervention if there were not plans to shut more of the control rooms on the underground, because London Underground Ltd proposes that all but a few control rooms in the largest stations will be de-staffed. Proposed staffing cuts and that emphasis on customer-facing duties will require staff who are normally allocated to control rooms to work in the ticket hall. The result will be that there will be no routine monitoring of CCTV at more than 90% of stations, including some that have high volumes of passenger traffic, when major events are taking place. Will the Minister be willing to meet, with me, a deputation of the workforce who are concerned about the impact of the various job cuts on passenger safety? I look forward to his answer, and hope that he will, in the spirit of his interventions, and the spirit in which I have taken them, be willing to do that.

I want to raise some concerns about the impact of the cut in TfL funding on the accessibility of the London underground network. My constituency has six tube stations—exclusively tube stations—that are inaccessible to people using a wheelchair, and usually inaccessible to people with a pram. I understand that there are no plans for North Harrow, South Harrow, Sudbury Hill, Rayners Lane or West Harrow to be made accessible. There has long been talk of a plan for Harrow on the Hill to be made accessible, but it is not currently included for access to the small amount of funding that is available to make stations more accessible. I worry that the loss of £3 billion will reduce its chances even further. Perhaps the Minister would use his influence with Mike Brown, the head of Transport for London, who I am pleased to say came to North Harrow station to celebrate its centenary earlier this year, and encourage him to take an interest in the accessibility of Harrow on the Hill station.

My last point about the impact of the cuts concerns property income and the pressure on Transport for London to maximise its income from property sales or assets—essentially from the land that it owns. I should think that the whole House would think it a good thing to encourage Transport for London to make its land available for housing. The concern is that it is being put under heavy pressure to extract as much value as possible from selling its land or the housing on the land, with no consideration of Londoners’ broader needs for affordable housing. There are also concerns, as my hon. Friend the Member for Hammersmith (Andy Slaughter) knows well, about the methods being used to encourage Transport for London down the property development route. It has established a commercial development advisory group, which is chaired by Francis Salway, with Richard Cotton, Mike Jones and Richard Jones as the other members, but I worry that none of them has a background in social or affordable housing. I hope that the Minister may be willing to use his good influence to encourage Transport for London to see the bigger picture about housing in London, while at the same time seeking to maximise its income from its land.

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[Clive Efford]

I cannot think of a better reason to want more buses. To get even more parochial for a minute, I want to put in a plug for TfL finally to deal with the issues with my local services, on which my constituents have been campaigning. I am talking about the B16 and 178 buses through Kidbrooke. Those issues must be resolved; we are not accepting no for an answer, and we welcome the moves that it has made already on the B16.

The 132 bus runs from Eltham to North Greenwich, and when I became a Member of Parliament I campaigned for its introduction. TfL came to my office to meet me and said, “There’s no demand for such a service.” It was to provide a public transport link along the route corridor of the A102, the Blackwall tunnel approach road. Finally, as the Olympics approached, we got an extension of the 132 bus route down to North Greenwich. It was a single-decker bus and it quickly filled up, so a double-decker service had to be introduced. That service is now often oversubscribed and passengers are left behind at the terminal where the bus starts—at North Greenwich—such is the increasing demand from people for public transport links along the route corridor of the A102, which connects with the A2 and my constituency of Eltham.

A road crossing, therefore, will not be sufficient: we need to have the DLR. If TfL is not going to build a DLR link, there is no point in building the Silvertown link, because it will just become as congested as the Blackwall tunnel is now. People will have no alternative to switch to—in the large numbers that we need them to switch—if we are to protect that route from becoming congested again in the future, just with more cars. As my hon. Friend the Member for Harrow West pointed out, the DLR has in recent times increased its usership significantly—by more than 50%. It has gone up from a few million passengers, as my hon. Friend the Member for Poplar and Limehouse said, to nearly 100 million passengers a year. That shows how effective it can be, so a DLR link from Silvertown to North Greenwich—that is then brought down the route corridor of the A102 to places such as Kidbrooke and Eltham—will have a significant impact by changing people’s choices of the transport method that they use to get across the river in that part of the city.

We cannot allow traffic to grow, and I accept that some form of tolling will be needed, but no one else in London pays to cross the river by their local bridge. I do not see why my constituents should have to pay to cross the river when no one else in London does. If TfL says that the only way to fund schemes in the future—because of the cuts to its budget—is to introduce tolling, I say that it has to be fair to my constituents, who in recent years have watched billions of pounds being invested in the London underground, which does not come anywhere near where we live. We accept that it is a major contributor to London’s economy and is vital—no one disputes that—but the comparison between the investment in other parts of London and that in outer south-east London does not stand up to scrutiny. We have bus services, but other than that, TfL spends precious little on investment in that part of London, so asking for—no, demanding—a DLR link as part of the scheme is just asking to be compensated for the lack of investment in previous years.

If people in my area are to be asked to pay a toll to pay for the river crossing, we should toll every river crossing in London and make everyone pay to cross the river, because that is the only fair balance that we could strike. I see the Minister’s eyebrows going up as he thinks, “Actually, there might be a point there. We might be able to make some money.” It is true that we have sat by in south-east London and watched money being spent on the London underground, while getting precious little—

[Mr Goodwill]

rose—

[Clive Efford]

I have a finishing time in order to allow the Minister time to respond, but if he will be brief, I will give way to him.

[Mr Goodwill]

I just point out that those who pay the congestion charge might argue that they are already paying to use the bridges and perhaps would not be thankful to be double-charged.

[Clive Efford]

They might well, but there are bridges beyond Vauxhall. I can point all the bridges out to the Minister if he needs me to do that; I can name them all. We need the Silvertown link, but it cannot be built without the DLR.

I want to move on to talk about a site in Kidbrooke, Henley Cross that is owned by TfL. TfL is definitely trying to maximise its income from that site, but we need such sites, which are in public ownership, to be used to provide local services and vital affordable housing where possible, not just sold off to the highest bidder. I would like to put in a bid to TfL to consider that site in relation to the Kidbrooke regeneration and the need to identify sites for secondary schools in the borough of Greenwich. Henley Cross is situated between the motorway—well, the approach road to the Blackwall tunnel—and the railway. The site is unsuitable for people to live on, but it would be suited to other uses. Perhaps some sort of land swap could be arranged with the Kidbrooke Village regeneration and a school could be built where it was intended to build a Sainsbury’s supermarket. I urge TfL to sit down with the London borough of Greenwich and with Berkeley Homes, which is doing the development, to consider that option, rather than cramming housing on to the site, which is unsuitable because of its location.

Finally, I want to turn to TfL taking over the running of suburban trains, which are vital for my constituency as it relies entirely on suburban trains as the major route into London because—as I said—we do not have direct links to the London underground. If that is to happen, TfL needs to start planning ahead now. At peak times, trains that run through my constituency—through Eltham, New Eltham, Plumstead and along all those routes—are heavily oversubscribed. They have so many passengers they have PIXCs—people in excess of capacity. We need to increase capacity on those lines. That means that when the Thameslink scheme is completed and the new rolling stock becomes available, the current Thameslink rolling stock must be made available to Southeastern, which wants to purchase it, so that it can increase capacity on those vital services in south-east London.

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[The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)]

I congratulate the hon. Member for Harrow West (Mr Thomas) on securing this debate about Transport for London funding, which is timely following the spending review. I will put the cart before the horse by dealing first with some of the questions that have been raised, meaning that if I do not have time to conclude my remarks, what I want to say will be cut off, rather than what hon. Members might want to hear.

The hon. Gentleman asked whether the upgrade of the sub-surface lines will be further delayed by the cuts in Government funding, and I have to point out that the delay was announced before the spending review. Indeed, the delivery of the upgrade is a matter for the Mayor. We have protected TfL’s capital funding and expect the Mayor to prioritise such tube upgrades as part of that process. The hon. Gentleman also asked whether other projects will be delayed; once again, it will be a matter for the Mayor to prioritise such projects. We will be agreeing a settlement letter with the Mayor that makes it clear which infrastructure projects we expect him to deliver, and by when.

[Mr Gareth Thomas]

I gently plead the parochial point that the Minister prioritises in the settlement letter the Metropolitan line upgrade as early as is reasonably possible.

[Mr Goodwill]

I certainly take note of the hon. Gentleman’s point; no doubt that issue will be raised during the upcoming mayoral election.

The hon. Gentleman raised the specific point of accessibility at Harrow on the Hill station, and I will ask Mike Brown to provide me with a report as soon as possible about the practicality of addressing that. As the hon. Gentleman will be aware, many of our Victorian tube stations do not lend themselves to such upgrades at a reasonable cost, although we have made considerable progress. In particular, the new Crossrail project will vastly increase accessibility for people with mobility problems.

The hon. Gentleman also asked whether there could be further devolution of property taxes, which is, of course, a matter for the Chancellor of the Exchequer, who has announced that business rates will be 100% devolved to local authorities from 2020. There will be a consultation on that in 2016, including on how the system will work in practice. Various things will need to be considered, including how the income from London’s business rates will be split between the Mayor and the boroughs, and which Government grants that will replace.

The hon. Member for Vauxhall (Kate Hoey) talked about the garden bridge. The Government and the Mayor have each agreed to make a funding contribution, but most of the costs will be met by the private sector. The garden bridge will be an iconic and attractive addition to the capital, and it will be free—there are no plans to charge people who use it.

The hon. Members for Poplar and Limehouse (Jim Fitzpatrick) and for Eltham (Clive Efford) raised the issue of the Silvertown tunnel, which is, again, a matter for the Mayor. Transport for London has recently consulted on the proposal. We agree that the tunnel is an important project and hope that the Mayor can deliver on it quickly. TfL is considering what package of public transport improvements might be needed to complement any new crossings, which might include DLR extensions, but the Mayor will need to take a view on the relative priority of such extensions compared with other schemes.

The hon. Member for Poplar and Limehouse also mentioned the cruise ship terminal. I have visited both London Gateway and the port of Tilbury, and I was impressed by the investment going into those projects. Indeed, London is re-establishing itself as a major port. I pay tribute to Dame Helen Alexander, whose term as chair of the Port of London authority ends at the end of this month. She has been a driving force behind the work that has been going on.

The hon. Gentleman raised in particular the issue of ship-to-shore energy supplies in a number of ports across the country, on which I am keen. Indeed, ports could derive income from supplying electricity. We will certainly consider how that might be funded, but such sensitive sea areas come under the quality of marine fuel regulations that have been agreed throughout the European Union, so ships will have to use low-sulphur fuel or to be fitted with mitigation equipment to ensure that they at least take care of sulphur. I am aware that ships produce other pollutants when in port.

The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), who speaks for the Scottish nationalists, talked about smart ticketing, which has been revolutionary since I arrived in London just over 10 years ago. I was then buying tickets, so the introduction of Oyster has been fantastic. Of course, a new aspect of ticketing, which is already in force on the west coast main line and is an element of the new Northern and TransPennine franchises, is automatic refunds when trains are delayed. I hope that new franchises take that on board. In due course, I hope it becomes the norm that if a train is delayed, a customer, having bought their ticket or season ticket on the train operating company’s website, will automatically get a refund, rather than having to apply. Passengers in the north of England are looking forward to that service becoming available.

I think it was the hon. Member for Harrow West who talked about meeting staff at the National Union of Rail, Maritime and Transport Workers. I occasionally meet the RMT, but more through my responsibility for shipping. I suspect that the Mayor of London would primarily be moving forward on that issue, but I hope that, following further discussions, we can soon deliver on the night tube. Many people look forward to some sort of agreement on that, particularly at this time of year when London’s night time economy is so vibrant. The hon. Gentleman also raised the issue of manning for British Transport police. Many people were relieved when the Chancellor of the Exchequer announced that overall police funding would not be subject to the cuts that many had predicted, but I will look into the specific issue of British Transport police and get back to him.

The hon. Member for Cambridge (Daniel Zeichner) said that TfL is facing a huge hit to its revenue budget. Actually, in terms of capital funding, this Government will nationally be deploying 50% more than the previous coalition Government, which is good news for people who use our train services and roads. He also mentioned the bus service operators grant, which is indeed a fuel subsidy. One criticism that I get from bus operating companies and bus manufacturers is that the BSOG is a disincentive for the roll-out of environmentally friendly or green buses. For example, electric buses that use no fuel get no BSOG.

The hon. Gentleman also raised the fact that Transport for London will soon no longer need any day-to-day operating subsidy, which is a good news story as that has been made possible by our sustained investment in London in recent years allowing TfL to make significant operational savings. London’s growing population and successful economy mean that more and more people are using public transport in London, which in turn, as I pointed out earlier, means that TfL receives more and more income from fares. TfL’s commercial development programme is also allowing it to generate more income from the private sector.

Having not got on to my prepared introductory remarks, I shall conclude by making the point that the spending review settlement shows that we recognise that London today is a city on the move. The capital’s economy is moving emphatically in the right direction, and our support is helping to transform London’s transport network. I am proud to be part of that transformation together with all our partners, including TfL. The investment that we are making for the next five years will not just keep London mobile, but will equip the city for the challenges of the future so that it can compete and win in the 21st-century global economy.