05 April 2012

TfL Board Members Dispute Ken's Fares Claims

Today, Transport for London board member and former Minister for Transport in London Steve Norris wrote a letter to the Telegraph disputing Ken Livingstone's claim that he can cut fares without harming investment and services.

Saying that it's time for a "reality check" on Ken's claims, Norris writes that "It is disingenuous to claim that [cutting fares] would not have dire consequences for London’s public transport."

Read the full copy of Norris's letter below, which was originally published in the Telegraph here (scroll halfway down the letters page).

SIR – Boris Johnson, the Mayor of London, can fight his own battles, but when I hear my old adversary Ken Livingstone, the Labour mayoral candidate, claiming he could slash fares in London without it having an effect on service levels or investment, it is time for a reality check.

As a former Minister for Transport in London (1992 to 1996) and a member of the Transport for London (TfL) board, I have scrutinised the accounts of London transport for the past 20 years. There is not, nor ever has been, a hidden pot of gold that could fund major fare cuts painlessly. The claim that there is a £727 million surplus to dip into has been comprehensively debunked by Channel 4’s FactCheck.

The cash sitting on TfL’s balance sheet is there to fund Crossrail. To maintain services and planned investment, TfL has taken substantial cost-saving measures, with a significant reduction in its headcount over the past four years.

TfL is a much tighter ship than it was under the previous mayor and every penny it takes in is earmarked to run the system, catch up on decades of under-investment and provide services for London’s rising population. The Mayor, not TfL, sets London’s fares. Cutting them would be a political choice. It is disingenuous to claim that it would not have dire consequences for London’s public transport.

Steve Norris
Conservative London mayoral candidate in 2000 and 2004
London SW1

UPDATE: 6 April 2012

A second Transport for London Board member has written disputing Ken Livingstone's claim that he can cut fares without damaging services or investment.

Read Eva Lindholm's full letter to the Guardian below (scroll to the second letter):

During the current London mayoral campaign, a claim has been made that public transport fares could be cut significantly, and that such a cut would neither trigger a reduction in services nor a cut to TfL's programme of investment, such as upgrading the tube and building Crossrail.

As a member of TfL's board, I would like to underscore that there is no pool of idle surplus funds at TfL that could be used to neutralise the impact of a major fares cut. The claim that there is a £727m surplus that could be used for such a purpose has been disproved by Channel 4's FactCheck. The cash currently lodged on TfL's balance sheet has in fact been raised through Treasury-approved borrowing specifically to pre-fund TfL's contractual commitments to the construction of Crossrail and other budgeted items.

To ensure its ability to finance London's current transport services as well as catch up on decades of underinvestment the system, TfL has implemented a rigorous series of cost-saving measures during the past four years. These measures, which feature a significant headcount reduction, have left no possibility for the accumulation of a large pool of unallocated funds. Therefore no Londoner should be under the impression that fare cuts could be implemented without negative consequences for TfL's finances and for the current and future state of public transport spending in London.

Eva K Lindholm
TfL board member

UPDATE: 9 April 2012

A third Transport for London Board member has now written to dispute the claim made by Ken Livingstone that he can fund a fares cut without putting investment or services at risk.

Read Charles Garnett's full to the Independent below (scroll to the 8th letter):

TfL cannot afford to reduce fares

As a member of the TfL Board for the past five years, I have seen the real benefit that London is starting to get from the long-overdue, significant investment in the Tube, under both Mayors. We cannot afford to put future investment at risk by cutting London's fares, which are set by the Mayor rather than TfL, when there is still so much to be done for the Tube and the recently commenced Crossrail.

The money from fares, in spite of all the recent cost-cutting by the Tube, is essential to help fund the investment London needs. Unfortunately, there are no reserves in TfL's finances that can both cut fares and maintain the Tube investment programme.

Christopher Garnett
London SW15


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