Transport for London has mentioned it’s going through a £3bn finance gap this 12 months owing to the coronavirus pandemic, suggesting it could want more money from the federal government despite securing a £1.6bn bailout on Thursday.

TfL, which agreed the bailout deal to maintain the enterprise working till October, has reported a 90% fall in revenue as journeys on public transport in London have dried up in the course of the nationwide lockdown.

TfL mentioned a monetary forecast, assuming the prioritisation of important companies and actions, predicted a £1.9bn funding gap within the half-year to the tip of October that will widen to £3bn within the full-year to the tip of March 2021.

Under the phrases of the federal government funding bundle agreed with the Department for Transport, TfL will be capable of draw right down to £1.9bn. The funding requirement might be beneath assessment till 17 October and the federal government mentioned passengers would face greater fares. The preliminary £1.6bn settlement contains a £1.1bn money grant and one other £505m in loans.

TfL mentioned on Friday: “In recognition that the current circumstances are likely to present ongoing financial challenges, a combination of future measures from TfL, Greater London Authority and the government will be implemented to enable TfL to maintain essential services and deliver a revised balanced budget over the remainder of the financial year.”

Lockdown measures have resulted in a 95% fall in journeys on the underground and an 85% fall in journeys on London buses, mentioned TfL.

“It is expected that the recovery will take some time and that passenger income will continue to be severely impaired after the strict response measures are gradually eased,” it added.

Sign as much as the day by day Business Today e mail or comply with Guardian Business on Twitter at @BusinessDesk

On Thursday, the transport minister, Grant Shapps, mentioned passengers would ultimately must pay greater fares to assist finance TfL.

He mentioned the federal government didn’t need a state of affairs whereby folks exterior London had been “unfairly carrying the burden, by which I mean, sadly, fares do end having to rise with inflation”.

The mayor of London, Sadiq Khan, earlier threatened to chop tube and bus companies except the federal government stepped in with a grant, after the capital’s transport authority burned via £1bn of its money buffers.

Source link